Everything went well! Through the years, companies had positioned themselves in the market, the competitors’ strategies were well known, the customers’ needs were predictable, and even though the competition was tough, there was and understanding of the market dynamics. Then suddenly – out of the blue – an extreme disruption occurred. Today, we call it the digital disruption.
We all know the examples of disruption such as Uber in the taxi market or Mofibo in the book market. However, disruption is not a new phenomenon, and during the years disruption has affected several industries, just ask the typographer or the travel agencies – two industries, which are almost distinct compared to the past glories despite the fact that people travel and read as never before.
Disruption hits all industries, and eventually it will affect your industry. Your competitors will use the new digital opportunities to find innovative ways of gaining market share or to service customers differently, even though your product is neither modern nor digital. Digital innovation drives disruption and today, you should keep an eye on especially three areas in order to figure out how your company should deal with disruption.
- The internet has long since moved from the desk to the outside world. Your TV, refrigerator, car and soon also your clothes all have small Internet computers built into them. So, in just a few years, the refrigerator will order milk and butter itself! This will create a flood of new market opportunities for companies wanting to get closer to their customers. As an example, Maersk build Internet connected computers in all their containers enabling them to better control the location and contents of the containers.
- We all have smart phones or smart watches, which constantly disclose what we do, where we are and what we buy, and as long as the information is used to make our life easier or our health better we fully accept this new reality. In addition, our mobile devices also know our social habits and relations, like our family and friends. It is no coincidence when Facebook suggests that you connect with a participant from the bike trip, you both attended last week.
- We increasingly use self-service solutions in our everyday life and it has become normal to spend the time in the plane ordering groceries or the waiting time in the train to check your next vacation. We do this on technological platforms or cloud solutions, which have become such an integrated part of our daily lives that we do not even perceive it as technology anymore. Just think of how often you use search engines or GPS in your everyday life.
The new players in the market use three trends to invent new ways of entering the market. New ways of thinking about the customer experience are common to all disruption. Take Mobile Pay as an example; Mobile Pay was not a new thing; however, when Danske Bank rethought the customer and user experience, and introduced Mobile Pay they smashed their competitors.
Disruption is definitely not just a new buzzword invented by the nerds in Silicon Valley to put old wine in new bottles. It is a strategic threat or a giant opportunity for the company, depending on whether you want to be first mover angling for an attack or you lag behind a disruption attack from a competitor.
My recommendation is that all companies respond to how the digital disruption – which will for certain hit their market – will affect their company’s strategies and then make the decision whether their company will be hunter or prey.