Table of Contents
3. Literature Review
3.1 General Approach
3.2 Consumer Access to Resources
3.3 Collaborative Consumption
3.4.1 Sharing, Gift Giving and Commodity Exchange
3.4.2 Incentives to Share
3.4.3 Impediments to Share
3.5 Increasing Returns – Putting Collaborative Consumption into Motion
4. Conceptual Model
5. Research Design and Methodology
5.1 Case Selection – Peerby.com
5.2 Exploratory Research
5.3 Focus Group Technique
5.4 Sample Choice and Research Execution
6. Data Analysis and Results
8.1 Theoretical Contributions
8.2 Managerial Contributions and Implications
8.3 Limitations and Suggestions for further Research
Collaborative Consumption is a term used to describe the notion of sharing and joint utilization of goods and services. Being deeply rooted in anthropology, the phenomenon of joint consumption is currently experiencing a form of renaissance on the internet, as online communication is beginning to lower the hurdles of geographical, social and emotional distance associated with sharing activities of an individual’s direct social circle. Although evidence suggests that the collaborative consumption market bears huge profit potentials, little research seems yet to have been conducted to foster the understanding of people’s motivation to engage in such sharing networks. To address this gap, the following research study reviews the literature on a diverse set of academic fields such as consumer behaviour, sharing, anthropology, sociology and increasing returns, based on which proposition are presented aimed at clarifying the influence of selected factors on people’s sharing behaviour. Grounded on these propositions, the study provides a conceptual model designed to improve the understanding of people’s motivation to actively participate in collaborative consumption ventures. In this context, special focus is set on the supply of goods in ‘pure’ sharing systems in which no immediately observable exchange takes place. In an attempt to expose the assumptions made to preliminary scrutiny, focus group research has been conducted with frequent users of the Dutch collaborative consumption network Peerby. Findings suggest that there seems to be interaction effects between different constructs, as individuals tend to consider them jointly rather than independently when deciding whether to engage in sharing or not. Furthermore, the need for development of richer definitions of constructs used, to aid better understanding of potentially influential factors and set a solid basis for future theory testing, is uncovered.
Collaborative Consumption is a rapidly emerging trend of the new digital age, which is becoming increasingly popular all over the world (Botsman & Rogers, 2010a; Botsman, 2012). While the joint consumption of goods is not a novel, but a rather old anthropological phenomenon deeply rooted in human society (Price, 1975), this new societal trend induces an ever-increasing amount of people to use internet platforms to share goods and services (Botsman & Rogers, 2010a). Having always been a medium for virtual exchange of information (Leiner et al., 2009), it is not surprising that the internet nowadays also plays a central role in the facilitation of offline exchange. Online communication has changed the rule of the game by broadening the scale of what is possible. Individuals are now virtually connected to a wide range of people both in their neighbourhood and all around the world, making the possibilities for sharing and collaboration almost endless. In this context, it must however be noted that the expansion of online collaborative consumption networks in different parts of the world is proceeding at different rates, as usage thereof is highly dependent on factors such as technical infrastructure. With income differentials being only one of many explanatory factors of the ‘global digital divide’ (Chinn & Fairlie, 2007), worldwide internet penetration had only reached a mere 34.3% in June 2012 showing significant deviations from this average value in different regions of the world, ranging from 78.6% in North America and 15.6% in Africa (Internet World Stats, 2012). While DiMaggio & Hargittai (2001) argue for the five most important drivers of digital inequality to be skill, the purposes for which the technology is employed, equipment, autonomy of use and social support as they have a direct influence on internet penetration, Skinner et al. (2003) suggest that not only penetration as such, but also access quality can impact participation in online networks. For those people who enjoy access, it has however become possible to offer their goods and services to strangers on platforms such as Peerby.com or Airbnb.com instead of sharing resources only with their direct social circle such as friends and family members. By now even many companies are beginning to adapt to the current movement towards an access-driven and away from an ownership-driven mind-set, and are adjusting their offerings accordingly (Rifkin, 2000). BMW’s ‘Drive Now’ initiative or the collection of rental tools offered in branches of the building supplies store chain ‘Bauhaus’ serve as good examples of this development in the German market.
Despite the fact that the estimated annual market value of collaborative consumption ventures is currently sky-rocketing, suggestive of a huge profit potential in a still largely unsaturated market (Forbes, 2013; MIT Sloan Experts, 2011; The Economist, 2013), an evaluation of current academic literature suggests that the field is still widely unstudied. For instance entering the combined search term “collaborative consumption” into the search engine Google serves as a nice illustration of this assumption, as a regular search provided roughly 491.000 sources compared to only 641 on Google Scholar in January 2014. Based on the observation of the embryonic state of the phenomenon in scholarly literature, it is assumed that there is currently insufficient academic insight aiding collaborative consumption based businesses to shape their value propositions. In better understanding what motivates people to share their belongings and offer services on such collaborative consumption platforms, founders and network operators could more successfully tailor their offerings to the people’s needs and wants, and as such retain current users while attracting new ones. While this study by no means aims to find a lasting solution for this interesting and relevant problem, it however attempts to contribute towards the issue at hand by helping to move closer to a solution. By making use of exploratory research techniques, the following two research questions will thus be addressed:
1.) To what extent is it possible to synthesize existing literature from different fields to craft first explanations for people’s motivation to participation in collaborative consumption ventures?
2.) Is it possible to develop a preliminary conceptual model based on the findings in academic literature and identify potentially missing concepts?
The beauty of collaborative consumption lies in the idea that it becomes more and more valuable to individuals the more people join, resulting in a self-enforcing mechanism which unfolds once the wheel has successfully been put into motion. The more favourable a collaborative consumption platform is thus perceived by individuals, the more likely they are to join and as a result make the platform more attractive to others, causing them to join as well. From a business perspective, research on consumer behaviour in the context of collaborative consumption will likely bring about profit increases as a result of rising demand for more tailored platform solutions.
From an academic point of view, exploratory research and theory building are often used as building stones established to provide a solid basis for future theory testing and more rigorous quantitative studies (Denzin & Lincoln, 2003; Silverman, 1993). In making first observations and collecting qualitative data, the path towards a better understanding of the phenomenon of collaborative consumption in the digital age can be smoothened.
In an attempt to shed light on the status quo in terms of current academic research on the topic of collaborative consumption and related fields, a thorough literature review has been constructed to serve as a theoretical background and basis for theory building. While going through existing literature, the emphasis of the study was limited to ‘pure’ collaborative ventures, which provide no directly apparent reward for the sharer, in order to set focus and adhere to the given time constraints. Based on the most relevant factors found in literature from different research domains, a conceptual model was constructed. The model is aimed at summarizing possible explanatory elements for both the supply and demand for products and service offerings on sharing platforms, and the resulting likelihood of sharing at individual level and collaborative consumption venture success at the aggregate level. To provide some empirical backing for the developed theories and to set the direction for further research in the field, focus group research was then conducted with active users of the Dutch collaborative consumption venture Peerby which operates on the basis of ‘pure’ sharing principles. The findings were then interpreted and used to give concrete managerial advice to Peerby as to how the platform could be improved in order to further stimulate and encourage people to offer their belongings on the site for others to share. Finally, the limitations of the study were highlighted and suggestions for further research were given.
3. Literature Review
With collaborative consumption being a very recent phenomenon, only a limited amount of research seems to have been conducted in the field up until now. Consequently, the combination and consolidation of literature from different, related fields was regarded useful in the attempt to grasp a better understanding of the nature of collaborative consumption, the phenomenon of sharing and potential drivers of and barriers to such behaviour.
3.1 General Approach
Confronted with a vast amount of potentially relevant academic fields to consider, research was initially anchored in the existing literature on sharing, ownership and access (e.g., Bardhi & Eckhardt, 2012; Belk, 2007, 2010; Benkler, 2004; Lamberton & Rose, 2012; Moeller & Wittkowski, 2010), taken mainly from highly ranked journals such as the Journal of Consumer Research or the Journal of Marketing, as well as some of the few published works on collaborative consumption itself (e.g., Albinsson & Perera, 2012; Botsman & Rogers, 2010a, 2010b). Given the state of theory on the topic at hand, many academics are still engaging in qualitative research and theory building rather than testing. There are however a few exceptions, such as the investigations conducted by Moeller & Wittkowski (2010) or Lamberton & Rose (2012), in which preliminary qualitative studies are used to build hypotheses which are then examined in quantitative studies using statistical evaluation techniques. As such, the study at hand is based on a mixture of both qualitative and quantitative research papers, of which most engage in qualitative, non-empirical theory building while some already attempt quantitative, empirical theory testing. This selection of sources simultaneously hints at the direction this research study takes, as it makes use of qualitative research techniques to attempt theory building in form of the construction of a conceptual model and strives for preliminary validation on basis of focus group outputs.
Throughout the next research phase, anthropological and sociological studies on sharing behaviour in communities (e.g., Marlowe, 2004; Peterson, 1993; Price, 1975) were also studied and taken into account. Despite stemming from a completely different academic domain, such studies were believed to add interesting new perspectives to the idea of sharing and collaborative consumption, especially in the attempt to shed light on the origins and early stages of joint consumption and community sharing. Additionally, these studies uncovered stimulating contradictions to the view presented in purely economic based literature on issues such as the level of altruism present in sharing activities.
Finally, an economic and mathematical perspective was taken on relevant factors such as network growth and size (etc., Arthur, 1989, 1990; Katz & Shapiro, 1985; Kretschmer et al., 1999; Madden et al., 2004) by studying research papers published in reputable journals such as Mathematical Social Science or the American Economic Review. With collaborative consumption ventures being highly dependent on large, active user bases, this field of literature was assumed to provide relevant insights into the mechanisms behind the functioning and growth of such platforms. In light of the study’s goal of contributing towards academic insight supporting collaborative consumption based businesses in successfully shaping their value propositions, the necessity of understanding the notion of network size and increasing returns discussed in this literature was clearly evident.
The following literature research is thus based on a very diverse, yet quality-controlled sample of literature which combines a wide range of different research areas in order to provide a comprehensive and value-adding overview of the topic at hand. In order to smoothen the path towards a solid understanding of what collaborative consumption is and why it has evolved as a viable alternative to ownership, the notion of consumer access to resources is briefly elaborated on upfront. While the concept of collaborative consumption is discussed in more detail thereafter, to provide an initial basis for discussion it should be thought of as the joint consumption of goods and services between two or more people, which provides these individuals with the benefit of decoupling access from ownership.
3.2 Consumer Access to Resources
There are numerous ways in which individuals can gain access to products or resources they desire. The most direct and obvious one is of course to purchase the item and hence take full ownership of it. In such an economic exchange, prices are either publicly displayed or negotiated on the spot between the seller and the buyer. To ensure the absence of reciprocity in such prototypical market exchange settings, money is usually used as a medium for exchange so that “when the exchange partners complete their transaction they need never again encounter each other” (Belk, 2010, p. 718).
Similarly, individuals can take ownership of products through barter, or in other words the exchange of items with other individuals. Botsman & Rogers (2010a) even claim that “the idea of the exchange of goods or services for other goods and services without any money changing hands is the oldest form of economic trade” (p. 156). Barter was already an established part of human culture and interaction in the ancient world and was long used as the prime medium of exchange before the introduction of coins and paper money during the renaissance (Botsman & Rogers, 2010a). However, the most problematic issue with barter is what Jevons (1875) refers to as a double coincidence of wants. “The first difficulty of barter is to find two persons whose disposable possessions mutually suit each other's wants. There may be many people wanting, and many possessing those things wanted; but to allow an act of barter, there must be a double coincidence which will rarely happen” (Jevons, 1875, p.3). Despite this obvious “ineffectiveness of barter” (Starr, 1972, p.290), making it much less flexible and universally applicable than prototypical market transactions involving money, it has nonetheless not died out as a phenomenon. Bartering for instance experienced a noteworthy revival during the Great Depression and is currently again becoming increasingly popular in the context of collaborative consumption ventures (Botsman & Rogers, 2010a) as a result of the emergence of modern technology and virtual communication.
Gaining temporary ownership of a product is also possible through renting agreements which provide individuals with the access to a product or service for a limited period of time in exchange for money. In such cases, the fee charged for the rental period often includes a deposit payment which protects the rightful owner from having to bear the costs of any damage which might be caused by the renting party. However, no such protection is usually present in the context of lending or sharing, which evokes the question as to what motivates people to share. In this connection, especially the conditions under which individuals are willing to engage in sharing in its purest form, namely sharing without asking for any directly observable compensation in return, are of particular interest and will thus be the subject of investigation of the following research.
Economically speaking, sharing goods or services with others without direct compensation does not only fail to create direct value, but can even be argued to destroy value for the individual who offers to share. The deterioration of object value through use, loss of time or the risk associated with potential damage are examples of factors which might lead to such value destruction which the sharing party is not compensated, let alone rewarded for incurring. Nonetheless, such sharing initiatives are not uncommon in society. They are mostly found in closely-knit communities (Price, 1975) but are nowadays even increasing in popularity between strangers through the rise of the internet on websites such as freecycle.com (Botsman & Rogers, 2010a). Despite approaching the topic from a different angle, namely the analysis of capitalistic systems and profit making, Small (1925) supports this idea that the “something-for-nothing motive” (p.439) is deeply rooted in human society. Similarly, Tencati & Zsolnai (2012) are convinced that “human beings are more than egotic machines: their intrinsic disposition is relational and collaborative” (p.346) and they propose that this view is confirmed by and reflected in the emerging collaborative trends and initiatives in today’s society.
Price (1975) provides a good example of community sharing by analysing the behaviour and habits of the Washo Indians from the central Sierra Nevada around Lake Tahoe (p. 15 ff.). The study gives interesting insights into the drivers and “rules” of sharing behaviour in tightly-knit groups and thus helps to at least partially facilitate the understanding of why people share with others. According to the case study, both social and geographical distance seem to play an important role in the context of community sharing since “[Sharing decreased] as kinship and residence distances increased” (p. 16). The notion of social distance as an important factor regarding the likelihood of sharing activities to take place is also picked up on by Belk (2010), who differentiates between “sharing in” and “sharing out”. Sharing in generally refers to sharing activities within the “aggregate extended self” (p. 725) such as family, while sharing out describes the act of “giving to others outside the boundaries separating self and other” (p. 725), and thus “preserves the self/other boundary and does not involve expanding the sphere of aggregate extended self beyond the family” (p. 726).
It is suggested that only sharing in classifies as an act of true sharing, as it is altruistic in nature and expands the domain of common property to the “extended self”. Sharing out in contrast is simply seen as a form of access, as the division of resources among discreet economic interests is non-altruistic and much closer to commodity exchange, since it preserves the self/other boundary (Bardhi & Eckhardt, 2012; Belk, 2010). This standpoint is however counter argued by a number of anthropological studies which offer evidence for the belief that sharing is in fact never truly altruistic in nature (Marlowe, 2004; Price, 1975). While the economic domain attempts to conceptualize the nature of sharing in isolation, anthropologists acknowledge that sharing usually takes place in a social environment in which individuals have to fear the consequences of their behaviour. Subsequently, it is often hard to detect the level of altruism an act is subject to. While an economist might conclude that a certain behaviour classifies as altruism because no apparent exchange has taken place, a more careful look from a sociologic perspective could reveal this to be untrue. Despite not being immediately observable to outsiders, future reciprocity might still be expected by the sharing party, turning the act into a non-altruistic one. This logic can also be argued to be transferrable to the domain of online communities facilitated by the internet, in which such expectations could also likely emerge as the social character of a network intensifies.
This idea of sharing being mostly non-altruistic in nature, even amongst relatives or closely connected individuals, is nicely exemplified in the study of Price (1975). He states that for instance in Washo tribes “the person who would not share with others of the same household, or who was generally stingy would not be included in the networks of sharing and would be ‘talked out’ of his household” (p. 16). Social pressure thus seems to play an important role in community sharing activities – rather than sharing based on generosity, individuals share to avoid punishment as the consequence of selfishness and stinginess. Price’s finding is also supported by a number of other sociological studies, such as the one conducted by Marlowe (2004) on Hadza hunter-gatherers. Sharing is deeply rooted in Hadza society as “Hadza say that people who do not share are bad people and that they will move away from them” (p. 85). However, it is interesting to see that Marlowe found them to be more willing to share in large than in small camps. He explains this phenomenon by stating that “being accused of stinginess in a large group could be more dangerous than being accused by one or two people in a small group, which might explain why people felt compelled to make higher offers in large camps” (p. 85), which supports the theory of sharing being enforced through social pressure and the fear of punishment rather than generosity. Peterson (1993) further undermines this school of thought with his research on demand sharing, which states that “despite the prevalence of an ethic of generosity among foragers, much sharing is by demand rather than by unsolicited giving” (p. 860). Taking Lester Hiatt’s study of Anbara Aborigines in Australia from 1982 as a source, Peterson explains that “below the melody line in praise of generosity among the Anbara people of Arnhem Land, a grumbling about their stinginess, neglect, and ingratitude also was evident. Public pressure on individual Anbara to share was virtually irresistible, so various counterstrategies were adopted by the diligent to prevent exploitation by the lazy or manipulative” (p. 860). The need for social pressure to enforce sharing conformity in a community setting thus seems to be a widespread, if not even universally applicable phenomenon. Nonetheless it should be noted that social pressure or the need for social acceptance is highly dependent on the given social cohesion and ties. Consequently, the phenomenon is expected to be more likely to occur in such tightly knit communities and weaker in many of today’s rather anonymous societies. However, as online sharing networks begin to develop a more social character resulting in the formation of societal ‘sub-groups’, the idea also regains relevance in the context of collaborative consumption ventures.
Given such strong empirical support in the academic literature as well as the indisputable logic of the argument, the aspect of social acceptance is expected to have a significant effect on individual behaviour in the context of sharing. Even though not all people care about the approval of their actions by others to the same degree, it is assumed that high levels of social acceptance for sharing will increase people’s likelihood of offering their belongings for others to share. The following proposition is thus formed from the discussion:
Proposition : People who experience high levels of social acceptance of sharing in their environment are more likely to show an increased willingness to share their belongings with others.
In light of all arguments discussed above, the question as to why individuals nonetheless increasingly engage in non-reciprocal sharing activities online leading websites such as freecycle.com, peerby.com or couchsurfing.com to experience a remarkable ‘hype’ in recent years, seems even more intriguing to investigate. To set an appropriate basis for discussion, the following subsections will firstly introduce the concept of collaborative consumption and then elaborate on incentives and impediments to share based on existing literature.
3.3 Collaborative Consumption
There is much evidence for the fact that consumers as well as companies are increasingly starting to perceive and make use of sharing as a sustainable and profitable alternative to ownership (Belk, 2007; Rifkin, 2000). While sharing as “an activity that is more characteristic of the interior world of the home rather than the exterior worlds of work and the market” (Russell Belk, 2010, p.716) finds it origins in tightly-knit, well-connected communities which Price (1975) refers to as “intimate economies” (p.3), sharing between strangers is also starting to become the norm. Online communities and sharing systems are growing in popularity and were estimated to account for an annual market value of more than US$ 100 billion in 2010 (Lamberton & Rose, 2012).
Despite the fact that sharing communes and joint usage have always been a societal phenomenon, the term Collaborative Consumption was first shaped by Felson & Spaeth in 1978, who defined the phenomenon as “events in which one or more persons consume economic goods or services in the process of engaging in joint activities with one or more others” (p. 614). This definition emphasises the communal consumption or sharing of a single good or service amongst the members of a certain community. The authors suggest to further divide the term into three distinct subcategories, namely direct, system-hookup and segregated collaboration. Firstly, direct-contact collaboration means that collaboration partners consume jointly at the same time and place. Secondly, system-hookup collaboration describes situations where collaboration partners consume simultaneously while being in different places. Finally, segregated collaboration characterizes collaborative consumption activities where collaboration partners cooperatively consume a good or service at different times as well as in different places. Consequently, Felson & Spaeth (1978) suggest that “collaborative consumption may or may not involve direct physical contact between collaborators” (p. 622).
Having emerged from intimate, tightly-knit communities, the concept of collaborative sharing has however evolved rapidly in recent years, mainly fuelled by the rise and growing importance of the internet. While sharing activities in communities were generally found to be decreasing with greater spacial distance in previous research (Price, 1975, p.13), meaning that people usually tend to share more frequently with others who are close to them both in terms of geographical distance as well as emotionally, this seems to be a somewhat outdated view in the age of digital communication and the internet. Trust as the basis for sharing activities, which could formerly only develop in real communities, can now be built between strangers using the power of technology (Botsman, 2012). Furthermore, the idea that “sharing is a principle that cannot be applied very well to large integrated populations because it is socially based on intimate linkages and bio-social attributes” suggesting that “small enough size is an important factor in the viability of [sharing] communes” (Price, 1975, p.7), no longer seems to hold true in all cases. It is however important to notice that the above discussed arguments are not meant to suggest that physical, social and emotional distance have ceased to influence sharing behaviour. Numerous studies show that these dimensions of distance in fact do play a significant role in social sharing behaviour (Marlowe, 2004; Peterson, 1993; Price, 1975). What has changed is the mode of communication – online interaction has significantly widened the scope of sharing possibilities and has brought about ease in the sense that things which could previously not be communicated across spacial or social gaps now can be (Botsman & Rogers, 2010). Peer reviews or ratings for instance aim to build virtual trust, rendering distances or social ties less important, allowing for a totally different form of collaborative consumption to emerge via the internet (Botsman, 2012).
The internet can thus be argued to have revolutionized the landscape of sharing activities as it has enabled the emergence of “’many to many’ peer interactions” which means that “sharing and collaboration are happening in ways and at a scale never before possible” (Botsman & Rogers, 2010a, p. xv). Already in 1975, Price acknowledged the possibility that artificial intelligence might be able to overcome the limits of the human brain and thus enable sensitivity to individual differences and the establishment of ‘personal’ bonds in larger groups and communities (p.7). The emergence and growing popularity of collaborative consumption networks in today’s society serves as proof for Price’s predictive assumption and emphasizes the fact that web 2.0 has changed the way in which the modern society engages in sharing activities. Albinsson & Perera (2012) also suggest that “an increase in collaborative consumption, which contrasts with the individualistic-oriented North American and Western European consumer culture, indicates that consumer preferences, albeit yet for a relatively small segment of the entire population, are undergoing a transformation” (p.303). Fuelled by the possibilities arising from modern technology, we seem to be slowly but surely moving away from individualistic, short-term oriented purchasing behaviour towards a more communal, sustainable model. In line with this train of thought and despite its currently still limited reach, Botsman & Rogers (2010b) argue that “collaborative consumption is not a niche trend, and it’s not a reactionary blip to the recession. It’s a socioeconomic groundswell that will transform the way companies think about their value propositions – and the way people fulfil their needs”.
In this comparably more recent work, Botsman & Rogers (2010b) define collaborative consumption ventures as “systems of organized sharing, bartering, lending, trading, renting, gifting, and swapping” which give participants “the benefits of ownership with reduced personal burden and costs (…)”, picking up on Moeller & Wittkowski's (2010) notion of burden of ownership. While in essence this definition is not much different from the one Felson & Spaeth (1978) present in their study on community structure and its effect on collaborative consumption behaviour, it takes a much more concrete approach on the distinct nature and different possible forms of such collaboration consumption activities. In order to provide a tool for classification of the numerous types of collaborative consumption ventures which currently exist, Botsman & Rogers (2010a, 2010b) suggest three distinct categories, namely Product Service Systems (PSS), Redistribution Markets and Collaborative Lifestyles.
Product Service Systems “enable companies to offer goods as a service rather than sell them as products” (Botsman & Rogers, 2010b). This means that consumers gain access to the benefits of the product or service without having to own it outright, such as in the case of car sharing. Another example to consider is for instance Océ’s concept of ‘managed print services’ which allows institutions such as universities to outsource their printing solutions. Rather than buying and maintaining their own, Océ offers these companies to rent the latest printer models and pay only for the actual usage and servicing (Océ, 2013). Such offerings provide alternatives to costly ownership, regular maintenance and eventual repurchase to clients, and new business opportunities for providers. In terms of participation intention, Katzev's (2003) study revealed people’s willingness to engage in such systems to be highest when their demand for the product or service was occasional and the financial saving they expect to realize were worthwhile.
In an attempt to explain the growing popularity of Product Service Systems, Bardhi & Eckhardt (2012) argue form an experience economy perspective by stating that “instead of buying and owning things, consumers want access to goods and prefer to pay for the experience of temporarily accessing them” (p. 881). Botsman & Rogers (2010a) even describe this phenomenon as a societal shift in mind-set, where people are increasingly moving away from an ownership oriented mind-set towards a “usage mind-set” (p. 71). In line with this, Rifkin (2000) argues that businesses, exemplified for instance by Océ, have already sensed and picked up on this trend and are “well along the way towards the transition from ownership to access” (p. 44). Rather than only focusing on the sale of the physical product (e.g. a car or a book), Rifkin explains that companies “increasingly turn customers into clients and sell access to the ‘experience’” (e.g. driving a car or reading a book). This creates a win-win situation for both customers and companies. Effectively, such businesses ‘re-sell’ the same product multiple times, resulting in multiplied profits and customer contacts. This in turn results in multiplied opportunities for “additional sales, for strengthening a brand, for improving a competitive service, and for deepening and extending the relationship with customers” (Gansky, 2010, p.5).
Following this train of thought, it becomes clear that products and services are closely coupled in Product Service Systems in the sense that by shaping the product, the service is shaped as well, requiring joint consideration and design. Public transport systems provide a good example for joint product service development since the physical product alone (e.g. functional buses and trams) do not ensure a functioning system without adequate service support (e.g. convenient routes and timings). In an attempt to avoid congestion, it is necessary to look at the integral system instead of each aspect in isolation. An alignment of product and service offerings is thus of crucial importance to the working order of Product Service Systems.
Redistribution Markets facilitate the (re)distribution of used or pre-owned goods “from where they are not needed to somewhere or someone where they are” (Botsman & Rogers, 2010a, p.72), meaning that essentially ownership is redistributed. While some of these communities operate on a monetary basis (e.g. eBay), others are based on free exchange of unwanted goods (e.g. Freecycle). But regardless of the exact nature of the exchange, “a redistribution market encourages reusing and reselling old items rather than throwing them out, and also significantly reduces waste and resources that go along with new production” (Botsman & Rogers, 2010a, p.72/73). This means that despite the practical aspect of shifting resources from where they are no longer needed to where they are needed at affordable rates, the concept of redistribution markets additionally benefits society by fostering sustainability and the sensible use of scarce resources. Even though the aspect of sustainability is often only “an unintended consequence of collaborative consumption” (Botsman & Rogers, 2010a, p.74), its importance should not be neglected in view of the strongly negative societal and individual consequences of overconsumption. Albinsson & Perera (2012) support this viewpoint by stating that “the need for sustainability is exacerbated by increasing levels of global consumption and the associated increase in demand for goods and services in international markets” (p. 303).
Finally, in Collaborative Lifestyles “people with similar need or interests are banding together to share and exchange less tangible assets such as time, space, skills and money” (Botsman & Rogers, 2010a, p.73). Again, such initiatives take place on both a local level (e.g. Landshare) and global level (e.g. Airbnb). Since collaborative lifestyle sharing is usually characterized by high levels of human interaction and is mostly concerned with intangible products, it is often regarded as requiring even more trust than other types of collaborative consumption ventures. By labelling the phenomenon ‘lifestyle’, the literature however introduces a bias since this term implies active engagement triggered by belief. Such bias might stem from the author’s conviction that such systems are highly efficient and the resulting attempt of propagation thereof. Engagement in Collaborative Lifestyle communities might however also be caused by factors such as convenience (e.g. finding cheap and central place to stay via Airbnb), leading to the consideration of relabeling the phenomenon to a less emotionally laden, more neutral term such as ‘Collaborative Conduct’.
- Quote paper
- Anna Catharin Heil (Author), 2014, Drivers of Participation in Collaborative Consumption Ventures, Munich, GRIN Verlag, https://www.grin.com/document/314179