Decoded: Sharing Economy

How An Online Economic Trend Is Helping Some Of The Smallest Businesses Connect With More Resources And Customers Offline

November 2014

The sharing economy, also called collaborative consumption and the peer economy, is a socioeconomic system built around sharing in the creation, production, distribution, trade, and consumption of goods and services by different people and businesses

Tech Term, Simplified

The sharing economy is structured to help individuals and businesses better monetize their assets and services. Most of the sharing economy is taking place online in the form of marketplaces for services or goods. The most well-known marketplace for this system is Etsy, a site that “rents” online storefronts to people who otherwise could not afford a full-service e-commerce site. Another site, Zaarly, functions in the same way, but focuses on services rather than products, allowing local small businesses, from plumbers to chefs, to set up online storefronts and connect with others in their neighborhoods. Fiverr is a business-to-business site that connects business owners with freelancers and service providers. Owners can shop for services the same way they buy goods on eBay or Amazon.

How It Can Help Small Businesses

These online marketplaces can not only help independent business owners find more customers, but it can also make it easier for them to connect with services or project-based help they may need. Just two examples include Floow2, a site that connects businesses looking to rent professional equipment to and from each other, and 99Designs, a site that connects businesses with logo and web designers.

There are several sites that help business owners make money from under-used or remnant products or services. Uber, for example, helps car service companies pick up extra fares when the drivers are not engaged with a customer.

While it may seem ironic that customers are taking to the Internet to find the nearest plumber or web designer, these marketplace sites are giving local businesses more digital marketing muscle. For example, the online marketplace TaskRabbit invites people to post odd jobs and projects for service providers to bid on.


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