4 keys to a success with a sharing economy business

Success in the sharing economy means building a business model based on trust, authenticity and transparency with your customers

Success in the sharing economy means building a business model based on trust, authenticity and transparency with your customers

Thanks to companies like AirBnB and Zipcar, “collaborative consumption” is now a thing. These businesses are now on similar footings with hotel chains and car rental services.

On top of this, services like TaskRabbit let you pay others to deal with boring, fiddly or previously-unavoidable errands.

What makes people share? How does any business make consumer interaction work for them? Here’s four things to consider if you want to your sharing startup to be successful:

Why do people share?

sharing-economy-business-model

Understanding the core values behind sharing is crucial. People share, mainly, for four reasons:

  1. Social (to meet new people),
  2. Economic (to save money),
  3. Practical (to save time) and
  4. Sustainable (to protect the environment).

If you’re selling a shared product, it needs to tick at least some of these boxes.

Car rentals, for example, might appeal to people because of all of the above. In that case, the brand needs to clearly explain how their service addresses each one.

Your business model

For a sharing model to work there needs to be trust on all sides. This is where transparency through reviews come in.

In a TED talk on how reputation is the new capital, Rachel Botsman talked about how technology is key to building trust. It can empower users, allow them to make meaningful connections and, eventually, start sharing.

The real magic behind collaborative consumption like Airbnb isn’t the inventory or the money,” she said. “It’s using the power of technology to build trust among strangers.”

Trust also comes from brands being authentic and transparent in communications.

Trust is the most important factor for attracting users, encouraging interaction and, hopefully, creating a community around your service.

A scary, yet important, move is taking a step back and let consumers shape the brand to some degree. The brand may be yours, but your main assets are loyal users. Without them, your business will struggle.

Be humble, let the users do their magic. If they like your platform and the values it represents, they will use it.

Sell experiences, not products

sharing-economy-business-model

Airbnb CEO Brian Chesky knows people don’t want to simply buy a product, rather an experience; a relationship with other people.

The stuff that matters in life is no longer stuff,” he said. “It’s other people, relationships, and experiences.

Airbnb continually highlights the experience of sharing, rather than simply detailing rental properties.

Danish car sharing company GoMore uses genuine reviews that highlight social, practical, environmental and economic needs that the service provides.

Success in the sharing model requires building trust and communicating authentically and transparently.

Plus, by letting the users shape the platform, you brand becomes the go-to for enriching experiences, not just buying products.

So, always be aware of the four core values: social, economic, practical and sustainable. Integrate them as an important part of the sharing economy experience.

Share this