Transformative Business Models : A case from Collaborative Consumption

The study’s purpose is to describe the growth process of Collaborative Consumption (CC) platforms and to identify the challenges of establishing an innovative matchmaking business model. This paper takes a lens of the customer approach to understand how to develop value propositions to satisfy users of CC platforms and their value co-creation process. In a CC network system, users exchange, redistribute or share existing products. In 2013, revenues from CC increased by 25% (Geron, 2013), with rentals as the greatest share of business models, e.g. car sharing. Therein, consumers seek access rather than ownership (Bardhi & Eckhardt, 2012). Rental services, a way for consumers to co-create value by sharing existing products that are only temporarily needed, embed the sharing paradigm (Lovelock & Gummesson, 2004), as well as the service logic. In this sharing paradigm, service organizations create online marketplaces enabling peer-to-peer exchange of product-service systems (PSS), i.e. sharing the value proposition with other consumers, instead of owning a product. The organic growth of structured sharing platforms to exchange services is the epitome of CC business models. CC dilutes the link between ownership and value in use; today’s defacto standard in consumption-based economies. This “sharing economy” is being revolutionized by ICT development and follows the societal urge to reduce the environmental impact of consumption (Belk, 2010). It disrupts traditional product industries by challenging established business models; not only because consumers follow the economic rationale of saving costs, but also because of its positive socio-environmental impacts (Botsman & Rogers, 2010). To provide and maintain a high quality service, CC platforms must reach a critical mass. This means having a well-balanced PSS with enough satisfied users to support the service delivery. Adoption rate is a fundamental problem, as limited initial service delivery capabilities prevent CC to become mainstream. Our case study of a car sharing platform expanding its service in Scandinavia shows that car sharing can be identified as three sustainable service offerings: car pooling, renting, and leasing. These services are based on business models that transform throughout maturity. Creating the initial demand or sustaining the supply of PSS, require CC platforms to develop transformative business models