The poster child for the economy of the future is Uber, the much ballyhooed (and much booed) on-demand mobile service for transportation. It's more than transportation, though. Every nook and cranny of the consumer economy is being "Uberized" by a business model that twins personal services with technology. Not only does this business model fit the competitive opportunities of today's marketplace, but it also dovetails seamlessly with the larger dynamics shaping tomorrow's marketplace. What's ahead is a shift in the dominant business model, one in which all consumer goods will be available as a service and all consumer services will be available on demand. This is the Uber-All Economy of the future.
Anticipating the future in this way is a bottom-up view of change. The usual line-up of macrolevel shifts in productivity-enhancing technologies and labor-force demographics will be critical, of course, but the most important dynamic is happening at the level of the firm. Companies will make money in different ways, and this will cascade through the economy. Changes in technology and in the labor force are setting the stage for this transformation not by enabling companies to do something old in new ways but by forcing companies to do something entirely new.
The success of Uber and of companies with an Uber-like business model is particularly noteworthy in the context of a global economy struggling with slow growth. Technology is unlocking these opportunities. In particular, mobile applications are enabling start-ups to aggregate sufficient demand to support this new business model, often by capturing unrealized value from assets these start-ups do not own. But even when new infrastructure is required, needed investments are lower, which reduces start-up costs and time to market.
Equally important, technology is closing the gap between decisions made by consumers and the satisfaction of those choices. Speed has always been important, but immediacy will be the ante going forward. Machines are better at immediacy than people, not to mention more productive for both routine and abstract tasks. The displacement of people by machines will put the labor force under increasing pressure, with a shrinkage of jobs in many sectors and a growth of jobs assured only in personal services and technology, a duality of future employment that matches the twin elements central to the Uber-All business model.
No business category will be unaffected by companies operating with an Uber-like, on-demand business model. For illustrative purposes, consider a well-established category such as laundry detergent. The competitive set for laundry detergents is no longer just the traditional products on a grocery store shelf but also includes companies such as FlyCleaners, Washio, Rinse and Dryv in the United States, Laundrapp in the United Kingdom, and Edaixi in China, all of which operate through an on-demand mobile app. With the click of a button, consumers get their laundry picked up and returned right away, clean and ready to wear. Obviously, such a service is not directly substitutable with a bottle of liquid laundry detergent, but it is a direct substitute for the same benefit--clean clothes when needed.
Every benefit can be addressed in many ways by solutions of many forms, and that is both the threat and the opportunity posed by the Uber-All Economy. Net benefits are all that matter to consumers. The Uber-All Economy is reshaping how benefits are delivered, thereby reframing what consumers expect and want.
Even more broadly, if the need for clean clothes is better met through an on-demand mobile service, then it's not just laundry detergent that's no longer needed but also at-home washers and dryers, and if there is no need for washers and dryers, then there's no need for a laundry room in the home either. Something similar is true for every category, such as meal-delivery services affecting kitchens and pantries or transportation services affecting cars and garages. As such trade-offs get sorted out in household budgets, the superior net value of on-demand mobile services will become more apparent, and as it does, the diffusion of the Uber-All business model will gather momentum.
Two elements are critical to the Uber-All business model. The first is a...