What does the local on-demand economy mean to companies and their customers? In this keynote address at BIA/Kelsey NOW, Mike Boland and I explain the rise of logistical systems for small business and individuals and how it changes the nature of work. In a nutshell, society built the old economy to keep needed resources on the bench and ready to work. Today, work will be assigned and completed through systems that put customers in control of the supply chains that serve them. It raises issues of fairness, as labor struggles to adapt and rethink how to build a “career.”
The whole talk is on YouTube, in case the player below doesn’t load in your browser.
Over at BIA/Kelsey’s Local Media Watch Blog today…. LODE in 2015: Household service and travel market penetration currently at 3.9 percent.
I wanted to lay down a foundational number for the on-demand economy, one that reflects how the economy can grow if the rhetoric of on-demand plays out to allow workers to be paid well enough to exchange some paid household labor for household services.
Based on our analysis, the on-demand market today could be worth up to $465 billion (labor fees inclusive), based only on converting some unpaid labor to paid using on-demand marketplaces. But only $18.5 billion in revenue appears to be headed for on-demand company P&Ls this year, so current addressable market penetration is 3.9 percent. And the current addressable market is only about 16.5 percent of the total U.S. population.
Next up, we’ll start to incorporating competitive industries that may be cannibalized by on-demand. At that point, the clear opportunity for lower transaction and logistics costs for LODE companies will be ridiculously self-evident. We’re talking many new billion-dollar markets, some vertical, some horizontal and some purely geographic.
Join me at BIA/Kelsey NOW: Rise of the Local On-Demand Economy on June 12th in San Francisco! Save $100 off the already reasonably priced tickets with the discount code “MR100,” for this one-day briefing and discussion on the Local On-Demand Economy.