Will legacy businesses catch up with agile competitors?
The on-demand economy – a digital marketplace offering immediate access to goods and services often delivered by contract, or gig, workers – continues to grow and to expand into new industries. The emergence of on-demand services, particularly in the transportation, retail, lodging, dining and grocery businesses, is built on mobile technologies that are especially attractive to middle-income Millennials. The sector’s future is clouded, however, as some on-demand companies battle state and federal regulators and lawsuits. The ability of businesses to remain viable in the competitive, fast-paced world of the on-demand economy appears to rest on whether startups can compete against – or partner with – large, established corporations to secure and expand their customer base, attract investors and work with policymakers to develop supportive regulatory structures.
Some key takeaways:
The rise of the on-demand economy is changing consumer habits, supply chains, regulations, competition and investment.
Traditional businesses are grappling with how to respond to shifting consumer expectations and searching for ways to improve their supply chains to deliver goods and services more quickly.
The on-demand economy’s future may include drones or robots handling deliveries and consumers receiving goods even before they realize they need them, based on their buying history.
Resources for Further Study
Solis, Brian, “X: The Experience When Business Meets Design,” Wiley, 2015. An industry analyst addresses how customers are increasingly expecting meaningful experiences rather than simply a product or service, and how that is changing corporate brands.
Sundararajan, Arun, “The Sharing Economy: The End of Employment and the Rise of Crowd-Based Capitalism,” MIT Press, 2017. A professor of operations and management sciences at New York University explains how crowd-based capitalism might replace the more traditional corporate-centered economic model and the impact that may have on daily life.
Colby, Charles, and Kelly Bell, “The On-Demand Economy Is Growing, and Not Just for the Young and Wealthy,” Harvard Business Review, April 14, 2016, https://tinyurl.com/
Gevelber, Lisa, “Micro-Moments Now: 3 new consumer behaviors playing out in Google search data,” Google, July 2017, https://tinyurl.com/
Lazar, Michael, “E-commerce Statistics & Technology Trendsetters for 2017,” IBM, March 3, 2017, https://tinyurl.com/
Paine, James, “$57 Billion Dollar Opportunity: the State of the On Demand Economy in 2017,” Inc., July 24, 2017, https://tinyurl.com/
Reports and Studies
Lam, Chungsang Tom, and Meng Liu, “Demand and Consumer Surplus in the On-Demand Economy: The Case of Ride Sharing,” SSRN, July 7, 2017, https://tinyurl.com/
Maselli, Ilaria, Karolien Lenaerts and Miroslav Beblavý, “Five things we need to know about the on-demand economy,” Centre for European Policy Studies, Jan. 8, 2016, https://tinyurl.com/
Montgomery, Cynthia A., James Weber and Elizabeth Anne Watkins, “The On-Demand Economy,” Technical Note 716-405, Harvard Business School, September 2015, https://tinyurl.com/
Schiller, Zach, and Carl Davis, “Taxes and the On-Demand Economy,” Institute on Taxation and Economic Policy, March 15, 2017, https://tinyurl.com/
Taylor, Terry, “On-Demand Service Platforms,” SSRN, Sept. 20, 2017 (revised), http://tinyurl.com/
The Next Step
Crook, Jordan, “Favor, the on-demand service focused on Texas, picks up $22 million Series B,” Tech Crunch, Sept. 7, 2017, https://tinyurl.com/
Dahlberg, Nancy, “Need a fast fix? Home-repair app joins South Florida’s on-demand economy,” Miami Herald, March 15, 2017, https://tinyurl.com/
Solis, Brian, “Impatience Is A Virtue: How The On-Demand Economy Is Making Mobile Consumers Impatient,” Forbes, Nov. 20, 2017, https://tinyurl.com/
Dieterle, C. Jarrett, “The Last Frontier: The Online Economy And Alcohol,” Forbes, Sept. 21, 2017, https://tinyurl.com/
Rosenberg, Adam, “Target acquires Shipt, with plans to offer same-day delivery,” Mashable, Dec. 14, 2017, https://tinyurl.com/
Sharma, Rakesh, “Amazon Debuts ‘Instant Pickup’ on College Campuses,” Investopedia, Aug. 15, 2017, https://tinyurl.com/
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