The internet and other next-gen advances have completely changed daily lives. It has opened up opportunities not only in the field of communication but also in the world of business, turning what used to be just science fiction into reality.
In this digital age, Amazon as well as peer-to-peer rides-hailing firms Uber and Zipcar, to name a few, have gained traction at exponential rates and are now part of the norm in their appeal among the tech-savvy. These businesses have led to the renewed consciousness of, and heightened interest, in the sharing economy.
Though it has been said that the sharing economy has been around for quite some time, the internet has aided its rapid development. It has provided ease of access that some traditional markets have struggled to deliver. The fact that transaction costs on e-commerce sites are lower further tips the scales in favour of this new service and its marketability.
Among the top considerations in choosing a service or product is the price. Price includes the actual cost, travel time, access, the benefits, and even comfort. This breakdown of various factors not only applies to the more popular platforms in public transportation but also includes accommodation services such as Airbnb, and retail companies such as Amazon. Such has been the influence of technology in business and communication, making the sharing community possible.
The popularity of digitised sharing started on social media platforms and eventually crept into the business realm. So what can one look forward to? It may sound getting way ahead, but it is not impossible for the financial and health care services to join this trend. To broaden the service field and cope with innovation, it’s evidently in the best interest, not to mention timely, for the financial and health care services to embrace a sharing economy.
However, with its rise comes a new set of challenges that can undermine the traditional business set-up. Hence, businesses need to address two urgent factors: cost and reliability. Though digitised sharing is far from perfect, the online market allows customers to become more confident in purchasing products or services because reliability is built through word of mouth and a consumer-centric feedback mechanism that facilitates a community of reviews.
Other facets to sharing
Aside from services, the internet has also opened doors to shared workplaces and “collaborative consumption”, which provides a range of employment possibilities. As the “Harvard Business Review” explains it, investors are attracted to go for companies that have digital assets that can be leveraged with their network’s assets.
Established businesses should start listening and responding to their younger target audiences as the sharing economy is expected to eventually lead to the decline of the traditional market. Failure to join the trend could impede diversification of existing enterprises, causing non-receptive service providers to lose their footing.
Responding to the rise of a sharing economy, the Dubai Economy introduced a new platform, ShareDXB, to maximise unutilised resources. The purpose is to reduce inefficiencies, enable the business sector, and cut costs as companies in the emirate would be able to exchange services instead of paying for them separately.
The “network orchestrators” would shake the foundations of the traditional market. The use of this digitally enabled platform would achieve even more efficiency in terms of physical assets or time. As demand increases, ShareDXB will not only be a more competent initiative among service providers but also a gateway towards growth.
Nidal Abou Zaki is Managing Director of Orient Planet Group.