The sharing economy has quickly overtaken many business sectors. To be successful in the sharing economy, a company must adhere to four core principles that also define successful entrepreneurship in general:
- Greater efficiency – there is a technological solution for almost every day-to-day operation. An upfront investment in new technology can increase total output and/or reduce expenses, leading to greater profit in the long run.
- Trust – trust must be established between buyer and seller. Time spent getting to know who consumers are and what they want allows for tailored communication and marketing strategies that improve trust.
- Innovation – innovation is important; however, not all innovation requires new ideas. Thinking “outside the box” and adopting strategies from other industries gives consumers greater service and changes their expectations. As innovation requires versatility and risk, it is important that companies not be afraid to fail.
- Active community – the sharing economy is built around dissemination and scalability, which isn’t possible without an active community. One of the easiest ways for entrepreneurs to build a community is through active engagement online (Twitter, Facebook, Instagram, etc.). By facilitating two-way communication, a company can build a community and establish brand loyalty.