August 23, 2017
By Antonino Benitez
With the continued rise of online businesses, like Uber and Airbnb, which play a major part in the global ‘Sharing Economy’ arena, protests against these collaborative platforms are increasing on an international scale – and the Philippines is part of the picture.
Back home, groups have expressed their negative sentiments against Uber and Grab. Considering the popularity of these companies and their wide usage (due to simple accessibility only requiring a device and internet connection), they have posed a threat to the traditional transport sector in the Philippines. To halt companies from gaining further traction, taxi drivers around the nation have recently allied to form DUMPER (Drivers Unite for Mass Progress and Equal Rights) blaming Uber and Grab for the substantial decline in the profitability of the taxi industry.
But the question is, are companies like Uber and Grab, and the sharing economy in general, really bad? Or has the new business model which has given consumers unparalleled service options, just brought an unfamiliar challenge to the old businesses as we know it?
What is the Sharing Economy?
Alongside many progressive concepts that have come into existence over the past few years, ‘Sharing Economy’ as a new way of generating business, has become rather prevalent; proposing new ideas on what we consume, and how we do so. Garnering skepticism from a number of sectors, the system has been scrutinized for its disruptive innovation (affecting traditional businesses), as well as for the actual term ‘sharing economy’. Also referred to as a ‘collaborative consumptive’ economy, in essence, it is rooted in the idea of sharing or renting out underutilized goods and services on a platform (usually facilitated by a website or an app), rather than buying from a central authority. Airbnb and Taskrabbit are among the many successful businesses within this field.
As mainstream companies continue to resist the idea, consumers, on the other hand, have countered with mainly optimism, as they benefit from the new opportunities such businesses create. Unlike traditional enterprises, where only two sides gain from a single transaction (the business and the consumer), the sharing economy allows three sides to profit – the business, the consumer and the brand partner. A brand partner may gain employment, or receive revenue by providing their assets for usage. True enough, companies such as Airbnb and Uber have given self-employment and entrepreneurial options to many individuals across the globe.
Collaborative Consumption in the Philippines
The Philippines, according to a 2014 study conducted by Nielsen was ranked 4th in the top 5 populations worldwide prepared to participate in the sharing economy. Despite the fact that economic giants like China make the Philippines’ sharing economy seem quite marginal in comparison, there exists a multitude of collaborative businesses, which may not necessarily be a household name for us Overseas Filipinos, but are quite ubiquitous in the lives of many Filipinos back home.
Leveraging the growing demand for a convenient transportation alternative in the Philippines, Grab (an initiative started in 2012, originally in Malaysia) has quickly branched out across South-East Asia, and is now known as the ‘Uber’ of the region.
For those seeking a truly immersive travel experience, Tralulu promises its customers authentic adventures, with local independent tour guides. Through this digital booking platform, visitors get to connect with the people, cultures, traditions, and languages in a variety of Southeast Asian destinations.
Good Meal Hunting: goodmealhuntingblog.wordpress.com
With many passionate foodies scattered all over the Philippines, Good Meal Hunting has been empowering Manila-based home cooks and entrepreneurs for more than a decade, through delivering their authentic dishes to those who crave a hearty serving of Filipino comfort food, or who have a palate for international cuisine.
Sulit PH is a 100% Filipino-owned and operated online marketplace that enables users to sell their secondhand belongings, as well as buy items for a substantially lower price. The platform also provides Filipino businesses with an online storefront, so they can benefit from more exposure and an alternative revenue stream.
Growing up, our ‘Kuyas’ were always there to offer a hand. Based on this simple premise, Hey Kuya provides services via sms. Users can simply text their ‘Kuyas’, requesting for any type of help. Whether booking a reservation for 2 at a restaurant, or sending your friend something special, Kuya’s got your back 24/7.
Carpooling has become more and more appealing to people because it is both practical and environmentally-friendly. The service is easy to coordinate – that is if you know the people you’re riding with, and if you’re in the same area. Tripid Philippines is an app that connects drivers and passengers heading the same way, from any place in the country.
iVolunteer Philippines: www.ivolunteer.com.ph
This organization particularly thrives on the notion of voluntarism, with the intention of helping the less fortunate. Although not operating within the conventions of the traditional business model, not having any monetary transactions, this company gives an alternative interpretation to the sharing economy – instead labelling it as an ecosystem. As suggested by their slogan ‘Every Filipino a Hero’, their simple and largely accessible online platform allows anyone living in the Philippines to provide aid, whether small or big, by connecting users to a network of volunteering opportunities.
Sharing Economy: Boon or Bane?
Indeed, the notion of a sharing economy has been frowned upon for its alleged flaws by some sectors. For one, some claim that businesses participating in this new model sector abuse the word ‘sharing’ because, ultimately, it is still a profit-driven exercise. Some have also questioned the ethics of such companies, since they are not regulated by an official government body, and therefore do not have the checks and balances that traditional companies have to comply with according to the law.
On the other hand, majority welcome the idea of the whole collaborative experience. In fact, studies carried out by Nielsen suggest that the South-East Asian populace is the most-receptive globally towards the idea with only 22% unwilling to share or rent out their assets (whereas, globally the figure is 32% ). The act of sharing or renting out assets that remain idle in homes is also seen as a positive sustainable move in the long run, lessening the production of waste. This also resonates with the world’s generation of millennials who favor more minimalistic lifestyles, preferring temporary service to ownership, as confirmed by a study conducted by Harris: “78% of millennials would rather choose to spend money on an experience, rather than pay and own something desirable.”
The sharing economy is also favorable for emerging economies, such as the Philippines, for its power to facilitate entrepreneurship, especially since only 7.3% of the population from ages 18-64 are current owners/managers of an established business, according to a census by the Global Entrepreneurship Model in 2015. Companies in the sharing economy not only make it easier for people to be their own boss, but also lessen the risk to establishing modest revenue streams. It is because of platforms like Airbnb that people have the freedom to work flexibly, whilst getting easy access to key resources to enter an active market.
Finally, there is the underrated upside of fostering a sense of community with your peers – something that might look minor in the grand scheme of things, but certainly a positive contributor to a mindset of international cooperation in the future.
In the eyes of many, the sharing economy has many favorable characteristics that cater to both the needs of the public and the future. However, one can argue that the system is not entirely perfect yet, as most world governments remain unsure of their stance on the situation. With several interpretations of this modern cooperative model to come, the future will be the ultimate test to its success.
Junior contributor Antonino is a straight-A student whose hair often gets him into trouble. A quirky character, well-versed in both the academics and the arts, he never strays away from his individuality. As he (not so) secretly fulfills his dream of becoming an astronaut, Antonino continues to walk through life hungry for new knowledge and in search of all things epic.
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