The re-invention of consumption

Sharing can be the new economic paradigm

Consumption is certainly a contested topic. In light of the fact that our planet's resources are finite, we are all aware that aggregate levels of consumption urgently have to come down. But it is hard to know where the “cuts” will come from, and in the past individuals have been discouraged to take action both because of the lack of and the overload of information necessary to make conscious choices.  An alternative solution to “sustainable consumption”, which is associated with minor reforms and incremental changes in behaviour, is the reinvention of consumption itself.  That is the promise of collaborative consumption.

The concept of sacrifice and the shift to more frugal lifestyles has been central to the sustainability debate. However, such debate is often accused of being embedded in a “Northern” perspective and fails to address distributive justice (who sacrifices what) and to envision innovative social configurations and economic paradigms.

Moreover, as long as the question is posed in self-sacrificial terms, individuals will be confronted with an apparent trade-off between personal and broader social well-being, and it is farfetched to expect they will systematically choose the latter.

An alternative scenario, proposed by the movement of collaborative consumption promises to overcome that obstacle. It is a new economic groundswell based on collaboration and efficient resource use which is emerging engendered by a convergence of factors other than environmental awareness, like the economic crisis and the maturation of social networks.

With the evolution of the social web, what started as experienced users sharing code (Linux), evolved to regular people sharing media (Napster), content (Wikipedia) and later their own lives (Facebook). Now, people are already moving towards a new stage, which is characterised by the use of the same technology to leverage the sharing of real physical assets.

In the book What is mine is yours, Botsman and Rogers describe this movement as “traditional sharing, bartering, lending, trading, renting, gifting and swapping (…) redefined through technology and peer communities.” The main idea behind collaborative consumption is that people often have underutilised assets, from physical goods and space, to intangibles like time and skills, and eventually they are discovering new marketplaces to tap into that “idling capacity” whilst engaging in their communities.

There are two major implications of this movement for the current economic structure. The first one is the creation of a new paradigm of service-based businesses. As companies start to realise that consumers want the benefits provided by products without the burdens of ownership (storage, insurance, disposal, etc), revenue streams will be based on membership and access instead of physical sales. That is already the case with companies that offer car sharing (Zipcar), rentals for toys (Toylib), clothes (Fashionhire), academic books (Zookal), to name a few.

One consequence of that change is the end of programmed obsolesce. Once companies are responsible for the upkeep and disposal of products, designers will have an incentive to think of long-lasting, reusable materials and goods that can be continuously upgraded. A video recently released by the Ellen MacArthur Foundation describes how this new scenario could shift the way we think about economies from a linear to a circular approach.

A second implication is that secondary peer-to-peer markets are being created with the help of communication technologies, enabling people to share (Getaround, Neighborgoods), swap (Netcycler, threadUp) and redistribute (Freecycle, Reuseit) their pre-owed goods and bypass the corporate middlemen.

Beyond the consumption of products and services, collaboration is becoming a lifestyle. Again with the help of technology, people with similar interests are getting together not only to exchange goods, but also to share skills (Skillshare, Streetbank), time (Timebank, Quid), space (Airbnb, The hub) and even money (Zopa, Prosper).

Those platforms can redefine the concept of neighbourhood and community and enable online connections to have meaningful results offline, by encouraging people to get to know each other and creating networks of mutual support.

Although this movement may seem confined to rich countries and those who are able to access technology, the disruption of the old ownership model has potential to increase poor people's capabilities, by facilitating their access to different services, either via community, like it is the case with local upcycling projects such as Maya Pedal, in Panama, or via technology, as it is the case with peer-to-peer micro loans such as Kiva.

An entirely new generation of enterprises is taking shape based on those principles and they are sprawling all around the world. Not in a structured fashion, but at great speed nonetheless. And it is very likely that they will revolutionise the way we understand, theorise and experience economies.