How has digital permanently altered your industry?
Is your business across the trends that can transform (or kill) it?
When ‘digital’ started to reach critical mass in the mid 1990s, it was pretty obvious that some industries were about to be turned on their heads.
Despite internet bandwidth speeds that were analogous to consuming a stew through a straw, the ability to transmit text, images, sound and video – even in what was then a rudimentary way, demonstrated that any business that dealt with content of any kind – be it recording, organising or distribution, needed to be put on notice.
Those that refused eventually became a shadow of their former glorious selves or even disappeared altogether, as the Kodak’s, Borders, Encyclopaedia Britannica and many other household names can sadly attest to.
At the same time, others who embraced the new digital paradigm soon found their way to almost unprecedented fast fortunes – as Apple (music), Google (search), Amazon (initially books and music) and Facebook (social networking) all demonstrated.
Unencumbered by the past
What these businesses have in common is that they were all unencumbered by dying ‘legacy’ business processes and models.
Like Amazon before it, Apple never had to hand over a Music CD to a customer over the counter. Google never had to print millions of printed business directories and Facebook never had to organise parties, send postcards or transmit phone calls between friends.
The old marketing advice of ‘if you don’t cannibalise your own business, someone else will’ soon became deafening.
But while the writing was on the wall for those in content-related industries, the digital world soon had industries that appeared to be completely removed from anything remotely digital starting to be impacted by the technology.
Few industries untouched by digital
Freight and postage businesses started declining (whilst growing in others like eCommerce enabled parcels). Small businesses started to receive less enquiries from printed directories and improved (or hampered) their cashflow with online payments. Transport and Travel companies had their customers help themselves to itineraries and bookings online instead of attending them in person.
And need we mention retail?
Few industries haven’t had a business process fundamentally altered or even removed altogether in ways like these examples.
Uncovering hidden competitors
Just last week, a former workmate of mine launched a crowd-funding campaign for a new travel concept called ‘social transport’, where commuters and travellers put a call out to drivers for lifts to a destination, and drivers bid (presumably downward) for the right to do so. Following the transaction, both passenger and driver get to rate each other’s ‘performance’.
Clearly the taxi and public transport instrumentalities will be looking very closely at this concept. Or at least they should be.
So if your industry hasn’t been significantly impacted by the digital world, it’s really just a matter of time before it is.
So what to do about it?
Three keys to staying healthy
As explored in these pages previously, it’s imperative that business operators take three key actions.
The first is keep abreast of technology trends – as remote as some of them might be from your core business. For example, who would have thought that music retailing would be dominated by a computer company (Apple)? Or that we would take the vast bulk of our photos on a telephone?
The fact that you are visiting this website is a sign that you are on the right track!
The second is to understand the core benefit you are offering your customer. No not the car but the ‘personal transportation’. Not the book but the entertainment or information. Not the telephone but the business or personal communication. You get the picture.
In this way you won’t be married to unsustainable technology and instead become vigilant for new ways of delivering your benefit to your customer.
Thirdly, constantly and critically review your own business models and processes to ensure it is the best way of delivering your product/service. Chances are there is now a much better way of doing something online – either partially or fully.
It’s only then that you will be able to unhinge yourself from potentially declining technology and who knows, even change the way your customers do things on the way to your fortune.
In addition to being a leading eBusiness educator to the smaller business sector, Craig Reardon is the founder and director of independent web services firm The E Team which was established to address the special website and web marketing needs of SMEs in Melbourne and beyond. www.theeteam.com.au