Das Scoble recently discussed what he thought was a trend in which Chinese manufacturers are creating new avenues of direct sales via internet commerce. I personally have been using DealExtreme to snatch up my favorite Canal Street goodies since 2005. A pioneer in this revolution, we’ll see more and more manufacturers and wholesalers cut out middlemen and thereby make the economy overall more efficient for consumers and value-generators. In general, I am stoked.
Other personal examples include my recent purchase of 40 pairs of no -brand knock off sunglasses for… $40 USD. Not bad when the exact some pair sells for $10 at a sunglass hocker on the street. Let’s face it, the whole concept of having a “wholesale license” or equivalent protection only creates unnecessary intermediaries. Now, we all know that the art of being a good businessman is being a good middleman, but this model is flawed for easily distributable consumer goods. There’s no reason to believe that the WAL-MART battle will not be fought 100% online once the vision of a completely internet accessible populous is established by low cost or free access methods.
Does this spell the end for revilers? Perhaps, I can’t rule this out. Some of the musings I’ve had with partners range from envisioning “flagship” stores for brands where would be consumers can kick the tires, try on the expensive clothing item, before then simply going home to purchase the product from the same manufacturer - or directly at a local kiosk, much like at an airport terminal. Maintain stock and sales people at the store? Are you kidding me? Waste of expenses, thank you. Besides, who wants to talk to any sales people these days. I just want to make sure the shoe fits, know what I mean?
Finally, and this is at the verge of science fiction, I envision the democratic and open knowledge sharing forces of the internet to drive the market economics much closer to theoretical perfect knowledge than years prior. I can’t rule out the possibility that this would spell the demise of modern advertising as we know it, if not the complete demise of advertising. That’s right, I said it. The demise and deprecation of advertising.
We’re already seeing the effect of digital media consumption upon the informed masses: we no longer respond to one-size-fits all broadcast media and dumb billboard adverts. No, for years now, the digital strategists recognize the need to connect by providing a service: the branded application, the mobile utility - something that adds utilitarian value in order to foster brand value. And then, maybe if you’re lucky, they’ll buy your soft drink.
So, yes, I can’t rule out the natural evolution of the intelligent consumer. Given that any sales process can be defined using game theory and probabilistics, if we make the assumption that the consumer acts at any given point in time based on the information and intelligence at hand, and that they will make the best decision given that information, who is to say that consumers wont simply purchase the best product based on ultimate, social and collective intelligence based on concrete reviews and customer experience as opposed to branding, positioning and the must enlightened of campaigning?
Imagine if at any time, consumers could access real-time, social recommendations down to the exact need for product or service, and at such a time, information was provided with such statistical confidence and volume that the “Zyco Com” Car is the best based on their provided, sliced and diced criteria, how could a consumer choose anything but what the other 14,345 Five-star giving consumers exactly like Punjib bought?
And so, perhaps, we are seeing the very beginning of the end of formal advertisement as we know it, with the moves in digital marketing today.
Tags: china, direct, disruption, manufacturers
2 Comments
That is very true, and I would agree that the media aren't inclined to glamorize the image of industry overseas. In the end, however, its only harmful in as much avoiding telling your children the truth about a difficult topic is. At some point, the nation has to take heed and change. Would love to see the media use this as a motivational tool, as opposed to hiding from it.
I guess that a lot of these changes don't make them apparent until you see them face-to-face. Also, the American media doesn't tell us much about how China really works and what their workers are capable of so we tend to underestimate them. When you visit and get a good tour you see that they are far more skilled than your media tells you they are. I saw a group of workers using a scanning electron microscope. Do you know how to use one of those? I don't. Also, the speed at which things are done here is stunning.