Competing With the Sharing Economy: Overcoming the Challenges Faced by “Traditional” Providers

Abstract

Consumer participation has made the sharing economy an economic wonder, creating valid competition for traditional service providers. Using the self-determination theory, we examine why both consumers and peer-providers engage in the sharing economy. Two common themes emerge: convenience and personalization. We examine ways in which traditional providers can embrace these themes. Three areas of consumer-focused marketing where traditional providers can increase efforts to decrease erosion are app abilities; niche markets; and consumer-desired amenities. Two areas of employee-focused marketing where traditional providers can increase efforts to decrease erosion are flexible hours and environments, and employee appreciation and rewards.