There continues to be a great deal of hand-wringing and teeth-gnashing from big business about encroachment from the sharing economy, and it’s likely to continue well into the future as these tech-driven businesses show no sign of slowing down.
Accenture’s advice to insurers continues to be to expand your ecosystems by partnering with startups and other ventures to broaden your offerings and expand your client base (see my blog post, “Transforming insurance: from an egosystem to an ecosystem”). To update an old saying, “If you can’t beat ‘em, add ‘em to your ecosystem.”
Smart traditional brands are bridging to the startup and sharing spaces to find their own role, and getting creative about ways in which they partner with the sharing economy for mutual benefit.
IBM’s recent Business Tech Trends study of more than 1,500 companies finds that “pacesetters”— businesses that excel in their goals—partnered more creatively with outside organizations and sought fewer traditional partners to add to their ecosystems.
Here’s a recent example of an old-school brand that had the foresight to connect with a sharing economy star.
Hotel giant Hilton recently announced that it is adding an Uber feature to its HHonors smart phone app, marking the first time that Uber has created a new native app for a partnership.
Hilton guests can set Uber “ride reminders” through the Hilton app or website and get automated notification on the day of travel to remind them when to request a ride. This is clever for Hilton because it doesn’t cannibalize any of a person’s hotel travel budget and offers a new, “hip” way to help people navigate.
The partnership also allows Hilton to tap into Uber’s local rider data, with Uber’s application program interface directing Hilton guests to area hot spots using its aggregate rider data in each city. That feature will release its digital guide on the app and will include 20 cities throughout the U.S.
It’s a pretty slick move on Hilton’s part – and signals a convergence between traditional corporations and the venture/startup community. Uber and Lyft drivers are already picking up and dropping off Hilton hotel clients. Why not piggyback on the sharing economy and attract millennials to a big brand that may not necessarily resonate with them?
I can think of lots of other creative team-ups involving traditional brands and startups—partnerships that will take the sting out of competing with them. How about an old-school rental car company like Hertz, which typically sells used fleet to interested buyers, making their fleet inventory available for a discount to Uber or Lyft drivers, allowing them to pay off the purchase over time by taking a percentage of the driver’s income?
Or how about a traditional hotel brand engaging its feared Airbnb competition by partnering with it to share custodial services with Airbnb sites – thus reducing costs for both companies?
The insurance industry should encourage and participate in creative ventures like these because it’s in our best interest to have both types of businesses alive and well – and buying insurance.
The old idea of “business competitors” has been turned upside down by the sharing economy. New partnerships and ecosystems that blend traditional businesses with startups can help everyone benefit.
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