1. The Emergence of “Disintermediation”
Disintermediation, an intimidating term at first glance, has been making waves in recent B2B circles. Initially dismissed as a fleeting buzzword, its repeated appearances in esteemed digital journals necessitate understanding.
2. Traditional Meaning vs. Modern Usage
Dictionary.com defines it as: “Withdrawal of funds from intermediary financial institutions, such as banks and savings and loan associations, in order to invest in instruments yielding a higher return.” But this traditional definition seems misaligned with the modern context.
3. Unlocking the Term’s Significance
According to the glossary at Upside.com, disintermediation refers to the process when middlemen are bypassed in business transactions. Drawing parallels, it’s reminiscent of Arthur Miller’s portrayal of Willy Loman, predicting this scenario decades ago.
In simple terms, it’s the streamlining of the supply chain:
- Supplier of raw materials
- Manufacturer of products
- Distributor or wholesaler
- Retailer at brick and mortar store
- Consumer purchase of the product
4. The Digital Age Revolution
With the advent of ecommerce, suppliers increasingly connect directly with buyers online. This seismic shift will inevitably spark debates about the “value-added” segment of the economy, from packaging and logistics to retail presentation. But one thing’s certain: the evolution is unstoppable.
5. Current Market Reactions
Companies are realigning their strategies. Electronics behemoth Sony, following in the footsteps of Dell and Compaq, is poised to adopt a web-only marketing approach. Labelled “Manufacturer to Consumer” or M2C, they aim to amplify their digital footprint. Already boasting 250 products online, Sony plans to extend this to their complete range of over 2,000 products. Find more details here.
6. Potential Market Implications
With the paradigm shift, companies like FedEx and UPS might see burgeoning demand. Speculations abound on which brands will emerge as key players, with some favoring WebVan’s dominance in urban landscapes. Will they remain confined to groceries? Doubtful.
7. Imagining the Near Future
Picture this: a tech-savvy individual spots an enticing product ad on their mobile. With a simple click, the order is ready either for immediate pick-up at a nearby store or delivered to their doorstep within half an hour.
The looming question for businesses remains: In this evolving landscape, where do you stand? Is your role in the supply chain strengthening or diminishing?
Got Ya Thinkin?
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