{"id":1729,"date":"2016-07-15T00:52:49","date_gmt":"2016-07-15T00:52:49","guid":{"rendered":"https:\/\/ptpinc.com\/staging\/?p=1729"},"modified":"2022-04-28T16:14:16","modified_gmt":"2022-04-28T23:14:16","slug":"digital-disruption","status":"publish","type":"post","link":"https:\/\/ptpinc.com\/staging\/cx-strategy\/digital-disruption\/","title":{"rendered":"How has digital changed the way people do business & businesses sell?"},"content":{"rendered":"

Sixteen years ago, only 6.7% of the global population had internet access. Today, 3 billion people and 40% of the global population can log on and connect. \u00b9\u00a0<\/a>\u00a0And by 2020, that number is projected to double.<\/p>\n

With digital growth accelerating, it acts as a disruptor to every organization in every industry. It also fuels what customers want and expect out of an organization\u2019s customer experience. From self-service check-out lines at grocery stores to video kiosks at bank branches to drones that enable 2-hour shipping \u2013 if you\u2019re not fast and efficient then you\u2019re out of business.<\/p>\n

\"CommercialHow does digital disruption influence customer experience? <\/strong><\/h3>\n

Because customers value the ease that digital channels offer, organizations strive to compete with newer business models that better serve customers. Look at how large retail banks chase Fintechs, Advertising agencies compete with crowdsourcing companies and retail organizations go head-to-head with e-commerce organizations<\/a>.<\/p>\n

Digital growth has fueled organizational visions of technology, processes and management structures that are open, connected and seamless.<\/p>\n

From business models that drive internal and external collaboration to customer service infrastructure<\/a> that enables fast, efficient, fluid service to data analytics and artificial intelligence<\/a> that offers the insight to innovate \u2013 connectivity across people, businesses and things is at the forefront of customer experience strategy.<\/p>\n

What are the business models that digital disruption fuels?<\/strong><\/h3>\n\n\n\n\n\n\n\n\n\n\n\n\n
Business Models<\/strong><\/td>\nExamples<\/strong><\/td>\n<\/tr>\n<\/thead>\n
Subscription<\/strong><\/td>\nNetflix, Shave Club, Apple Music<\/td>\n<\/tr>\n
Freemium<\/strong><\/td>\nSpotify, LinkedIn, Dropbox<\/td>\n<\/tr>\n
Free<\/strong><\/td>\nGoogle, Facebook<\/td>\n<\/tr>\n
Marketplace<\/strong><\/td>\neBay, iTunes, Airbnb<\/td>\n<\/tr>\n
Access-over-Ownership<\/strong><\/td>\nZipcar, Airbnb<\/td>\n<\/tr>\n
\u00a0Experience<\/strong><\/td>\nAmazon, Apple<\/td>\n<\/tr>\n
Pyramid<\/strong><\/td>\nAmazon, Microsoft, Dropbox<\/td>\n<\/tr>\n
Business Ecosystems<\/strong><\/td>\nApple, Google<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Subscription-Based Business Models <\/strong><\/em><\/p>\n

The way consumers purchase has changed over the last 10 years ago. Back then, if you wanted to purchase Microsoft Office for your computer \u2013 you had to go to the store, purchase the box of CDs and insert the CD to install it. Today, you visit the Microsoft website, select Microsoft 365, purchase it, download it and you have software that auto-updates and is always current. You also didn\u2019t pay in the triple digits for it.<\/p>\n

This subscription-based business model has a lower cost point for the customer, making the decision to purchase easier and less significant as the month-long duration has little risk.<\/p>\n

In customer service departments, cloud infrastructure is on the rise for the same reason: low upfront investment, quick launch timelines and lack of maintenance fees lead to little upfront risk.<\/p>\n

Freemium & Free Business Models <\/strong><\/em><\/p>\n

Digital <\/a>brought social media and the idea that sharing content (news, music, video) should be free and easy to do. Spotify gives consumers an alternative to radio, with personalization of channels and music lists. Dropbox gives users the ability to share files that would bounce via email. LinkedIn offers recruiters and salespeople access to potential employees and clients. If a user wants to get premium service \u2013 no advertisements, greater file size, the ability to email without connecting \u2013 a user can elect to pay more.<\/p>\n

These business models leverage technology and the digital channel to make it easy for users to get what they need. They give consumers the ability to choose what level of product and service they want. And they appeal to the masses while allowing users to personalize which music channels they listen to, what they see in their news feed and who has access to their Dropbox folders.<\/p>\n

Further, Dropbox also employs the Pyramid business model as it rewards users, with more storage space, for inviting other users to join. This enables them to grow users exponentially because\u00a0you need other users to join the platform to be able to share content with them.<\/p>\n

Access-Over-Ownership Business Model<\/strong><\/em><\/p>\n

Organizations like Airbnb and Zipcar took the \u201ceasy-to-access\u201d pointer from Freemium models and gave users access to houses and cars without ever having to fill out paperwork and answer endless questions about pre-purchasing gas and the different levels of insurance.<\/p>\n

Instead, users self-serve via mobile applications and the web and can book a stay or a car within minutes. It\u2019s a quick, easy, low-investment transaction. There is no barrier to use.<\/p>\n

Business Ecosystems Drive Successful Business Models\u00a0 <\/strong><\/h3>\n

As consumers value hyper connectivity, organizations focus on business ecosystem strategies to grow.<\/p>\n

\"TabletPlatform Ecosystems <\/strong><\/em><\/p>\n

Platform ecosystems provide the footing from which ecosystem members and owners can develop products and services for customers to use.\u00a0 Marketplace business models are built on these ecosystems, with eBay selling goods from individual providers globally.<\/p>\n

While platform ecosystems abound, a few companies who leverage platform ecosystems are\u2026<\/p>\n