How is sharing economy changing industries and shaping the world we live in?
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What the sharing economy even mean?
The formal definition of the sharing economy, according to Investopedia, is “an economic model defined as a peer-to-peer activity of acquiring, providing, or sharing access to goods and services that is often facilitated by a community-based on-line platform.
The value of the sharing economy is expected to expand from $15 billion in 2014 to $335 billion by 2025!! YES, THAT’S a $320 BILLION increase in only 11 years!!
So how exactly has the sharing economy shifted traditional industries and where is it projected to expand?
The music and movie industries may not be the first thing you think of when thinking of the sharing economy, but platforms such as Spotify and Netflix were massive disruptors, creating space for streaming services to dominate the traditional space of media ownership.
Who remembers trying to carry around all your favorite CDs and having to listen to the same songs ?!
In the world of Spotify and Apple Music, we have access to any song,>. Digital transformation has made this shift, not only possible, but expected. Meaning that flexibility is a huge player in this game.
A lot has changed, though, since the boom first started. It is estimated that an average of 53% of users in Germany are between the ages of 18-39, meaning that Millennials have impacted the move away from ownership into short-term “rental” or sharing more than any other demographic.
More recently, co-working spaces have emerged as an innovative work-space alternative for freelancers, start-ups, and entrepreneurs to share office spaces.
Have you ever thought that, both as a freelancer and by being a part of a co-working space, you are an active participant of the sharing economy as well?
First by being a co-working space targeted primarily towards freelancers and entrepreneurs, and secondly by basing their business model around creating the most sustainable model possible, co-working space >Twostay is also a part of the sharing economy.
The focus is on transforming under-utilized urban spaces throughout Munich into workspaces during the day. In it’s own way, creating a shift in the real-estate industry by using the same spaces for multiple purposes; co-working during the day, and a fun place to get a drink with friends during the evening. It’s pretty much Airbnb for your workspace
Why is the sharing economy so popular in the first place?
Convenience & flexibility.
As mentioned before, the big upside to sharing is the convenience of having what you need without the extra burden and costs of ownership. And it’s there with you; everywhere. Other services can be accessed and booked easily through an app on your phone and, just like that, your car, home, co-working space is booked and ready to be used!
Isn’t that one of the reasons we decide to go for an Airbnb rather than that not-even-so-fancy but still super-expensive-for-no-reason hotel while travelling??!
According to a study by PWC on the Sharing Economy, 50% of users in Germany believe that the greatest advantage of participating in the sharing economy is the price-performance ratio.
The second-best perceived advantages of the sharing economy to German users is it’s sustainable attributes. Instead of buying that thing you need for just one use, why not rent and share or buy used?! It’s super easy and there are so many platforms out there specifically for this purpose; Ebay being one of the most-used.
Same concept applies to many sectors within the sharing economy. Booking your Airbnb from the bus you are taking on the way to the city you are headed to, all while watching Netflix-streamed movies on your phone.
In Germany, the sharing economy moves as far along as to including the farming industry, providing shared farming equipment, which can be very expensive otherwise.
In general, industries have changed dramatically throughout the decades, but never at the pace they are now with the digital transformation we are living through. So, it’s safe to say, this is just the beginning of a booming multi-industrial shift!!
Watch the video below that shows the many different industries throughout Germany that have adopted and benefited from the sharing economy in their own ways, causing a disruption to the way these industries have traditionally operated: