Thought /

The Sharing Economy Series – Part 1

By Jonathan Bingham | February 12, 2015

In this three part series, we’ll analyze and question why some lawmakers and citizens are opposed to the business models that have created the Sharing Economy while others have embraced these companies and become avid fans and users.

The sharing economy is best described by pairing excess, and in some cases unknown supply, with high demand. This demand may be elevated by new ways and offerings that enhance the experience being shared. And it’s taking the world by storm. A couple of specific examples that highlight this economic model include Uber, AirBnB, TaskRabbit and more.

However, some roadblocks continue to battle the growth of the sharing economy: political pressure, class issues, and a difference of generational perspective. Let’s take a closer look at Uber.

The launch of Uber tapped into two key pain points. The first includes idle black cars sitting around waiting for their next scheduled appointment. The other key ingredient is the awful experience many of us have with taking cabs. In Boston, the cab experience flat out sucks. Every ride ends with an argument over using a credit card. Flagging one down is near impossible. Calling for one is laughable with flashbacks to Danny Devito in Taxi. With Uber, the drivers are happy, the ride is smooth, and the technology that enables it is so brilliant that I don’t even care if I pay more. Hell, maybe I’ve always been willing to pay more. The cab companies just didn’t listen. And now they are turning to the local and state government to help shut it down. Just one problem: The heads of state love it.

There are a few issues that are continually road blocking the sharing economy from growing, which include political pressure, class issues, and a difference of generational perspective.

Politics follow any disruptive event. The government polls its constituents as things unfold in an effort to side with public opinion. At times it can seem this puts existing companies and businesses at a disadvantage. But is it the government’s job to prevent commerce? Or to define what paths commerce takes? Uber customers are savvy to the service and the associated costs – even with some of the more questionable fees Uber charges, I still use the services with open eyes – as well as the risks.

In a nutshell, we are educated “businesses” and “customers,” that like what we are selling or buying. Delivery drivers make more money. Customers no longer sit outside looking for grumpy cab driver to show up and then hassle them for cash: win, win. The door was open for cab drivers and their owners to listen but they ignored us and now we have an option. That’s life. Innovate or die.

The sharing economy is here to stay. Consumers are educated and clearly show a demand. And the supply is there. And the younger generations and progressive old folks (me included!) are embracing it. The companies that are leading the way have done a remarkable job of partnering technology and consumers into solutions that just make sense. Embrace it. Keep an eye out for my next post on the sharing economy where I’ll take a look at another company that’s really putting some “air” into the hospitality sector.

Jonathan Bingham

CEO

View more by Jonathan Bingham

CATEGORIES: Thought

RELATED CONTENT

The Apple Watch: Worth It?

This blog originally appeared on Business 2 Community. Everyone is abuzz over the Apple Watch. Click through any general news…

Read more

CES: Should We Still Care?

Let’s face it – the holidays are over. The presents have been opened, the carols have stopped, and Santa Claus…

Read more

The Sharing Economy Series – Part 2

In my last post I talked about how companies like Uber are contributing to the explosive growth of the sharing…

Read more
// // //