Monday, 2 March 2015

Google Targets the Collaborative Economy

The term ‘collaborative economy’ has been floating around a lot in the past few years, with companies such as Airbnb & Uber transforming their respective industries by providing services as you need them, and through much more efficient (and usually cheaper) means. For those of you unaware of this term, it basically refers to an economic model within which people obtain goods and services from their peers – ranging from food, money, accommodation, transport and basically any (reasonable) good or service they may require.

Although Airbnb, Uber and oDesk have been at the forefront of the collaborative economy, it seems that Google is now gearing up to join them and will play a major role in this market going forward. Not only is the technology giant literally joining them (Google initially invested $258 million in Uber and is partnered with Airbnb), it’s also developing it’s own offerings to rival these businesses, and to provide solutions to other consumer problems that are better met within a collaborative market.

The most intriguing venture that Google has taken on is the ‘Google Self-Driving Car’ project, which as the name suggests, involves developing autonomous cars. Where this really hits home from a marketing perspective is how it’ll change consumer purchase behaviour within practically every industry imaginable. The automotive market is perhaps the first, with there most likely being a turnaround in car ownership as people begin to share or rent cars when they need them, as opposed to owning them outright. Other industries that may also see a complete turnaround are the fast-food, clothing, and grocery industries, with people becoming even less inclined to actually go and shop in person, and instead order and have good and services delivered to their homes.

The Google Self-Driving Car Prototype (Source: BBC UK)

It’ll probably be another 5-10 years before the Google Self-Driving Car and other technologies in this market really come into play, but it’s eye-opening how many industries are likely to be overhauled by the collaborative economy. What this does suggest is that in many cases, we as people are better able to meet each others needs by sharing and collaborating, instead of relying solely on third party sources. Although the collaborative economy won’t be the answer to all our problems, it does seem to address some, and is doing a pretty good job of it too.  

To read more about Google’s recent investments in the Collaborative Economy, visit the Web-Strategist blog.

By Salil Kumar
Current student in the Master of Marketing program at the University of Sydney Business School

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