Posted by As we move out of the recession, we need to be prepared for how business will adapt as companies, once again, start investing and growing their business. The new reality is that the new economy is going to look, feel and even "be" completely different. These changes are going to be very much "next generation" when compared to what we’re presently seeing.
Here are 6 steps towards this new economy:
- Digitization. There is going to be a dramatic shift in how business is created on the business-to-business side and on the front-end as well. As we come out of the recession, the investment is not going to go back into the old infrastructures. The changes and shifts are going to be deep, and the investments are all going to be into the digitization and modernization of everything from business process to delivery mechanisms. If you thought what happened to the music industry (and what’s happening to the newspaper industry) is an anomaly, it’s not. It’s going to happen to your industry as well (if it’s not already happening).
- New Business Models. The real industry leaders of tomorrow are going to crush the current top-tiers in their sector not by replicating what was done before, but by creating an entirely new business model. Think of what Google did with pay-per-click advertising in relation to the traditional advertising industry and multiply that many times (while adding in some exponential growth for good measure). The big dollars in the future will be made by selling and promoting brands in a way in which we have never seen before.
- Digital Nomads. This could well be the biggest and hardest shift that we’re going to see. The entire workforce is going to change completely. As more and more people are connected always and anywhere (the Internet will be as pervasive as electricity), it’s going to change our perception of what a work week looks like, how teams are formed and collaborate, and the physical structure by which architects will build corporate offices. The new economy is going to obliterate the cubicle culture (somewhere, Dilbert is smiling). We’re also not going to see people sitting at desks, working at terminals and looking like a factory assembly line. That is all going to pass. Welcome to the great untethering of our society.
- Personal Customer Care. The "us vs. them" model that most companies currently employ for customer service departments in relation to their customers is going to disappear. Competition for almost everything is going to get much more fierce as globalization continues and other countries begin to improve in both product creation and marketing. From that, companies will (finally) get very customer focused. Much in the same way luxury brands offer their consumers a higher level of service and attention, so too will all companies. Brands going forward will not battle over price, they’ll battle over value and relationships as they build communities around their consumers.
- Direct Contact. One of the many reasons why Twitter is so fascinating to so many people is because of how it gives an individual direct access to people who they would have never had direct access to. From politicians and celebrities, to business leaders and customer service divisions of companies, this type of direct contact is just the beginning. There is no going back. In the new economy, the companies who allow, enable and empower their employees to have direct contact with the consumers are going to be the ones with the most brand evangelists and the biggest communities.
- Analytics Driven Initiatives. The technology and infrastructure will be in place to actually understand and use the current sea of data that most companies are simply housing right now. The shift from housing to harvesting is going to make companies extremely smart, quick and agile. Through analytics and better decision making, they will be able to not only serve their current consumers, but better understand the types of products and services they are looking for based on current usage
These 6 steps will have a tremendous side-effect on everything we think we understand about Marketing, Communications, Advertising and Public Relations.
The reality is that these six steps are just a dream. It was a personal exercise I charged myself with. I wanted to imagine what business might look like five years after the current economic situation had passed (and, it will pass). Many companies today are simply trying to see what their business might look at the end of the next quarter. The bigger challenge is in imagining your business five years into the next boom (which is coming too).
What are some of the steps that you think will help forge the next new economy?
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Excellent blog!
We are at the end of the era of heirarchical institutions and at the beginning of the era of the rise of the individual and the network.
There is strength in numbers and a law of increasing returns through networks.
Web 2.0 is based on a horizontal business model, where everyone has access to the same tools, the same platforms, the same resources, and can reach massive amounts of people through little cost. This, in effect, levels the business playing field so that we can all compete on an equal footing. Yes, David really can slay Goliath! The days of vertical businesses are over. They are closed, selective, and controlling, whereas the new business rules and web 2.0 dictate open, random, and supportive. Big corporations cannot react quickly to change, whereas individuals are very flexible and can adapt rapidly.
Business is becoming up close and personal again, and the individual actually has an advantage as we can offer a more personal service.
I think we are seeing the rise of the high tech cottage industry, the digital nomad, outsourcing, JV’s, strategic partnerships.
The transparency that Web 2.0 affords, means that businesses have to be more ethical and transparent to gain trust. This can only be a good thing in my opinion.
The is a split I often hear about looking forward between points 4&6, customer focus vs. analytics driven.
As companies learn how to use the vasts amounts of data available to them, many of them are beginning to understand how to be results driven. What that sometimes means if offering what sells at the greatest returns rather than based on what the customers say they want.
This new perspective works into the marketing world to place the most effect driven thoughts to tie with a selling strategy based on numerical analysis over intuition and customer customer service.
What is not in the list of 6 points that replaces customer service and will be shared by the most successful of these companies is flexibility. With online strategies, information with instants, and quick market testable strategies, larger companies and smaller companies alike will both be able to achieve unprecedented levels of adaptability.
As a customer, where you may not get all you want, it will be easier for a company to find out and provide the minimum they need for you to vote for them with your dollars and feel good about it.
Nice. This is a great exercise for thinking about a world of open, and transparent business. We’re definitely getting closer. Thanks.
Great points Mitch. Economic downturns like the current one we are experiencing are the result of companies who don’t think they have to change or choose not to assuming the market will adapt to their needs.
Adjustments are those times when people with wisdom and clear insight can say “I told you so”. It’s when the light bulb goes on and companies pull their head out of the sand and look around.
People involved with digital marketing have known for the past ten years that things had to change. This is that “come to Jesus” moment when those who avoided it have to be brought to their knees in order to see the light.
It’s sort of funny, in this digital world many relationships are reduced to mass emailing to a list of your clients. Now Twitter and @tweets are essentially the new face to face communications.