Looking for a big idea on a business model? In The Mesh, Lisa Gansky proposes that some things are better shared than owned. It’s a model based on access instead of ownership. Its central strategy is to target high-cost unused waste, leverage existing communications infrastructure, customize offerings based on personalized information, and build customer loyalty. Oh, and it’s better for the environment too.
WHAT IS THE MESH?
The (lowercase) mesh describes a network that allows any node to link in any direction with any other nodes in the system. At the heart of this idea is information. The mesh uses the interconnectivity of social media, leverages existing wireless GPS-enabled networks and builds on analytics from repeated use to provide people with goods and services at the exact moment where and when they need them.
Zipcar is the poster child for the mesh model. According to Gansky, on average people only use their cars about 8% of the time, which certainly fits the criteria of low usage and high cost. Zipcar created an easy and efficient way for drivers to use cars without owning them. The value proposition of Zipcar is to provide you a vehicle when you need it in a convenient location. It differentiates from rental cars on models, parking locations, web enablement, keyless entry and no hassle of waiting in lines providing the vehicle you reserved waiting at the specified location. Zipcar claims that its average user saves $500 a month compared to car ownership. Beyond financial benefits, it Zipcar claims that fewer vehicles on the road creates a cleaner environment.
There are 4 characteristics of a mesh business:
- The core offering can be shared within a community, market, or value chain—including products, services, and raw materials.
- Advanced web and mobile data networks track and aggregate data on usage, customers and products.
- The focus is on sharable physical goods, including the materials used, which makes local delivery of services and products—and their recovery —valuable and relevant.
- Offers, news and recommendations are transmitted through word of mouth, augmented by social network services.
Humans have a long history of sharing as communities. But Gansky makes the case that the current environment has created the perfect conditions for a mesh model—conditions likely to continue into the foreseeable future. The trends include:
- The economic crisis has created a deep distrust of older brands and models.
- Consumers are rethinking what they consider valuable in their lives.
- Climate change is forcing the cost of doing business, including the making and selling of throwaway goods.
- Growing population and greater urbanization create densities that favor mesh businesses.
- Information networks and mobile technology have matured to the point where businesses can provide better and personalized services exactly when needed.
This book builds on phenomena that other authors have highlighted. The Mesh differs by challenging the reader to consider the possibilities of sharing common, personal, everyday items— like cars (Zipcar), quickly outgrown children’s clothing (thredUP), and even electric power (Basin Electric Cooperative). The Mesh echoes what some of our thought leaders are proposing: More of our major industries will reconstruct themselves as services, not products.
Ramiro Roman is Marketing Manager, Solutions Marketing, at GE Healthcare. He can be reached at firstname.lastname@example.org, email@example.com, or www.LinkedIn.com/in/RamiroRoman. His blog, Marketing 4 Marketeers, can be accessed through the PM360 blogs tab—join the discussion!