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Is Singapore Ready for the Access Economy?

In the last three years, a slew of disruptive new services emerged suddenly and significantly altered how we interact with mature industries across several sectors. Its growth and reach rose in tandem with and because of the popularity of smartphones. All of a sudden, bicycles for use could be found almost everywhere, at almost any time. A private car to take you to where ever you want to go could be found waiting by the side of the kerb.  You could even have access to a villa along the Amalfi coast or cottage in the Taiga, all for a fraction of the actual cost. This new world order of consumption was called many things, including the Gig Economy, the P2P Economy, Collaborative Consumption and the Sharing Economy. However, it was most accurately encapsulated in the phrase, “access economy”, by Giana M. Eckhardt and Fleura Bardhi, both London-based professors of marketing in an article for the Harvard Business Review, in which they studied the development of apps that facilitated the exchange of goods and services on a barter basis or altruistism to a more sustainable model that was incentivised by monetary gain.



The Access Economy in a Nutshell

It is an enticing business model that allows a business start-up easy entry into a capital-intensive industry, with considerably less financing. It does this by effectively serving as a broker between the haves and have-nots and marketing the asset or service that has already been acquired beforehand by a third-party owner. By acting as a market maker that pairs those that own an asset with those looking to employ the asset, a winning proposition can be created for all parties; The asset owners earn a return by gaining access to a ready market without the risk involved in starting a traditional business, the business owner does not have to risk any seed money, and consumers are able to gain access at a considerably lower cost and with greater ease.

Today, cell phone-based applications facilitate a large proportion of activity in the access economy and these apps are ubiquitous; almost everyone has or at least knows of Uber, Grab and Deliveroo to name just a few. From the early years of 2013/2014, the access economy has seen tremendous growth in Singapore.

A study done by PricewaterhouseCoopers has pegged the industry size today at about US$15 billion (S$21 billion) and foresees that it will grow to US$335 billion by 2025. In comparison, China, the world’s largest access economy is worth in excess of US$500 billion. As personal devices connect more of the global population, the future of the world’s marketplaces shifting online.



Behaviour that Thwarts the Access Economy

However, as perfect as the arrangement seems, there are inefficiencies in this market. People, with their intrinsic nature to seek out maximum utility, are quick to exploit these to get more bang for their buck. This, not altogether uncommon, practice of self centered, self interested behaviour gives rise to a free-rider problem where, the collective participation in the provision of a good or a service maintains the critical mass to keep it viable, in spite of the free rider abusing it in a way that is detrimental to the provision of the same. An example close to home, are the many yellow bikes by the bicycle sharing company OFO, found in drains, stripped down, chained up for personal use or hogging them in many creative ways. It also manifests itself in other irksome habits such as spitting, littering, and lately sharing tables, taking colleagues’ food from the pantry, taking more pencils from IKEA than required, taking shopping trolleys home… the list goes on.

Although selfish behaviour is not unique to Singapore, the most identifiable trait that threatens to undermine our nascent access economy is Kiasu-ism. This characteristic compels one to extract more utility from a good or service or reserve its access at the exclusion of others. The mindset is more focused on how the individual receives more benefit than anyone else, than on how a community can benefit collectively. As such, the person who parks a shared bicycle where only he or she can find it, free rides on the service that only is made possible by the collective participation of the community to the service.

Unsurprisingly, Kiasu-ism is often linked to bad manners. Another lynchpin of the access economy is ride-sharing. With services like Lyft and Grab-hitch, travellers have more options for transportation. However, not all “Grab-hitchers” have noticed that the “hitch” in Grab-hitch stands for hitch hiking. This shifts the driver-rider dynamic to one where the driver is not just a paid chauffeur but is someone who has taken some time from his schedule to offer a ride. Consequently, many passengers exhibit an obnoxious attitude of superiority when using such services, despite paying fares much lower than with taxis. This has led to many guides on ride-sharing etiquette being published online to codify ride-sharing decorum.



A Change on the Horizon

“Selfish people are weak and are haunted by the fear of loss of control”, quoting published psychologist, M.Farouk Radwan, he explains why people are selfish. Singapore is often ranked amongst the most competitive countries globally and the most competitive in Asia. It is also a very new country built on its diversity as an immigrant nation, a demographic that it still maintains today; up to 25% of the population is made up of non-residents. Immigration is usually triggered by uncontrollable circumstances that are less favourable than the country one moves to. This compounds the sense of competitiveness and the fear of loss of control. This leads to a “dog-eat-dog” mentality where everyone fends for himself first and foremost. Over a long time, this is deeply ingrained, as part of the national culture. Change would take just as much time, and only with a willingness and concerted effort.

Initiating a cultural shift towards greater civic-mindedness, instilling positive social norms to give everyone a clear barometer of gracious behaviour or, at least establishing a way of monitoring bad behaviour will go a long way for the country to reap the rewards of the access economy.  To this end, there have been several steps taken by vendors and government alike. Ofo has responded to vandals and thieves of their bicycles by making an open call for users to help report bicycle abuse. Sites like STOMP have contributed to this informal system of community policing by providing vigilantes with a platform to report these inconsiderate acts. Aside from adopting a system of shaming and disincentives, rewards have also been adopted to reward positive behaviour.  oBike, another bicycle sharing company has implemented a structure that rewards or penalises users based on their behaviour. These measures augmented by government protection of the vendor’s’ property rights as well as consumer rights is a big step towards the country embracing the access economy and towards bringing about the promises of efficiency asset allocation by the access economy.

Until then, the mature, considerate culture that we all aspire toward will take some more time to take root. As the access economy is still in its infancy, the rules of engagement are not yet set in stone and until then, people will have to make up the rules as they go along. With the rapid expansion of this industry, we can only hope that the change will come sooner than later.



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