[There are only
two types of companies: the quick and the dead. Michael Dell]
For more than 20 years, we have heard about the benefits, excitement, promise and impact of a digital revolution and a technologically-driven society. Concept albums by iconic rockers such as Radiohead (OK Computer), Rush (2112) and David Bowie (The Rise and Fall of Ziggy Stardust and the Spiders from Mars) sung about the all-encompassing power of technology – for good and evil -- before the new economy was born. And, a half century ago, Rod Serling relayed ironic tech-based themes in his brilliant television series, THE TWILIGHT ZONE (e.g., Time Enough at Last, Third from the Sun, To Serve Man, and so many more spell-binding episodes).
In the 1990s, Internet pioneers such as America Online, Amazon, Cisco Systems, Dell, eBay, E-Trade, Expedia, and Yahoo! dramatically changed how consumers and businesses bought products and services in a 24/7 global market space. A seismic shift in the new economy has taken shape over the past ten years led by the FAANGs -- Facebook, Apple, Amazon, Netflix and Alphabet’s Google. These digital leaders focus on speed, service, selection, sociability and solutions.
What has been the result of this 5-S transformation? Welcome to the Now Economy! Just as a toddler cannot possibly wait for a chocolate chip cookie and absolutely, positively must have it right now -- today’s consumers are equally impatient and demand immediate satisfaction. Hence, the rise of Amazon Dash, Fresh, and Prime; Apple’s iTunes; Couchsurfing; TaskRabbit; ZipCar; and a multitude of other “I gotta have it now!” business models.
Strategic differentiation combined with technology and consumers interest in choice has led to industry disruption. Marriott and Hilton have sure felt the effects of Airbnb in the lodging industry. Today, target marketing means segment-of-one personalization. Mass promotion has evolved into two-way dialogues with consumers and business users. Customer relationships lead to lifetime brand advocates. The new economy has morphed into the Now Economy!
The Now Economy is service dominant. This includes business, consumer, professional, and government services. Knowledge workers and the creative class turbocharge this economic sector. In addition, digital services (the platform economy) and consumer-to-consumer services have surged in the past 5-10 years. Realize that a strong traditional backbone of manufacturing, agri-business, construction, and infrastructure is still a key economic priority in industrialized nations. And, let’s not forget the trade segment (retail and wholesale), as well as the burgeoning e-commerce marketspace and the rise of smart products (e.g., appliances, energy regulation and the internet of things).
The 24/7 Now Economy is always-on and always open. Buyers will no longer accept shopping from 9 a.m. to 9 p.m. daily and noon to 6 p.m. on Sundays. Online shoppers will expect their orders to be delivered immediately, within the next two hours, or overnight (not in 5-10 business days). Bricks-and-clicks business models allow consumers to pick up their purchases at a neighborhood store. Sub-par customer service will not be tolerated. Buyers expect to be wowed with amazing experiences and will not settle for yesterday’s ordinary store visits.
Here's an example of the Now Economy in action.
I recently dropped my dogs off at a neighborhood pet spa for one-hour grooming services. I visit the Target Superstore down the street to grab a cup of dark roast in the mini Starbucks. The café is sparsely populated but employees (mostly millennials) drop by to consume premium coffee and pricy pastries. Occasional shoppers, largely female, young and old of all ethnicities, stop by to get their caffeine fixes, too. The fresh produce section in the grocery department is right across from me, part of the one-stop shopping experience. A hundred or so yards away is the embedded CVS Pharmacy -- once a formidable competitor and now a strategic partner. Paralleling the unstoppable movement towards online buying, I notice very few shoppers in this cavernous establishment. Is it any wonder that H.H. Gregg, Sears, Macy’s and dozens of other retail leaders have closed stores or went out of business? (The death of retail is a very real threat in the industry). I get a text message from the groomer – it’s time to pick up Maya and Payton.
The Now Economy is also about sharing and access. Users are bypassing traditional market structures and business channels to work directly with other consumers to solve individual problems – think about an Uber instead of a taxi. The redefinition of buyer behavior has spawned a vibrant consumer-to-consumer sector and impacts the future of work.
While most of us would love to be like Tim Ferriss, rich and only work four hours a week, such incredible wealth is unlikely. In the Now Economy, many individuals are turning to multiple entrepreneurial ventures to pay the bills to survive or thrive. Just as struggling musicians work hard and hope for that big break, many millennials (and others) are juggling multiple gigs such as driving for Lyft, creating apps, writing blogs, posting YouTube videos and starting innovative businesses as they seek the “big deal” and navigate their individual paths to success.
Consider:
1. What impact does the Now Economy have on your personal life?
2. What impact does the Now Economy have on your professional life?
3. Is your company truly creating superior value in the Now Economy?
If not, what strategic changes are called for?
4. Identify 1-2 other companies that may ascend as a potential rival(s) to the FAANG giants.
This blog post is the 1st in a series extracted from Superior Customer Value – Finding and Keeping Customers in the Now Economy, 4th Ed. (2019, Routledge Publishing/ Taylor & Francis). For further information, contact Art Weinstein at artweinstein9@gmail.com , 954-309-0901, www.artweinstein.com .
The Now Economy impacts my personal life by making it easier for me to buy books for my classes, buying the groceries from my house and just picking them up at the store, by giving me access to more entertainment tools on my free time, and by giving me more options to compare prices. Undoubtedly, the Now Economy has changed the companies' way to reach their customers, and as a result competition between companies has increased. However, the Now Economy has also produced more jobs and opportunities for more people. For example, many millennials want to be part of this FAANG giants or work at modern companies instead of work at old companies that can be replaced in the future. One company that may ascend as a potential rival to the FAANG giants could be Tesla because all of its cars are electric, which nowadays is becoming an important characteristic to be considered when buying a car. In my opinion, companies who show interest in helping the world, are the ones who could raise as rivals for the FAANG companies.
ReplyDeleteI agree that the "Now Economy" is very much a common trait of many consumers. I also agree that many people want to be able to purchase products and services from the comfort of their own home but also in a fast paced manner. The internet has hugely increased the buying power of many consumers as they are now offered many goods and services that were once unattainable. Personally, however as much as these online options are great and useful I would still very much prefer to go into a store to purchase a product as it means I can have the product in hand in that instant rather than waiting and paying extra for shipping. The internet however provides me with the tools to inform a purchasing decision in terms of getting the best price or value for money. I believe that although many businesses have struggled with the introduction of the internet, they too are given the option to put their products and services online to broaden their market.
ReplyDeleteI think the “Now Economy” can also be described to be very impulsive. Buying things are no longer that much of a hassle, it is not needed to go out of your way to drive to a store and take time out of your day. It’s as simple as a click of a button. This is part of the reason why companies work such as Shein. It’s cheap, and it’s delivered to your door. There will be a lot of competition to these companies in terms of being environmentally friendly. The use of boxes, packaging, and fast fashion that just is thrown away from how cheap it is once its lost its use, will significantly affect the environment negatively. Companies will take advantage of that and offer a more environmentally-friendly option. Once Web 3.0 takes over, it can be assumed that making purchases will be even more easy, as you don’t need to go through the hassle of making returns if you’re able to try the product through extended reality. This will also be another form of competition towards these companies.
ReplyDeleteI agree that The “Now Economy” represents a significant shift towards impulsivity in consumer behavior. Gone are the days when purchasing required a physical store visit and dedicated time. Today, it’s as effortless as clicking a button, as exemplified by companies like Shein, known for its affordability and doorstep delivery. However, this unprecedented convenience raises alarming environmental concerns. Excessive packaging and the disposable nature of fast fashion items are contributing to adverse ecological impacts. In response, we anticipate a surge in competition among companies striving to offer eco-friendly alternatives in the market.
ReplyDeleteThis blog post is extremely relatable. Since I was a child, I have seen the world change from enjoying a movie night by visiting blockbusters (a brick-and-mortar video rental store), to claiming a movie from a vending machine (RedBox), to now watching movies from the comfort of my own couch through many different streaming services. This is one small example, just as the dog lover had her example. I believe this works to our advantage as a society because the money flows faster, and companies have improved greatly with their services/products. You explained it in a way that is easy to understand the “Now” economy with the boom of the big “FAANGs” companies leading the charge. It is simpler now for businesses to receive consumer feedback and engage in direct conversations with their clients. This aids in improving marketing, business practices, and most importantly sales, as a result of online shopping, brick-and-clicks business models, and social media.
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