Taking part in the sharing economy

I’ll never spend money on a hotel again.

Well, not really. But I’ll definitely avoid it when I can. I’m a convert of the sharing economy. Why pay a hotel when I can just rent some random person’s apartment for a week?

I tried booking accommodation through Airbnb for the first time last year, and I’m never looking back. Not only did I pay less than the going rate for a nice hotel, but the apartment I stayed in was just as good, if not better. I had the whole place to myself, a big-screen television, fast internet and a beautiful view of the city.

With an overseas holiday coming up soon, I’ve just finalised another Airbnb booking. Unfortunately, the same place I stayed last time wasn’t available. No matter. I just rented an apartment just as good across the street.

Why go back to hotels after this?

It’s not just me, either. The sharing economy is completely transforming how we do business. A recent profile on the phenomenon discovered a man who, having lost his job, is renting out accommodation and his car for several thousand dollars a month.

Clearly there are disadvantages to this model – sometimes you want to pay money for customer service staff and the mint on your pillow. But for millions of people the sharing economy is going to transform the way they live.

Airbnb founder and chief executive Brian Chesky even calls the company “a movement”. Laugh all you want. He’s right.

At this point, the standard recommendation would be to consider how the sharing economy can impact your business. Or how the sharing economy can benefit your company by allowing you to explore cheaper options for equipment or services.

Both of those recommendations are fine. But they don’t speak to the heart of the matter – younger customers are less attached to products as they age.

You need to be aware of this, because it’s going to impact how you do business in 20 or 30 years’ time. The entire economy is shifting from things we buy and have to things we rent and use temporarily.

Music? Please, iTunes is old. Renting through Spotify is where the industry is heading. You only have to look at the impact Netflix has made on the television industry in the past week with the new season of the popular sitcom, Arrested Development.

You know how much it costs to access Netflix? Just $8 per month. For television content that cost tens of millions of dollars to make, and an extensive library of everything else. Unlimited access. Of course I’d pay that, and you would too. I don’t have to deal with DVD cases in my house, and can just access the content whenever I want. Why not?

This isn’t just a matter of things going digital. It’s shifting how we see products and services, which are becoming less attached to the companies which distribute them. When I head to Los Angeles next month and stay in some random person’s apartment, I’m not the biggest benefactor – the person renting to me is.

They’re gaining money from undermining existing services and by becoming less attached to their own home or accommodation. They don’t care who stays there (within reason). They’re just happy to have another revenue stream.

The sooner you acknowledge the sharing trend, the better off you and your business will be.