Our entire economy is undergoing a seismic shift in terms of the way customers and suppliers are connected, according to collaborative economist Rachel Botsman, speaking at Adobe’s Digital Marketing Symposium, July 28 in Sydney.
The real change, Botsman told more than 1,500 Asia-Pacific marketers in attendance, is the fact that trust has become the currency of the 21st century. She explained how her ideas regarding the importance of collaboration and sharing in the contemporary economy initially fell on deaf ears when she first began researching the phenomenon in 2009.
“It started with EBay, which is really the godfather of the collaborative economy,” Botsman said.
The phenomenon picked up momentum in 2010 with a series of articles in leading business magazines, and has gone from strength to strength given the tremendous success of collaborative companies such as GoGet, Airbnb, and Airtasker.
“Technology created this new kind of social glue between strangers, which is changing the way we think about supply and demand, buyers and sellers, consumers and suppliers, lenders and borrowers,” Botsman said.
The emerging collaborative economy, which already boasts 17 companies valued at more than US$1 billion and employing more than 60,000 people, is forcing many large-scale companies to rapidly respond to dramatic changes, she added.
Trust is the currency of this new age, where technological platforms match consumers with what they need to meet their needs, bypassing the traditional mechanisms of exchange.
“Not only does this change the way we buy and sell products and services, but it also changes everything we know about brands,” Botsman said. “The best way to understand the extent of this disruption is to change the way we think about value.”
Traditionally, companies would spend a significant amount of their marketing budgets establishing a trusted brand. However, the platforms that underpin the collaborative economy enable consumers to establish trust in individuals and not just institutions. Botsman warned that, like the emergence of social media, the rise of the collaborative economy will require brand managers to create new and more agile ways to establish and maintain brand trust and loyalty.
“The real challenge, from a brand’s point of view, is a loss of control,” Botsman said. “It’s something that first started happening with social media, and we’re now employing millions of people to control those mechanisms for us.”
Botsman suggested that brands will have to respond in similar ways to collaborative platforms, as the sharing economy increasingly becomes the new normal.
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