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Collaborative Consumption – Could Your Business Benefit from Crowd Power?
Posted on August 30th 2012
Collaborative consumption (CC) is not a new concept, but technology – and, in particular, social media – has given this age-old practice a method of delivery that has allowed it to expand on a global scale that, until now, has not been possible. This concept of peer-to-peer sharing and peer-driven redistribution using online platforms is quickly recreating an old-world village atmosphere of bartering, lending, swapping and renting; however, this time around, ‘village’ residents may live on an entirely different continent and not just down the street.
We all value access to the things we want and need, but are becoming less inclined to insist on individual ownership being part of the deal. And, of course, as families face the financial hardships brought about by the ‘Great Recession’, the cost of ownership is a price many can no longer afford to pay. Rather than purchasing toys that will quickly be outgrown, textbooks that have little value after the class, or ballgowns, movies and tools that will only be worn once, watched once or used once, collaborative consumption allows consumers to save money, while never having to go without.
Between the global economic crisis, the move towards greater environmental awareness, the generational shift away from excessive consumerism and the universal value placed on saving money, it was only a matter of time before an economic model like collaborative consumption would become a disruptive trend turning old business models on end. This is particularly true when CC is thought of as a type of new social welfare where people supporting one another are bridging some of the gap left by the erosion of traditional support systems on which communities once relied, such as social programmes, religious organisations and charities.
The phenomenal growth of eBay and craigslist, for example, shows us just how successful these online platforms can be, and it goes beyond that to further show that people do not need to be tech-savvy to take advantage of this growing trend. Sellers, buyers and bartering partners who may have little tech-related knowledge come together to do business based on their joint value of the concept of saving money and trading pre-owned goods they no longer want, often, for someone else’s pre-owned goods that meet their current needs.
In 2010, TIME magazine named collaborative consumption among its ‘10 Ideas that Will Change the World’, and CC proponent, Rachel Botsman deemed collaborative consumption “a new socio-economic ‘big idea’ promising a revolution in the way we consume”, and put forth that it allows community members to “create value out of shared and open resources in ways that balance personal self-interest with the good of the larger community”. It is publications and people like these that are increasing the social acceptance of collaborative consumption and promoting the benefits of this economic model that relies on trust, recommendation and reputation in a society where trust has become an increasingly rare commodity.
Companies that do not currently use collaborative consumption should be aware of this growing social trend and consider the opportunities it provides to build closer, stronger relationships with their customer base and the community. Much like social media has become an integral part of any successful promotional effort, the massive influence and momentum of collaborative consumption cannot be ignored and should be on the radar for inclusion in the ongoing marketing strategy of every business.