The Essence of the Sharing Economy

The offer is tantalizing. Own less, yet have more.

This is the essence of the sharing economy, what some experts see as nothing less than a revolution within our society, much like the industrial age was to the late 18th century. Examples of the sharing economy touch our lives almost everywhere, from Uber, Lyft, and other ride sharing platforms, to Airbnb, peer-to-peer lending companies, co-working spaces and even RV rentals.

The development of this economy has its roots in many factors; increased computing power and storage, the age of big data and machine learning, improved artificial intelligence – and even the “Just In Time” inventory management system of the Japanese automakers, that Toyota first started exploring in the 1970’s, whereby large amounts of inventory were now held or owned by the manufacturers themselves, but rather ordered “on demand”, as and when required.

If it’s not on demand, I’m not interested

This “on demand” factor is a critical element of the sharing economy. The thinking goes as follows” why own something – with the associated hassle factors, costs, and risks – when you could just pay for what you use? Airbnb is a compelling use case here. In the past, owning a holiday home in an exotic destination was seen as an ideal, a mark of status, and for many a life goal. Realistically, this home would be used by most people for, at most, a couple of weeks of the year. For the rest, it would lie empty. Today, Airbnb has made it possible to not only monetize this idle time, but to experience a magnificent holiday home anywhere in the world, whenever you should so desire; thus uncoupling the physical asset from the experience.

This has been applied to so almost all areas of modern living. A business for example does not need to hire a full-time employee for specific tasks. Rather, they can use freelancing sites like Upwork, Freelancer, Fiverr, and a plethora of others to get amazing work done. These experts can be sitting anywhere in the world, and each one comes with their portfolios, ratings by others, the relevant escrow accounts, and so on.

The best of the Sharing Economy

Other well known examples that most of us will be familiar with or have read about are: Lending Club, that connects borrowers with investors through an online marketplace, and which has already processed over $26 billion in loans and dealt with over 1.5 million customers; Rent the Runway, an innovative service that lets you “raid a dream closet” and rent high-end designer pieces; HipCamp, which allows you to discover and book over 285,000 campsites, ranches, vineyards, farms, public parks and other interesting places; and Cohealo, a company that is pioneering a new way for healthcare facilities to leverage technology and collaborate in terms of usage of other facilities’ idle capacity.

Who’s guilty ? The industries that haven’t changed

What aspects of our lives have not yet been improved by the exciting sharing economy? To spot the culprits, one needs to look no further than industries dominated by a few older, “established” companies that have been slow to adopt technology to make consumers’ lives better (Hint: the retail space is exactly such an area. Amazon’s acquisition of Whole Foods in no coincidence). One area or industry that has been conspicuously lagging behind, is that of deliveries. Dominated by older, established players (UPS, DHL, US Postal, Fedex), the industry has not used technology sufficiently in order to bring their business model into this new technological era.

Rising stars of Sharing Economy

For us at SoPick, we see the incredible value we have to offer as part of the sharing economy. Being a technology company, there is a massive opportunity to revolutionize the delivery space much like what Uber did to the motor industry, and Airbnb did for the hospitality sector.

SoPick leverages the sharing economy in a fresh model that enables anyone with our app to be a courier, and anyone to be a sender. For example: you left your gym bag at the coffee shop this morning, and you’re already at the office. In the past, this could have caused untold amounts of stress and worry, countless phone calls and arrangements with friends, as well as a huge drop in productivity and focus at work. Instead, you could just order a SoPick Courier through any of your devices, and they’ll pick up and deliver your bag safe and sound, and you can track their progress throughout. The courier could be student on a break from school who is looking to earn some extra cash, and sees that this delivery is on their route. Like the best of the sharing economy, a win-win situation is created.

What the future may bring

The sharing economy is set to grow tremendously. The Brookings Institute is forecasting $335 billion by 2025, with some estimates even more optimistic.

What is certain is that we are no longer shackled to physical assets that are often chronically underused. The power is back in the hands of the consumer in terms of what goods or services they need, at a time and place that suits them. Moreover, technology has given people unprecedented access to this economy, breaking through traditional boundaries and ushering in an era of equality, agility and convenience.

The sharing economy has already revolutionized so much of our lives, and for companies in this space as well as the consumer, the future is looking brighter than ever.