New technologies are changing the way we do things. Digital disruption refers to the technologies and innovations that are changing the benefits businesses offer to consumers. These innovations are also changing what consumers expect and creating a new relationship between brands and consumers

What Is Digital Disruption?

A disruptive innovation is a new technology that makes another one obsolete. For instance, phones replaced telegraphy, and personal computers made it possible for businesses to give employees individual workstations.

Besides replacing old technology, a disruptive innovation often allows businesses to create a new value proposition by broadening the spectrum of what can be done. Digital disruption specifically refers to a group of technologies that are connecting machines, gathering data, and using algorithms to find patterns and make predictions.

In the past, digital disruption was seen as something that would impact a few industries. Online news would replace printed newspapers, and online media would disrupt the music industry by making CD sales obsolete.

Digital Disruption Is Impacting Every Industry

Digital disruption is no longer impacting a handful of industries with an outdated model. The Internet has changed how consumers find information and choose products or services. It has transformed the way businesses are organized, and digital technologies have also created some new expectations from consumers.

More importantly, digital innovations are changing the benefits consumers can receive from brands. It is possible for brands to offer a more personalized experience throughout the entire customer journey, and most consumers are now expecting this type of experience.

Communications between consumers and brands are also impacted. Traditional marketing campaigns are still relevant but creating connections on social media is a priority for most businesses.

How Businesses Are Changing Their Value Proposition

Many businesses are rethinking their model. Digital disruption is allowing for constant communication between employees and making it possible to work with remote teams.

While a traditional business model would usually keep each process in a separate silo, new technologies are pushing businesses towards a more centralized approach. This results in businesses that are more focused on the outcome rather than on processes, and in products and services development being accelerated.

There is also a greater emphasis on using digital platforms such as websites, apps, or social media, and on generating value on these platforms. For a lot of brands, these online interactions are an integral part of the new value proposition. More connections are made with partners and other companies to meet new expectations and reach out to new markets.

Which Technologies Are Driving These Changes?

digital disruption and cloud computingTechnologies like cloud computing, AI technology, and data mining are the main driving forces behind the new centralized business model. Businesses have been able to collect datasets for years, but new AI and cloud computing technologies are making extracting valuable insights from these datasets easier.

Having access to business analytics is helping businesses make decisions that will benefit consumers, and is also creating a new business model that focuses on outcomes.

Cloud computing gives businesses access to a wide range of tools and systems that would otherwise not be accessible due to limited onsite storage and IT capabilities. Mobility is another advantage of cloud computing. Professionals can access clients’ files while they are on the go, which is redefining the value propositions made in the professional services industry.

As of 2017, 95 percent of businesses had adopted some form of cloud technology.

More Connected Objects

One of the particularities of the digital disruption we are currently observing is the increasing number of connected objects. Businesses can now use hybrid wireless networks to connect wired and wireless devices.

This technology is making it possible for employees to bring their own Smartphone or laptop to work and to connect to the company’s network. Hybrid networks are flexible, boost productivity, and allow businesses to still use old technologies such as workstations by connecting them to newer wireless devices.

The Internet of Things is another disruptive innovation that should be mentioned. This technology connects objects and devices to a network. It has been getting more attention as the first connected appliances and objects are appearing on the home automation market, but the industrial sector has been relying on the IoT for years.

Using IoT software in combination with factory machines provides better visibility into the entire manufacturing process. The IoT is helping businesses collect data throughout every step of the supply chain.

Manufacturers have access to more data related to product quality and can use it to improve the products they make. It is possible that products could keep communicating with manufacturers after being sold. This could result in automakers tracking quality issues with vehicles once they are on the road.

Retail, healthcare, and supply chains are projected to be the main industries that will drive IoT adoption in 2018, but this technology could potentially disrupt every industry.

Consumers’ Expectations Are Changing

Digital disruption is changing the way consumers can access information. It is also transforming how people consume media, entertainment, and communicate with each other.

Having access to these technologies has transformed what consumers consider as a positive interaction with a brand. In a way, consumers expect more than ever before from the interactions they have with businesses.

These expectations aren’t limited to online interactions. There is an urgent need for brick-and-mortar stores to catch up with these new expectations by introducing technology in their stores.

Consumers expect to easily access information about products whenever they need it. Speed is important when delivering information, and forming a personal connection with a brand is something that is likely to result in a purchase.

Businesses are adapting to these new expectations by focusing on people-based marketing. New technologies like AI are helping brands develop customized marketing campaigns tailored to what each potential customer would benefit from seeing at a specific stage in their journey.

Consumers expect to have a one-on-one connection with brands from the moment they hear about the brand to the moment they become a loyal customer. Social media is making it possible for consumers to connect with brands, voice their opinion, and get access to valuable content.

While traditional forms of marketing such as TV ads would focus on the product or service, this new approach is about building a community around a brand and connecting with consumers on a personal level.

Meeting these new expectations is an important goal since a consumer will probably choose a competitor’s products or services if they have a bad experience with a website or an app.

Which Trends Are Helping Businesses Meet These New Expectations?

Apps and mobile websites are helping brands deliver information to consumers. There are new design trends affecting apps and websites that make these platforms faster and easier to navigate for users.

An increasing number of brands are relying on website optimization tools to continuously improve their interface and design and deliver the best user experience possible.

Intelligent agents are also becoming more common. Businesses can use these agents to interact with customers in web-based chats or in apps. An intelligent agent can inform about a product, perform some customer service tasks, and even make personalized recommendations.

As these agents are becoming more sophisticated, they could replace customer service departments and help brands create a more direct connection with consumers by mimicking a human interaction.

Artificial intelligence is an essential element of a business model that focuses on customization. Machine learning allows businesses to anticipate what a customer’s needs will be to offer a more personalized experience. Cloud computing is the technology that provides businesses with the computing power needed to deliver a unique experience for each customer.

Digital Disruption Is Creating New Concerns

Even though businesses can offer a better value proposition and tailor their offer to their customers, digital disruption is also tied to concerns regarding security and privacy.

Having more connected devices and objects represents security risks. Gathering and storing data from customers represents a security risk, and many consumers are concerned about their privacy.

Businesses need to acknowledge these risks and take the necessary steps to protect the data they store and use. There is also a need to protect networks of connected objects, and to continuously assess security risks as attacks become more sophisticated and as networks and datasets keep growing.

Visibility is another issue. Because of the complexity of these new technologies, outsourcing and relying on third-party service providers has become a common practice. This results in third-party service providers potentially having access to sensitive data and in businesses not being fully aware of the security or privacy policies used by their partners.

It is likely that new regulations and legislation will soon be developed to address these issues. Businesses would have to comply with more regulations to protect sensitive data, and it is possible that legislation could limit the kind of data businesses can collect, store, and use.

Digital disruption is currently transforming the entire business landscape. AI technology will probably become even more significant in the near future, and the IoT will impact more industries beyond manufacturing.

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