Businesses deal with disruption in a variety of ways, but those affected by on-demand seem to realize now that these new digital platforms are an actual threat.
The on-demand economy is defined as the economic activity created by technology companies that fulfill consumer demand via the immediate provisioning of goods and services
Tap a button and get the world, sounds revolutionary right. That is what is being promised by emerging on demand platforms emerging in different verticals today.
For the uninitiated, the “on demand economy” (also known as access economy) is built on top of a technology infrastructure that brings the online and offline world together. Demand that is aggregated online is serviced offline either instantaneously or in a scheduled manner. This broad concept finds application in different industries in slightly varied forms.
On-demand refers to services like Uber and Airbnb. Each provides a digital platform to give instant access to a taxi or room rental.
What is revolutionary about on demand economy is how it takes a full cycle approach – search, discover, book/schedule, consume, pay and review – to consumers needs – making it a much more efficient way of consuming services.
The ground transportation industry disrupted by the on demand economy
In January 2016 San Francisco’s biggest taxi company filed for bankruptcy. Bear in mind this is a protected municipal monopoly that up until several years ago faced no competition whatsoever. The heady world of digital delivery changed all that as ridesharing services like Uber and Lyft have taken a serious bite out of long-established businesses.
Cabs or taxis have completely shifted to the on demand model. Many existing taxi companies have launched their own apps making it easy for their customers to book a cab.
Apart from cabs, technology driven platforms have made it possible for people to rent their own cars on an hourly basis and car-pooling platforms are enabling people to travel together and save fuel.
But it won’t stop here – Industries being disrupted by the on demand economy:
On demand In store reservations - Online table bookings
Recipe and ingredients delivery
Hire freelance chefs to cook and deliver with freelance delivery staff
Doctor visits patient at his location
Local goods deliveries with crowdsourced workers
Outstation cargo deliveries by hiring drivers who own trucks
Cabs on demand
Ridesharing platforms or car pool
Transport vehicles on demand like trucks, vans etc.
On demand valet parking
The on demand economy is definitely the future
The on-demand economy is rapidly expanding across the global economy. The size and rapid growth of the on-demand economy clearly shows that consumers are attracted by the user experience, added convenience and other benefits it provides.
The rise of the on demand economy
While new technologies continue to provide the ability to transform business models, effectively engage customers and make business operations more efficient, the majority of organizations were still struggling with the basics of digital transformation.
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