MKTG2023 Chap.8 Platforms and the Sharing Economy
Platforms and the Sharing Economy
Access instead of ownership
Eckhardt and colleagues define the sharing economy as a scalable system in which technology-enabled platforms let users reach physical or intangible resources for a limited time, often supplied by a crowd. Five characteristics define it: access for a limited time, a real transfer of economic value, a platform in the middle, consumers who also supply, and capacity drawn from the crowd.
Reputation systems and peer-to-peer exchange are typical but not defining, and providers sit on a continuum rather than in or out.
Distribution without ownership
A platform distributes a service it neither owns nor stages in a setting of its own.
Consumers become prosumers who produce, promote and rate the service, and the platform has no legitimate authority over the independent providers who make up its capacity.
That is the sharpest contrast with franchising, which governs by contract.
Quality, trust and regulation
Guaranteeing quality across a decentralised, changing crowd is the central challenge, made harder by uncontrolled settings, leakage off the platform and weak norms.
Reputation systems carry trust between strangers but are imperfect, and regulators weigh lower prices and flexible work against labour, safety and tax concerns.
What this chapter covers
- 01
Defining the sharing economy
- 02
The five defining characteristics
- 03
Typical but not defining traits
- 04
Prosumers and crowdsourced capacity
- 05
Traditional channels versus platform channels
- 06
Quality, trust, leakage and regulation
Worked example · free
Test a car-pooling app against the five characteristics
- 1Temporary access: present, a rider uses a seat for one trip.
- 1Transfer of economic value: present, the fuel contribution is a real payment rather than a favour.
- 1Platform mediation: present, the app matches drivers and riders and handles payment.
- 1Expanded consumer role: present, drivers are also consumers and both sides rate each other.
- 1Crowdsourced supply: present, capacity is pooled from many private drivers.
- 1With all five present, the app sits at the archetypal end of the continuum.
Key terms
- Prosumer
- Consumer who also acts on the supply side, producing, promoting or quality-checking a service, as sharing-economy users do.
- Crowdsourced Supply
- Aggregate service capacity pooled from many independent individuals rather than from resources a firm owns.
- Platform Leakage
- Loss of transactions that occurs when a provider and user meet through a platform but then deal with each other directly.
- Reputation System
- Ratings and reviews that build trust between strangers and stand in for formal quality control on platforms.
Platforms and the Sharing Economy FAQ
Is every company with customer ratings part of the sharing economy?
No. Reputation systems are typical of sharing-economy firms but do not define them, and the lecture’s example is an online auction marketplace that uses ratings yet is not part of the sharing economy. Classification depends on the five defining characteristics, tested one at a time.
Why is quality so hard to control on a platform?
Providers join and leave at will, so monitoring at scale is far harder than in a franchise network. Service happens in settings the platform never designed, users may match on the platform and then trade off it, and community norms are too weak to govern behaviour alone. Ratings help but suffer from bias and inflation.
How does a platform channel differ from a franchise?
A franchisor licenses a format and controls quality through contracts, training and monitoring, and franchisees work within a servicescape the brand designs. A platform relies on independent providers who are neither employees nor franchisees, cannot fully govern them by contract, and builds trust through ratings and algorithms instead.
What is a prosumer in the sharing economy?
A prosumer is a consumer who also acts on the supply side. In platform services the same person can drive on one day and ride on another, promote a service by sharing their experience, and control quality by rating the other party. The lecture adds that prosumers both evaluate and are evaluated, and that comfort with the role varies.
Assessment move
Pick two apps you use and fill the workshop table for each: the five characteristics as present, partly or absent with evidence. Place both on a continuum line. Then name one fail-point in each journey that the platform does not control and propose a fix tied to a theory from the lecture.
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