ServiceFriday: Let’s Share – The Trend of Millennials Using Shared Services

Sharing economy, also referred to as access-based consumption, is a relatively recent but massively growing consumer trend. Zipcar, Uber, Airbnb, Spotify, and Rent the Runway are just a few examples of access based consumption. A research paper in the Journal of Service Marketing by Adesugun Oyedele and Penny Simpson examines these sharing systems and the implications for millennials’ willingness to adopt this trend of using versus buying. 

This trend is expected to grow swiftly, “from $15bn in 2013 to $335bn in 2025.” Millennials, or emerging adults, who are in the life-stage between adolescence and adulthood (approximately between 18 and 29 years old) have shaped this trend. Oyedele and Simpson examine the role of emerging adulthood, shareaids (apps that facilitate shared transactions such as Splitwise), and the perceptions of social utility value on access-based consumption.

The study shows that flexibility utility has the greatest impact on intention to use shared services. This means that users’ access to many options and the ease of switching choices at any time or place were the most important factors for using shared services. Additionally, flexibility has indirect effects on familiarity and transaction utility.

Surprisingly, in contrast to existing research, the perceived deal value, or transaction utility, had no direct significant effect on intention to use shared services. This suggests that an economic or cost advantage over competitors (or ownership) may not suffice to motivate emerging adult consumers to use a sharing service. It is factors such as flexibility and familiarity with the service that are more powerful in determining the usage of a service. This is why managers should consider promoting the advantages of a shared service rather than the financial benefits, and should also initially create the opportunity for greater familiarity with their service, for example, by using trial offers.

Uniquely, the study examined the effects of shareaids (noted above as online apps that facilitate and promote transaction utility) to find they hold strong importance in effecting social utility. This result is not surprising considering that shareaids facilitate group-based consumption. Managers might want to enhance the usability of shareaids or improve their shareaid features. “An example would be to allow users to create and share a profile, as does the Tinder dating service, and then allow customized sharing experiences based on the profiles.” Shareaids provide users with greater convenience utility and also influence others to use the service.

To access the article in the Journal of Services Marketing, visit this link at Emerald Insight:
https://bit.ly/2JzrGfk (A fee may apply.)