The growing adoption of broadband connectivity has created a Demand Economy – consumers who expect access to information, entertainment, and commerce with more choice, at faster speeds and in any location. With greater choice available 24/7 consumers are able to compare products and services from multiple suppliers at the click of a button. To serve today’s emancipated customer, enterprises must deliver not only the best products, but outstanding communication and an innovative buying experience as a standard part of their commercial offering. The shift in power from supplier to consumer is fundamentally changing the way businesses operate.
Consumers in Control
Today’s customers learn that they do not have to demonstrate loyalty to receive good service from suppliers. In fact, the less loyal they appear, the harder companies work to establish a connection – the level of service and value extended to the consumer is rising all the time. This result is one of the economic realities of a borderless market where companies are exposed to continuous competition. Speed, best pricing and personalization dominate, forcing new challenges to retain brand value and customer loyalty.
Armed with a near limitless amount of information, consumers also demand greater variety and immediate availability. They no longer rely on information delivered by suppliers in order to reach a purchasing decision. Now, they have access to a host of other consumers whose experiences and opinions are readily available online. They can get the best fit, at the lowest price, and with the quickest shipping times. Instant but enlightened gratification now extends to the most complex choices.
The result is a new consumer attitude that pits established companies against new market entrants on a global scale, placing tremendous downward pressure on prices. Consumer expectations are increasing and companies are forced to constantly innovate to win and keep customers.
Technology Opens the Door
Before always-on, broadband commerce could effect a seismic shift in consumer attitudes, telecommunications companies first had to physically deploy these technologies and extol their virtues to consumers and companies alike. As companies rushed to bring broadband services to market, standards evolved to help enable interoperability and further technology’s penetration.
The next challenge was to keep visitors engaged on Web sites. Early movers established themselves as content centers and experimented with advertising targeted at distinct segments defined by the content they accessed. These nascent attempts would give rise to what is today a phenomenal online advertising market. Consumer patterns were clearly shifting as the online world began to assert greater influence over users’ lifestyles.
Business models had to change to accommodate these new technologies, resulting in innovative new ways to cultivate contacts, customers and suppliers. Business transaction times fell dramatically as companies could compete instantly on speed, price and availability.
Pervasive connectivity, computing and digital content have led to a technology absorption cycle: larger bandwidth leads to more available volume which enables more dynamic content which, in turn, fuels the need for more bandwidth. Simultaneously, device mobility and ever-increasing mobile phone adoption feeds an “always-on” dynamic among consumers. In fact, Gartner Research predicts that by 2010, 3 billion people will use a mobile device, up from 1.5 billion today. With a consumer populace reliant on a combination of PDAs, mobile phones and smartphones, broadband access has become a utility – as necessary as electricity.
Customization is Key
To access consumers directly, suppliers must appeal to individuals as members of groups, through personalization and customization -- not only in product features, but also in consumer interaction. This is the true hallmark of the Demand Economy and it can be seen working to great effect in the domain of media and entertainment. This geo-targeting will take on a whole new dimension as its value is experienced and demanded by the consumer. After all, in the wash of information, consumers demand a unique experience to capture their interest. Enterprises must grab, hold and vigorously defend the fleeting attention span of the consumer.
Similar changes have occurred within enterprises in other segments, like retail and technology, which rely on instant and accurate information to help consumers make business critical decisions. Real-time services and online applications must not only be always available, but also customized for industries, and also for specific parameters within organizations.
Mastering the Demand Economy
The Demand Economy is not entirely a one-way street. Enterprises have ample opportunity to capture the voice of their customers directly, treating their input as a basis for new products and services. A customer-oriented approach to innovation is at the heart of the Demand Economy and will ensure companies have a strong and positive interaction with the changed consumer. Those companies that can develop online strategies that give consumers what they want, when and where they want it will be the power brands of tomorrow.
