I recently attended a seminar focused on residential real estate and technology / social media. While the spotlight was on residential real estate firms, brokers and agents, the takeaways apply to any small or medium sized business.
One of the keynote speakers started her presentation deck with slides showing some well known brands: Blockbuster; Barnes & Nobel; Borders; Tower Records. Then she asked, “What do these brands have in common?”
Of course, the answer was obvious – they are all out-of-business, or on their way out. But, taking that to the next step, why? What happened to these businesses? The easy answer is “the Internet.” And that’s part of the answer, but we have to go a step further.
The Internet did not put these, and others (see: your local newspaper) out of business, but the Internet fostered a change in consumer behavior. No longer did you have to drive to the nearest Blockbuster Video store on your way home from work on Friday night to select a video for your “movie night.” And, you had to remember to return it on Sunday to avoid the late fee. A combination of NetFlix and on-demand services killed Blockbuster. You could get movies on the spur of the moment or via the mail, without ever leaving home.
Barnes & Nobel? That’s an interesting story. Not only did they not adapt to ecommerce, in this case Amazon, but they farmed out their meager online operation to Amazon for fulfillment! Doh!
iTunes? It made an entire manufacturing and distribution system irrelevant in about two years. ITunes was the demise of Tower Records and your local CD store. And, while they were doing that, they changed the music business paradigm. Music consumers no longer had to buy an entire CD full of songs to get the one or two cuts that they wanted, they could just download the cuts that they wanted.
The point of this is: consumer behavior has made a major shift to online. And it is causing online businesses like Amazon, Zappos, Expedia, hotels.com, eBay and others to garner bigger and bigger shares of the pie. Soon, these etailers will also threaten the brands that once ruled those retail spaces.
I watch my daughter, mother of two small children, order everything under the sun from Amazon while she touts the advantage of Amazon Prime, the one time-payment shipping option. I’m happy that Zappos made me a VIP customer and guarantees me overnight shipping at no additional charge to thank me for my business. I love ordering shoes at 10pm and having them on my doorstep by noon the next day. These businesses have created a relationship with valued consumers based on satisfying my needs to order whatever I want whenever I feel like it and to get it tomorrow.
As a marketer, you are not going to reverse this shift in human behavior. Consumers expect to be able to sit in front of their computer monitor at 10:30 at night in their jammies and find and buy whatever they want and have it show up on their doorstep tomorrow. What’s your strategy to maintain your market and serve the econsumer?
How has your consumer behavior changed due to online options?