Over the 1980s and 1990s, we watched the phenomenon of the Walmart revolution. New stores opened at an amazing clip while people flocked there for their low prices to buy everything from school clothes to groceries to tires.
They were able to charge those low prices through the use of first class supply chain technology, low non-union wages, cheap foreign imports, and many other factors.
Despite the many customers, Walmart had its detractors. People complained about how Walmart squeezed their vendors’ profit margins and how they moved into midsized towns, running thousands of traditional mom and pop stores out of business.
It was always my opinion that Walmart was not who ran those mom and pops out of business. It was Walmart’s customers. If the customers didn’t shop there, Walmart couldn’t have done it. They may have created a market, but the market responded.
Now, Walmart isn’t doing so well. They been “Walmarted” themselves. New technologies have emerged that have caused Walmart to experience a hit to their normal upward trajectory.
This, and many other shifts in markets are taking place that show that the world is changing. And the way business is transacted will change for some time to come.
The Amazon marketplace
Although it has been around for twenty years now, Amazon (and many other portal websites like it) has become the go-to place to purchase next to anything. Anything you used to be able to buy at Walmart can now be found online in seconds. You can also find millions of items you can’t find at Walmart or any other store.
RadioShack used to be the place to go to for electronics supplies that couldn’t be found anywhere else. No more. RadioShack is now feeling the effects of everything available on the internet.
The internet has caused many brick and mortar companies like Blockbuster Video to go down in flames. Don’t be surprised if many more begin disappearing, unable to compete with the low overhead of online companies.
Everybody’s an author
Speaking of Amazon, through their Kindle publishing for ebooks and their purchase of CreateSpace for print, they have removed virtually all barriers to entry for self-publishing. Independent (Indie) authors can now publish their works on both print and electronic formats for free and have their works available on Amazon.com within hours.
The traditional publishers like MacMillan and Hachette are quickly losing their strangle hold as gatekeepers of the publishing industry. Certainly a fair amount of bad content will be entered into the market. But the consumers will be the ones to decide what is good and bad for themselves.
The end of privacy
In my carefree teenage years, I could tell my parents I was going one place and go somewhere altogether different. As long as I wasn’t spotted by someone they knew, and as long as those people didn’t tell them they saw me, I was safe.
That’s no longer true. Parents today have constant contact with their children and their smart phones. They can even use GPS-based apps that allow them to track everywhere they go.
Even without the electronic tracking, people use social media to tell people where they are, what they are eating, who they are with, and every other detail they can think of to share. Companies will soon be able to track who is in their retail location and send them deals to their smart phone during their visit.
Public opinion is more public
Word of mouth used to be exactly that. You had to talk to someone you knew to get a recommendation for a restaurant or a good book. Now, with apps like Yelp, you can find out what restaurants are near to you and get countless opinions from complete strangers reviewing their experience there.
Back to Amazon, if you find a book – or any other product – that sounds interesting on their website, you can look at the reviews, where sometimes hundreds of people have given their opinion. You can see how many gave ratings of 1, 5 and each ranking in-between.
Walmart changed the way we purchased products in the 80s and 90s. It also changed the landscape of retail as we knew it. Now, as the internet becomes more ubiquitous, the retailers that ruled the roost are getting ruled by more agile organizations with lower overhead, using more advanced technology. The world is changing.
How has your business been affected by new businesses run on new technology?
As always, I welcome your comments and criticisms.
If you would like to learn more about working in consulting, get Lew’s book Consulting 101: 101 Tips for Success in Consulting at Amazon.com.