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End of ownership, and move to renting/sharing almost EVERYTHING

Last month, The Financial Times published an important review - The end of ownership - in their FT Series which described how “Online music streaming started it all, but fundamental changes in what consumers want and how they behave have led to a cutting of ties across sectors.”

Consumer behaviour

The report highlighted key examples of how this has lead to companies rethinking their business models:

  • Carmakers are launching rental services - Volvo, Cadillac and Porsche drive subscription model growth - even as peer-to-peer car lending platforms gain traction
  • China’s bike-sharing market rides on, despite wobbles: Ofo and Mobike at vanguard as numbers soar, but profitability concerns persist
  • ‘Mini-grid’ household energy sharing begins to take off as network of 20,000 German homes selling to each other shows new distribution model
  • Commercial and residential landlords are changing their business models as WeWork and Airbnb impact
  • Educational publishers experiment with ebooks and rentals to deal with falling sales
  • Renting clothes expands is no longer just for weddings.

This changing behaviour is creating demand for new types of insurance as people choose to borrow everything from cars to pets. No longer will consumers need long-term cover in an economy where goods are rented rather than owned.

Business behaviour

Consumer behaviour tends to migrate to businesses as well, as business people expect the same level and type of service they receive in their consumer products. There is no reason why this move to end of ownership will not affect corporate business models as well. This move to the end of ownership raises important strategic questions for every company:

  • What new rental services can we launch, will our competitors launch?
  • How will sharing impact our industry?
  • What new distribution models affect our industry?

Collecting regular payments

As the world business model moves to renting/sharing, the need for efficiency in collecting regular payemnts will become paramount, particularly in keeping subscription renewal rates high. A recent report by Recurly  showed that it is vital to monitor your subscriber churn rates and then carryout a series of promotions and offers:

Tip #1: Don’t carpet-bomb offers to your entire audience

Tip #2: Identify likely churn candidates for targeted renewal offers

Tip #3: Use incremental promotions

The need for Understanding and Managing Subscription Businesses - see Recurly report, here, is vital.


CTMfile take: Systems and services to improve collecting regular payments wil become vital in the next decade.

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This item appears in the following sections:
Payments - Receipts
Accounts Receivable Management
Billing Systems & e-Invoicing
Direct Debit Bill Payments