To avoid disruption, companies must adopt the collaborative economy value chain, Altimeter Group claims. Their study, which was presented today at the London tech conference LeWeb by Jeremiah Owyang, gives a concise market overview of over 200 sharing economy startups.
The Collaborative Economy is changing our products, services and market relationships, Altimeter research states in a 30 page report published on June 4th. Their study, which draws from a combination of interviews with 35 startups, investors, brand and thought leaders and an analysis of industry trends based on data of 200 sharing startups, examines the impact of the Collaborative Economy on corporations while giving an overview of the industries that are being disrupted by it.
Other research done on this topic include Michel Bauwens’ seminal report “A Synthetic Overview of the Collaborative Economy” as well as studies done by the industry itself such as Airbnb’s study of its impact on San Francisco. However it is important to note that the definition of the term “Collaborative Economy” used in this study does not coincide with our definition of the term. While Altimeter mostly use it as a synonym for Sharing Economy or Collaborative Consumption, also including crowdsourcing and co-creation platforms, we define the collaborative economy as a broader phenomenon that includes not only new models of ownership and access, but also new forms of production and financing based on peer-to-peer dynamics.
Even though it would have been nice to see this report go into more depth on some points and include more international examples, it gives a good overview of the sharing economy so far. Here are some of the takeaways:
The Collaborative Economy Era: Empowering Customers
According Altimeter’s findings, technology has resulted in three eras: the brand experience era, the customer experience era and the collaborative economy era. This refers to how at first, the internet changed the availability of information from few to many; then, social media began enabling many to share and create information; and now, the collaborative economy is enabling many to engage in real life transactions, without companies being involved at all.
The “disintermediation” of businesses from customers, or, in other words, eliminating the middle man in many transactions, is leading to a shift of power from companies to customers. Since this shift will increasingly affect the bottom line of incumbents, companies must prepare themselves for this change.
What’s driving and opposing the Sharing Economy
Similar to the drivers of collaborative consumption that were defined by pioneer of the space Rachel Botsman, Altimeter organizes the drivers of the sharing economy into three groups: social, economic and technology drivers. As part of the former they name factors such as increasing population density, something they call “generational altruism”, people’s drive for sustainability and desire for community. From an economic perspective, the influx of VC funding has played an important role (on-demand ridesharing platform Lyft recently raised 60 million in funding), while on the technology side new payment systems and mobile devices are accelerating the growth of these business models.
Driven by, among others, these factors, countless industries, most notable the hospitality and transportation industries (where shared assets are very expensive), are being disrupted by peer-to-peer marketplaces.
However disruption never comes without opposition. Many of these new business models fall through the cracks of legal regulation, and are seen with a sore eye by government officials (learn more about this topic in the recap of OuiShare Fest’s Public Policy Jam). Only last week, for instance, peer-to-peer vacation rental marketplace Airbnb was declared illegal in New York City. Not only governments fear the collaborative economy due to the legal disruption they may cause,
What does this mean for Corporations?
At the end of his presentation at LeWeb, Jeremiah Owyang gave a call to action for corporations to adapt the collaborative economy value chain, “let go” and acknowledge that the relationships between customers and companies are fundamentally changing. He presents three models for how companies can rethink their business models in the age of the collaborative economy:
Header Image: “The Collaborative Economy”, Altimeter Group (June 4, 2013)
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