New strategy: peer-to-peer access
Another strategy for existing businesses is to switch to peer-to-peer access, however this will call for big retooling of the businesses’ operations. For instance, an existing taxi company can switch from its model to start operating its own platform to compete with Uber and Lyft. But this will mean selling or leasing their cars out, investing and competing in a sector that is dominated by Uber.
However, an existing business might still find this option useful, and may gradually migrate from their existing model towards this model. It is also possible to do both, using traditional models of commercial exchange and simultaneously creating platforms that enable peer-to-peer exchange. For instance, a company that specialises in furniture or plumbing may use the model of sending their own staff to do specialised work, whilst also connecting skilful casual employees with people who need carpentry work done. This company may therefore be able to compete with TaskRabbit, for providing carpentry or plumbing work.
Existing businesses - and many other stakeholders - are yet to grasp the full scale of the sharing economy. However, they cannot overlook the competitive alternative that they provide, and it is imperative that they address them. There is no perfect strategy, but an in-depth understanding of the needs of a business' target market and how best to deliver superior value to them will be a useful starting point.
Imagine you are the current owner of a car salesroom that sells second hand cars. There has been a shift in your industry due to the progression of the share economy. Instead of owning cars outright, many drivers are renting them on demand. What strategy would you choose to implement for your business? Consider whether you will use a traditional and/or new recipe.
Take our poll
© RMIT University 2017