My first 3 blogs were a high level view of current business change as information technology becomes the foundation of business process. I’m now going to talk in a little more detail about each asset and its shift.
Leverage Physical Assets to Leverage Information Assets.
Think about this in two ways; Product and User/Meta-data
Product – On December 25th Amazon.com sold more e-books than physical ones – any product that can be converted and delivered electronically will be. The physical attributes of these products are becoming less important than the ability to deliver them faster and cheaper.
User/Meta-Data – Wrapped around both electronically delivered products and physical products is more and more data. Online consumers are becoming used to a level of tailored service that is based on data from the wider pool of behavior (User/Meta-Data). Who wants to repeat a flower order address when it is easily saved in an address book? Netflix recommendation engine is a perfect example of this.
I am sure everyone knows the reason milk is at the back of the grocery store* or why beer and diapers stick close together at the convenience store** – ‘Leverage Physical Assets’. These conventions have been tested and tweaked over decades but bricks and mortar business are going to struggle to match the personal nature of Amazons ‘someone who bought that also bought this’.
Business that continue to treat the ‘web’ as another channel are missing the massive opportunity to leverage information assets collected online to extend and improve the customer experience in the physical world.
Not sure? Blockbuster is closing 22% of its stores during 2010 partly because of alternate delivery methods for movies but also because it failed to innovate around the information assets it held.
Prediction : Large bricks and mortar retailers will find margins squeezed even more as Smartphone apps offer augmented reality price overlays based on real time visual recognition of products.
Next Up – Brand and Rating Agencies…
*you have to walk past all the other products.
** men sent to buy diapers can not help picking up beer.
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