The handbook for safe user to user communications in the Sharing Economy

The collaborative, gig, peer-to-peer or sharing economy — Whatever your preferred term, these platforms have taken off around the world: the European Commission estimated 2015 gross revenue in the EU from platforms and providers to be €28 billion, Pew Research reported in 2016 that 72% of American adults have used a sharing economy or on-demand service, and professor Arun Sundararajan stresses the immense untapped market potential in India and China. But with such success comes inevitable friction, namely concerns about government regulation, precarious employment, racial discrimination, and whether the “sharing economy” really lives up to its name in terms of profit distribution. To deliver value as a sharing economy platform in 2017 means navigating these issues successfully – by no means an easy task.

The majority of Americans have participated in the sharing or on-demand economy. Pew Research Center, Shared, Collaborative and On Demand: The New Digital Economy, May 19, 2016

As a Communications Platform as a Service provider, our place in helping these platforms grow is mainly in two areas – matchmaking between buyers and sellers, and, crucially, in facilitating security. As we’ve watched the market evolve, we’re eager to weigh in on how sharing economy platforms can add value to users, especially with the help of SMS and voice.

This whitepaper covers the critical elements to consider to design or improve an online marketplace notification and communication systems. It includes comprehensive overviews, best practices and feedback from industry experts — P2P platform entrepreneurs:

Meet the experts

Curren Bates is the current manager of the Vehicle Strategy at Bird and is the former Director of Marketing at Splinster (bike sharing).

Patrick Nangle is the CEO of a car-sharing co-op implemented in British Columbia, Modo, and former CEO of Purolator, a freight delivery service.

Esther Marthos Carrión is a UI/UX expert and sociology & sharing economy PhD researcher. She worked, among others, with HireGo, a platform reinventing shared mobility using blockchain and smart contracts

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Adam Broadway is a marketplace expert and CEO of NearMe, a service to build a P2P and business to business marketplaces.

You'll find all the sources of this whitepaper at the end of the document.

On the go? Download the PDF version of this whitepaper (689kB).

Embedding trust mechanisms into a P2P platform

What makes a peer to peer platform successful?

The Federal Trade Commission has boiled sharing economy platform success factors, (largely applicable to any peer-to-peer platform), down to:

1. They are “successful if they are liquid”;
2. if they enable matchmaking between buyers and sellers in real time; and
3. “if the transactions in them are safe.”

Building a safe environment into your peer-to-peer platform is vital. Certain notification systems, such as anonymous numbers, email identification, in-app chat or two-factor authentication via SMS, can help build secure environments. The trust mechanisms you choose will depend on your business model and the kind of experiences you are building. As BlaBlaCar explained in their 2016 Entering the Trust Age report,

“Different peer-to-peer marketplaces use varying mechanisms of creating digital trust to foster online exchanges. These mechanisms depend in part on the stakes involved in the exchanges. Craigslist favours a low-stakes and low trust strategy, while eBay and Etsy use ratings, but do limited moderation by themselves. At the other end of the spectrum, platforms such as BlaBlaCar and Airbnb, who offer high-stakes offline experiences, put a lot of thought and effort into creating the highest possible level of trust between their users, through ratings, moderation, verified IDs and insurance.”

The report ultimately outlined a 6-point vision that can serve as a model for other P2P entrepreneurs. These are their DREAMS pillars: declaring information, using rating systems, engagement from users through financial commitment, encouraging active members, creating moderated environments through third-party verification, and finally, identity verification through social network linking. (You can read more on their report here).

Image credit: https://www.blablacar.com/trust[/caption][cta href="https://www.callr.com" txt="Secure your P2P platform users communications" btn="Try CALLR"]

User Identification

Now, with all of my optimism, and I am an optimist, comes a healthy dose of caution, or rather, an urgent need to address some pressing, complex questions. How to ensure our digital identities reflect our real-world identities? Do we want them to be the same? How do we mimic the way trust is built face-to-face online? How do we stop people who’ve behaved badly in one community doing so under a different guise?

Rachel Botsman, (TED talk) September, 2012

A crucial decision when building these systems is to what degree users’ “real” contact information – telephone number, email address, social network profile or even full name – should be made public.

What info do you need to trust someone in a specific context?

Some advocate for “total transparency,” arguing that this acts as a self-regulating mechanism. The reasoning goes that if everyone’s equally exposed, we’re all likely to act reasonably, and we’re all equally vulnerable if we don’t. Indeed, in some instances, it’s preferable to know users’ real identities; integration with social networks like Facebook, or requiring a university email address, can reassure users about who they’re interacting with, or keep platforms within a closed community.

Airbnb allows users to sign in via Facebook, linking users’ “real” identities to their Airbnb profiles. This can be reassuring for users, especially if they see they have contacts in common.[/caption]

Storing contact information is a risk factor

However, there are also many opportunities for people to take advantage of unprotected contact information: Scammers and spammers look for phone numbers readily available on websites for phishing campaigns, and research has well documented the tendency to act in disinhibited ways online, which can lead to cases of harassment or other unsavoury episodes. The issue is more one of balance. As a 2015 Future of Privacy Forum report explains,

“…[sharing economy] platforms must understand the relationship among identity, anonymity and obscurity, and reputation that will facilitate user trust… some of the steps needed for users to build and maintain their reputation on a sharing economy platform can create privacy challenges. Platforms need to offer a degree of transparency in how users can access their information. They also can offer users obscurity vis-à-vis other users to the extent possible to enhance privacy.”

In other words, in some scenarios, it’s preferable for a buyer or seller to know each other’s real identities, and in others, it’s best to hide them. CPaaS providers are well-placed to help sharing economy platforms tackle the challenge of obscurity vs identity.

We're also seeing the emergence of blockchain-based systems offering significant improvements in the way identity and reputation are recorded, stored, and shared. Blockchain-based identity management protocols are still very new, but they are already promising for P2P platforms.

In the future, P2P platforms might be able to operate without asking users for their "real" identities. Indeed, blockchains-based authentication systems enable persistent identity that are separated from real-world identity, but still verifiable: a blockchain-based persona, where the user uses a pseudonym but his history his verifiable and unfalsifiable.

Insider's perspective — Esther Marthos Carrión

Esther Marthos Carrión is a UI/UX expert and Sharing Economy PhD researcher. We asked for her opinion on the anonymity vs transparency debate.

Do you have an opinion on the anonymity vs transparency debate? i.e. Should buyers/sellers be kept totally anonymous, or should their “real” identities be transparent?

This is a constant debate, transparency or privacy? Personally, I think that societies are moving toward transparency. From my research, I have learned that new generations are less concerned about keeping their privacy (which is an aspect that was quite important in previous generations). People share their personal lives every day, and they enjoy doing it.

We can also see how many sharing economy platforms (and others) are using social networks like Facebook to log in, so what I see is that platforms are mutually networking (Google, Facebook, Paypal, YouTube), and sharing their information. Reputation systems will be also be shared from platform to platform (see Traity). Payment systems are the next to join this wave. To be honest, I don’t see privacy in a very near future. To answer your question, I think that buyers and sellers will keep their social network profile as their identity.

Platform Boundaries

Once you have determined the minimal amount of contact information you need to build trust, the next step is to figure out the channels you will use to both communicate with your users (system notifications, announcements, events) and to connect your users.

However, before we address the most common channels and their benefits, it's worth diving into the question of the platform boundaries: should all communications between users happen or your platform?

Keeping all conversations on the platform

For most P2P platforms, keeping conversations on their medium is ideal:

1. It ensures that there are no side-stepping attempts: if you let users communicate freely, what prevents them from closing the deal outside your service to avoid the fees?
2. It facilitates the resolution of conflict: be it text or voice, you'll have access to conversation logs and records, including both sides.
3. Analyzing the users' exchanges is insightful: it might help you figure out pain points or prioritize your developments.

Nevertheless, locking users on your platform without additional benefits is not the best option. It might lead to user frustrations. Instead, most platforms, stress out the advantages of using their service and include additional features to make it worth it: insurance, buyer protection, and reimbursement, VAT, professional accounts.

The most common practice is now to lock the conversation on the platform before the deal is closed. Then, users have access to each other contact information, such as a phone number or an email to facilitate the delivery. This is, for instance, the workflow currently used on Airbnb:

The balance between usability and safety

The question of the boundaries of the platform is a good illustration of the inevitable tension of peer to peer platforms: the service must be as easy as possible to use. However, the platform owners must enforce check and balances to prevent scams, abuses, and ensure their users' safety.

So where does that leaves us? Let's ask an industry insider.

Insider's perspective — Curren Bates

Curren Bates is the current manager of the Vehicle Strategy at Bird, and is the former Director of Marketing at Splinster (bike sharing).

How do you organize user communications on Splinster?

We encourage communication by whatever means necessary (text, phone call, carrier pigeon, etc.). It’s simply that, for the safety of both parties, we don’t allow that exchange to take place until after a rental has been booked through Spinlister. That’s when our $10,000 protection guarantee kicks in. Outside of that, our in-house messaging platform is simply there to allow community members 1.) convenient, instant communication across both email and mobile, and 2.) organized record keeping of their rental communications, should anything come up. The latter can be done outside of our system, for sure, but it’s a little bit more of a headache.

Any advice for sharing economy entrepreneurs to design a notification system that is both convenient and safe?

Hire good devs, trust your team and above all learn from your mistakes. I know it sounds cliche but the market will lead you in the direction you should be heading, so listen.

Designing your platform notification system

A big part of enabling real-time matchmaking and safe transactions is choosing an appropriate notification system. Indeed, speed and reactivity are critical for P2P platforms.

Should you use personal email, in-app messaging, text messaging, anonymous phone numbers? A mixture of all of the above? How can you build trust in your peer-to-peer community?

[cta href="https://www.callr.com" txt="Looking for a voice and SMS provider for your marketplace?" btn="Try CALLR"]

To help answer these questions, we’ll go over the advantages and disadvantages to some commonly used notification systems in sharing economy (or peer-to-peer, marketplace…) platforms.

Voice

👍 Benefits Voice communication is synchronous and personal. Voice messages are very efficient, which makes them a great pick for critical or emergency communications. Everyone, including older generations, is familiar with phone calls.

‍✔️ To Consider You can only allow users to swap numbers, but it comes with risks. Using a CPaaS API, you can combine the best of both world: have users talking to each other through text, but also preserve the privacy and access the conversation log.

‍🏷️ Recommendations Phone calls are the most reliable way of communicating in situation of emergencies.

Text Messages

👍 Benefits Out of all the channels, Text Messages/SMS is the one boasting the best opening rates, reading rates and time-to-read. SMS are still the best for time-sensitive alerts.

‍✔️ To Consider Regarding number-swapping, the considerations are the same than for text messages. It's recommended to use an anonymous phone number service to put your users in touch.

‍🏷️ Recommendations SMS is the best option for time-critical alerts. It's also worth noting that SMS doesn't require a smartphone, which can be an essential factor depending on your audience.

In-app Messaging

👍 Benefits Users can exchange easily, and safely. Allows for a certain degree of privacy until trust is established.

‍✔️ To Consider In-App is not the best option for time-sensitive messages. Don't forget about people who disable notifications: consider alternatives.

‍🏷Recommendations In-App messages are great for synchronous communications, but sub-optimal if the exchange is asynchronous.

Email

👍 Benefits Already used by users: everybody has an email. Allow for an advanced check based on the address (ex allow only @something.edu)

‍✔️ To Consider Make sure your users' emails are not publicly exposed. Increase the risk of off-platform transactions

‍🏷️ Recommendations Emails are convenient, but also risky. Keep them mostly for service notifications.

The main factor while choosing communication channels for a P2P platform is your audience.

Insider's perspective — Adam Broadway

Adam Broadway is a marketplace expert and CEO of NearMe, a service to build a P2P marketplace.

What communication channels (personal email, in-app messaging, text messages, phone calls, push notifications…) would you recommend incorporating into a (sharing economy) marketplace platform to put users in touch?

All of the above, including video calls and 3rd party API integration points like CALLR, Slack, and Olark, as well as UserVoice and customer service apps. Ease of communication between the guest/host, buyer/seller, ‘lister’/enquirer is critical, including escalation rules to handle the exceptional cases when follow-up on the part of the platform doesn’t happen.

For some, instant messaging might be fastest, and able to provide enough of a ‘personal connection’ to answer simple questions. For others, click-to-call with anonymized phone number masking may be needed, as the caller requires a more in-depth conversation than an email or text exchange can efficiently provide. Calls made via CPaaS providers can also be recorded for ‘training and quality’ purposes, so the marketplace owner is able to review conversations as a means of enhancing the marketplace user experience and FAQ areas of the site.

The platform used to power the marketplace must also provide a flexible workflow engine, so that additional alerts relating to, ‘You have a new inquiry/message’ can be sent as an email, mobile text/sms or as an in-app alert. These workflow rules should also handle reminders, such that if the communication follow-up has not occurred in a timely manner, escalation through other communication channels can occur to make sure the reminder gets through to the end user.

Future-proof the communications channels by including an API layer, so that 3rd party services such as Olark, Slack, UserVoice, CRM and Service Desk applications can also form part of the overall communication strategy.

Setting up control mechanisms to maintain trust

Safety is arguably the crux of the debate surrounding the sharing economy, and one of the most difficult to resolve. Opinions differ as to exactly how to ensure the safety of buyers as well as sellers, or in fact or who’s responsible, as a Pew Research survey indicates below. Governments tend to take a stronger stance, with a June 2016 European Commission agenda stating that, “…the Commission does call on the [tourism] platforms to take voluntary action to fight illegal content online and to increase trust.” It’s certainly in the interest of platform providers to decrease the real (and perceived) risk involved in using their service, and there are several ways this can be done.

European Parliament Briefing, Tourism and the sharing economy, pg. 8. January 2017

Though safety is a key concern in the sharing economy, the public isn’t unanimous on who’s responsible for what. Pew Research Center, Shared, Collaborative and On Demand: The New Digital Economy, May 19, 2016[/caption]

Rating systems

If your providers are individuals, the best way to provide value is to focus on trust and safety. People are hesitant to trust strangers. If I am renting my car or power drill to a stranger, how can I be sure they will not steal it, trash it or break it? This distrust creates lots of friction in C2C marketplaces. The marketplace itself can reduce friction by acting as a trusted middleman.

Juho Makkonen, January 5, 2016

Rating systems are much more complicated than they seem! Learn more about them with this article published on Uber Engineering blog.

One critical mechanism that has come to be a cornerstone of the sharing economy is reputation rating systems. Although they do decrease “information asymmetry,” as the FTC report calls it, there are also certain limitations:

Reputation rating system limitations

1. Ratings Biased Upward and Toward Extreme Experiences: Users are more prone to leave a review if their experience was particularly good or poor, and many often don’t leave any review if it was negative (to avoid potential confrontation). This can skew results.
2. Ratings Can Be Manipulated for Strategic Purposes: Fake reviews, whether positive or negative, abound, and some people shy away from posting negative feedback for fear of repercussions or of violating social etiquette.
3. Impact of Experience: Newer users who aren’t used to how reviews tend to be written aren’t as adept at interpreting them as more experienced users.
4. Cold Starts as a Problem for New Entrants: Users who are completely new to the platform necessarily have no positive (or negative) reviews, making it difficult for them to build a reputation and get the ball rolling.
5. Reputation Milking and the Final Period Problem: People who know they will be leaving the platform or who want to play off their good reputation score may feel they can benefit from these two situations by doing what they like without reprisal.

All in all, reputation systems certainly help build safer sharing economy platforms, but they shouldn’t be used as a sole mechanism for trust building. As the FTC report states, “Although panellists generally agreed that reputation ratings systems are working well in the sharing economy, many expressed the view that these systems do not function perfectly.”

Insider's perspective — Patrick Nangle

Patrick Nangle is the CEO of a car-sharing co-op, Modo.

How do you ensure security for your platform’s users? (ex: by using a reputation rating system, anonymous phone numbers, providing insurance…)

Our members own the co-operative. The platform simply provides a means for them to use the vehicles and contribute to the cost of operations. We require our members to return the vehicle at the end of their trip on-time, clean and with the fuel tank not less than quarter full. That is a courtesy to the next user. Members failing to do so are subject to fines. We count on the next user to let us know if there was an infraction. The fines are meant to encourage better behaviour and are not designed to be profitable. The updated version of our app includes photo functionality to aid reporting.

Platform intervention

If you have a rental marketplace, you can offer insurance. If an item is stolen or broken, you cover it—but only if the payment was conducted through your marketplace’s payment system. Peer-to-peer carsharing marketplace RelayRides prides on offering an insurance of up to $1 million, and it covers not only the damage to the car, but also potential claims from third parties for damage or injuries. KitSplit focuses on low-value items (cameras and other creative equipment), so in their case lower coverage of up to $10,000 is enough. Unlike most of its competitors, BlaBlaCar charges a commission, and justifies it with ridesharing insurance.”

Juho Makkonen, January 5, 2016

Many platforms also recognize the need to intervene directly in a variety of ways to ensure safety and build trust in the community. This can be called “platform intervention”:

1. Curate entry into platform: providers can select who can begin using the platform based on certain criteria – for a ride-hailing app, this might mean those who have valid driver’s licences.
2. Reimbursement options: useful for service-providers to reassure unhappy customers
3. Insurance through platform: can help home sharing platforms be perceived as more secure, for example.

However, platform curation can never filter out all bad apples, and reimbursement and insurance options won’t prevent problems, just help after the fact. Reputations rating and platform intervention systems cannot provide totally secure sharing economy experiences.

Parting gifts

We hope this document will help you understand the challenges of direct user to user communications and how to tackle them. Before we part away, let us provide you with ten final takeaways to design better P2P communication systems, and one last round of tips from our experts.

The ten commandments of P2P communications

1. It’s advisable for P2P platform users to keep communication on the platform, and not publicly post their personal email or phone number
2. Adding in-app chat/emailing via third-party vendors can help ensure communication stays on the platform (for security and insurance reasons)
3. High deliverability and open rates make text messages a right choice for time-sensitive alerts, when your users are on the go, or when your audience may not have a smartphone
4. Voice communication is easy to use, and a good choice if your platform requires personal, synchronous communication
5. CPaaS providers can add an often desirable extra layer of privacy or user verification via anonymous/dedicated numbers and 2-factor authentication
6. Provide a variety of (secure) ways for your users to communicate
7. The more ‘high risk’ your P2P business model is, the more trust mechanisms you need to put in place
8. While the transparency vs anonymity questions is an open debate, providing trust mechanisms that make sense for your platform is essential, whether that means 2FA ID checks, log in via social networks, anonymous numbers, reputation rating systems or insurance
9. Be transparent about what your platform does – if your business model isn’t truly about ‘sharing,’ don’t market yourself as such
10. Listen to your users and model your notification system around the channels they already use and the kinds of interactions you’re building

Final Insider Tips

All along the whitepaper, our four insiders kicked in to give their insight and tips. We asked each of them for final advice to help marketplace entrepreneurs avoid critical mistakes

Curren Bates

Trust starts with you, the entrepreneur. Demonstrate how you expect your community to interact with each other, every day, to the nth degree. It’s imperative that you maintain exemplary customer service, especially early on when things like user reviews and external backlinks are in short supply. Listen to what your community is asking for. Take cues from other successful, more established sharing economy participants. Remember that when it comes to brand loyalty and customer satisfaction, there’s no such thing as “too much trust.”

Patrick Nangle

Don’t claim to be part of the sharing economy if you’re not. You will lose trust very quickly if you’re not authentic. Decide if your platform will truly facilitate sharing or if it’s simply an exchange for buying and selling products and services. There’s nothing wrong with creating a business that facilitates trade for a profit, just don’t call it sharing if that’s the case.

Adam Broadway

Communication is the key to success in any relationship, whether online or in the real-world.

Provide more choice in the way your marketplace community members can communicate and don’t worry about them ‘taking the deal off the platform.’ The more conversations though IM, chat, email, text, phone, or video you provide, the more engagement you will have, which will lead to more growth and more conversion towards your end business goals.

Building on top of existing, respected platforms, rather than from a ground-up approach, will also mitigate security holes in your platform, as you leverage the learnings and best practice of others.

Esther Martos Carrión

From my personal experience, I think that at the initial phase it’s better to advertise via social networks, like Facebook, Twitter, etc. This will bring quite a lot of visibility and therefore new users. In my opinion, it’s less invasive than emails, SMS, and other more personal channels. Once the platform is consolidated and has a community of users, you can move to other communication channels, like monthly email newsletters or live chats. We also created an internal social network with different channels in which our users were able to comment, ask about any doubts they had, connect with other peers, etc.

[cta href="https://www.callr.com" txt="Secure your P2P platform users communications" btn="Try CALLR"]

Sources and Acknowledgement

This whitepaper was made possible by the fantastic research and writing effort lead by Robin Nichols. She has been consistently delivering very high-quality content built on extensive research and interviews.

You can find her writings below, and they include all the sources mentioned in this document:

• Security in the Sharing Economy
• Tips for Improving your Peer-to-Peer Marketplace
• Surmounting P2P Challenges (1/2): Choosing a Notification System
• Surmounting P2P Challenges (2/2): Trust and Security

Primary sources mentioned in this document:

• Federal Trade Commission Staff Report, The “Sharing” Economy Issues Facing Platforms, Participants & Regulators, pg. 40-46. November 2016
• John R. Suler, “The Disinhibited Self,” in Psychology of the Digital Age: Humans Become Electric, ed. John D. Kelly et al. (Cambridge: Cambridge University Press, 2016), 95.
• Future of Privacy Forum, User Reputation: Building Trust and Addressing Privacy Issues in the Sharing Economy, pg. 3, June 2015