In May 2017, Martin Roll’s contribution and perspectives about digital and the sharing economy was featured as the main article in Today’s Manager. It is a quarterly management magazine offering articles on cutting-edge trends, development issues and changes that impacts management professionals published by the research and publications arm of the Singapore Institute of Management (SIM).
The sharing economy refers to digital platforms enabled through technologies like location-based GPS that allow people to quickly make and respond to requests for goods and services. Users have the liberty to freely share data to let others know what they need, while big data is leveraged to match idle capacity to fit the needs of users. In this article, Martin Roll discussed what impacts the sharing economy has on consumers and businesses, and what it means for future brand strategy.
Before the advent of the Internet, businesses have thrived on information asymmetry between them and their customers. As customers had limited information, brands had complete control over products and services they pushed out into the market. However, with the advent of the sharing economy, such asymmetry has reduced tremendously, allowing consumers to interact and share information, greatly enhancing consumer purchase decisions. This has allowed consumers to enjoy greater value and consumer surplus from the lower prices they pay and greater variety of consumption choices. For businesses to leverage on this new change in dynamics, they need to engage in value co-creation.
The sharing economy has also allowed customers to interact with other customers and businesses in real time. By participating in discussion forums and virtual communities, customers can share information and generate collective customer power to impact corporate decisions. Businesses need to keep up by designing products and services according to customer feedback in a way that would enhance the customer experience.
With all these developments, so much of a brand’s success in the future depends on how it manages the sharing economy and more broadly, the mobile, social and digital revolution. In this new age for brands, organizations must make IT and analytics an extension of branding and part of its DNA. The value of information and Big Data must be given a seat at the boardroom table in order to reflect the strategic importance of being data-driven. Some important considerations that brands must have are:
By allowing businesses the reach and tools to better serve their customers, the sharing economy has ushered in an era of coopetition that allows both businesses and consumers to reap benefits in the long run. Businesses will benefit greatly if they choose to fine tune their business processes such that they can not only respond to changes by also innovate in ways beneficial to their customers.
The sooner businesses learn to maneuver the changed lanes in the economy, the better it will be for their survival and success.
This article appeared in the May 2017 Issue 2 of Today’s Manager magazine in English.
Read the full article here: What The Sharing Economy Means For Future Brand Strategy (Martin Roll)
Download PDF here: What The Sharing Economy Means For Future Brand Strategy (Martin Roll)