I’m not saying that the now well-established trend of the sharing economy will rapidly take over the common practice of ownership. Providers of goods like cars will still continue to sell possessions in the future. But the buyers may then be increasingly enthusiasts or collectors. Moreover, as ownership in any form binds you to certain commitments, being flexible in terms of mobility might not correspond to the ownership of a vehicle anymore and in future even outweigh its current advantages. Last year in a blog post, I analyzed business ideas that emerged from the sharing economy trend, how they were coordinated over platforms, as well as their underlying financial processes. Back then, I predicted that a mere business idea that involves the sustainable trend of sharing – no matter how grand – would not be enough. Instead, the entire processes within a company need to be aligned with the new possibilities of the sharing economy. Particularly in the automotive sector, which before was mostly concerned with selling as many cars as possible, new processes must be established to also reach those, that do not want to own a car while still being mobile. This is not intended to discourage, but to motivate the pioneers of our age to seek out solutions – namely, those that simplify complex processes.
The trend-setting car-sharing approach of Lynk & Co
One of these pioneers of our time that focuses on revolutionizing mobility is Lynk & Co. The company realized that, on average, cars spend around 96 percent of their time unused in front of our homes. Many people, especially in urban areas, no longer want to own a car. While they want to be able to get around when they need to, they don’t like to see it parked unused. That’s because this simply no longer befits their sustainable and efficient lifestyle. For this reason, Lynk & Co is currently launching an exclusive and pioneering membership model with a simple pricing structure, maximum flexibility for users, and a monthly cancellation period. A P2P car sharing option, in which enthusiasts can choose between signing up for a free membership and use cars “owned” by other members using “month-to-month membership”, prevent long periods of idleness. This is ultimately beneficial for both parties. On the one hand, the price paid by the subscription holder decreases when they offer up the vehicle for shared use. On the other hand, members who don’t subscribe themselves can use available cars spontaneously. A concept that is both simple and ground-breaking at the same time.
Simplicity often involves hidden complexity
Nonetheless, even brilliantly simple concepts can involve a high degree of complexity in practice. In order to pass on this simplicity of an idea to the customer, the technical processes running in the background, enabling a seamless usability, must be borne in mind from the very start and be developed in line with this idea. Therefore, unique services, such as the ones being offered by Lynk & Co, must first be converted into individual and automated background processes. Moreover, if a company wants to address customers in different countries, they should seek support from an internationally positioned provider, that is familiar with the local needs and cultures of the respective country and is able to translate this knowledge into processes. Do not forget that business models, that offer memberships like the ones Lynk & Co offers, tend to be rather uncommon in the automotive industry, as the implementation of those services is more complex than a monthly subscription for a streaming service. For example, as regards to Lynk & Co, members receive a certain amount of money back if they share their car with other members. Despite this complexity, the customer experience must remain the central focus throughout the entire customer journey. Therefore, processes should be automated as much as possible, yet as personal and individual as possible when it comes to direct customer communication. And this not only refers to the car journey itself, but also registration, subscription processing, the payment, as well as customer communication in the event of outstanding payments.
Technology that enables growth
This is where we at Arvato Financial Solutions can step in and help promising ideas become economically viable and growing business models. As a company with broad industry experience, we cover the entire process chain in the background and deliver a solution with our mobility clearing service that can simplify all underlying financial processes. This spans everything from risk management, subscription management vital to the sharing sector, as well as payment processing and accounting to the debt collection process where necessary. By implementing Big Data into the backend processes, we are able to safely detect fraudulent behaviour at an early stage and draw attention to customers that do not possess the necessary credit-worthiness before finalizing a transaction. We thereby help companies reduce the risk of outstanding payments and chargebacks while simultaneously ensuring consumers an optimal customer experience by providing a variety of payment options and individually responding to their needs. All in all we take care of the backend processes of the industry, enabling companies to address new trends quickly and grow. Our passion is making such innovative ideas, like those of Lynk & Co, possible by making complex easy. Only this way can large parts of society benefit from sustainable business models.