The trend of shared economy - examining Share Now
Sharing economy
Sharing economy is booming. The mindset of today’s younger generations has changed drastically away from possession and towards subscription models and sharing services.
Source
Instead of visiting metropoles in a hotel people share their flats with visitors and earn spare money on platforms like Airbnb to uplift their lifestyle. Visitors on the other hand have a personal living experience in foreign cities. That implies that apartments are not used by one household anymore.
Another example is Spotify. A decade ago, people had to buy singles or albums to listen to their favorite music over and over again. Now they can listen to several million music hits wherever and whenever they want, by paying a monthly subscription fee. The key essence is that the user does not own the music but have the right to use it.
Shared mobility market
Since the mobility market - especially the car industry – is also in great change towards shared economy, key players such as BMW Group (DriveNow) or Daimler AG (Car2Go) also adapted their way of understanding customers and therewith change their way of doing business.
Reasons for that shift in customer’s mindset seem to be obvious: Overcrowded streets in (inner) cities, a chronically lack of parking spaces and a growing infrastructure in substitute mobility services such as train, airplane, coaches, etc. Furthermore, the penetration of the market by digital mobility solutions like Uber or MyTaxi, but also Emmy Scooter (scooter sharing service) or digital bike rentals have made the ownership of a car less attractive in recent years.
Therewith it’s not surprising that the global mobility on demand market is set to grow from its current market value of more than $100 billion to over $200 billion by 2024. The main regions are Europe, China and USA.
Share Now
Big players in the car industry such as BMW or Daimler have already reacted years ago to that trend. Both initiated simultaneously their car sharing services Car2Go and DriveNow in 2011. The market was characterized by a high price competition and razor thin margins. Furthermore other big players in (digital) mobility services such as Uber gained more and more in power and scope for action.
Reason enough for BMW and Daimler to take a big step in their companies’ histories. In early 2019 they merged their car sharing daughters to the biggest car sharing provider in the world, Share Now. Together they act in 30 Cities in 14 countries, providing a total fleet of 21.600 vehicles.
From this strategic alliance all parties are meant to benefit. The merger will accelerate the growth urgently needed for such mobility services as well as reduce costs in the long run. Instead of competing each other Daimler and BMW bundle their forces to stay relevant in the main markets North America, China and Europe and to tackle the threat of being slowly outcompeted or quickly disrupted by other shared services (e.g. ZipCar, USA; EvCard, China) or taxi apps (e.g. Uber, USA; Didi Chuxing, China).
The urge of the merge is displayed in the following graph. Displaying that the car sharing market will rise from 7 million in 2015 to apprx. 36 million customers in 2025. Without the strong positioning of the new strategic alliance it probably would have been only a question of time that another strong player would have taken the chance to place themselves within the emerging market and gaining big market shares.
Conclusio
Considering the current sharing economy trend, Daimler and BMW set a secure base for operating successfully in the carsharing market. By encouraging synergies, transferring their know-how and cleverly investing their joint resources BMW and Daimler created a market barrier for potential new entrants. Moreover, they established a disruptive channel to freely promote their premium car series to a wider audience and probably converting them to buying customers in the future. No matter which trend will be prominent in the future the alliance created a foundation to be successful.
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Yours
Max
A very interesting post. I became interested in the "sharing economy" during the recession, around 2011. At that time it was usually seen as an "ethical" idea, but I think now it's simply a win-win. I was renting out a flat, which had a private parking space that the tenant did not use. I found a website that allowed me to rent out the parking space, and I've been making a small income from it ever since.
However after a while the website that facilitated the parking space rentals was taken over by a multinational company, and problems crept in, eg, they would hold onto customer payments for weeks, etc.
I also found employment managing flats that were rented out via Airbnb. In the early days, this was a friendly, almost backpacker service where you met interesting people. Over the years it turned into a kind of luxury accommodation service, and some customers had a really high-handed attitude. Now most Airbnb accommodation is high-end and expensive.
I still think the sharing economy can work, especially if it can be low-cost, flexible and decentralised.
Hello dear friend @mcnestler, thanks for sharing.
This is a great experience of the shared economy, it is a way for families to diversify their economy, gain profits and new relationships.
In the case of automotive companies I think that the economy is in constant evolution and companies are studying how to increase their wealth, if they see a stagnation in the traditional form they will undoubtedly try to innovate or migrate to an effective way of multiplying your income
This is the world we have and thank God for all the advances. Take care, friend.
Pr EV
Hey @ fucho80, thank you for your comment.
A great comment from you SIR :) I only wanted to add that car companies realized that their "old" sales model is not working 100% anymore. Therefore, they had to change their model in order to compete with other service provider like UBER.
Take care :)
Very interesting post, Max! I personally did not use car sharing so far. Maybe I will use it when I travel to a city by train or bus. But anyway . . . it is a big trend and is well accepted by people all over the world.
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Hey @actifit-peter, danke für dein Kommentar.
Ich glaube Anmelden kostet zur Zeit nix, dann kann man es mal ausprobieren.
Ist halt praktische wenn man mal in die Stadt fährt, aber mit den Öffentlichen zurück.
Steemit-Stammtisch z.B.
Ich wünsche dir eine schöne Woche.
Viele Grüße,
Max
Hey Max! Bei Gelegenheit werd ich das sicherlich mal ausprobieren. Bis dann und dir auch eine tolle Woche! Viele Grüße, Peter
Dear @mcnestler
Always the evolution must be given by how young people assume some responsibilities, that tendency was first given as you mention in shared houses and apartments. And as always others realize how we can transfer that marketing of things to share the economy of expenses.
Greetings from Venezuela.
Hey @lanzjoseg,
thank you for your comment. You are totally right. But it also reduces the price of possession because some people might only want to have the mobility factor :)
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This trend of shared economy is very interesting, totally contrary to the old thinking of many companies that have had to adapt in order not to perish along the way. What I see from this trend is that the sharing of resources protects the planet in many ways, leading us to a greener trend. Both in space (Airbnb) and in less carbon monoxide pollution, by using a shared vehicle (Uber and similar).
I could say that it is a win/win for everyone (including the planet). Hopefully, time will prove it.
Thanks for sharing