Sharing economies are becoming the norm in the 21st century following the consuming habits of the digitalized generation. This two-sided marketplace eliminates the middlemen, turns what once were end-product investments into scalable, flexible-turnover investments, and provides users on both sides more choices. You name it, they rent it!
Despite heavy governmental regulation, companies featuring sharing-economy business models are still showing strong presence in various sectors. One crucial element for sharing economies is high smartphone ownership, easy internet access that enable users to respond promptly, and profound resources that reduce the cost for app development. Moreover, 68% of respondents worldwide are willing to engage in shared services, according to Nielsen, constituting another important element for the sharing economy – users.
The term “uberization” derives from the pricing model Uber developed. Unlike most services/items provided on the sharing platform, it charges differently according to demand. By providing a platform and a series of algorithms, this implementation of a simple supply-demand economic theory leads to the flourishing of hundreds of thousands of micro-entrepreneurships through direct P2P interactions.
With the increasing popularity of the concept, analysts estimate that the wireless and financial industries may be the fields that are mature enough for uberization. By collecting big data, wireless service providers can filter out the most popular times and uberize the price. On the other hand, as one of the most mediated industries, traditional banks are losing clients as Internet eliminates the asymmetry of information that banks hold as an advantage, and the complicated process for applying for loans has indirectly encouraged the growth of the virtual realm where pools of small lenders can combine online to grant loans. Although this normally requires a higher interest rate, platforms like Lending Club or Prosper achieved a loan amount of $7B and are expected to reach $150B by 2025, according to PwC.
Combining technology and countless innovative ideas following the framework of the sharing economy, uberization embodies platforms that enable individuals with excessive resources to pool together to thus form a precedent trend that might raise a revolution against the economic status quo. Uberization for industries is unstoppable, and is about to change the way we look at the market from every perspective.