The same technologies and fundamental premises that underpin what we know as social media, are also emerging in markets for physical things or to share existing resources. Venture Capitalist Fred Wilson, speaking at LeWeb this week in Paris, noted that its important to look beyond the technologies to people and their needs, the trends of what is happening in society.
In this respect he pointed to 3 major trends:
- The transition from bureaucratic hierarchies to technology-driven networks
- Unbundling (of goods and services, and a specialized focus on what humans actually want/need or use, think of your cable service and the channels you don’t watch, and increasing ways to get around that without paying as much)
- How people actually become Nodes in the larger network
#1 and #2 are pretty self explanatory. What does #3 mean in reality. Jeremiah Owyang has been chatting about the Collaborative Economy lately and today launched a business council call Crowd Companies. He notes, “smart phones, mobile apps, payment systems and social networks [mean that] people can easily share the following things from the physical world: goods, services, space, and money.” That sharing by one with others is about a node in a network.
Social media disrupted mass media, mass advertising and institutional and traditional communications. It has, and continues to, democratize communications – making the tools more accessible and available to anyone and everyone, enabling individuals to connect with each other, form networks where we share and communicate with each other.
Take these developments in communications to the next iteration and people can go beyond sharing news and information or their point of view or status updates – they move to get more of what they want or need from each other, often without buying it new. Those sorts of actions take us right back to what Fred Wilson mentioned in point 1 above. Sharing of goods and physical resources means the structure and the power of traditional marketplaces undergoes change.
The “I sell you stuff, you buy it” premise of the consumer economy is being undermined, he says, and big companies that want to survive need to learn to share. Not because it’s the nice thing to do but because, like the internet itself, it’s becoming an unavoidable part of doing business.“Just as we saw social networks emerge, now we’re going to see sharing networks emerge,” Owyang says. “The physical world is becoming socialized and democratized.”Social media may have changed the conversation. But he thinks the emerging “sharing economy” is changing the entire business model.
As the technologies mature and are adopted, and the emerging start ups in this space become real and viable business propositions, what happens to traditional companies, their sales, business models, and even the organization itself? For example, a properly shared car is about $270,000 lost revenue of auto sales.
Resilient companies are looking to become a part of the collaborative economy – in some quite innovative ways. Additional opportunities to explore the impact of this trend on your business and begin work to prepare for the market and business model changes that you may need to consider are also now available through the newly announced “Crowd Companies” – a brand council where large businesses can tap into the collaborative economy while also having:
1) A private place to connect to other members – 24 Founding members from a diverse market sectors including technology, food, groceries, automobiles, travel, telecommunications, department stores and more
2) Access to Experts who come to present to the council (saving you time), and
3) Access to the innovation network of startups who want to work with big companies.
You can also learn more about Crowd Companies at the FIR podcast interviewing Jeremiah on the topic.
There are 2 other reasons I write this post:
- Jeremiah Owyang is a friend today, but my relationship with him is rooted in his work as an industry analyst. He is someone I learned from and stayed in touch with throughout the tough entre into social media, as well as when we turned some of those tough corners and began to look at issues of operationalizing and scale. He is smart and business savvy and driven by a career mission to “help corporations connect to their customers using new technologies.” He is also passionate about this subject, as it has emerged in this thinking over the past year. Passion is a good thing. (Its why I am doing what I do too)
- While at Dell, very early in the social media days, several of us in a room (Caroline Dietz, Andy Sernovitz, John Pope, Stan Joosten, Lionel Menchaca) came up with the idea that a brand council would be helpful to businesses wanting to move forward in this space — Socialmedia.org was created. Much like Jeremiah is launching here, Socialmedia.org is a community of, and for, like-minded businesses — a peer to peer network where Companies support and facilitate each other in the adoption, best practices, as well as share their learnings from personal “war stories.” In a world of disruption to business, these kinds of councils help foster a safe and effective path forward for the participants and their companies.
My experience with Socialmedia.org and with Jeremiah tells me that both of these councils merit any company’s attention and consideration to continue to keep abreast of the kind of change businesses confront.