Access Is The New Ownership
If you didn’t learn to share in kindergarten, NOW is an opportune time to adopt those skills. Sharing is da bomb these days. Read on to see why Cloud economics and the access economy together disrupt the status quo.
The sharing economy — a.k.a. the access economy — is exploding to take over the market. You see, more and more companies and customers alike are trading in the shackles of ownership for the freedom of shared access.
After the recession, loads of consumers felt they needed a simpler lifestyle. Fewer possessions, greater freedom, and flexibility brought just that. Fast forward to today, and most of us have taken part in the sharing economy (maybe without realizing it).
Whether binge-watching Game of Thrones on Netflix or taking an Airbnb and Uber-fueled vacation, you’re a participant. And most of us — over 80 percent according to an extensive PriceWaterhouseCoopers report — think it’s made life more affordable, convenient, and efficient. Let’s not forget more fun!
What’s the Difference Between Access and Ownership?
The traditional ownership model is built on an old-school dream. Buy a family house in the suburbs and a car to schlep possessions home in. Half of that stuff sits in the basement untouched, while the other half drains your bank account with maintenance and repairs (think cars, appliances, and electronics).
Which reminds me of a one-for-one model, but with every family — every individual — owning their own sports equipment, vacation home, and DVDs. And every company owning their own facilities, equipment, and inventory.
The problem with ownership is that it’s burdensome. I bet you were really excited about that first car you saved for and bought…until you added up the monthly cost of insurance, registration, inspection, and gas. When you got your first flat tire, first ‘check engine’ light, and first failed transmission? I bet your once-prized possession became an unwanted appendage!
The access model flips the old dream on its head and embraces the new, hyperconnected, data-driven reality we live in. Products and services are sold again and again to temporary users as peer-to-peer digital platforms allow us to connect available goods to demand, instantly. It favors subscriptions over ownership, networking over shopping, and reuse over raw materials.
Since the Sharing Economy Hit the Scene We Haven’t Looked Back
Airbnb averages 500,000 guests per night, surpassing Hilton Worldwide. But Uber is worth $68 billion and more. It’s no wonder, as you can book an Uber in more than 600 cities across 76 countries. The only upper limit on their growth is human population, which isn’t slowing down anytime soon (another reason the sharing economy makes sense).
Think this over for a second. Nearly every object and service we use in our daily lives can be networked.
So they are visible and available to anyone who wants it. When we access — rather than own — the products, equipment, and experiences we want, we can return them when we’re done. This makes our lives and businesses more nimble, mobile, and happy.
If You’re Not At a Customers’ Fingertips, You Might As Well Be On Mars
In case you haven’t noticed, the Internet changed everything. Then smartphones came along and brought more radical change. Connectivity is everything!
Social networks, mobile apps, and a blossoming Internet of Things are not only our platforms. They are also the very currency of our fast-paced lives.
At the heart of this revolution? Simply…the click of a button. Which enables access-oriented businesses to align themselves with the way people live and interact.
Since we already communicate, browse, navigate, and shop through our computers and mobile phones, we prefer the rest of our needs to be met the same way. With digital platforms that know us and are always conveniently in pocket.
We prefer peer reviews and user communities over advertising and expect personalized at-your-fingertips experiences. The good news here for enterprises is that consumers are happy to interact via mobile app. What’s more is they trust startups that have no privately owned assets.
Why is that good news? Because the barriers to entry are lower than ever…and you can scale like crazy!
The demographic most enthusiastic about the access economy is 18-24 year olds and households with kids under 18. Meet the most powerful consumers — your future market.
All ages and demographics have been shaped by the social and responsive nature of the Internet. We’ve all come to expect the kind of personalized brand interactions made possible by Cloud and mobile technologies.
The Access Economy Is More Trusting, Creative, and Green
The access economy isn’t just about our new digital world. It’s also about the physical world. People are going to cities for the stimulation, opportunity, and (you guessed it) access that urban centers provide.
By 2050, 75 percent of all humans will live in cities, while city budgets steadily decline. This would be a recipe for catastrophe in the ownership model, where overcrowding leads to scarcity and competition.
The access economy, however, meets the challenge head-on, transforming previously wasted resources into on-demand transportation, housing, food, labor, and more.
Consumer values are different than a generation ago. People now prioritize sustainability and reuse. They desire local, communal, and collaborative solutions.
Brands are pivoting to reflect these values, rolling out highly successful city bike-share programs, co-working space memberships, locally-sourced grocery delivery platforms, car-sharing services, tool libraries, and more.
The sharing economy both relies on and fosters trust in strangers and a sense of community. It offers a way forward for people and businesses while solving problems of waste and limitations of traditional asset ownership.
Solutions are being found with innovative, agile ways of delivering and accessing goods and services. It’s about using only what we need, precisely when we need it. It’s about doing more with less.
It’s Happening Everywhere, Right Under Your Nose
If you think your business or industry doesn’t fit into the sharing economy, consider this. There are near endless variations on the sharing model, allowing any brand to participate in the disruption.
Not every access-oriented business does away with ownership completely. ZipCar owns its fleet of cars, strategically distributed throughout cities for easy, temporary access. The company is a hybrid of a car rental agency and car sharing community, using mobile technology and cloud to bring something new to the market.
Many services have embraced the sharing economy by transitioning to a subscription model. We all know how Netflix and Spotify have transformed individual DVD and music ownership with their monthly membership subscriptions. We don’t always think about other subscription services that have become nearly ubiquitous. But we should.
Dropbox, Salesforce, Adobe Creative Suite, Microsoft Office 365, and many others give users month-to-month access to software and storage space that we used to have to buy, license, install, and upgrade.
Even healthcare is adapting. Subscription medicine means patients can see their doctor as often as they like for a flat fee. Cloud-based services like One Medical offer same-day appointments made online, more personal treatment plans, and direct access to doctors outside the office for an annual fee.
It’s The Access Economy, Stupid
You don’t have to operate in a high tech industry to realize the value of the access economy. Thanks to the Cloud, any business can benefit from automatically upgraded, access-from-anywhere, maintenance-free services.
For example, Skip The Dishes is a Cloud-based restaurant delivery service that provides not only the web portal for online orders but even the drivers. Restaurants no longer need to own a delivery website or drivers. They can sign up for the mobile interface that links them to hungry customers, assigns a driver, and handles the transaction. It’s all done through Cloud infrastructure.
Or if you’d rather cook but can’t find time to source out healthy ingredients, HelloFresh is quietly changing the way people buy food. This “huge data-driven technology platform” delivers recipes and fresh ingredients needed to create interesting meals.
The Cloud is truly the backbone (and arms, legs, eyes, and brain) of the access economy. Whether you are a print shop, clothing retailer, accounting office, software developer, textile manufacturer, or periodical, ZERO percent of your business revenue has to be tied to managing servers, upgrading systems, building storage, and other outmoded ownership demands.
So why wouldn’t you choose access? Cheeky, but we might even call this Cloud Economics 101.
Don’t Lose Your Access to Consumers
The research is in: “Small businesses who embrace the Cloud achieve 25 percent additional revenue growth compared to cloud skeptics and more than double their profits.”
At its core, the access economy challenges (and disproves of) the very notion that we need to own something in order to network it and make it available to others. It dares to assert that owning goods, services, facilities, and equipment — all that makes our lives run — is wasteful, inefficient, inconvenient, and unsustainable.
The Cloud has finally made longstanding human ideals like community, collaboration, utility, and productivity more viable and profitable.
If you are still a skeptic, listen up. The opportunity to innovate your processes, become more accessible to your customers, compete, and thrive in a rapidly changing world could pass you by. Don’t let it.
The access economy and Cloud-fueled businesses are here to stay… and to grow. Think of how you can adapt to stay relevant. And to take advantage of this opportunity for innovation, free of burden.
Sure, the access model is a bit different than the “business as usual” one we’ve used in past decades. But if unknown 20-somethings with startups can pull it off, you can too!