Right after we launched GML I became intrigued by how digital marketing changed this whole notion of time and space .. That through digital the space between realizing demand and fulfilling demand was collapsing leading to what we call real time marketing. Now over the past couple of years we’ve seen digital marketing start to make yet another shift. It is no longer about digital marketing … that is apply digital to traditional marketing technique s .. Rather we are marketing in a digital world as we move into what is commonly known as the connected economy.
NAPA Auto Parts picking up on the Nike Plus effect realizing they can be more than a provider of auto partns rather a provider to help you get back on the road as quickly and safely as possible. This migration of their market position from product provider to provider plus advisor, leverages the Nike Plus effect making NAPA a destintion for those seeking advice, even non-customers.
The watch of today and the future goes well beyond telling time … but the point for marketers .. When the watchmaker knows how buyers use the watch it opens up dialogue. Communicating with customers has always involved listening as much as talkiong, but now we have opportunities to create dialogue which is how relatnishps are built. Listening and diaglogue is how proudcts are conceived, adapted and accepted. As all markets begin to look like niche markets the communication process becomes more and more direct and far more interactive. Moreover brand loyalty is dying. Consumers are open to trying anything new that gives them more information more advice more help.
When buying and using are separated int ime, a large part of potential demand is unrealized. Say you hear a piece of classical music .. You wish to buy it. But the time passes and the need fades or you simply forget. This unfilled need is what we call the underserved market or what economics would call latent demand. This demand is Invisible. For example, does MacDonalds know how many people walk away when the queues are too long? Another impact … is the possibility of marketiong access rather than ownership, Since music is now digitized it is marketed as something you can listen to it without owning it. You still may have to buy it, but not as a phsyical product such as a CD. And of course, when music become liberated from CDs it become sharable .. It created communities of people sharing music tastes, conversations about music with each other, and sometimes even the musicians themselves. This sharing and social nature of music slipped into other models, for example sharing of one’s lidle assets through services like Uber or Airbnb.
But the sharing economy's rapid evolution has shown that, as a business model, it functions more as an access economy versus one built on a true sharing relationship (which implies social exchange and social trust between two people who know each other). Zipcar customers aren't interested in socially interacting with those that have used the car before them. Consequently, the consumer's buying motives are driven by cost and convenience, versus the opportunity to develop a social relationship. Businesses that understand how the motives behind access differ from sharing will garner competitive advantage. For example, Uber's marketing stratregy "better, faster and cheaper than a taxi" has proven far more lucrative than Lyft's "we're your friend with a car."
To summarize this convergence between buying and usage has created four market effects. Offering value , in real time, at the point of consumption The second impact of convergence and usage is the creative of new contexts. Where previously music was just for your own listening pleasure, its availability wherever and wshever you want has made it possible for musit to be shard, shown or showcased in different ways for different reaasons. Latent needs create what is often called the unserved market, or what economist call latent demand. The type of demand that was invisible but is now recoverable. A fourth impact is the possibility to gain use and benefits wityhout ownership but just through access. Since music is digitized you can listen to it wityhout owning it. You might still have to pay for it but through other models such as subscription services. You can also stream it for free but be subjected to ads as in the case of Spofify. Digitization of music gives you access without a long separation of time between buy and use. Of course, there will be those that prefer ownership but by giving people a choice of wonership and access the market expands. If access is cheaspter than ownership, the needs of those who originally could not afford to buy CDs and the rest of the unserved market is addressed.