In the summer time of final 12 months, I did a
video evaluation
of Lime and Bird, two e-scooter firms taking on the streets of Los Angeles. At the time, it appeared like an attention-grabbing novelty and a enjoyable strategy to get across the metropolis.
Since then, although, the mobility wars have exploded. Both Bird and Lime crossed the ten million journey mark in 2018, and Bloomberg experiences (paywall) that each firms have lately been valued at round $2 billion. What’s extra, new rivals have entered the house with varied tweaks on Bird and Lime’s mannequin: Jump, Wheels, and Motivate are all vying for primacy in micro-mobility.
But these firms are doing greater than providing a brand new mannequin for short-distance transportation in city facilities. They’re additionally creating a brand new craze within the gig financial system — one with attention-grabbing implications for the aggressive way forward for the sharing financial system.
The Evolution Of The Model
Every night time in Los Angeles, San Francisco and different cities the place these companies are standard, a military of individuals got down to observe down lifeless, deserted scooters and cost them up for money.
These “chargers” are unbiased contractors paid on a per-scooter foundation for his or her efforts. Chargers can use the corporate’s cell app to search out scooters, seize them, and cost them for a paycheck.
In the start, there was little variance within the mannequin — each for chargers and the scooters themselves. But the market is maturing, and new gamers are introducing improvements on each the product and the contractor aspect in an try and compete.
Take Wheels. Wheels is a newcomer to the trade that’s fixing loads of issues at present dealing with the present leaders. Instead of scooters, Wheels makes use of battery-powered mini-bikes with modular, replaceable components. This makes them extra accessible and bodily simpler to journey. But what’s attention-grabbing right here is that Wheels’s mannequin doesn’t simply enhance on the product aspect. It additionally takes into consideration the gig financial system staff that these firms depend on.
To be a charger for Bird and Lime, you need to take the scooters again house, cost them up in a single day, then drop them off at varied designated places earlier than 7 a.m. the subsequent morning. This works for a lot of, but it surely comes with drawbacks: Chargers should bodily raise up the scooters, they should have a home to cost the scooters, and to make a lot cash in any respect, you type of want a automobile.
Wheels takes a special strategy by having what they name “Transporters” merely transfer lifeless bikes to hubs. This means the function doesn’t require a automobile, a home, a 6 a.m. get up name or the power to raise the bike. It makes the expertise of being a Transporter simpler.
Wheels acknowledged that their platform serves two customers teams — riders and Transporters — so that they’re implementing innovation to enhance the expertise of each events. And whereas I have never seen as a lot concentrate on this facet, it highlights how the competitors is altering within the sharing financial system.
Double-Sided Competition
The mobility wars present us that within the sharing financial system, competitors has two sides.
It’s now not nearly satisfying your customers: While customers drive income, contract staff play a basic operational function for these firms, and which means improvements on the employee aspect can present the identical type of aggressive benefit by rising provide. After all, if nobody needs to cost your scooters as a result of it’s too onerous, there can be no scooters for customers the subsequent morning. It successfully turns issues right into a two-front struggle.
We’ve seen related ways previously with Uber. The New York Times did an in-depth examination (paywall) of how Uber had enlisted the assistance of social scientists to gamify the driving force expertise and used gamification and psychological methods to subtly affect driver habits. The Guardian printed a related piece exploring the practices at Lyft and Uber.
While the specifics of those firms are totally different, all of them exist within the sharing financial system and all depend on a double-sided consumer base: one base of consumers, who pay to make use of the service, and one other base of contract laborers, who earn a living by protecting logistics going. But successfully, each communities are nonetheless, basically, customers. And enhancements within the consumer expertise of both aspect are a aggressive benefit.
As the sharing and the gig financial system develop and disrupt extra facets of our lives, I anticipate we’ll see this pattern develop extra pronounced. The similar precept applies to supply companies like PostMates or Seamless. As new sharing financial system platforms pop up, they’ll face the identical panorama.
Recently, I wrote about how the sharing financial system modifications the character of possession, and we’re all aware of how the gig financial system is altering the character of employment. But as these forces develop, they’re additionally altering the character of competitors between the businesses and platforms within the house. Moving ahead, I consider firms that target bettering consumer expertise for all stakeholders — not simply finish customers — would be the ones that win.
In the identical means that app-based firms carry out consumer expertise analysis and testing to enhance the app design, they’re going to have to commit assets to understanding and bettering the expertise of their contract staff. They’ll have to ask contractors the identical sorts of questions they ask customers: what do you want concerning the work expertise? What might we enhance on? What are the ache factors? While this sort of analysis would not translate to new income as immediately or clearly, it nonetheless supplies a aggressive benefit by augmenting provide. App builders already understand how to do that, because it’s completely necessary for finish customers. Now, sharing financial system firms ought to apply the identical rules to the opposite aspect of their consumer base.
In the digital world, competitors is more and more double-sided — and corporations might ignore this solely at their peril.