On average, a drill will be used 15 minutes during its lifetime, similarly the average car will be parked 95% of its lifetime. The solution, with the first initiatives being introduced early 2010, is collaborative consumption also referred to as the shareconomy. People recognized the problem and embraced the idea, the media believed in it and business angels were heavily investing in these promising business models. Yet six years later, many of these break-through startups were forced to close their website and we can state that the real shareconomy is dead.
The reason why the shareconomy flopped? Well, although everyone agrees it is a beautiful idea, in reality nobody actually cares. People sign up for these sharing platforms, but end up buying their own drill anyway. One example is SnapGoods, the online platform that allowed individuals to rent and borrow gear from others in their neighborhood or network.
SnapGoods had more than 100 000 users registered, while in fact only a small fraction actually used the sharing system enabled by the platform. And I have to admit that I am guilty of similar behavior; I also have an account on a similar Belgian based website for sharing tools and gear. I initially signed up because I thought the idea and reasoning behind it made perfect sense, however I have not borrowed or lent out anything yet. Why? Honestly I don’t know. Is it a trust issue or just me being a bit lazy? Today you can easily buy things online, get next day delivery (in some cities deliveries take less than a few hours) and there is always some little voice in your head arguing that you might need the gear later again and as such you end up buying.
And this is also what we’ve seen in a recent study conducted by InSites Consulting amongst Babyboomers, Gen X, Millennials and GenZ in the US. The interest for these sharing initiatives is rather high, especially amongst the younger generations, while the actual usage is below one would expect. 14% of US millennials is interested in sharing gears and tools, while in fact less only 5% has actually used these services. Similarly, we found that one in five Millennials is interested in using ride sharing services. But when we look at those who have actually used the service, we see that this is again much lower, with only 12% of Millennials used this is the past.
Hot tweetaway: Interest in #shareconomy is relatively high, but actual usage is below expectations insit.es/2dB5pMP by @KPallini via @CoolBrands #nextgen
Yet sharing initiatives like Airbnb and Uber did succeed although one might argue that these big corporate companies have nothing do to with real sharing anymore. These companies have moved away from the peer-to-peer sharing model to a price competing model with traditional services. Although Airbnb initially was set up “for the people, by the people, off the people” many of their business is now done through professional and commercial homeowners, causing housing problems in some regions as these initiatives are more profitable than long term renting. Similarly, Uber has now professional drivers as it proved to be more lucrative than driving a traditional taxi. Yet what makes Uber grow year after year, is their agile business model where they are not only disrupting transportation business but they are also experimenting with potential tracks for growth (e.g. on demand ice-cream service, on-demand barbecue,…).
Shareconomy in its pure form might be dead, yet it did construct the foundation for new business models that are shaping the future.
Hot tweetaway: The #shareconomy may be dead, but it laid the foundation for new business models insit.es/2dB5pMP by @KPallini via @CoolBrands #nextgen