The Era of Collaboration

Miguel D'Souza - AAP

2 minute read

"BUSINESSES NEED TO UNDERSTAND THAT THIS TYPE OF EXCHANGE BETWEEN PEERS CAN MAKE THEM IRRELEVANT."

The concept of 'collaborative consumption' is nothing new: it is a reinvention of old market behavior: rent, share, exchange. The difference is that now, technology allows us to do it at a scale that was unthinkable before. The most recognized cases are those of AirBnB, which has allowed people to put unused spaces in their homes up for rent, and Uber, which gives people with cars the possibility to offer a transport service without having to register as a professional driver. But these are just two examples of things that facilitate the exchange of things: platforms that connect agricultural producers with consumers, or people that have certain knowledge with those that want to learn."

"Some companies have already started to realize that this model is about adding aggregated value to existing capital. The hotel chain Marriott, for example, decided to partner up with LiquidSpace, the platform that allows people to rent workspace out to travelers, after observing that their conference rooms weren't being used. But a mentality shift is necessary in the majority of companies. Mostly because today, based on mutual trust, consumers conduct exchanges under the 'peer-to-peer' model, and brands and corporations alike lose relevance in those agreements."

"The good thing about the model is that it can be applied to almost any industry. In fact, we're talking about platforms that generate a very efficient connection between supply and demand. Nonetheless, during my research I have discovered that the most natural reaction is rejection. All countries believe that for some reason, it won't work in their marketplace. But against all odds, it does work. And it is modifying the lives of millions of people all over the world."

"The biggest enemies of this model are governments: they believe that they shouldn't adopt it for the good of the people. It's a dangerous way to treat innovation in an early state, when regulations tend to produce difficulties for this type of new business format. The law doesn't like it when technology surpasses it, but it will have to accept it, because that is what is happening.

Rachel Botsman is the author of What's Mine Is Yours, in which she speaks about the changes that collaborative consumption is generating in people's lives. Professor at Oxford and collaborator on various international publications, Botsman specializes in the consequences of this type of consumption for markets.