A business is successful depending upon many factors – Having a good vision of the company, imperative knowledge of the future economy, having a team backboned with experienced and specialized people, and a great leader to get the ball rolling.
As we all know that sharing economy disrupting the existing business model and changing the way we rent and share stuff with others. Business owners foresee it as the next industrial revolution and set their footing towards it.
Before starting your own sharing economy platform, you need to be aware of the critical factors to grow and be successful in it. And that’s what this post is about. Let’s go through one by one and examine it.
Choose a scalable idea for your sharing economy platform
Growth is the main goal of any business!
Choosing a scalable business idea is essential as that helps to sustain your business and gain profits in the long-term.
But how to find out if your sharing economy platform is scalable?
A sharing economy platform resolving people’s problems and elevates the burden of a mass audience is sustainable in the long run.
If you take Uber, it reduces the burden of booking a ride for a short distance. People can now book easily in a click and travel in comfort.
Take Airbnb for instance, the business model is completely innovative, giving stiff competition to the hotel industry, as they represented as an alternative to staying cheaper and feel of being at home. Customers found it viable compared to other options.
Balance the providers and Consumers
This is the classic chicken-egg problem. A marketplace can function smoothly if there is a minimum number of customers and providers in the marketplace.
The platform owners should concentrate on building enough supplies(i.e Providers or Host) to provide service to customers. Calculate the minimum number of Providers and customers required by estimating the liquidity of the marketplace.
The liquidity known as the percentage of transactions happens in the marketplace at any given time. The higher the liquidity, the higher is the profit.
Determine the liquidity of the marketplace based on the company target and accordingly invest time in roping providers into your marketplace.
Focus on devising strategies on acquiring providers and customers and retaining them inside the marketplace.
Build a Safe and Secure sharing economy platform
Customers naturally approach a platform if it is trustworthy, safe and secure to use. It is an innate quality of humans to be safe and secure.
The marketplace owners should assess possible risks might arise in the marketplace and take measures in reducing them.
To build a trusted marketplace, one must employ various methods such as:
- Verifying the provider’s identification details
Details such as their identity and if the marketplace deals with their concerned assets such as car, home, bike, etc. Doing a background check can be necessary to avert any risky situations.
- Keeping customer reviews
Reviews can help in identifying the bad apples from the good one. Customers before booking any service from the marketplace will be well aware of the quality of the provider’s service.
- Building an appealing website
Marketplace website/app a user first checks to judge the service. If it is neatly embellished with all the crucial details such as the location, phone number, help support, and the succinct information of your provided service, it helps to build trust in the marketplace.
Keep your loyal customers happy
Other than acquiring new customers to your marketplace, you have to look after the existing ones who are loyal to your sharing economy platform.
For instance, you have booked an Airbnb home in Sacramento when visiting and felt extremely happy with the stay and service, obviously, you would give a good rating and recommend to people in your social circle who is going to make a trip.
Making one customer happy invites a few new people to the marketplace. Imagine keeping 10 or 100 or 1000 loyal customers happy. Your loyal customers can be a hook to acquire new customers.
Have a smooth transaction process
The booking flow is the integral process of the marketplace. Normally, the process of the booking flow in a rental marketplace is:
- The customer chose a suitable service from a list of choices.
- Book it for further processing.
- Provider gets notified of the new booking and looks for availability.
- If it’s available, the booking gets confirmed or the provider rejects the request.
- After the confirmation of booking, the customer pays for the service and the service happens at the mentioned time.
- After the end of the service, the platform deducts a small commission and the remaining amount transferred to the Provider.
Design the booking flow to provide a smooth transaction flow where the user has to experience few seconds in booking and money transactions.
For instance, if your marketplace is an on-demand service, the transaction should be fast and secure for both the provider and customer to safely use the platform.
Using multiple payment options would be beneficial for the platform as it builds trust among users, as they feel of having an option to choose their trusted payment service.
Some people prefer using payment services providers like PayPal or Stripe as it represented as a trusted payment service mode within users.
Online and offline presence of your sharing economy platform
Even if you built your business using the latest technology, the marketplace never gets visibility if it isn’t properly marketed to consumers.
Marketing your sharing economy platform both in online and offline boosts the visibility of your service. The more people are aware and understand your sharing economy platform, the more people would easily find it relatable and recognizable.
Effective advertisement time to time would increase recognition and also helps in retaining the existing customers on the platform.
Basic things to start from is:
- Advertising your platform online through social media and search engines. Offline such as television, billboard, at local events, etc.
- Taking care of SEO of the website.
This blog post delivers the main critical factor for the success of the sharing economy platform. The points to remember are:
- Choose a scalable sharing economy business idea.
- Balance the providers and consumers ratio who sign into your platform.
- Build a safe and secure platform for both providers and consumers.
- Have a smooth transaction and booking process.
- Build a good presence of your marketplace in both the online and offline worlds.
To build a successful sharing economy platform with the superior technology, RentALL, an airbnb clone, be a perfect solution.