It’s one of the buzzwords of the decade and constantly discussed. Embraced by millennials, pronounced by many economists as the ‘new way; of sharing resources, and seen by political scientists radicals as a true ‘disrupter’ in the market, in 2015 it finally received its own entry in the Oxford English Dictionary.
What is it? Why the sharing economy of course. But what does this term actually mean? Many things to many people I suspect — in fact, it would be no surprise to me if I stopped 100 people in the street to give me an example of the term, and 90 of them would reply “Uber.” But the sharing economy is about far more than being able to order a cheap cab, have your parcels shipped ‘same day’ by Amazon or rent a room on Airbnb. Put in its most simple terms, it’s about using under-utilized resources usefully and efficiently, sometimes for free and other times for a fee paid directly by the individual. It’s also about using technology to swap/barter/lend services in a whole new way — a way that simply didn’t exist before the era of the internet arrived.
Now, for sure, the sharing economy can’t be explained in a few sentences, or a “4 minute read” here but the ideas behind it are so important (and so powerful) that I think it’s worth taking a look at some of the concepts behind it, all of which are key to understanding this very big idea.
In it’s most simple form, this refers to socio-economic systems that are built around sharing resources (physical or human). Whether individuals, organizations or communities, they all contribute and benefit from this system — peer-to-peer (P2P) they can create, collaborate, produce and distribute amongst themselves. A great example of a company that was built on this idea is CasaVersa, a home exchange community that helps you swap your home for vacation and travel purposes for free. This community of home swappers is based on trust and sharing, giving everyone the chance to see the world without breaking the bank.
This is all about cutting out the ‘middleman’ — matching those who need something with those who have it. You have a car and I don’t? I can lend mine to you. You have a toolkit and I want to do some DIY? I can borrow yours. Put in its most simple form, it’s about ‘unlocking’ underused or undervalued assets and putting them to good use. Not to mention that when goods are produced and shared locally, this shortens supply chains and increases access and efficiency. For example, My Private Tutor, which was established in India, connects teachers and students and lets them study together by virtue of a ‘virtual classroom’ facility. Tutors can find part-time work at hours convenient for them; students can browse profiles and choose someone they find to be a good personal fit for them. A real win-win!
Collaborative consumption isn’t just an excellent way to save money, it’s also good ethics. The last 50 years in the West have seen a meteoric rise in conspicuous consumption — and it’s making many of us extremely uncomfortable. No wonder more people are turning to ‘minimalism’ or, at the very least, ‘decluttering’ their homes. How much of the things that we own do we really need? Shamefully few I think. Cutting back on what we consume isn’t just central to the sharing economy — it’s doing your bit for the planet. Think women and fashion – and how often pieces bought are worn once and then sit in the closet for months. A startup company which called Style Lend is using this idea. Style Lend lets women rent designer clothes for a relatively small price and then return them after a few days. The clothes conscious individual saves money and the planet also gets a break from ‘fast fashion.’
- “We” and not “Me”
Another central tenet of the sharing economy is the way it promotes a “we’ rather than ‘me’ culture. Borrowing, bartering and giving things away are all ways of encouraging us to look beyond our own needs and towards those of the wider community. In an age where disparities of wealth have never been so great, more and more of us are realizing the value of social responsibility. We want to feel we can trust others and that altruism has a place in our daily lives. We want to find that sense of community again that somehow got lost…and sharing is a fine way to do it.
It also goes without saying that internet access and social media have made it easier than ever to connect people with similar needs. Communication used to involve writing letters, mailing them and waiting sometimes weeks for responses. People used to toil 9–5, from an office desk. The daily commute was a harsh fact of life! That’s all over now, with millions of people working ‘remotely.’ Armed with nothing more than a laptop and an internet connection, you can work out of a coffee shop on your block or the other side of the world, and yet still meet your deadlines.
To wrap up this introduction then, young people are coming of age utterly unaware that there ever was a world without the web and smartphones. For them, then the idea of placing an advertisement in a newspaper or picking up the Yellow Pages to locate a furniture store or car mechanic is completely alien. Sharing information via technology is completely natural — indeed, it’s all they know. They don’t have to be convinced to share things — without even realizing it, they are!