We take it for granted now, but on-demand business models have truly changed the way we engage with products and services. From Netflix disrupting the media landscape to Uber changing the way we look at transport, it has only taken a few short years for people’s behaviour to change quite radically from personal ownership to on-demand sharing. In this post I want to look at some of the key features that define a successful on-demand proposition, and share some of my thoughts on where these could go in the future.
The on-demand economy starts with this key insight: much of what we use, we don’t actually need to own. If I don’t use my car for most of the day and hardly ever drive, for example, then maybe it’s more viable for me to Uber. If I only wear expensive clothes on special occasions then maybe it’s more viable for me to just use Rent the Runway.
On-demand services allow me to tailor my product at an individual level. This could mean a for example a Netflix offering that’s curated to speak to my viewing habits. Being digitally-enabled, these services can show me only what is actually relevant to me and my life.
Ongoing ownership or commitment to a service makes it difficult to live flexibly. On-demand thinking makes it easier to get what I need when I need it, or overcome a minor hassle in my life. AirBnB speaks to this need - giving travelers an experience that is more authentic than a hotel but still trustworthy and held to quality standards.
There are two main reasons that we’re at the tipping point of “on-demand everything”. The first is that the way the working world has shifted means the gig economy is more viable for people to work in. It’s possible for someone to sell their creative services on UpWork for part of the day, manage an AirBnB in their spare time and then drive Uber in the evenings. The second part of the equation is the sheer number of services in the market now. A decade ago it would have been inconceivable to book travel or cleaning services through an app, but now it’s commonplace. That means the consumer conditioning is there and the trust barrier is becoming much lower.
Much of the disruption in this space has centred on travel and entertainment, but some spaces where we are seeing significant on-demand players emerge include:
Apps like the South African startup Flow Living are looking at bringing an on-demand mindset to the rental market. The brand looks to centralise everything a tenant needs through one platform, from rental payments, property search and lifestyle services. In this space going forward we could see more subscription based living services too, where tenants can move from rental to rental in the same ecosystem to facilitate a “digital nomad” lifestyle.
There is already a significant trend towards people wanting to take control of their own wellness, with services like virtual consults through Discovery and online mental health counselling. Apps like Doctor on Demand take this a step further by facilitating a house call when you need it. This is a key space for growth in the On Demand economy because it can help to solve the pain point of people trying to balance health and scheduling needs.
This is an industry ripe for on-demand disruption for two main reasons. Firstly, there is growing awareness of its negative environmental impact and secondly people will always appreciate a more bespoke fashion item in terms of fit and personalisation. This is still very much in its infancy but we’re already seeing offerings like Tailored Industry emerging. The knitwear brand produces garments on demand for customers, charging slightly more per piece than a high street store but coming without all the guilt that fast fashion can bring.
This is definitely a space we’ll be watching going forward, both in terms of business and systems models we can use in our own work, as well as the technology that enables it all. It’s only something that will continue to grow as the trend matures, and finding real and useful applications of it will continue to be key. As always, you can find out more about our work by reading up on our case studies, and if you’d like to chat about how we could work together please do get in touch.