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One Trend Your Business Can Not Ignore

Ever since we were children, our parents taught us to share because it was the right thing to do. Who knows if we would have seen that miraculous rescue of those 33 miners pulled up from a Chilean mineif numerous companies, governments and individuals had not shared their resources, experiences and ideas. That rescue was a celebration of collaboration.

But sharing isn't just a moral thing to do - it's a necessity to survive in today's global marketplace.

Three new books tackle the issue of sharing in the corporate world - its risks and its rewards.

In WHAT'S MINE IS YOURS The Rise of Collaborative Consumptionauthors Rachel Botsman and Roo Rogers explain how organized sharing be it bartering, lending, trading, renting or swapping products and ideas are done successfully online and in the real world.

In the book the authors show how the globe is moving into the new realm of consumerism one where trust between strangers exists and ownership is replaced by shared access.

The authors make the case that this model will create more sustainable consumerism and increased alternatives to outdated modes of business. (You can read more at the authors' web site)

In THE POWER OF CO-CREATIONauthors Venkat Ramaswamy and Francis Gouillart offer a roadmap to start and then work thought the many mine fields that accompany corporate collaboration.

The authors say that the idea of co-creative enterprises adopts "a different perspective on how to innovate and deliver offerings" moving from a "firm-centric" process to one of engagement for all stakeholders - internal and external.

Using numerous examples from companies like Nike, Starbucks Apple and Cisco, the book explains in depth how thePower of Co-Creationcan become a "win-more/win-more" for all involved engaging "all stakeholders in creating value together, while enhancing network economics and governing risk-value relationships in the ecosystem." (You can read more at the authors' web site)

And in her book, Mesh: Why the Future of Business is SharingLisa Gansky says the future of business will revolve around the idea of sharing goods, services and products, or as she calls it, "meshing."

Gansky says those businesses that "Mesh" throw away the traditional model of first make something, THEN sell it. She says these new businesses use social media, wireless networks and data gathered from everywhere - anywhere - to provide people with what they want and the exact moment when they want it without the burden and expense of having to actually own them.

Gansky's book is full of examples of some well-known 'mesh' companies including ZipCar, Netflix, FedEx, and Craigslist.

Gansky has written a Guest Author Blog for Bullish in which she explains how these new so-called "Mesh" businesses have a crucial edge.

THE MESH PLATFORM

Guest Author Blog: The Mesh Advantage by Lisa Gansky author of The Mesh: Why the Future of Business is Sharing

Guest Author Blog
Guest Author Blog

While companies based on shared goods and services are positioned to create the next huge wave of innovation (and disruption), in business, they’re not exactly new.

Some of history’s most aggressive titans, such as Conrad Hilton, well understood the profits to be made in businesses based on sharing. Hilton created the first premier brand of international hotels, a global “share platform.” Railroads, airlines, granaries and mills, and apartment buildings are all based on leveraging a resource over multiple customers—in other words, on sharing.

But today’s share platforms, the so-called “Mesh” businesses, have a crucial edge over older models.

The tremendous competitive advantages of Zipcar, Facebook, Foursquare, Netflix, Groupon, Relay Ride, Swap.com, and thousands of other Mesh companies are rooted in the explosive growth of information networks and mobile devices. By combining the “always on, everywhere” convenience of the mobile web with the efficiency and reach of share platforms, the “Mesh,” is set to become the next major wave of disruptive business innovation. Mesh companies will soar past their more traditional business competitors.

Take Netflix.

Blockbuster Video was a highly successful share platform. But, despite a data-driven supply chain and club memberships, the company did not take full advantage of share-enabling technologies. Netflix used what I call a textbook Mesh strategy to beat them. They knew that Blockbuster’s Achilles’ heel was late fees. Their revenue model depended on the fees, but customers hated them. Worse, in that model, their best customers were likely to be punished the most.

The then-in-progress shift to DVDs presented Netflix with the opportunity to easily deliver movies through the mail.

Customers wouldn’t have to rush to the rental store after a new release, or wait in line behind a guy arguing with his girlfriend, or deal with an underpaid clerk. Netflix introduced a model that allowed customers to return the DVDs at their own pace. Early on what cinched Netflix’s advantage, though, was that they knew they were an information business, not a movie rental company. By creating a share enabled web service where subscribers can create queues, rate movies, and share recommendations with friends, Netflix gets fine-grained data on what their customers want and don’t want. Rather than spend money on expensive advertisements, Netflix created partnerships with nearly every brand of DVD player. Each new player included a card offering three free rentals and a bold promise: “No Late Fees.”

"Traditional businesses that sell something once, and then watch a customer walk out the door, will be at an increasing disadvantage." -Author, The Mesh, Lisa Gansky

Instead, Blockbuster paid a late fee.

They were late in acknowledging the spreading power of social networks connected to share platforms with frequent customer contact. Netflix’s more robust and networked service gave them the power to collect and crunch consumer, usage, and product data to frequently iterate and shape fresh and customized offers. Their service is delivered locally, but spread through social networks, partnerships, and word-of-mouth. With its more nuanced knowledge of customer preferences and its culture of innovation, Netflix can rapidly adapt offers to particular communities and markets.

These are classic Mesh advantages.

But the core Mesh advantage remains frequent customer contact and cleverly converting that data to delighted customers – it allows a business to continually put its brand and timely, finely tailored offers in front of people. Better yet, businesses can further shape their offers based on greater amounts of data, particularly when coordinated with partners.

Traditional businesses that sell something once, and then watch a customer walk out the door, will be at an increasing disadvantage to those able to gain the trust of customers and their friends by “listening” through multiple touchpoints and data sources.

As a result, these businesses are spreading like wildfire.

At meshing.it, we’ve identified over 2000 of them in categories including energy, food, finance, fashion, real estate, transportation, and dozens of others. Other broad B2B share platforms, such as Amazon Web Services and FedEx, are making it cheaper and easier to build businesses that can scale rapidly.

Other factors, including the recession, distrust of old brands, the increasing cost and regulation of waste, and customers’ growing comfort with mobile technology and social networks, are central to driving the Mesh. The disruptions seen for digital products like music and videos are now quickly migrating to physical goods. We are heading into a shift in our businesses and daily lives, where access trumps ownership.

In this environment, forward-thinking businesses are asking: How can we use Mesh strategies to deepen customer satisfaction and loyalty, and to enrich our brand authenticity?

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Lisa Gansky, author of the new book, The Mesh: Why the Future of Business is Sharing is a serial entrepreneur—the co-founder of Ofoto, now the Kodak Gallery; the co-founder and CEO of GNN, the first commercial website, acquired by AOL in 1995; and an investor and board member of more than twenty internet and mobile services companies.

Email me at bullishonbooks@cnbc.comAnd follow me on Twitter @BullishonBooks

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