November 8, 2021
MIT Sloan recently published research by Carey Morewedge, Professor in Marketing, about what businesses need to understand about the evolution of consumerism. The article discusses the rise of digitization and technology-mediated platform markets, changing society from “owners” to “users” through access-based consumption. Carey explains how access-based consumption has been around for decades, through libraries, hotels, and amusement parks. However, where it has evolved is through digitization. For example, ZipCar and Uber have replaced long term ownership of cars, streaming and data services have replaced libraries and CDs.
“For businesses, such value-enhancing effects of ownership are (mostly) worth preserving: They reduce price sensitivity for goods, services, and brands while increasing positive word of mouth, satisfaction, and loyalty.”Carey Morewedge, Professor of Marketing
Carey explains by giving up private ownership, people experience a decline of psychological ownership –when they own something, it is seen to have more value than the things they don’t. He states, “for businesses, such value-enhancing effects of ownership are (mostly) worth preserving: They reduce price sensitivity for goods, services, and brands while increasing positive word of mouth, satisfaction, and loyalty.” Carey concludes by offering a mindful approach to cultivate a new sense of ownership, helping businesses avoid commodification.
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