Collaborative Consumption: How it will disrupt “traditional” Business Models

Time Magazine recently rated Collaborative Consumption, which is defined as technology enabled sharing, trading, renting and bartering of goods and services, as one of the top ten green stories of 2010 (for more, see this).

In a study titled The New Sharing Economy by Latitude Research and Shareable Magazine, it was found that:

• 75% of respondents predicted their sharing of physical objects and spaces will increase in the next 5 years
• 78% of felt their online interactions with people have made them more open to the idea of sharing with strangers, suggesting that the social media revolution has broken down trust barriers
• 85% of all participants believe that Web and mobile technologies will play a critical role in building large-scale sharing communities for the future

(For more, see this excellent article titled The New Sharing Economy by Neal Gorenflo and pdf version of full report is available here).

Rachel Botsman, co-author of the book What’s Mine Is Yours: The Rise of Collaborative Consumption, spoke on the subject recently at TEDxSydney (please see following video):

Social Media is ‘enabling’ trust between strangers and this helps remove middle-man in exchange process. As a result, Collaborative Consumption will disrupt traditional business models.

To thrive in this brave new world, companies will have to reinvent themselves leveraging collaborative technology to connect with their customers and giving them “access” to products or services, rather than “selling” them products or services. This will radically change the way products (or services) are created, distributed, priced, accessed (not owned) and consumed. We live in exciting time indeed!

What do you think? Please do share your thoughts on the subject: