Sharing economy: The new world order

If the 20th century was about consumption, the 21st is about collaboration. Whether you call it collaborative consumption, peer to peer, the sharing economy, the digital clearing house or repackaged renting, it’s the new world order.

Globally celebrated speaker, writer and commentator Rachel Botsman has become a world expert in this field and how it’s transforming the way we live, work, bank, travel, consume and more.

Here’s a taster of our chat with her from Issue 20 of Collective Hub:

THE FUTURE

We’ll still be consumers – shopping is in our DNA but in the new era of sharing, we’ll shop for access and experience rather than ownership. “It’s a legitimate choice,” says Rachel Botsman, who coined the term “collaborative consumption”. “It’s teaching people new forms of trust, and how to interact with marketplaces versus traditional companies. It’s rippling into different areas of our life – the way we work, bank and travel. It’s the new normal.”

INDUSTRY DISRUPTION

Fast Company predicted that Airbnb would “usurp the InterContinental Hotels Group and Hilton Worldwide as the world’s largest hotel chain ¬ without owning a single hotel”. It has reportedly reached more than 1 million listings in 192 countries that have been used by 25 million guests and is set to be valued at US$13 billion, with a US$250 million turnover generated by commission on each house share.

MAKING IT LOCAL

Most sharing apps hook into geolocated resources, making hyper-local pods pop into life in the global village and, in the relentless search for authenticity which underlines the share economy, travellers can stay at a stranger’s home and eat at another’s around the corner booked via EatWith, posting it all on social media for others to see in the ultimate word-of-mouth recommendation. Unsurprisingly, outside of the US, EatWith has the most number of hosts in Italy.

BEYOND CROWDFUNDING

Finance seemed impenetrable until crowdfunding sites such as Kickstarter began the disruption. Enter Lending Club, which offers personal loans of up to US$35,000 to creditworthy collaborative consumers, matched online, much like a dating agency for money at low interest rates from investors. To date, Lending Club is reported to have loaned US$7.6 billion in funds. Similar sites are RateSetter and Prosper.
“Personal loans were the first wave,” says Rachel. “There are now peer to peer currency transaction platforms (PIP and TransferWise) and peer to peer insurance that bypass financial institutions. We’re now going to the white-collar end of the economy; the professional services. It’s more than getting your dog walked. You are seeing the same model applied to legal and financial industries.”

EVERYONE’S IN ON IT

In a case of ‘if you can’t beat them, join them’, Rachel sees the next wave of the sharing economy as all business. Companies are collaborating to benefit from the new world order. She notes Marriott lists conference and other meeting rooms in 432 hotels on sharing site LiquidSpace. Marriott, Rachel says, reaches out to new possible guests while utilising unused space, thereby promoting sustainability with an ‘Airbnb style’.

RULES & REGS

As for regulation, Rachel notes, “Technology has outpaced the law. New standards will be set. It took years for the minimum wage. But technology is reinventing and enabling old behaviour and we’re embracing it. The new currency is trust.”