5 Ws of the sharing economy: How social data gives marketers a competitive edge
Why should you be paying attention to the sharing economy? Columnist John Donnelly III dives into the social data behind the sharing economy's explosive growth and what marketers stand to gain from it.
Not long ago, when you needed a ride in your city, you’d call a cab — completely unaware the market could offer another option. When you were booking a place to stay for an upcoming trip, your mind probably wouldn’t wander beyond the idea of a hotel. Today, however, the sharing economy is so deeply entrenched in major industries and consumers’ lifestyles that it’s almost hard to remember life before Uber and Airbnb.
Multiple factors played a role in this cultural takeover: the reasons why mainstream consumers engage with sharing-economy businesses, how different demographics perceive the trend, and the growing competition between traditional organizations and sharing-economy alternatives. To capitalize on trends and thrive in the modern business landscape, marketers need to understand and accommodate these elements.
Luckily, there’s an in-depth record of the “who, what, when, where and why” factors that drive this economy’s growth: social media data.
Who are the major vendor and consumer players in the sharing economy?
Organizations catering only to a sharing-economy model have steadily increased with the amount of consumers expressing interest in them. However, Airbnb has become the poster child for the trend, generating 70 percent of the social conversations in the last five years, more than any other companies in its space, according to research by my employer, Crimson Hexagon (registration required).
By using social data to track which sharing-economy services have the most influence over customers, you can better inform the type of promotions, contests and other marketing information that your brand shares.
On the consumer side, gender and age have much to do with the customers supporting the sharing economy. For example, we found that consumers under 25 had 72 percent of total conversations about Airbnb and other home-sharing organizations between 2010 and 2015, although older generations were actually more likely to have positive conversations about such services.
Meanwhile, men account for 60 percent of social interactions about home sharing, but their focus differs from female-led conversations. Male consumers tend to discuss verification processes and express frustration about plans gone awry, while women discuss advice and recommendations for travel planning, legal issues and trustworthy services.
What draws users to engage in the sharing economy?
Most sharing-economy brands base their messaging around convenience and low costs. Those factors certainly resonate with audiences, as affordability and convenience are the top reasons consumers prefer the shared business model. However, factors like unique experiences and better options than what traditional industries offer also play a major role.
Knowledge of the reasons why customers participate in the sharing economy is a critical tool for every marketer. By learning more about their users’ driving factors, brands can build detailed buyer buyer personas, new products and services and craft marketing messages that speak to customers in the language and messages — and on the channels — they’re already interested in.
When did the sharing economy become ubiquitous in our culture?
In 2010, social conversations about the sharing economy were confined to a niche audience, which was almost entirely based in the US. By 2015, there were more than 25,000 global posts each month on Twitter simply focused on the home-sharing industry. Those five years completely disrupted once-steady industries and fundamentally changed the way millions of people consume services.
For brands, the most remarkable aspect of the sharing-economy boom is simply its pace. In a rapidly growing market, it’s vitally important for marketing messages to be perceived as timely and informed — if not, they risk appearing outdated, out of touch and not worth consumers’ already fleeting attention.
Where are sharing-economy conversations taking place?
Throughout the trend’s rise in popularity, Twitter has been the top social channel for conversations about the sharing economy. However, users are increasingly using online review sites, photo-sharing apps and forums to compare prices, experiences and opinions about everything from travel destinations to dog-walking services.
Combining the information available on public review forums, blogs and Twitter and other social channels helps paint a complete picture of users’ preferred aspects about the sharing economy. If your brand is building or partnering with a sharing-economy service or gearing up to compete with an industry heavyweight, this consumer-driven data can serve as a direct line into your customers’ previous experiences in the space, which can make branded content all the more relevant.
Why should marketers care about the sharing economy?
Beyond convenience and cost benefits, the sharing economy was able to take hold because consumers were ready to rise above the norms of industries that had begun to feel stuffy, such as travel and hospitality. Every space becomes ripe for change when consumers feel trapped by limited options.
By taking a cue from the factors driving users to participate, engage with and support the growth of the sharing economy, marketers can ensure they’re actively listening to their customers’ needs and pivoting as needed to succeed in a changing sharing economy climate. And when brands take heed of customer insights, they’re able to attract and convert customers using direct, meaningful messages and promotions that hit their intended mark and increase the company’s bottom line.