The Emergence Of The Sharing Economy In The Business-To-Business Sector
The so-called “triumph of access over ownership” that is defining and driving the new Sharing Economy is also the underlying force bringing new economic models, not just to lodging and rides, but to a wide array of business-to- business (B2B) sectors, as well. Coupled with new mobile technologies, cloud computing, and growing comfort with approaches to validating reputation and trust, the disruption that has been synonymous with brands like AirBnB and Uber has launched a parallel movement in areas such as temporary office space, just-in- time delivery of construction equipment, and many aspects of supply chain management.
Much has been written about the insurance risks associated with consumers using private homes and vehicles in ways not previously envisioned. Less discussion is apparent, however, about risks involved when companies, government agencies, and nonprofits pioneer new business models designed to put underutilized assets to work, or create access for people, services and opportunities outside of their traditional operations.
The technological innovation and business transformation shaping a new global economy, be it called “collaborative consumption,” “the sharing economy,” or “anything-just- in-time,” are moving so quickly and are now so pervasive, that it is worth looking a what some insightful companies and business experts have written in the past year or two, to set the stage for what lies ahead.
What follows is a brief, annotated list of articles and papers that we found helpful in “catching up” on the economic movement that’s sweeping us all into new territory.
(Excerpt) Around the world, a new wave of peer-to- peer, access-driven businesses is shaking up established categories. Whether borrowing goods, renting homes, or serving up micro-skills in exchange for access or money, consumers are showing a robust appetite for the sharing-based economy. We set out to explore how the sharing ethos will make its mark on the wider market—and to understand what incumbents and challengers must do to position themselves ahead of disruption and capitalize on new sources of revenue. By unlocking the sharing economy today, can companies transform today’s threat into tomorrow’s opportunity?
Sharing has, of course, been around forever—and many industries offer alternatives to ownership. But as a model, the sharing economy is distinguished by these core pillars:
- Digital platforms that connect spare capacity and demand
- Transactions that offer access over ownership
- More collaborative forms of consumption
- Branded experiences that drive emotional connection
- Understanding an economy built on trust
- Rethinking value exchange
- The push for less friction
(Excerpt) The sharing economy represents an outstanding opportunity for insurers to forge closer relationships with their customers and connect with a wider base of prospects. In addition, it is forcing insurers to rethink all aspects of their business including product design, pricing, risk assessment and channel strategies. Insurers that are first-movers in this arena are likely to become powerful market leaders in the sharing economy. Given the rapid and likely long-term expansion of this market, this should provide an excellent opportunity to drive profitability and growth.
(Excerpt) While the peer-to- peer market is growing, there are many headwinds that could derail this powerful economic force. Regulatory requirements will become more rigorous as the segment matures. Additionally, insurers’ wariness of the sub-contractor structure and the high liability risk makes these businesses particularly vulnerable. One lawsuit could wipe out a company before it gets off the ground. With limited access to insurance markets, these firms need to find alternative risk transfer vehicles.
(Excerpt) The sharing economy offers opportunities for emerging markets, megacities, and the rising middle class, but we need more collaboration across sectors—and the impact investment community. To date, the vast majority of activity in the sharing economy has focused on the private sector: startups, private investment, and questions around what it means for big business. However, there is an equally significant set of opportunities for the public and social sectors. This is a conversation that has yet to surface in a meaningful way, and until it does, our understanding of the sharing economy is incomplete.
(Excerpt) The vast differences in the types of sharing economy platforms can be mind- boggling, from pure sharing services with no money changing hands to commercial services and everything in between. Policymakers often assume that the concept of the sharing economy applies only to ridesharing (or ridehailing) and homesharing, and are typically unaware of the wide array of goods and services that can be shared, which range from food and other consumables to an individual’s time and tools. Municipalities, for example, can even share heavy equipment, reducing overall expenditures and providing needed tools that might otherwise have been unavailable.
The best-known sharing-economy companies do business in ride sharing (BlaBlaCar, Didi Kuaidi, Lyft, Uber, and Yandex.Taxi, for example) or in room sharing (Airbnb, Couchsurfing, onefinestay, 9flats). But in other areas too, companies have succeeded by identifying market inefficiencies and transferring control over transactions to consumers. They include shop and office sharing (We Are Pop Up), meal sharing (EatWith, Meal Sharing, Traveling Spoon)—and even clothes sharing (Yerdle) and solar-energy sharing (Yeloha). In all cases, the common threads are disintermediation, the sharing of excess capacity, and increased productivity—as well as commercial challenges, on an unprecedented scale, for incumbent operators such as taxi firms, hotels, restaurants, and utilities. Not everyone is happy, however. More broadly, regulators and governments have started to question the long-term impact of the sharing-economy business model on incumbents and communities.
(Excerpt) Honeycomb 3.0 was a large undertaking. At least 460 startups were reviewed, and 280 were chosen to be included in Honeycomb 3.0. We specifically focused more on international startups, startups that are on the upswing, and those receiving a lot of funding. The goal was to take a current snapshot of the “A-list” companies in the space.
This process led to uncovering new trends in the sharing economy and establishing new categories, subcategories, and some re-organization of previously established categories. There were also some startups from previous Honeycomb versions that no longer exist or had been cannibalized, so they were removed.