The currency of Shared Mobility is 'Reputation'
"Until the mid-1980s, our economy was commodity-based. In the 1990s, we moved to a service-based economy. Now, the sharing era has started. And in the brave new world where sharing is king, the coin of the realm is reputation.", says Seth Mattison, trendspotter and workforce strategist at FutureSight Labs. Seth Mattison spoke at the 2017 conference of the Automotive Fleet Leasing Association in Las Vegas. Key message: we must adapt our organisations accordingly.
Sharing is of course nothing new; it's mentioned, favourably, in the Bible. The fact that it's 'hot' now is because we're at a crossroads where economic circumstances make sharing attractive, and technological progress make it easy.
It all goes back to the Great Recession, which started in 2007. As the economic downturn ate into people's income, two trends emerged and reinforced each other: Labour Supply increased (as people were eager to work more to supplement their income) and so Consumer Demand shifted (people still wanted to consume, but didn't have the money anymore to acquire big-ticket items, such as cars or fancy hotel suites).
This was the birth of the sharing economy. It can be defined thus: a social and economic system driven by network technologies, which enables the sharing and exchange or assets (including locations, skills and mobility modes) in ways and on a scale never before possible.
Uber, Wework, Airbnb: these are some of the most recognised and most successful brands emanating from the shared economy. Each is valued at billions of dollars; none actually own any assets.
Looking at these and other successes of the sharing economy, we can distinguish four pillars:
- It’s about digital platforms that connect spare capacity with demand
- It’s about transactions that offer access over ownership
- It’s about collaborative forms of consumption
- It’s about branded experiences that drive an emotional connection
And the magical ingredient is: trust. What successful companies in the sharing economy have in common, is that they use technology to build trust between strangers. That is why trust in the 'collective us' is the ultimate determining factor in the value of a shared-economy company. The degree to which a community trusts a company is 'reputation' - and there you have it: reputation as the currency of the sharing economy.
You don't have to wait until tomorrow to understand the value of reputation. You can already see it in today's business environment. Glassdoor is a company with an exponential growth rate. It is where people share information and ratings on companies, employers and employees. A classic example is Uber, which doesn't just allow the user to rate the driver, but also the driver to rate the user.
As trust and reputation become increasingly pivotal in our economy - and our society - we can expect a future in which we as individuals will have a 'reputation score' that is as important as our social security number, or (perhaps more aptly) our credit rating.
Once Trust is earned and Reputation is established, we as consumers will be prepared to pay a premium for a better experience. In fact, in the U.S., the share of consumer spending on live experience has increased by 70% since 1987.
Here's how that works: consumers don't pay for the best flight to get somewhere, but do pay for the best experience when they get there. We don't want to pay a fortune for a taxi, but we are prepared to fork out money for a great experience at our destination. That's one reason why shared mobility is set to grow, and why reputation is such an important factor in shared mobility. We want to trust that we get the mobility experience that the reputation promises us.
For mobility companies to become successful in the sharing economy of tomorrow, Seth Mattison says, they will need to embed 'experience' throughout the organisation, both internally and externally. Key according to him is that we get rid of the Hierarchy Model that we've used since the Great Depression of the 1930s.
"We're used to living in a hierarchical, top-down model, in a world with clear leadership functions. But that is changing: in a world dominated by connectivity and sharing, non-hierarchical networks will become the dominant form. As more companies and more customers migrate to this connected network model, the shared experiences we will have need to be mirrored by a new model of shared leadership".