What would you do if you wanted to go to Liverpool next weekend and needed a place to stay? Or perhaps you’re in San Francisco and you want to drive around bohemian Haight-Ashbury, but you’re new in town and have no car?
The conventional answer would be to book a hotel or go to a car rental service, but these businesses have been challenged since around the beginning of the financial downturn by a new form of hiring and renting: collaborative consumption.
Collaborative consumption works by sharing what you have online with other people to maximise its value. So if you have a spare room in Liverpool, you can offer it to rent through a site like Airbnb.
Both parties benefit: the owner of the room makes money out of a room that would otherwise be unused and the renter gets the desired room at a price which is potentially below the market rate.
The financial crisis explains partly the rise of collaborative consumption. The cost of living in the West has crept up since the recession, but wages have stagnated. We still want to enjoy ourselves but have less money in our pockets to pay for it. Suddenly the idea of paying a three figure sum for a night for a London hotel isn’t such an attractive option, and we’ve been looking around for alternatives.
Sharing what we can offer is now so much easier than before. There are peer-to-peer sites like Getaround that allow you to hire out your car, Housebites to hire out your cooking skills and Guardian Home Exchange to hire out your property.
It’s easy to upload a biography or yourself and photos of your car. This helps us both to identify our business partner and to identify with him or her as just another enterprising person with a room to spare or a car to hire out.
You’re almost guaranteed to find a review function to rate the product or the service you’ve used. This is crucial to building the trust on which the whole system works. How do I know this guy who claims to be a natural at putting up IKEA furniture is telling the truth? I don’t, but the 22 reviews which mention his reliability and friendliness are strong evidence on his behalf. A Harvard study concluded recently that the average aggregate review of Amazon readers was roughly as accurate as critics’ opinions, suggesting that “the wisdom of the crowds” is astute.
As I noted at the beginning, collaborative consumption is fundamentally about sharing. TIME magazine points out that sharing has a feel-good factor to it. It’s what motivates us to post photos on Facebook or share playlists on Spotify.
The majority of us who share online still do so primarily for pleasure, but more and more of us are sharing our products and skills to put a bit of extra money in our pockets. Takeaway, anyone?