Tuesday, 19 November 2013
The peer-to-peer business model, Part IV
Part I What is the peer-to-peer business model?
Part II How does it work?
Part III Relating the p2p model to the internet business model
Part IV Impact of p2p
Part V How businesses can use p2p
Part VI Issues and what’s next
Let’s look at the impact of the p2p model; positives and negatives.
A company can use p2p to lowers costs, improve productivity, innovate and to improve sales. Perhaps augment its core business by tapping on the consumer economy or simply use it to improve business. Primarily though, it is used to engage potential clients. These were covered in part II and III. Evidently, it cannot be applied to everything. Those in the consumer space and where information is involved are candidates.
P2P creates a new class of business based on consumers, not consumption but production - the sharing economy. This is good for the economy and jobs. A new sector, there is much room to grow especially in Asia. And for a change, the consumer benefits as well, monetisation of consumer resources can only be good for the populace. P2P has given rise to a new consumer economy that should benefit any country.
But it threatens traditional businesses because they are being reimagined. Not always though. Because p2p creates an entirely new category of consumer-derived business, a luxury hotel chain could spin off a unit to handle less moneyed clients ala AirBnB model, thereby expanding its business footprint. Similarly a restaurant could facilitate enterprising home cooks, perhaps by first accrediting them, to offer private cooks. I’m sure there are better applications. But some types of businesses will be affected, perhaps those in the traditional consumer businesses especially in the services sector to do with consumer resources; travel, tourism, banking, consumer services (taxi, real-estate, car rentals, insurance, home services). The book industry could transform again, beyond the long arms of Amazon.
The middlemen sector, the basis of so many businesses and a huge part of any economy are especially affected. While the internet is already causing them pain (it makes direct trade easy), the p2p business model in particular will transform it another level. In a way, the new-generation middlemen are the online marketplaces but as this post explained (part I), they now serve mainly as an information business, not trading (but some still do). That’s redefinition.
There is no doubt we are still in a period of great change. We are moving away from the industrial age deeper into the information one. And as anything to do with change, it is disruptive. The sharing economy is another agent of change. This consumer-to-consumer business will have many sectors reimagined.
Economically speaking, there must be transformation since p2p adds an entirely new producing class, the consumers. One day it may contribute to the computation of a country’s GDP. But this can be taken advantage of, even now. The jobless youth, a seeming recent phenomenon in many parts of Asia would have another option for work. And to further the domestication of the economy, the middle class and below who have the most to benefit can earn extra. But first they must be given the opportunity. With p2p marketplaces still a novelty in Asia, agencies could promote this sector while the lawmakers take an enlighten touch ie.mostly keep out of the way for these firms. Besides production, monetisation of consumers’ spare resources can only be good as it better allocates use of resources. Previously unusable personal resources can now be put to productive use.
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