Thanks to the sharing economy, a system where amenities can be shared between people for free or for a fee. For example, homes can be easily rented through Airbnb, cars can be shared with a friend through Uber, or handcrafted items can be sold through Etsy. This collaborative use of services has become increasingly popular as consumers view them more trustworthy. Dr. ChongWoo Park, an associate professor of Management Information Systems in the James M. Hull College of Business at Augusta University, along with research colleagues from other institutions, have been researching this new phenomenon.
Park and his fellow researchers examine how people make purchasing decisions through the sharing economy platforms such as Airbnb, Uber, and Etsy. Their research found that the sharing of personal information from service or product hosts has an impact on whether or not the consumers choose the service.
Park’s research reinforces that trust is essential in consumer purchases. Consumers typically research the product, its reviews, and the company before making a decision. Applying these practices, Park and others suggest that as the seller shares more about themselves on their profile within these platforms, the more likely the consumer will purchase or rent the service or product. When a seller shares personal information about themselves, the consumer develops a sense of familiarity. This social presence starts to create a relationship between each individual, the seller and the consumer. Linking profiles from social media accounts, such as Facebook and LinkedIn, may increase trust and the intent to purchase or rent the service or product.
Another way to increase trust is from product reviews. Park and colleagues found that while providing information about the seller helps a consumer become familiar with the identity of the seller, positive reviews will attract more potential consumers. Consumers are more inclined to purchase a product that has more reviews from other consumers. This review activity should be a top priority for sellers who are selling a service, along with sharing personal information, to attract more consumers after their visits.
Park’s future research will examine another factor known as homophily, “a theory describing how similar people tend to trust more than dissimilar people”. Park explains how demographic factors such as gender, education, and income may alter the relationships among consumers who are looking at services. Park would also like to research other platforms such as Uber and the Lending Club. This phenomenon of the sharing economy has spread across the globe. While some consumers may not be participating in this sharing economy now, they may find themselves contributing later.
Sunyoung Cho, ChongWoo Park, and Jung Kim, “Leveraging Consumption Intention with Identity Information on Sharing Economy Platforms,” Journal of Computer Information Systems, Vol. 59, No. 2, 2019, pp. 178-187.