How often have we heard people say ‘the world as we know it has changed.’
And generally they have been right as a new technology has emerged that has significantly altered an industry or the way that customers interact with a company. History tells us though that after a significant technology shift, the market stabilises and everyone adapts to the new world or the new way of working. Certainly, some companies fell by the wayside but even companies that went through a ‘near death’ experience generally had the chance to adapt and revive once the new technology had been bedded down within their industry – IBM is the oft quoted example of not adapting fast enough to the advent of the portable computer.
But now the world has changed. No longer is a period of new technology or innovation followed by a period of stability. The arrival of online or digital is leading to constant change, where the disrupters are being rapidly disrupted. only 12 years ago we saw the total disruption of the music industry with Itunes and we marvelled at how Apple had changed the industry forever. Itunes was such a dominant force in music that people were talking about a monopoly and wondering about how others would compete.
So what’s happened just over a decade later? Fare fewer people are buying songs on Itunes – sales last year fell by 6% to 1.3bn units – while music streaming through Spotify, Pandora etc grew by 32% to 118bn units. the disrupter has been disrupted. Apple have tried to hit back with their own streaming, Apple Radio, ut lost first mover advantage and certainly don’t seem to winning the battle.
The lesson? Today there is a constant need to innovate. Online business models have ‘potentially’ a shorter shelf life than physical models and customers’ today are demanding constant evolution. It takes a new attitude to strategy and a constant need to be evaluating customer needs and competitor actions.