Friday, June 1, 2012

Collaborative Consumption Marketplaces

Collaborative Consumption was a term made popularized by Rachel Botsman & Roo Rogers in their 2010 book entitled "What's mine is yours: The Rise Of Collaborative Consumption". (Well worth the read). Their blog defines collaborative consumption as: 
"A social and economic system driven by network technologies that enable the sharing and exchange of all kinds of assets from spaces to skills to cars in ways and on a scale never possible before."
The book chronicles the history of sharing/bartering highlighting some of the innovative companies leading the new sharing economy. With the convergence of mobile technology, connectivity, economic challenges, and social networks we are seeing a shift in consumerism. In 20 years ownership, employment, and nearly every marketplace will be impacted by the ideas in this book.

I believe areas of traditional rental marketplaces represent the greatest opportunities within the sharing economy: Most of us have reserved a hotel room, rented a car, taken out a person loan, hired a carpenter, paid for parking, and rented a tool. Here is a quick run down of how these industries are being disrupted:
  1. Space - Temporary use of space is the largest near term opportunity. The entire hotel, B&B, and travel industry exists to support this need. Airbnb has done a fantastic job of building out a peer-to-peer accommodations marketplace. Other space needs such as event hosting are being addressed through sites such as Venuetastic.
  2. Cars - The utilization rate of person automobiles is an unbelievably low while the cost of ownership is very high. Car ownership costs vary widely but can be between $3K and $12K per year when factoring in carrying and operating costs. Car sharing companies RelayRides, GetAround, and Wheelz are working hard to address this market. Each has a different approach with hardware, market entry, partnerships, and focus.
  3. Capital - Obtaining personal loans from others outside your network will continue to grow in popularity. Sites like Prosper and Lending Club are creating efficient brokerage marketplaces to transparently lend money directly to others. Banks are no longer the only option for consumers.
  4. Skills - Service marketplaces are being created by companies such as TaskRabbit and Zaarly which enable consumers to directly address a variety of needs. Cleaning services, handy-man work, dog walking, and countless others will be radically changed through these services.
  5. Parking - We all pay for temporary use of pavement, many of us daily. ParkCirca and ParkingPanda are working to create a marketplace for all that unused pavement across our cities. 
  6. Tools - If you own a home you need tools. There are 11,000+ rental stores across the US alone renting items owned by others in our community. ToolSpinner is creating a marketplace for idle tools.

I believe the above six areas represent the greatest opportunity for disruption of traditional industries through technology enabling idle capacity.

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