As I was scouring through the CNN homepage earlier today, two headlines caught my eye: the first was ‘Spotify files for a $1 billion IPO’ followed by the disturbing ‘3,000 jobs at risk for Toys R Us collapses in UK’. The irony of their positions in the list of headlines wasn’t lost on me. Nor was the fact that of the billions of children under the age of 15, the majority of the toyshop’s target audience, are online. They are the digital natives.
Brick and mortar is expensive, bulky and slow to change. All the examples we know of the agile companies who can scale up faster, wider and smarter than their traditional predecessors, are just affirmation of this shifting trend. It’s hardly a trend; it is the ‘it’ we refer to. The companies who come in with disruptive services, with no assets to offer, low cap-ex, guerilla marketing tactics and a killer USP can give the dinosaur organization a shrewd papercut their first year of operation and wait while it slowly bleeds out to its ugly death. Toys R Us collapsed in the UK and is shutting down stores across the US. Why? Online sales are just too competitive, more convenient and a hundred other things that the physical store simply isn’t.
Back during it’s 2015 Black Friday sale, Daraz announced that they had 1.5 million visits on the website, experiencing 55 times greater number of orders than they would otherwise on a regular shopping day. The numbers can almost knock the wind out of you considering the majority of these transactions were still cash on delivery (COD). In fact, if I’m not mistaken, almost 90% of all transactions on Daraz that year were COD. The ecosystem of technology, financial system and trust are quite the recent addition. Think back to even those who braved the lawn sales on the first day – even they have incentive to shop online because people realize shopping can, among other things, still be a menace.
Ideas. Concepts. The Ubercool ventures are the ones that have the agility to make it in today’s competitive world. Not one market. Click here and deliver across the world. The world is just one big integrated village where geographical boundaries and different currencies are less meaningful and increasingly frustrating. Commerce thrives if it can leverage the multitude of connections, be fluid and move product at the speed of thought. Inventory is bad because everything from wastage, logistics to storage is expensive. The economy is shared along with everything in it and the businesses that figure out how to leverage that, come out on top.
Regardless of how big and old you are, you will get beat by the smallest disruption if you don’t be the change… and fast.
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