Advanced technology is everywhere, and the next generation of consumers and workers expects and demands technology solutions. Combined, these forces—technology and Millennials—provide tremendous business opportunities for the equipment rental industry and its pursuit of meeting online customer demand.

Companies such as Uber and Airbnb are prime examples of what happens when you take advantage of these two forces. In reality, while many will try to apply the Uber or Airbnb business model to the equipment rental industry, it is difficult to think an owner of an $80,000 asset will feel comfortable lending it to a stranger they just met online.

So what approach do rental owners take to tackle online customer demand? 

One approach many are taking to tackle online customer demand—and which will work to some greater or lesser extent—is to make an investment and become a technology company. In practice this means developing, launching, supporting, updating and marketing an app for online customers.

This is a common approach taken across different industries, such as banking for example. Someone that banks with Bank of America will have a BofA app on his or her mobile device. Following that model, many rental companies have or will build their own apps in the hopes that their customers will find and use it.

Many rental companies—particularly the larger public rental companies—see this as a necessary move for their businesses. They are probably right, in light of the trends discussed earlier. We can expect to see the whole range of approaches here, including sourcing code license from an ERP (enterprise-resource planning) provider and building something unique. Others will take an off-the-shelf app offered by their POS (point of sale) or ERP vendor, include their logo on it, and declare themselves “online.” Either is a workable approach.

Regardless of how equipment companies get online, it’s going to require time and an investment of hundreds of thousands to millions of dollars over the course of development, marketing and maintenance of these mobile programs. Depending on how far some companies pursue the tech provider route, they can easily spend tens of millions of dollars or more.

As they make their choices and weigh the options, it will be important to keep in mind an important lesson from the Dot Com crash: technology is not magic fairy dust that can be sprinkled on a business and suddenly achieve results. They will need full organizational adoption to really see the benefits.

Software development is hard, but changing your company and its internal processes to incorporate and leverage technology is really hard. Stories of hundred-million-dollar-plus IT innovation projects completely failing—after years of effort—are almost a cliché.

Despite the required investment and warning, over the next six to 36 months, we will see a proliferation of these sort of “rent from us online” apps in the app store from all sorts of rental companies. More about this, and an alternative to becoming a technology player, in part two of this story on Tackling Online Customer Demand.

Liam Stannard is the chief technology officer for BigRentz, directing all technological processes and leading the engineering team in improving overall operational efficiency for the company.

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