From her home in Sydney’s east, TEDx speaker Rachel Botsman is changing the way people think about what they consume. With her global bestseller What’s Mine is Yours, she has inspired a new consumer movement around the concept of sharing. And if TIME Magazine is right, the idea of ‘collective consumption’ is changing the world.
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If you’ve ever bought something off eBay, scored a cheap overseas stay with Airbnb or pledged money to a fledgling art project through Kickstarter, you’re actually part of a huge global movement. You just mightn’t know it. In fact, until Rachel Botsman started writing and speaking about it, this international phenomenon – of shared, participatory consumerism – didn’t even have a name. That changed when TIME Magazine identified it as one of 10 Ideas That Will Change the World. Now this movement doesn’t just have a name, but the combined energy of a locomotive. Botsman calls it “collaborative consumption”.
Around five years ago, when Botsman was living in New York working in brand marketing, she started to become acutely aware of how her own consumer habits had changed. Botsman realised she was generally buying fewer things and borrowing them instead. “I started to think, ‘Okay, I now rent my movies on Netflix, because I don’t want to own box-sets of DVDs. I don’t own a car, I use a car [through a car-sharing network].” She also found herself involved in donating money to social lending and crowd-source projects.
Noticing a pattern, she asked herself how these things were connected. Botsman’s answer eventually became her bestselling 2010 book, What’s Mine is Yours: The Rise of Collaborative Consumption (co-authored with Roo Rogers), which has seen Botsman’s name uttered in the same breath as Malcolm Gladwell’s. Botsman’s work was similar to Gladwell’s, in that it identified, named and catapulted an idea into popular consciousness (think: The Tipping Point). However, Botsman wanted to take collaborative consumption one step further and purposefully wanted to trigger off a movement. “I always saw creating a brand around collaborative consumption,” she says. “I wanted to give entrepreneurs a common language of describing this thing that helps everyone.”
Raised and educated in the UK and a graduate of Oxford, Botsman worked in New York for nearly a decade before finally calling Australia home. Along with her Australian husband Chris and her Australian-born son, Botsman settled in Sydney as a permanent resident shortly after signing her book deal. “New York is a wonderful place to spend your 20s and start your career,” she says, “but it’s a different kettle of fish when it comes to raising a family. Travel-wise, life would be easier if I lived in London or New York, but Australia feels like home. The lifestyle, climate and environment plays a big role, but top of the list is the people.”
“I passionately believe Australia holds a tremendous amount of promise in terms of culture and business, and that its true potential and role in the world has not yet been realised. I like to think that I can play my part in helping Aussie talent and putting our digital culture on the world map.”
Working from Australia has both its benefits and disadvantages, Botsman has found. “Life is different for sure,” she says. “We actually timed the move to Australia around me starting to write What’s Mine is Yours. I found the change of environment and tempo extremely helpful for writing. For one thing, it took out the constant interruptions during the day, because the people I work with in the UK and US are sleeping when I’m writing. The flip side is that it requires discipline and organisation to not find myself working from 6 to 10 pm to catch both sides of the world.”
After releasing her book, Botsman was headhunted to work for various agencies. She eventually said yes to Collaborative Fund, founded by Craig Shapiro, who was an early and major investor in Kickstarter. Their ethos for investments is simple: partner up with entrepreneurs who share their vision of shifting from an ownership economy to a sharing economy. “Craig was really the only one who came along and got this from a passion and heart perspective as much as a head perspective,” Botsman says. “He shares a lot of the similar values, he’s very design and brand savvy. And I really want to create a fund that supports entrepreneurs, not just through capital, but through knowledge and network. It’s a lot of fun.”
The way Collaborative Fund makes its investments is usually through a personal relationship or introduction, which is how Shapiro originally came across Kickstarter. “It took those guys a couple of years to really figure out what the business model was. But Craig really believed in the founders, and it was so clear they wanted to disrupt the traditional grant fund and pledge model.” Now with Botsman on board, that mission continues. Right now, Collaborative Fund has invested in 12 projects, and two that get Botsman particularly excited are TaskRabbit (which she describes as “like eBay for errands”) and Getable (“Amazon for Rentals”).
In Botsman’s mind, it’s actually online connectivity and social platforms such as Facebook, Twitter, Instagram and 4Square that have allowed us to get back to traditional modes of consumerism. Botsman says we are innately hard-wired to share, and now technology is helping facilitate that. “As people share more in their digital lives, as they trust strangers more in their digital lives, they start to share,” she explains. “We’ve been doing that for thousands of years. Now when you say to people, ‘Oh do you want to give a loan to a complete stranger?’ it doesn’t feel like a crazy concept.”
"I really believe the Collaborative Revolution could be as big as the Industrial Revolution … we’ll look back and see this as a turning point where we started to transform the way we matched wants and needs, the way we thought about supply and demand.”
It was back when Botsman was working in brand marketing in New York that she really started to understand how human impulses and behaviour lead us to consume different things. “It was astonishing to me the rigour of understanding the consumer psyche,” she says. “Understanding everything from, ‘If you change this colour, or this music,’ how you could affect peoples’ buying patterns.” Brand marketing might have a reputation for being manipulative or coercive – essentially persuading people to buy things they don’t need – but Botsman says it’s those exact skills that can help change the way we consume things too, and for the better.
“It’s not that it’s evil,” Botsman says of brand marketing, laughing. “You’re actually seeing so many big agency figureheads – Alex Bogusky, who ran Crispin Porter + Bogusky, comes to mind – who have created some of the biggest campaigns asking, ‘How can we actually apply this to do some social good in the world?’”
With our global population already at seven billion and projected to reach nine billion by 2050, collaborative consumption makes sense as resources rapidly dwindle worldwide. While Botsman originally felt sustainability was a key issue driving collaborative consumption, her research also uncovered another reason why this model was appealing. “For people, it was about community and transparency, and wanting to feel like they were a part of something, versus having faceless one-way transactions.”
Either way, collaborative consumption has clearly struck a chord. Botsman’s 2010 TEDx Sydney talk on the subject has attracted nearly 400,000 hits on the TED website, and an extra 40,000 views on YouTube already. Botsman and collaborative consumption have been written about in media outlets as diverse as The New York Times, Vogue Australia, Rolling Stone Argentina, The Sunday Times, Wired, Le Monde and The Economist.
However, it was one story in Forbes magazine that began to question the merits of the collaborative consumption model, which noted that the shift from ownership to access almost seemed like “an outright sales killer”. Did collaborative consumption signal a death knell to our robust capitalist economy as we knew it?
Not quite. The Forbes story recognised the potential of this new consumer model, concluding: “Could it be that collaborative consumption can actually be a category extender instead of a category killer?” That’s what Botsman’s consumer research found. Consumers weren’t just warming to the idea of sharing and exchanging goods, they were embracing it. Sixty per cent of people surveyed found the concept of sharing appealing, and 71 per cent who had already used shareable products said they would continue to do so. Botsman points out that when she started giving talks about collaborative consumption in 2008, there was around $22 million in investment into collaborative consumption-based ventures. By 2011, there was over $500 million dollars.
Botsman says one of her favourite examples of a collaborative consumption that took off was Airbnb, the website where people can rent out privately owned accommodation to travellers, as an alternative to hotels. Airbnb initially couldn’t raise their needed investment for the first two years. “No one thought it would work,” she says. The San Francisco start-up company is now valued at over $1 billion. “Now Aussie entrepreneurs are looking at ideas that are taking off in the US, such as TaskRabbit’s errand networking and adapting models to work in Australia.” Botsman cites start-ups like TaskBox and Airtasker, which just received $1.5 million in funding. “I passionately believe Australia holds a tremendous amount of promise in terms of culture and business, and that its true potential and role in the world has not yet been realised. I like to think that I can play my part in helping Aussie talent and putting our digital culture on the world map.
“What I would love to see is the rest of the world looking to Australia for ideas and the best talent ... We should become a hotbed for ideas that get ‘exported’. London is having a tremendous amount of success with ‘Silicon Roundabout’ in terms of reviving the start-up scene over there. It’s the magic profile of giving something a name, a shared location, and government and media backing that is working.”
Nowadays, it is common to share bikes, cars, surfboards and video game consoles to complete strangers for money. We rent out errands and barter skills, and invest in micro-loans on the other side of the world. “I say this and I don’t say it lightly: I really believe the Collaborative Revolution could be as big as the Industrial Revolution,” Botsman says. “That we’ll look back and see this as a turning point where we started to transform the way we matched wants and needs, the way we thought about supply and demand. It’s actually reinventing very old market ideas and behaviours that are innate to us.” Another nice side effect? We’ll have less clutter in our lives. Or as TIME Magazine put it: “Someday we’ll look back on the 20th century and wonder why we owned so much stuff.”
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