How are consumer behavior, consumption and expectations driving the movement known as the local on-demand economy (LODE)? It’s a key question, especially for increasingly buying-empowered millennials, which we unpacked at BIA/Kelsey NOW (video below).
The on-demand economy, like many two-sided marketplaces, is fundamentally driven by supply and demand. As covered when we dissected LODE unit economics, the demand is deeply rooted in cultural factors. That makes it somewhat of a constant.
So a lot of the strategy and the magic of LODE is in the supply. Put another way, the factors separating the winners and losers include how well they can bring together and create liquidity from previously disaggregated supply (i.e. Uber drivers).
That can include people’s idle time, knowledge, possessions and other things from which liquidity is being extracted. It’s about renting out your idle table saw; lawyers monetizing pockets of idle time throughout their day; or Uber matching you with a driver.
“It’s about sharing the things you have in your garage, attic and basement that are of value but being under-utilized,” said MyNeighbor CEO Brendan Benzing. “We want to see people borrow more frequently than buy, and that extends to skills and services. So it’s really about accessing idle capacity.”
Though most of the strategy is in the matching algorithms and logistics that manage supply, there’s still much to discuss when it comes to demand. For example, Benzing attributes the tempered thirst for ownership to the “hangover from the great recession.”
We also got to hear from a range of voices in the on-demand economy including Silicon Valley personality (and our de-facto millennial representative) Sarah Austin. And we unpacked PwC’s influential sharing economy report with its author who joined us on stage.
The full video of the mega-panel is below, and we’ll continue this discussion in full force here and at our upcoming conferences (starting with next month’s SMB show). This will continue to be a rapidly evolving topic we’ll sink our teeth into.