This post is about the sharing economy and its particular focus is why consumers may opt to transact by sharing rather than buying. HBR offers recent research on the subject.
The first thing to note is that the sharing economy is growing and it is growing rather quickly. Folks are finding more and more ways to participate in re-selling or renting than ever before and the trend is likely to persist.
It turns out that most people are primed to make the shift to sharing if certain conditions are met. A majority of customers report that they would consider sharing instead of buying if it allows them to save 25% on their purchase—and among younger customers in particular, the vast majority are swayed by potential savings. About a third will switch from sharing to buying if it offers convenience—whether that’s in the form of delivery, ancillary services or customization. And just as many can be swayed if the sharing service offers them access to brand-name goods or services.
To summarize, we are looking at price discounts, convenience and access to brands. But price is the most important of the three. Non-sharing companies may be able to compete on price by offering opportunities to re-sell on their platforms. They can compete on convenience by offering rental and purchasing options. Or they can link up with a sharing platform to create better packages of goods and services (like a hotel offering a deal on rental of fashion brands).