Section 3

Network, Attention, and Sharing Economies

Network Economy

The network economy has transformed us as consumers. It has forever changed the way we discover, learn and interact with things in our daily lives from the way it influences our buying decisions, to the ways we spend our money and the nature of our consumption. It has turned traditional business models on its head. Transactions are cashless - process-less in some instances so our upwardly mobile existence is reflected in not being able to take a bankcard from our pocket. The network economy facilitates the need to no longer linger in one spot that second longer. The network economy has changed the products and platforms on which companies sell, communicate, distribute, and connect. It has taken traditional forms of commerce and given power to the users to determine their rules. Is this the perfect model? Fekete (2006) describes the network economy - but argues this model cannot be maintained - as interactions based on, “cooperative, informed and transparent communication.” (p.737, 2006)  

The network economy is, in part, the convergence of online technologies and the conversion of people, social ecology, and products in the 21st century. The difference between it and traditional economies is unlike previous connection technologies such as television and radio, the internet has the “ability to quickly retrieve information stored on computers” (Leibowitz, 2002, p.11). Broadcast media such as television or radio, only allowed for one way communication and messages were largely homogenous. Today, connectivity, inclusion and communication are key - customers define products and services in the new economy and are able to dictate the terms; roaming a virtual world in search of products (Fekete, 2006). From buying dinner, finding a date, to accessing transportation services such as Uber, this new form of networking has changed the way the market connects and consumes.

Consumers are now spending just as much of their income on experiences as they are on buying goods, coining the term of an “experience economy” (Rifkin, 2001). With the realisation of the power of e-commerce, many businesses are selling physical property and shrinking their stockholdings for a place in the online sphere of the network economy (Rifkin, 2001). Ownership of expensive items is transforming into access, where items that were once seen as important to own are now being upgraded so often, that the idea of physically owning them is becoming outdated.  By consumers using the power of access, businesses are able to withhold a relationship with them for the duration of their lease of the item. This relationship differs strongly from the traditional buyer to seller relationship, where buyers would purchase the item from the seller, and that would be the completion of their relationship. According to Rifkin (2001) in twenty five years, more consumers will pay to lease items rather than own them.

For a network economy business to thrive, they must be continually connected. From a customer loyalty perspective, the network economy is already assisting businesses in creating more of a connected, tailored, relationship with their consumers. Uber is currently trialling a loyalty program in LA for consumers who wish to ride with Uberblack. Every Uberblack ride the customer will receive 200 points. Once they reach 3000 points, they will receive a $25 Uber ride. (Tepper, 2016). By implementing such programs, Uber will promote and increase the frequency of UberBlack rides.   

The network economy has allowed businesses to “keep track of customers' orders, their consumption habits, credit history” (Leibowitz, 2002, p.12). This has formed the emergence of data control and ownership, where corporations are selling the consumer’s personal data, thus creating a new business of its own (Fekete, 2006). Although many positives do emerge from the trend of network economies, there are downsides. Whilst the fees for transmission costs are extremely low, the ability for businesses to have any form of a monopoly is also less obtainable (Leibowitz, 2002). Exotic brands online that consumers are unaware of, will have more difficulty finding and connecting with customers without paying for advertising on websites such as Google. Whilst larger known brands will be easily discovered by consumers, they do not have the forcefulness of being the only physical option for a consumer at a shopping mall. With all this in mind, the company Uber is currently holding a fair chunk of monopoly in terms of an online transportation business, as it dominates local areas. Those using online commerce as a consumer still desire the same outcomes that a bricks and mortar shop will provide, such as the best price, customer satisfaction, and reputation. With one the most prominent features of Uber being that is (generally) cheaper than other taxi services, as well as the roll out of a trial loyalty program, it is obvious why consumers would be taking part in this emerging online trend of transportation.   

Although Uber would not be categorised as being an attention economy business, there is one feature available that relates to the attention economy, and the attention of users. The application allows users to see available Uber drivers in their area through a live map that uses GPS on your mobile to find your location. The interactive feature of being able to ‘watch’ the Uber driver attracts the attention of its users to focus on the driver. Although this is only a minimal amount of attention, it is still a beneficial feature that has contributed to the success of the application (Rempel, 2014).

Attention Economy

With internet use in full swing, most users starting a new business have ease of access to a free web design builder, free logo/graphic design builder and access to start up a Facebook page. What is not easy, is to retrieve the attention from other users/consumers. Businesses that are able to retrieve and hold the attention of consumers, are those that will succeed (Davenport & Bec, 2001).  The internet provides an abundant amount of information, yet there is only a certain amount of time that can be contributed towards attention on a daily basis (Terranova, 2012). As discussed by Goldhaber (1997), once ‘real attention’ is no longer required/available, illusory attention commences in the form of books, television, gaming or the web. For businesses to prosper in an attention economy, they must understand how and where users will implement their illusory attention for the sometimes short duration of being online. For businesses in the attention economy, the use of new and original creative content is a must. Reused, unoriginal content will result in no attention from users (Goldhaber, 1997).  

An example of an online business that has grasped the idea behind the attention economy entirely is Snapchat. Snapchat communicates between users via images and videos. Snapchat uses “Ephemeral messaging with disappearing data” (Charteris & Masters, 2014, para.1), permitting users to view the image or video for only ten seconds or less. Therefore, the user’s attention is focused on that image/video and nothing else as they know it will disappear and never come back (Pittman and Reich 2016). As of 2013, 350 million snapchats were shared daily, compared to 20 million in 2012 (Charteris & Masters, 2014). Based on the enormous figures of content sent daily, it is obvious that Snapchat in one of the leading social networking icons within the attention economy.