The Key Value Components of a Customer Value Proposition for Free-Floating Car Sharing Services in the Nordics

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The Key Value Components of a Customer

Value Proposition for Free-Floating Car

Sharing Services in the Nordics

MASTER THESIS WITHIN: Business Administration NUMBER OF CREDITS: 30

PROGRAMME OF STUDY: Strategic Entrepreneurship AUTHORS: Elliot Strand & Viktor Sandell

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Master Thesis in Business Administration

Title: The Key Value Components of a Customer Value Proposition for Free-Floating Car Sharing Services in the Nordics

Authors: E.S. Strand & V.N. Sandell Tutor: Duncan Levinsohn

Date: 2021-05-21

Key terms: Car Sharing, Free-Floating, Customer Value Proposition (CVP), Perceived Value, Satisfaction, Trust, Loyalty

Abstract

A well-crafted, locally adapted customer value proposition (CVP) can aid businesses in attaining loyal customers. The main purpose of this research is to determine the key value components that should be considered for the development of a CVP, for free-floating car sharing services in the Nordic region. This is done by establishing the relationship between deductively identified value components, perceived value, satisfaction, trust, and loyalty. A research framework is proposed, where the relationships between the different constructs are hypothesised. Quantitative data is collected from existing car sharing users in the Nordic countries, through a self-administered online questionnaire, distributed through a non-probability sampling method. The empirical data is analysed through multiple regression analysis using the software SPSS, and the extension “PROCESS”, as well as additional analysis techniques to ensure data quality. The research findings indicate that perceived convenience, need fit, and a low service price positively impact both perceived value, as well as satisfaction. Satisfaction shows a stronger, positive effect on loyalty than that of perceived value, yet, loyalty is better explained when both constructs are accounted for. Additionally, trust shows to carry a mediating effect between both satisfaction and loyalty, as well as between perceived value and loyalty. Therefore, firms operating within this context should emphasise the customer needs to provide a service which is perceived as affordable and

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Acknowledgements

The authors would like to express their gratitude to all individuals involved in this research project.

The authors thank Duncan Levinsohn for providing the necessary guidance to successfully execute this Master thesis. Also, the authors wish to thank Jonas Persson for sharing his exceptional data analysis expertise.

Moreover, the authors would like to thank the peers providing invaluable input along the research process at monthly feedback sessions.

Also, the authors thank all respondents who sacrificed their time to provide valuable insights for the study.

The input made by the concerned parties is highly appreciated, thank you very much!

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1. Introduction

This chapter introduces the reader to a problem faced by free-floating car sharing in the Nordics through an illustrative story. This is followed by a background where the different sub-components of the sharing economy are outlined, along with an introduction to the mobility sector and car sharing. Consequently, the problem is discussed in detail before the research purpose and question is presented.

Michael realised that his car sharing venture HappyCar has been operational for over one year. He contemplates over how to celebrate the milestone, but quickly settles and realizes that the celebrations will have to wait. There is a lot of work ahead of the upcoming investor meeting. HappyCar has received a lot of coverage in international media with headlines such as “unicorn-potential” and “growth-rocket”. It is easy to see why. The novel car sharing business has since its introduction attracted tens of thousands of registered users. The number of users has also increased exponentially during the last months, and there does not seem to be a roof to the firm’s success.

Michael feels proud of his accomplishment and has the impression that he has the upper hand in the investment negotiations. The numbers show accelerating growth in both the number of registered users, as well as in revenue. He and his team also performed extensive market and customer analyses, which seemed to be completely accurate. Due to the high growth in registered users, thousands of cars have been added to the completely electric fleet.

Michael perceives the investors as surprised, while he tries to remain calm. He contemplates whether he should increase the initial valuation and give away a smaller portion of his

business. “How many monthly trips are completed by each user?” one investor asks. This was the one question Michael feared. “It has been difficult to estimate, due to high discrepancy

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Michael was confused, angry, and disappointed at the same time. He figured that the reason for their withdrawal had to be connected to their question about monthly trips per user. After rushing back to the office, Michael started to examine the numbers more closely. He realised that only a fraction of the registered users had completed more than one trip. Initially, this was no problem due to the novelty of the venture, and a steady inflow of new users. Michael however, realised that this would not be sustainable long-term. Why do most users only travel once? Why don’t they come back? he thought to himself. A large proportion of the early growth was attributed to the market and customer analyses, which seemed to be accurate. Michael had a realisation: Perhaps different forces are in play considering why a user chooses to sign up, and why they return. He immediately set on a mission to figure out what was missing in the customer value proposition of the service.

1.1 The Sharing Economy

In the past couple of decades, changes in consumer habits have led to significant change in how individuals consume. One result brought forward by these changes is the phenomenon “sharing economy” (Belk, 2014). At a ground-level, the sharing economy refers to when a consumer pays for temporary access to an under-used asset (Böcker & Meelen, 2017; Hossain, 2020). This contrasts more traditional forms of exchange, where ownership is transferred in full at the point of purchase (Benoit et al., 2017).

A key driver that has facilitated the rise of such companies has been the development of Information and Communication Technologies (ICT’s), more particularly Web 2.0 (Belk, 2014; Laurell & Sandström, 2017). The two-way nature of the internet has allowed for consumers and businesses alike to create, communicate, and share information, skills, experiences, and knowledge through various platforms (Grassmuck, 2012). Similarly, online communication has allowed businesses to capitalise on the matchmaking of individuals. This has been a crucial factor for the rise of ridesharing platforms such as Uber and Lyft which has reshaped transportation through mediating the relationship between individuals (Jia et al., 2020). While Uber and Lyft accurately embody examples of sharing economy companies, the businesses can further be classified into a specific subset of the industry, known as

collaborative consumption (Figure 1). The sharing economy label is frequently used as an umbrella term, and comprises sub-components, such as access-based services, collaborative

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The broader definition of sharing economy businesses has together spurred the interest of venture capitalists, with billions of dollars being invested into new sectoral entrepreneurial endeavours (Crunchbase, 2020). This has led to a constant battle of developing the new, most successful way to capitalise on the recent trend. Hence, understanding the factors that drive success for such businesses becomes crucial for new business development. More

particularly, developing in-depth knowledge of the various categories of sharing economy businesses can facilitate a greater understanding of the unique dynamics of such businesses and their individual value deriving factors.

Scholarly attention has been devoted to consumer motivations for sharing economy participation (Bardhi & Eckhardt, 2012; Böcker & Meelen, 2017; Edbring, Lehner, and Mont, 2016; Hamari, Sjöklint, and Ukkonen, 2016; Heinrichs, 2013; Schor, 2016). These publications highlight environmental, social, and economic factors as motivators for participation. Additionally, factors such as flexibility, temporary nature of use, and

opportunity to test have also been examined to motivate customers to partake in consumption (Edbring et. al., 2016). Economic impacts have proven difficult to measure due to the

cannibalizing nature of the sharing economy on the traditional economy, particularly when considering its effects on job creation (European Commission, 2013). By using resources more efficiently, a greater share of scarce resources can be saved in the process (Böcker & Meelen, 2017). Although the concept or at least similar phenomenon than that of shared economies has existed in literature for a couple of decades, its rising popularity can strongly be argued for in today's environment (Schor, 2016). The sharing economy market is expected to grow to nearly $335 billion by 2025, which can only be considered as remarkable given its estimated value of $14 billion in 2014 (Hossain, 2020; Yaraghi & Ravi, 2017). Nevertheless, current literature is still in the process of being developed to provide for an understanding of the concept itself. Numerous publications have been written where authors attempt to define the phenomenon (Bardhi & Ekhardt, 2012; Belk, 2014; Böcker & Meelen, 2017). Attempts have also been made to break the concept down into various categories, through which a greater understanding of its entirety can be derived (Acquier et al., 2017; Benoit et al., 2017; Schor, 2016).

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The sharing economy embodies all forms of exchange where the consumer is granted temporary access or temporary ownership to a good or service. The different subcategories which are present within the sharing economy are illustrated in figure 1, as well as compared to traditional buying.

(Figure 1) Based on the work of Benoit et al. (2017).

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1.2 Mobility Sector

The sharing economy trend is increasingly prevalent within the mobility sector. For example, around one hundred European cities have seen their streets being filled by electric scooters during the last few years (MobilityForesights, 2021). Individuals’ demand for convenient transportation modes has reshaped urban mobility, and consumers today have numerous alternatives to get around. Electric scooters are by the World Government Summit (2020) acknowledged as a complementary mode of urban transportation with strong potential. The access-based consumption-trend is also visible for slightly longer journeys in the form of car sharing, where consumers in a similar fashion to scooters are granted temporary access to passenger vehicles. For example, GreenMobility offers users the ability to rent an electric vehicle (EV) at either a minute-based fee, or even days (GreenMobility, 2020). This form of temporary access has developed into an industry comprising over 200 operators in more than 3,000 cities (Movmi, 2019). Also, a 47% increase in the number of cities where car sharing is present can be identified between years 2016 and 2019 (Movmi, 2019). The rising trend is also expected to continue, particularly in Europe (PwC, 2020).

There are numerous ways through which vehicles are shared in non-ownership models within the sharing economy, and the term under-utilisation describes few assets better than cars. In Europe, private cars sit unused for more than 92% of the time (Min & Xing-fu, 2020), and the equivalent number for the US reaches 95% (Benjafaar et al., 2019). The most common forms of vehicle sharing are through renting and leasing, forms which have been around for

decades. Ridesharing, carpooling, free-floating and station-based car sharing, as well as peer-to-peer car sharing are other forms in which private vehicles are shared. Ridesharing refers to companies such as Uber, where a private individual utilises their privately owned vehicle to offer ride-services to customers. This can even be combined with carpooling, where

numerous passengers share the same vehicle to reach common destinations. Car sharing, on the other hand, refers to services which provide short-term rental of vehicles, and further classification depends on the number, and nature of actors involved (Figure 1). Thus, car sharing users have multiple alternatives to choose between, as offerings of this nature may take on various forms.

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Considering car sharing offerings within the sub-category of access-based consumption, the main distinction can be found in their station based, or free-floating nature. The former utilises designated return stations for vehicles, whereas free-floating offerings allow for flexible transport through the offering of a fleet of vehicles accessible in a larger area. This study mainly considers free-floating car sharing services in the Nordic region. This form of service was chosen as Hahn et al. (2020) identified flexibility to be a key predictor of service acceptance. Therefore, it is suggested that a free-floating model would be more beneficial than a station-based counterpart for optimal service adoption. Several relevant businesses were identified to operate in the Nordics and therefore included in this study. These companies are GreenMobility, Aimo, ShareNow, VY, and Omago.

Car sharing can also be recognised for having a positive environmental impact (European Commission, 2017). According to Loose (2010), between four and eight private vehicles are replaced by implementing a single car sharing vehicle. Transportation accounts for

approximately 14% of global greenhouse gas emissions (EPA, 2021), from which road transport accounts for the vast majority (European Commission, n.d.). Thus, car sharing has the potential to both reduce the environmental footprint of personal transportation, while alleviating parking pressures in increasingly dense urban environments (Chapman,

Eyckmans, and Van Acker, 2020; Loose, 2010). Additionally, since a large proportion of car sharing trips are made with a small amount of people and luggage for each car, companies often provide small cars through their service (Loose, 2010). These smaller cars generally emit less CO2 into the environment, resulting in up to 20 percent lower emissions when compared to the average personal vehicle (Loose, 2010). Large car manufacturers have in recent years expanded their offering to enter the car sharing segment. For example, Daimler and BMW have created a joint venture, merging their previous ventures “Car2go” and “DriveNow”, to form “ShareNow”, which at the point of merger became the largest car sharing service in the world (NewMobility, 2019). Alongside the industry giants, smaller actors with different scopes also operate in Europe. For instance, “Aimo” in Stockholm, “Zity”, in Paris and Madrid, and GreenMobility who are present in 7 European cities. (Aimo, 2021; Zity, 2021; GreenMobility, 2021).

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1.3 Problem

1.3.1 Car Sharing in the Nordics

Car sharing solutions have, among other regions, found a presence in the Nordics. The Nordic region is generally sparsely populated by roughly 27 million individuals (Herning, n.d.). Denmark is the only exception, where the population density is above European average. The Nordic countries are characterised by their high socioeconomic status and gender equality (EIGE, 2019). Also, a large emphasis is devoted to sustainability, which is depicted by the countries’ quick adoption of personal vehicle electrification. In fact, the five Nordic countries were all featured in the top six nations with the highest percentage of electrified vehicle adoptions globally, in 2020 (Richter, 2021). Private car travel has been common amongst the Nordic countries, and these nations have been making efforts to promote non-private transport alternatives (Swedish Energy Agency (SEA), 2019). For example, Finland and Denmark have both made efforts in developing Mobility as a Service (MaaS) softwares in order to facilitate non-ownership travel modes (SEA, 2019). Despite this, the market penetration of car sharing in the Nordic countries merely reaches between 2 and 4% in 2021 (Statista, n.d.), and attaining loyal users in the region has proven to be difficult (Stocker, 2018). The penetration rate numbers from the Nordics can be compared to 1,9% in Canada, 2,6% in Germany and 5,9% in New Zealand, which is the second highest globally, only behind Singapore at 7% (Statista, n.d.). In both Canada and Germany, around 10 cities populated by 500 thousand individuals can be found. This contrasts the Nordic nations, which are characterised by large proportions of the population living in the

respective capital cities. Thus, the nations’ relatively small populations merely form one or two cities in each country that reaches the aforementioned magnitude (Iceland excluded). The lucrative nature of multiple large cities within one area of legislation thereby speaks against the Nordic region for car sharing organisations.

Green Mobility, a Danish car sharing platform, has, however, recently announced its entrance into additional Nordic markets (GreenMobility, 2020a; GreenMobility, 2020b). Starting with Finland in Q4 of 2020, followed by Norway with expected entry during 2021. In their

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Before merging in 2019 to become the largest actor in the world, Daimler’s “Car2go” and BMW’s “DriveNow'' both entered and closed down their operations in Stockholm. This was partly due to an insufficient number of loyal customers, as well as high congestion taxes and parking fees (Jelica, 2018). Similarly, DriveNow also entered Helsinki in 2017, only to withdraw a few years later (Bertoli, 2017). The difficulty of attaining loyal users in the industry, and the fact that most services offer sign-up bonuses and free rides, gives an indication of high competition, as well as the campaign-driven nature of the sector. For instance, the service “Aimo” in Stockholm has incorporated a “frequent user program” in order to drive customer loyalty (Aimo, 2021).

1.3.2 Importance of deriving customer value

Increased customer demands and global competition have brought forth the increased importance of a customer-oriented value delivery, following its potential to generate a competitive advantage for firms (Woodruff, 1997). Customer value is however a highly subjective and complex concept. Yet, it has been recognized in past literature as a key component in understanding business success (Parasuraman and Grewal, 2000). Given the recent development that has been noted within the car sharing industry, avenues for customer value-based research are yet to be established. Hence, developing and defining a customer value proposition (CVP) that delivers value for customers and drives competitive advantages for businesses within the car sharing market, become crucial components to drive the market forward. Despite the limited attention devoted to value driving factors, and their link to loyalty in the free-floating car sharing sector, attempts have been made with regards to the sharing economy as a whole. Zhang, Gu, and Jahromi (2019) have researched factors of value and suggest a CVP for SE businesses collectively. However, as the sharing economy

embodies a complex structure with multiple categories of businesses that coincide within, categorising the market into a single entity with shared value constructs is problematic. The authors acknowledge this, and call for further research to take place in specific contexts within the phenomena. Furthermore, researchers emphasise the importance of distinguishing sectors within the sharing economy in order to achieve consistent results (Böcker & Meelen, 2017). Therefore, additional research should be conducted on the various forms and

industries of sharing economy businesses, and their unique CVP, in order to derive generalisable findings.

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The emerging car sharing market has received attention from scholars, with a large share of literature emerging within the past years. However, arguably due to the novelty of the industry, a large share of literature has only touched the surface of the phenomenon. For example, scholars have linked the concept to access-based consumption (Bardhi & Ekhardt, 2012), emphasised the sustainability factors of using car sharing services (Chapman et. al., 2020; Dowling & Kent, 2015), and its impact on the traditional car-selling market (Schmidt, 2020). However, gaps in literature can be identified when considering value within the car sharing context. Also, the relationship between different components of value, how these are perceived by car sharing users, as well as their link to user loyalty, is yet to be established. Loyalty, a key component of management literature, has been referred to as a commitment to a brand, causing repetitive purchasing (Oliver, 1997). The concept has been further linked with customers’ satisfaction and the quality of a service (Patterson, Johnson, & Spreng, 1997). Customer satisfaction has further been identified as a precursor to loyalty, with additional links with perceived value. In simple terms, contrary to perceived value,

satisfaction has been recognized to emphasize post-consumptive fulfilment. As mentioned previously, car sharing businesses have had difficulties maintaining customers over a longer period of time, causing them to withdraw from the Nordic market. Therefore, it becomes crucial to understand the components that users perceive as valuable, and the components that lead to satisfied customers. Additionally, businesses must also recognise whether these aspects translate into continuous commitment to the brand.

The role of trust has been proven to have significant importance for loyalty in several sharing economy contexts (Chica et al., 2019; Shao et al., 2020). Additionally, the Nordic region has been recognized as having the highest level of social trust globally (Andreasson, 2017). Based on the European Social Survey in 2014, the top four countries ranked by social trust were Denmark, Finland, Norway, and Sweden (Andreasson, 2017). Among other factors, social trust has been recognized to contribute to economic growth, social integration as well as cooperation (European Social Survey, n.d.). Such factors could be seen as beneficial for car sharing operations. However, the role of trust remains unclear with regards to free-floating car sharing in the Nordics. Studies have also emphasised the importance of culture when considering motivational factors within the sharing economy (Davidson, Habibi, and

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The Nordic region comprises high socioeconomic characteristics and has proven to exert efforts toward alternative transportation methods. Despite car sharing companies recognising the market potential in the region, attaining loyal customers has proven difficult. Therefore, in order to drive the market forward, further emphasis should be devoted towards developing and defining a CVP, and its broad spectrum of concepts that can generate value for

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1.4 Purpose

In order to address the research problems, this study attempts to identify the various value components of free-floating car sharing offerings in the Nordic region through an extensive review of topical literature. Furthermore, the purpose of this study is to explain the

relationship between the value components, and users’ perceived value, as well as their satisfaction evaluation of the usage experience. Additionally, the study aims to explain the relationship between perceived value and loyalty, as well as satisfaction and loyalty, both with and without trust as a proposed mediating factor. Through this examination, the study aims to suggest a CVP for free-floating car sharing firms in the Nordics. This will allow firms of this nature to better align their value creation and appropriation activities with what is perceived by customers in order to achieve economic gains through loyal users.

Accordingly, the following research question is proposed:

What are the key value components of a customer value proposition (CVP) for a firm operating in the free-floating access-based car sharing sector in the Nordics?

The following research objectives highlight the accomplishments necessary to answer the proposed research question and provide clarity regarding the proposed research approach. Identify the various value components that affect perceived value and satisfaction within free-floating access-based car sharing services through a review of literature. Establish the relationship between the various value components and perceived value. Establish the relationship between the various value components and satisfaction. Establish the relationship between satisfaction and loyalty, as well as perceived value and loyalty, while examining the potentially mediating role of trust.

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1.5 Delimitations

This study is carried out with a geographical focus on the Nordic countries. This is since the landmark studies on car sharing have been carried out in Asia (Chun et al., 2019), North America (Bardhi & Eckhardt, 2012; Zoepf & Keith, 2016; Martin & Shaheen, 2011), as well as southern and central Europe (Firnkorn & Müller, 2011; 2015; Böcker & Meelen, 2017). This region was also suitable for the researchers due to convenience reasons. That is, access to information in the native languages, as well as local cultural understanding.

There are several forms and modes of car sharing. In order to derive more generalisable findings, the scope of this study was limited to access-based car sharing services with a

free-floating offering. Companies offering peer-to-peer services through a platform, or a

B2C solution with a station-based model are therefore disregarded. As no companies of this nature operate in Iceland, this geographical region was therefore disregarded.

Lastly, the Covid-19 pandemic was not considered as a major topic in this study, despite its potential effects on the research findings. This is due to expert predictions that the impacts of the pandemic will not have a significant effect on the medium- and long-term development on this form of mobility (WGS, 2020).

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2. Literature Review

First, the various definitions of the sharing economy are outlined and compared, and the major research streams in extant literature are highlighted. Second, the car sharing sector, and the various forms that constitute this subset of the sharing economy are covered. Third, literature on the various motivations for sharing economy participations is analysed,

followed by concepts of value, satisfaction, trust, customer repurchase intention, and loyalty. Lastly, the proposed research model and hypotheses are presented.

2.1 Literature Review Process

The purpose of the literature review was to outline, clarify, and synthesise existing ideas and theories on our research topic. Through providing the context in which our study takes place, it allowed for the development of in-depth knowledge on the topics, and clarification of gaps in extant literature. Lastly, the exploratory, yet systematic review allowed for hypothesis development, as well as the proposition of a framework for testing these. A detailed explanation of this process can be found in Appendix 1.

2.2 The Sharing Economy

The sharing economy is a term frequently used by scholars as an umbrella term to describe the exchange process of under-utilised assets between individuals and organisations, where no transfer of ownership takes place (Hossain, 2020). This form of exchange has dramatically disrupted multiple industries, particularly within accommodation and transportation services (Kathan, Matzler & Veider, 2016). Despite the contemporaneity of the topic, there is no uniform definition for what the term actually encompasses (Acquier, Daudigeos, & Pinkse, 2017). For example, due to its catalytic effect on the sharing economy, scholars commonly mention digital platforms when defining the phenomenon (Belk, 2014; Mair & Reishauer, 2017; Skjelvik, Erlandsen, & Haavardsholm, 2017). It is also frequently suggested that the definition of the sharing economy should include the aspect of asset under-utilisation (Apte &

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access, contrasting with traditional ownership transfer is a key attribute of the sharing economy.

The sharing economy therefore comprises a large variety of businesses in different sectors, with varying motives. The broad scope of the concept has demanded more specific

subcategories, which have separated the viewpoints of scholars. Acquier et al. (2017) emphasise the need for more narrow classifications, as umbrella constructs rarely fulfil academic validity, while too narrow definitions may result in wrongful categorisation. Thus, based on a review of literature, Acquier et al. (2017) conceptualised the sharing economy through categorisation into three foundational cores (Figure 2).

(Figure 2) - Foundational Cores of the Sharing Economy (Based on the work by Acquier et al., 2017)

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The access economy comprises resource sharing initiatives to optimise asset utilisation. The key distinction for the access economy is that users are given access to an asset, where no transfer of ownership is taking place (Acquier et al., 2017). In many cases, ownership does not increase the asset’s benefit for the user, while owning it can drastically increase the sacrifice. Common examples of services operating within the access economy realm are Spotify, Netflix and ZipCar. However, an exchange where access is temporary rather than definite, and where no transfer of ownership takes place is not a novel phenomenon. Such exchanges have been common for rental of properties, cars, and books. However, the concept has evolved, and incorporated services alongside such products to collectively satisfy

consumer needs. Mont (2002) recognised this as product-service systems (PSS), and argues for their many benefits for companies, consumers, governments, the environment, and the society as a whole. Today, the access economy is established in a large variety of sectors, and takes various shapes through different business models.

The second fundament of the sharing economy is by Acquier et al. (2017) denoted as the platform economy. This subset is explained by efforts that connect peers through digital platforms, and allow for decentralised exchanges. A signifier for these platforms is their non-producing nature, as well as their tendency to possess a strong network effect (Acquier et al., 2017). That is, when the relative value of the ecosystem increases with the number of

connected users (Lang et al., 2020). Amazon, Uber, and Facebook are all examples of companies operating within this realm.

The third and last pillar constituting the sharing economy is the community-based economy. This realm is unlike the former two, not market mediated. Instead, it rather relies on the social bonds between the community members. Exchange is rarely contractual nor monetary, but rather altruistic and driven by social motives (Acquier et al., 2017). Similar to the access economy, the community economy is not novel in its way of organising efforts. However, information and communications technology (ICT) have allowed for significant development with regards to the sharing economy during the last decades, for example through connecting individuals regardless of physical proximity, while facilitating exchanges and access to information (Ferrero et al., 2018).

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The three foundations are however contrasted by Benoit et al. (2017), who argue that new compartmentalisations add to the confusion, and therefore separates the different forms of exchange by a set of distinct criteria: number and nature of actors, nature of exchange, and to what degree the exchange is mediated by market mechanisms (Figure 1).

(Figure 1) Based on the work of Benoit et al. (2017). The distinction between leasing, renting and access-based consumption is fine, yet distinct. What separates the two is the longevity of the access period, and the distinction may thus fluctuate depending on the good or service in question. Leasing a car for a few years, renting it for a few weeks, or accessing it for a few hours, arguably involves completely different dynamics when considering for example consumption involvement.

Based on these classifications, all forms of exchange apart from traditional “buying” would be considered a part of the sharing economy. The distinction also holds true according to Bardhi and Eckhardt (2017), who argue for separation between solid and liquid consumption. Whereas solid consumption reflects buying, liquid consumption is defined as “...ephemeral, access based and dematerialized” (Bardhi & Eckhardt, 2017 p.582). The authors argue that the classification of liquid consumption is required to explain the new type of online consumer behaviour, where consumption is decoupled from brand attachment and identity alignment.

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This form of consumption also caters to the consumers’ increased desire for flexibility and speed, following shortened product life cycles and increasingly rapid technological

development (Bardhi & Ekhardt, 2017).

Hossain (2020) has thematically analysed the findings of 219 peer-reviewed articles written on the sharing economy topic. Apart from the definitional disagreement, scholars have mainly devoted their attention towards the different stakeholders involved in, and affected by the sharing economy uprise, and their motivations for participating (Benoit et al., 2017; Böcker & Meelen, 2017; Barnes & Mattsson, 2017; Hamari et al., 2016). Studies have also been conducted from an organisational perspective, analysing business models,

organisational challenges, as well as its environmental, social, and economic implications (Edbring et al., 2016; Constantiou et al., 2017). Additionally, the transportation and accommodation industries have been under scrutiny due to the major disruption caused by sharing economy businesses in the respective sectors (Hossain, 2020).

2.3 Motivations for Participation in the Sharing Economy

When studying the various components or characteristics of businesses that offer value for consumers, it is important to understand the motivations behind consumers' decision to participate in consumption. Consumers' motivations behind SE participation have been consistently highlighted across the research field of the sharing economy, through which numerous themes and topics of relevance can be identified. At a large scale, consumer

motivations are commonly categorised into environmental (Botsman & Rogers, 2010; Böcker and Meelen, 2017; Hahn et al., 2019), social (Gullstrand Edbring et al., 2016; Tussyadiah, 2016), and economic factors (Bardhi & Ekhardt, 2012; Lamberton & Rose, 2012; Zoepf & Keith, 2016). These factors can further be nurtured and optimized to create a sustainable marketplace (Hamari et. al., 2016). Furthermore, self-determination theory (SDT) has been highly discussed and associated with SE participation (Böcker & Meelen, 2017; Hamari et al., 2016; Tussyadiah, 2016). SDT divides motivations into two particular forms, extrinsic and intrinsic (Böcker & Meelen, 2017). Intrinsic motivations are related to the value or

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Also, looking at the different types of sharing economy sub-categories, it is easy to

understand how motivations may differ across the different forms or sharing activities. For example, the factors motivating consumers to share gardening equipment within their local community may be driven by social stimulus to assist acquaintances. However, sharing office-space with various companies may strictly be a decision weighted by economic

opportunities or constraints. Hence, the following section highlights the various categories of consumer motivations within SE, as highlighted in past academic literature. These main streams include environmental, social, and economic motives for SE participation.

2.3.1 Environmental Motives

The awareness of wasteful consumption, as well as global warming and pollution has created a drive for sustainability (Barnes & Mattsson, 2016). Recognition of these environmental pressures has further pushed individuals to find more efficient use for resources (Tussyadiah & Pesonen, 2016), driven partly by the intrinsic motivations of consumers (Böcker &

Meelen, 2017). Businesses within the SE are generally categorized as firms maximizing the utility of under-utilized assets, hence, consumption within SE is generally associated with a reduction in scarce resource use, and therefore sustainability (Hahn et al., 2019; Böcker & Meelen, 2017; Botsman & Rogers, 2010; Hamari et al., 2016). Piscicelli, Cooper, and Fisher (2015) examined consumer values for a UK based SE business, Ecomodo. Their results indicated that nearly a third of the respondents found “to be green” as the main reason for choosing to join the service. Similarly, Edbring, Lehner, and Mont (2016) identified environmental reasons as a motive for both access-based and collaborative consumption participation.

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Despite the commonly highlighted environmental motivation to participate in the SE, the topic is still highly debated in literature. Studies have found absence in terms of

environmental drivers for participation motivation (Tussyadiah, 2016; Möhlmann, 2015) as well as consumer preference when comparing renting with ownership models (Wittkowski et al., 2013). On the other end of the spectrum, Geissinger et al. (2019) acknowledge a

correlation between customer motivations and environmental concerns, however, highlight that a link between SE platforms and sustainability is yet to be made. Leismann et al., (2013) further emphasise the environmental effects of hiring goods as a case-to-case situation, where each case is unique and therefore result in individual outcomes.

Environmental motives for SE participation are recognized in literature, and shown to exist amongst consumer drivers. However, considering that SE comprises multiple different and unique forms of businesses, categorising environmental motivation as a component of the entire SE context is difficult. Therefore, further understanding of the unique businesses within SE can aid to derive better conclusions regarding the environmental motives of consumers within their respective markets.

2.3.2 Social Motives

The second core component contributing towards consumers' motivation for SE participation is the consumers’ perceived social benefit. Given the nature of SE, interaction, and

communication between the provider of a service or good and the user is a core component of such activities or businesses (Hamari et al., 2016). Factors such as relationship dynamics between provider and customer, as well as consumer trust have been identified to be crucial in forming attitudes towards an SE model of commerce (Gullstrand Edbring et al., 2016). Benoit et al. (2017) find social motives to drive CC behaviour, due to aspects of community and authenticity through peer-to-peer activities. The authors argue that providers'

participation may also be driven through social benefits if they value the opportunity of meeting or helping new people. Similar results were identified by Gullstrand Edbring et al., (2016), where consumers were found to be motivated by the opportunity to be part of a

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When considering SE in online contexts, intrinsic motivations such as individuals’ reputation has been identified as a key contributor to customer participation motivation (Hamari et al., 2016). Additionally, Hars and Ou (2002), in a study of open-source projects, identified intrinsic motivations and community identification as key contributors for participation motivation. However, amongst paid participants, negative correlation was noted with regards to recognition and community identification. Bucher et al. (2016) found social-hedonic values to be the most influential motives for participating in sharing. These refer to the enjoyment derived from occurrences such as enjoying new experiences, or meeting new people, a similar link identified by Tussyadiah and Pesonen (2015) when analysing peer-to-peer accommodations’ impact on travel patterns. However, Tussyadiah (2016) argues that some individuals specifically seek accommodation through which social interactions could be avoided.

Social motives for SE participation have been widely discussed in literature. In particular, aspects of communication, relationship dynamics, and trust are highly recognized in SE contexts. However, as highlighted by Tussyadiah (2016), motivations for participation vary across consumers. Arguably, these motivations have the potential to vary drastically also when comparing different cultures or geographical contexts, further highlighting the need for additional research across different regions.

2.3.3 Economic Motives

Referring back to Self Determination Theory (SDT), economic motives are related to the extrinsic motivations of individuals, which is an outcome that is separate from the particular behaviour inhibited when partaking in consumption (Böcker & Meelen, 2017; Bardhi & Ekhardt, 2012). Some authors have recognized a connection between SE and the 2008 financial crisis (Barnes & Mattsson, 2016; Böcker & Meelen, 2017; Tussyadiah & Pesonen, 2016), however, further links have been made with technological advances, urbanization, and changes in consumers attitudes (Baumeister, 2014). Nevertheless, SE is strongly associated with economical value of access, where decreased costs benefit the individual value of accessing a good (Bardhi & Ekhardt, 2012; Botsman & Rogers, 2011; Lamberton & Rose, 2012; Tussyadiah & Pesonen 2016). In a peer-to-peer context, Apte and Davis (2019) argue that acquiring the marginal cost of using an asset, together with a portion of the fixed cost of owning the particular asset, is a key driver of the sharing economy. As a result, partaking in

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However, economic motives are not solely present at a P2P level. Wittkowski et al. (2013) also identified financial motives as one of the most important drivers for the use of non-ownership services in a B2B setting of small and medium-sized enterprises (SMEs). When considering the economic impact of SEs on users' motivation to participate, it is

important to understand the impact of price or cost with regard to consumer decision making. Wittkowski et al. (2013) investigated the impact of price consciousness when comparing renting and ownership modes of consumption, and found no influence on consumer preference of consumption mode. On the other hand, when considering car and

accommodation sharing services, lower prices have been identified as a factor contributing to consumer satisfaction (Möhlmann, 2015).

Furthermore, psychological ownership has also been recognized as a factor to consider when evaluating the economic implications surrounding non-ownership modes. Psychological ownership refers to the sense or feeling of ownership that one has over a specific object (Paundra, Rook, van Dalen, & Ketter, 2017). In an SE context, high psychological ownership has been recognized as a factor contributing to lower price consciousness (Paundra et al., 2017).

The economic motives for SE participation have shown to play a role in the decision making of consumers. However, considering the broad concept of SE, economic outcomes may vary across the different forms of SE businesses. For example, in P2P contexts, consumers have the opportunity to generate economic profits, contrasting to that of other forms of SE businesses. Hence, such motives and their levels of impact are expected to vary across SE and should be researched. Unsurprisingly, lower prices have shown to lead to more satisfied customers (Möhlmann, 2015), whilst consumers have been found to be more price conscious when they do not perceive a great amount of ownership over the particular product (Paundra et al., 2017). This further emphasizes the importance of evaluating the economic factors of SE services, as they have shown to play an important role in consumer purchasing behaviour contexts.

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2.4 Literature streams on car sharing

The current state of the literature on car sharing services is divided into three main streams. First, scholars have been researching the modelling angles of car sharing services, which can be classified into three main modes; station-based (one way, or two way) and free-floating (Namazu & Dowlatabadi, 2018; Ferrero et al., 2018). Second, consumer motivations for participation in car sharing have been outlined, as well as its social and environmental implications (Hossain, 2020).

2.5 Car Sharing Modes

Station-based car sharing modes are models where users can expect to find the shared cars in designated parking spots. After usage, the car is due to be returned to the same station, or another station of the same nature, depending on the mode (one way, or two way; Min and Xing-fu, 2020). A free-floating mode on the other hand allows for greater trip flexibility as the cars can be parked anywhere in the operational area after usage. This mode does however carry high fleet management complexity for the firm, due to the need for vehicle relocation following concentrated demand or usage patterns (Ferrero et al., 2018). The relocation need does on the other hand naturally diminish with fleet size, as the firm then relies more on its consumers to relocate the vehicles through usage (Perboli et al., 2018).

Namazu and Dowlatabadi (2018), as well as Wielinski et al. (2016) have studied the different car sharing models in the Canadian cities Vancouver and Montreal. The findings from both studies indicate that the usage patterns differ significantly depending on the service mode, and that they therefore should be treated separately. Namazu and Dowlatabadi (2018) found that only station-based systems served as an adequate substitute to private ownership, and Wielinski et al., (2016) suggested that users of free-floating services travel significantly shorter distances compared to users of station-based counterparts. It should however be stated that the validity of the findings regarding substitutability can be questioned. The sample constituting the free-floating model merely comprised 2-seated compact vehicles, whereas the station-based counterpart included a range of vehicle models, which can arguably cater to more errands, thus affecting the willingness to substitute. This can also be seen as an

indication for car sharing users’ ambiguous desires and needs. Firnkorn and Müller (2015) argue that vehicle electrification is an important aspect to consider when investigating

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The findings from their study on “Car2go” users in Germany indicates that customers who have used electric cars from the car sharing fleet show a higher willingness to give up private car ownership, compared to customers with experience from gasoline-powered counterparts. To our knowledge, there is only one previous study which has focused on customers’

intention to reuse a car sharing service. Mattia et al. (2019) conducted a mixed methods study to investigate the motivations of Italian customers to reuse a free-floating car sharing service. Through applying Ajzen’s (1991) theory of planned behaviour (TPB), they, like Hamari et al. (2016) found that the customers’ attitude towards free-floating car sharing synthesised

economic, social, and environmental aspects. This attitude, along with subjective norms and perceived behavioural control, all showed to influence planned future behaviour of reusing a free-floating car sharing service (Mattia et al., 2019). Hahn et al. (2020) on the other hand suggest that a positive attitude towards a service is not, by itself, a good predictor for adoption. The authors therefore suggest that emphasis instead should be directed towards lifestyles and needs, following their identified gap between attitude and actual behaviour.

2.6 Motivation for Car Sharing Participation

2.6.1 Environmental Motivations for Car Sharing Participation

The environmental impacts of car sharing services have been debated by scholars (Hahn et.al., 2019; Bardhi & Ekhardt, 2012). Similar to other sharing businesses, car sharing attempts to maximise the utility of underutilised assets. Therefore, it has shown to have a declining effect on both car ownership, as well as private vehicle distances driven (Hahn et. al., 2020). This could further lead to decreased costs for consumers, as well as lower carbon dioxide emissions (Hahn et. al., 2020). Chapman et al. (2020) identified car sharing users’ emissions to be halved due to the reduced car use resulting from participating in sharing. Despite the potential for reduced car use, car sharing has also been found to have the

potential to increase the total number of vehicles. Ke, Chai, and Cheng (2019) found that car sharing would reduce the total number of vehicles if transportation needs and production costs lied below a specific threshold, whilst market size was sufficiently large. Hence, a potentially negative environmental effect could also be identified due to increased vehicle

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This challenges the asset-utilizing nature of sharing economies, since without a decrease in the total number of vehicles as a result of the service, an increase in the efficiency of resource use could be difficult to justify. To further challenge the perceived environmental benefit of SEs, Acquier (2017) argues for the existence of a Jevons Paradox, particularly in the car sharing sector. This implies that the decrease in cost of private transportation through the efficient use of resources may in fact increase the amount of travel through private transportation, hence, resulting in a rebound effect. This rebound effect is a trigger for increased unsustainable behaviour through what could potentially be argued as

overconsumption. A similar effect could be identified in the hospitality industry, where Tussyadiah (2015) argues for the increase in travel as a result of decreased accommodation costs through collaborative consumption.

A large share of today's car sharing businesses that operate in the Nordics utilise electric vehicle (EV) fleets. Considering electric vehicles' potential to produce lower carbon dioxide emissions (Firnkorn & Müller, 2015), consumers may be more motivated to participate in such sharing activities. Additionally, these motivations may be a combination of variables which drive participation, such as positive social externalities of pro-environmental consumption behaviour. For instance, Hahn et al. (2020) suggest that electric vehicles are often associated with sporty, quick, and silent attributes, which some users enjoy identifying with. It is therefore also important to consider the social aspects contributing to car sharing participation. Regardless of the actual environmental impact of car sharing, it is hypothesised that the general notion regarding this transportation method is environmentally beneficial, amongst Nordic consumers. The following hypotheses are thus proposed:

H1a = At least one item within the environmental value construct has a significant, positive effect on perceived value

H1b = At least one item within the environmental value construct has a significant, positive effect on satisfaction

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2.6.2 Social Motivations for Car Sharing Participation

The social aspects of motivation for participating in car sharing are often overshadowed by other factors, such as environmental or economic, yet are becoming increasingly prevalent in SE literature (Tchorek et al., 2020). Hartl et. al. (2018) analysed the potential difference between peer-to-peer and B2C car sharing platforms, and found no distinction between the two when considering social identity as an influential factor with regard to user preference. However, the social benefit received from participating in car sharing has been recognized as a factor promoting car sharing adoption (Peterson & Simkins, 2019). This social utility has been argued to be originating from the positive environmental effects and the impact of other people's perception of the particular effect (Peterson & Simkins, 2019). Therefore, it is

hypothesised that the social value which consumers recognise from partaking in car sharing is positively associated with both their perceived value, and satisfaction:

H2a = At least one item within the social value construct has a significant, positive effect on perceived value

H2b = At least one item within the social value construct has a significant, positive effect on satisfaction

Considering that car sharing is based on multiple person access to a vehicle, the sense of sharing also has the potential to generate negative personal outcomes. Issues such as a fear of contagion or low levels of trust can negatively influence the status which consumers derive when partaking in car sharing (Bardhi & Eckhardt, 2012; Catulli et al., 2013). Such contagion can occur when consumers do not adhere to rules relating to hygiene, such as smoking

regulations (Bardhi & Ekhardt, 2012). The concept of trust is discussed more in depth in section 2.9.

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2.6.3 Economic Motivations for Car Sharing Participation

Consumers' economic motivations for participating in the sharing economy also manifest themselves in the context of car sharing. Car sharing is argued to offer a financially efficient mode of travel, offering vehicle access at a lower cost compared to ownership (Peterson & Simkins, 2019). Additionally, consumers partaking in car sharing possess decreased aspects of responsibility over the product, particularly when compared to traditional modes of ownership (Peterson & Simkins, 2019; Lamberton & Rose, 2012). However, this may partially be due to the various securities put in place by car sharing companies to protect consumers from damage related costs, and further research should be conducted into the perceptions of ownership, responsibility, and control within a car sharing context. Namazu and Dowlatabadi (2018) also found cost savings to have the strongest association with car sharing in comparison to factors such as convenience (technical aspect) and environmental effects. The authors also found price, along with environmental sensitivity to be important consumer features to promote reduction in vehicle ownership. Therefore, the following hypotheses are proposed:

H3a = At least one item within the economic value construct has a significant, positive effect on perceived value

H3b = At least one item within the economic value construct has a significant, positive effect on satisfaction

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2.6.4 Technical Value

Previous studies investigating consumer motivations for participating in car sharing services also emphasise the technical, and functional aspects of the service offering (Lamberton & Rose, 2012; Zoepf & Keith, 2016). Some examples of such aspects are the distance to the closest available car, available payment options, aesthetic of the app or online platform, or the availability and types of vehicles offered. Considering these factors, the technical value can be closely drawn with the convenience of using the service, however, it also encompasses other service features. Lamberton & Rose (2012) argue that consumers encounter significant search costs with regards to car sharing. Search costs are incurred when customers exert efforts or resources to find, and sign up for a service which they deem suitable. In the context of car sharing, customers encounter additional search costs each time they are to access a vehicle. Therefore, in the context of car sharing, search costs are partly associated with the ease of sign-up, but also ease of accessing a car and likelihood of finding it (Lamberton & Rose, 2012). These costs are highly related to convenience, and should therefore be

minimised, as both convenience and timesaving have been found to carry a strong predictive effect on car sharing usage (Schaefers et al., 2013; Kim & Jan, 2021). In fact, Zoepf and Keith (2016) quantified how American users of the industry giant, Zipcar, valued different factors of the offering. Their findings indicate that one mile (roughly 1,6 kilometres) of travel to access a car, or rescheduling their trip up to one hour was valued at roughly US$2. The types of cars available have also been covered in extant literature (Bardhi & Eckhardt, 2012). Apart from the mode of drive (fuel or electric), Hahn et al. (2020) hypothesised that different situational contexts may require a broad fleet of car types (e.g., compact 2-seaters, station wagons or SUVs). This factor did however not show any significant effect on service adoption in the specific study. Following these findings, the following hypotheses are proposed:

H4a = At least one item within the technical value construct has a significant, positive effect on perceived value

H4b = At least one item within the technical value construct has a significant, positive effect on satisfaction

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2.7 Customer Value

Understanding the motivations that attract consumers to participate in car sharing, firms need to design an economically sustainable business model that reflects these motivations

(Piscicelli et al., 2015). A business model comprises various interrelated elements that together creates value for a business (Kathan et al., 2016). The first element of which, according to Johnson, Christensen and Kagermann (2008), is the customer value proposition (CVP). That is, the activities undertaken by a company in order to create value for its

customers. The concept of customer value became increasingly prevalent during the 1990’s, both in academia and amongst practitioners, and is often considered one of the most crucial elements for business success (Woodruff, 1997). Customer value can be seen as a signal for customers’ repurchase intentions and loyalty (Parasuraman and Grewal, 2000; Woodall, 2003), and has been recognised as a major source for a competitive advantage in the

marketplace (Woodruff, 1997; Payne & Holt, 2001). Customer value is, similar to the sharing economy, a rather broad concept, and scholars view the concept from numerous angles. The perspective mainly differs between firm- and customer centric logic (Martelo Landroguez et al., 2013). The viewpoints also differ regarding whether the concept is predominantly cognitive (Zeithaml, 1988), or both cognitive and affective (Zhu, Kevin Kam & Hudson, 2017).

(Figure 3) (Based on the work of Martelo Landroguez et al., 2013)

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Considering customer value from an organisational perspective, literature emphasises the value creation- and appropriation processes (Figure 3). According to Martelo Landroguez el al. (2013), the former is: “...an innovation that establishes or increases the customer's valuation of the benefits of consumption.” (p. 237). Value appropriation on the other hand considers the way in which a firm is able to capture, or realise the value through preventing others (competitors or channel partners) from imitating the offering, or claiming the

payments from customers (Priem, 2007).

From a customer-centric point of view, research has predominantly focused on how value is perceived. However, perceived value is highly subjective and complex (Zeithaml, 1988; Sánchez & Iniesta, 2006). Major contributions towards the conceptualisation of perceived value are made by Zeithaml (1988), and Woodruff (1997), and their definitions are still widely recognised in current literature (Yu & Lee, 2019; Martelo Landroguez el al., 2013). Zeithaml (1988) defined perceived value as “the consumer’s overall assessment of the utility of a product based on perceptions of what is received and what is given” (p. 14). This definition accounts for the subjective nature of the concept, by addressing the assessment of utility, as well as perceptions of the resources involved in the exchange. Martelo Landroguez et al. (2013) clarifies that what is given comprises both monetary and non-monetary means, and sacrifices such as time, energy, effort, and perceived risk connected to the purchase should therefore also be considered. Woodruff (1997) further expands on the definition by Zeithaml (1988), and argues that utility itself is poorly defined, as it is unclear whether utility is built into the product, or if it occurs as a perceived result from usage. As the usage

situations of products or services are distinctive by nature, the individual intentions, goals, and consequences linked to the usage are thus also likely to be unique (Gardial et al., 1994). Also, sub-components of the value offering are likely to be appreciated in a different manner prior to, or during purchase, compared to during or after usage. For example, product

attributes play a larger role during purchase while the consequences (e.g., social risk) are more apparent after usage (Gardial et al., 1994).

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In the context of car sharing, the different service aspects are thus likely to be perceived differently during different parts of the purchase process as well. For example, excellent roadside assistance could be a factor reducing the perceived risk of choosing a particular service. However, the value of excellent roadside assistance might not be perceived as particularly high by the customer until they actually need it. Woodruff (1997) therefore defines customer value as “... a customer's perceived preference for and evaluation of those product attributes, attribute performances, and consequences arising from use that facilitate (or block) achieving the customer's goals and purposes in use situations.” (p. 142). This definition is argued to provide a link between the individual perception of utility, usage situations, as well as the individual goals of the customer (Woodruff, 1997). The definition has, however, been criticised for capturing a broad array of concepts, thereby making it difficult to apply in practice. For example, in order to capture and measure customer value based on the definition, and in its entirety, it has been argued that multiple approaches and metrics are needed (Parasuraman, 1997). Nevertheless, as proposed by Martelo Landroguez et al. (2013), perceived value is of utmost importance when considering the concept in its entirety. Theoretically, an organisation can create significant value. However, if the value is not perceived by their target customers, the outcome of the value created becomes superficial as customers are not prepared to make any sacrifice for an exchange, where no value is received. Martelo Landroguez et al. (2013) take the argument even further, suggesting that if the created value is not perceived by the customer, no actual value has been created.

However, there are other factors which play a role, and may potentially add value to understanding consumers' purchasing behaviour, such as satisfaction and loyalty. The concepts are therefore outlined separately, and the relationships between them are hypothesised at the end of the chapter.

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2.8 Satisfaction

Customer satisfaction has long been a vastly important concept in marketing and consumer behaviour, and has along with trust been explained as one of the predominant precursors for loyalty (Rego, Morgan, & Fornell, 2013; Ahmed, Chandio, & Qureshi, 2015), as well as a predictor of repurchase intent (Patterson, & Spreng, 1997). Several studies have further clarified the link between satisfaction and trust, posing satisfaction as an antecedent (Garbarino & Johnson, 1999; Siau & Shen, 2003). Oliver (1997) defines satisfaction as pleasurable fulfilment, and argues that in order to achieve satisfaction, the customer fulfils a goal, need, or a desire through consumption, and that this fulfilment is pleasurable. Other definitions of satisfaction also emphasise its post-consumptive nature (Gundersen, Heide, & Olsson, 1996; Cronin, Brady, & Hult, 2000), which is the main factor separating the concept of satisfaction from perceived value. As mentioned in section 2.7, customers experience different dimensions of value throughout the purchasing process (Gardial et al., 1994). Similar to the concept of perceived customer value, not all scholars agree on whether or not satisfaction is made up of merely cognitive elements, or if affective components also should be considered (Martin et al., 2008; Gallarza et al., 2016). Martin et al., (2008) suggest that satisfaction is measured more in its entirety when also including an emotional measurement for the construct. These findings are in line with Cronin et al. (2000), who find satisfaction as a predictor of behavioural intentions when including both elements in the measurement.

2.9 Trust

Trust plays an important role when building relationships with customers and has been identified as a set of specific relationship intentions (Kim et. al., 2008). Such intentions consider factors such as integrity, benevolence, competence, and predictability to build relationships between a business and its customers. Rotter (1967) highlights the existence of reliability when considering the concept of trust. Similarly, Morgan and Hunt (1994) define trust as the existence of confidence in the reliability and integrity of an external party, or individual. Finally, Crosby, Evans, and Cowles (1990) conceptualize trust and satisfaction within relationship quality, and derive a link between relationship quality and reduced perceived uncertainty. Trust can therefore be argued to carry a significant importance,

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Previous research has recognized the uniqueness and importance of trust within SE, and further highlighted the importance of high levels of mutual trust between parties (Chica et al., 2019).

When considering social trust, higher levels of trust are linked to increased cooperative behaviours (Bergh & Funcke, 2020), hence, increased social trust has the potential to favour SE behaviours. In a peer-to-peer context, Wirtz et. al. (2019) find trust to be a dependent factor on a platform's competitive position in the market. Additionally, the authors recognize two types of trust which are needed to build platform loyalty, these include mutual trust and platform trust. Mutual trust refers to the trust exhibited between members of the platform, whilst the latter considers the trust which the members have in the platform itself.

In an online context, trust plays a crucial role in attracting and maintaining new customers (Gefen, Karahanna, & Straub, 2003; Kim et. al., 2008). Trust has also been identified as a factor influencing decision support such as two-way rating systems for individuals to create a pre-purchase understanding of the service provider (Bergh & Funcke, 2020). Such rating systems have also been recognized in literature as influential reputation and trust building components within SE (Wirtz et. al, 2019; Belk, 2014). However, Ert, Fleischer, and Magen (2016), in a study on AirBnB customers, found visual factors, such as photos of the host, to play a greater role in consumer decision making, than that of reviews or reputation. Abrate and Viglia (2019) also examined AirBnB users with regards to reputation factors and identified both personal and product reputation variables to impact revenue inefficiencies. These included factors such as seller presence on the platform, and the number of reviews they had received. Furthermore, rating systems have been identified to positively impact market quality and allow for transactions to take place in moments of time where they otherwise would not be due to boundaries of trust (Bergh & Funcke, 2020).

The Key Value Components of a Customer Value Proposition for Free-Floating Car Sharing Services in the Nordics