Opportunity for Enterprise Software in a New Category
I see a market opportunity and I want to get the word out to entrepreneurs and innovative brands. The number of collaborative startups that support lending, borrowing, funding, trading, or gifting of products and services is on the rise. Brands are at risk of falling behind or missing the opportunity altogether. This is a significant business opportunity for entrepreneurs and venture capitalists to create a platform that will enable brands to take advantage of this movement.
We’re more than halfway through the interviews for our next report on the Collaborative Economy and what it means to corporations. I’ll be sharing in a keynote address at Leweb. One thing is for sure: This trend is unstoppable.
Here are some early clues from our analysis of 200 startups:
- There’s been over $2 billion of funding issued. Those who have been funded have received close to $28 million each on average. These startups aren’t going away.
- We’re seeing brands starting to participate. In particular, innovative Wal-Mart is considering allowing customers to deliver products to each other in order to compete with the giant known as Amazon.
- The macro trend is societal. As consumers possess fewer resources and less land, and as population increases, we will rely more and more on trade and barter systems.
Use Cases and Scenario
The goal is to enable brands to directly rent or lend their products and services to the market or to build a community that enables its members to do so on its behalf. Imagine a branded Hyatt or Hilton version of AirBnb that rents out luxury guest rooms in a neighborhood where you are traveling, or a branded service of local talent for rent by Manpower, Kelly Services, or IBM services . Or imagine renting your neighbor’s Lexus, powered by a version of Lyft or Zipcar that’s hosted by Toyota. This trend isn’t all that new. Over six years ago, we saw the rise of branded Online Communities, which was comprised of 125 startups. Today, the leading players include Jive, Lithium and Telligent.
There are a number of features that must be included any collaborative venture in order to succeed, including an online marketplace or community presence, reputation control, ecommerce capability, APIs to connect to other programs, and an aggressive marketing plan. A professional services team for integration and implementation will be necessary, as well as strategic services to educate and provide profession-level direction . There are also opportunities for digital agencies to provide branding and content, as well as communications teams to launch and seed with ongoing media air cover.
Players that are already on the field could assemble these features rapidly. These include social commerce vendors known for ratings and reviews, such as Bazaarvoice which already has over 50% of the retailers on their platform or Lithium, or Jive. These are branded, community software and social management solutions that leading enterprise companies are already using. I can also foresee that the Salesforce developer ecosystem could quickly put these tools together into a platform and brand for leading companies like Burberry. I do think, because most of these players are entrenched in their current business models, that they will not pivot fast enough, so there’s room for a scrappy, early-round startup to emerge, disrupting the space.
So there you have it, from your trusty Industry Analyst. There’s a blue ocean market opportunity on the horizon, and I see zero players to date.
As vendors emerge, I’ll cross link below.
- May 29th: Bazaarvoice published the first thought piece, indicating this is an opportunity for brands. They are first-to-market with thought leadership from the social business category.
19 Replies to “Blue Ocean Opportunity: Branded Collaborative Economy Software”
Faster than real time
Now that sounds familiar.
Thanks Chris for sharing this perspective of a workbench that enables developers to do this.
When technology becomes transparent, it’s all about agendas and culture – as you rightly point out.
Jeremiah, great thoughts and huge opportunity identified.
I think another aspect of a collaborative economy in addition to shared products/services is far greater collaboration between brands and consumers. The ability to learn from, ideate and market with consumers in real time is where marketing is headed.
Crowdtap’s latest white paper, The Collaborative Marketing Future focuses on this http://www.collaborativemarketingfuture.com.
Thanks Brandon for joining the dialog. I agree that collaborating on products is part of this, and nearly an impossible use case to avoid in future.
The collaborative economy also includes the “Sharing” economy where brands will need to enable customers to share products among themselves.
Related offering: http://labs.connectme360.com
Here’s what’s awesome about this. Shirky said (paraphrasing) “Human motivations change little, but opportunities change a lot.” We’ve always wanted to share, collaborate, etc. But the costs and risks were too high, and access to likeminded others (and markets for our goods and services as independent agents) was too difficult. That’s where this wave you’re identifying comes in. Quite simply, it helps people do what they’ve always wanted to do. Brands can play a role, or they can run away–but since the human motivations are not going away, and the market opportunity is being articulated, they should dive in.
VERY interesting concept. I would be interested in digging deeper to understand the ecosystem at an operational level. How would companies leverage their current ecosystems and maintain operational execution on delivery of their overall business strategy and brand.
Seems like a natural extension of networks and their effects. And sign that our comfort zone and trust in these kinds of transactions is ever increasing.
Would be great to hear your thoughts – and what you uncover while talking to companies – on inherent or perceived risks of letting go of control over distribution etc.
Where are the boundaries of these kinds of ecosystems most safely drawn? From a brand’s perspective?
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