Adapting to the Sharing Economy

by Kurt Matzler, Viktoria Veider & Wolfgang Kathan for MIT Sloan Management ReviewHow do consumers access, buy and use their favorite products and services? The answer to that seemingly simple question is changing. While individuals have traditionally often seen ownership as the most desirable way to have access to products, increasing numbers of consumers are paying to temporarily access or share products and services rather than buy or own them. This so-called “sharing economy” is growing rapidly.While estimates for the current size of the nascent market vary, PricewaterhouseCoopers has estimated that by 2025, five main sectors of the sharing economy could represent $335 billion in revenue worldwide. Well-known examples of successful startups built on collaborative consumption systems include Airbnb Inc., a San Francisco-based online accommodations marketplace, and Zipcar, a car-sharing brand that is now part of the vehicle rental services company Avis Budget Group Inc., based in Parsippany, New Jersey.Growth in sharing systems has particularly been fueled by the Internet, with its rise of social media systems, which facilitate connections between peers eager to share their possessions. The central conceit of collaborative consumption is simple: Obtain value from untapped potential residing in goods that are not entirely exploited by their owners.Read More →