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What Marketers Can Learn From The Sharing Economy

Sharing pioneers Airbnb, Lyft, and Uber changed the transportation and hospitality industry. Marketers need to be innovative, not boring.

What Marketers Can Learn From The Sharing Economy
[Image: cvm via Shutterstock]

The ancient Chinese crisis pictograph contains images that represent both danger and opportunity. In traditional, established markets, disruption can cause incumbents to be reluctantly dragged into a game of survival.

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We don’t have to look far to learn from modern marketing crisis creators and innovators, such as Airbnb, Lyft, and Uber. Lyft and Uber are disrupting our common transportation models, while Airbnb is revolutionizing the hospitality industry. For some market incumbents, such as hotel chains and taxi companies, they represent the Evil Empire. For others, they create tremendous opportunity.

The practice of disruptive innovation–when an upstart product or service eventually displaces established competitors–should be at the forefront of every marketing leader’s agenda. But in many cases, marketers are still acting as tactical order takers, not strategic market makers. Applied creativity–the core essence of innovation–is often why marketers are hired. Launching breakthrough products and services is essential to ensuring long-term organization growth.

Ignoring this basic marketing belief could make your company the next boring taxi service or mediocre hotel. Competitors in the transportation and travel industries need to rev up their innovation engines quickly because they are losing market share and brand security with each passing day.

Sharing Economy Has Gone Mainstream

Philip Lay of the Chasm Group, a strategy advisory firm in San Francisco, recently commented on the implications of the sharing economy, and the shift in buyer behaviors.

“The sharing economy is a socio-economic trend enabled by technology, and it is rapidly going mainstream,” Lay says. “Increasingly, people are comfortable ‘sharing’ by renting or even selling their unused or surplus assets on a for-profit basis.”

“Although Lyft, Craigslist, and eBay have existed for years, getting someone to share unused space–such as a car or a room–for profit is now an accepted practice,” he adds. Listen to an excerpt of Lay’s findings here.

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Uber now boasts an $18 billion valuation, and the investor feeding frenzy is well under way. Uber’s business model nourishes their growth because of their uncanny way of integrating multiple modalities–smart use of mobile technology, a streamlined payment system, and smooth service delivery. Many would argue that their concept isn’t new, but our buying habits are.

Today people are often more trusting of small-business owners and homeowners whom they have never met rather than big establishments with household-name brands. A general disdain for authority within Western society, coupled with unacceptable taxi service and mediocre lodging experiences, have opened the outlet for new asset sharing models to thrive.

Impact of Innovation and Change

Here is a simple process for marketers to anticipate future disrupters:

  1. Create a three-column grid with Competitive (or Commoditized), Distinctive, and Disruptive at the top of the columns.
  2. Create three rows below the columns entitled Products, Services, and Relationships.
  3. Create a list of your current list of products and services.
  4. Map each item within one of these three categories. For example, LinkedIn has owned the disruptive category for professional business relationships for several years.

For any products where you are competitive or commoditized, ask the following questions, posed by Lay:

  • Who might be our next disruptor?
  • What is that disruptor doing that we are not?
  • Have we lost our competitive edge and unique value? If so, what is our NEW differentiator?
  • Why not partner with the disruptor? In other words, should we think laterally?
  • Are we no longer able to be competitive in this part of our business? If so, jettison that product or service. This is a tough question, but essential to long-term success.
  • How can we define a new, unique value proposition?

If you are ready to make a disruptive move, then your strategy and focus looks different. You need to get one thing right above all else: being transparent.

Lay says that in Airbnb’s case: “The sine qua non principle is your obligation to establish and maintain 100% trust between owners and renters. Occurrences of things going wrong must be kept to a minimum, because hard-earned trust is one asset that can disappear in a second, leaving you with a seriously damaged reputation and a fast-declining business.”

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Pay close attention to both Airbnb’s and Uber’s narratives closely in the coming months. Their stories may be worth replicating.

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