Blog April 29, 2015

The collaborative economy is here to stay

ase with which we’re able to connect with others via an array of smart technology. This has given rise to new ways of doing business, a practice that’s collectively known as the collaborative or sharing economy. In short, individual sellers and buyers are connecting online, with time, currency and location being immaterial.

Two companies who’ve used the collaborative economy model – with great success – are AirBnB and Uber.

By monetising what’s essentially a sharing economy, these two pioneers of profitable business based on a collaborative economy have successfully introduced and firmly established an entirely new way of doing business.

Jeremiah Owjang – one of the foremost thought leaders on the subject – sums up the collaborative economy: “Ordinary people are now empowered to turn their homes into hotels, their cars into taxis. They’re makers, funders, lenders…” What this means for businesses is that new markets are emerging in the most unlikely places, across all industries and demographics. Profiting from the collaborative economy then, relies on a willingness to adapt your business in line with changing consumer behaviour.

Companies need to find innovative ways to solve common irritations and improve people’s quality of life.

This is why the collaborative economy has taken root, and is where companies can take advantage of it in order to expand their customer base. It’s estimated that the five main sharing sectors: peer-to-peer finance, online staffing, peer-to-peer accommodation, car sharing and music streaming have the potential to increase global revenues from around $15 billion now, to $335 billion by 2025.

The collaborative economy empowers both the individual and business by enabling them to form a mutually beneficial relationship.

Owjang predicts that the collaborative economy will evolve to see a new class of corporations host their own communities that enable customers to trade, rent and resell their goods and services in a brand-hosted community. This will enable new value for the brand by offering new ways to extract value thanks to a larger, diversified market.

As the collaborative economy takes root and grows from strength to strength, one thing’s for sure: it can only benefit established businesses who embrace this new way of doing things. Just like the internet, which is now an indispensable tool for all businesses, the sharing economy is set to rise from relative obscurity to an accepted and welcomed way of doing business.

Here’s how to start using the collaborative economy for your business: Consider investing in, or partnering with a startup to diversify your offering.

By sponsoring a startup, you’re able to expand your revenue and market. Whether you partner with a local organic co-op, offer to finance a portion of a new business in exchange for goods or services, or collaborate with several local businesses whose offerings complement your own, incorporating the collaborative economy into your current business model can result in increased profit, market share and brand awareness.

Profiting from the collaborative economy relies on a secure online payment solution

Online payments solutions are crucial for the collaborative economy. An ecommerce solution offers companies the opportunity to sell their goods or services online, opening up access to a much wider customer base. If you’re able trade anywhere, you’re able to diversify that way you do business. It’s essential that your payment solution provider is reputable: if people are sharing banking details, they need to know that their information is safe. A secure and efficient payments solution, such as EFTPOS’s ecommerce solution, can catapult the way you do business.