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Digital Disruption is about the “Substantial Minority”

How can your organization create meaningful change in the world if it doesn’t know what the world is going to look like? This is why we always start our Digital Transformation workshops or presentations by inspiring and opening the eyes of our public or workgroup. We show them examples of players that are disrupting their sector today and others that may do so in the future.

How do you define disruptive?

While it took us years to get to the point where people believed Digital Disruption was real, most people finally do see it is not just a hype. And yet when we show them examples of disruptive players, we’re sometimes met with disbelief.

Surely this player isn’t going to change the way everyone behaves, experiences and buys in my sector?

This is the one comment that keeps popping up in nearly all of our workshops and presentations. The arguments for it are usually along the lines of:

Their business model isn’t sustainable!
How is it disruptive if I haven’t even heard of it?
Do people actually use this?
We’re different, it doesn’t apply to us.
That’s a foreign player, they don’t know the market like we do.
We’ve seen this happen before, people will come back to us eventually.

People often assume that Digital Disruption means that the digital challengers are better in every way and that soon everyone will go to them for all of their needs. That is not disruption, that’s DESTRUCTION.

Digital destruction

It is about the Substantial Minority

As we already wrote in our book on Digital Transformation:

Let’s suppose 10% to 20% of the viewers would no longer watch linear TV, but engage with their channels in a time shifted way, skipping most of the ads that are aired. Only a limited amount of advertising revenues would be lost, nothing for an industry to worry about.

What if 10% to 20% of the advertisers start shifting their budgets to new digital platforms like YouTube, Facebook, Twitter or Google, pulling part of the money from traditional TV? This doesn’t seem too dramatic, there is still 80 to 90% left right?

Consumers like to decide what to watch themselves so what if 10 to 20% of them run away from TV entirely and instead embrace Netflix, YouTube and others as their primary source of entertainment?

The real problem occurs when all of these drivers coincide and amplify each other’s effect. Even if we would conservatively assume that the real financial impact is always on the lower side of the assumption, just adding them up would already make the difference between profit and loss for most media companies, between survival or extinction.

If a minority of the people prefer a different proposition, with a superior user experience, that is mobile, that solves their problem or fills their need, that saves them time or money,… then that is a small amount of revenue your company loses and isn’t getting back.

Do you think that after people discover a superior experience, they will come back to the old way of doing things once it didn’t work out? Not a chance. They will continue to look for alternatives that fulfil their needs and solve their problems, as the rules of the game have changed for them.

Digital Disruption

How long can you keep it up?

How many of these small stings can you survive? How big are your profit margins? For many businesses it is down to a few percent these days and a small shift in preferences for a select group of their customers could have a substantial impact on their business. That is what Digital Disruption is about; Digital-first alternatives that appeal to a group that seems small at first, but that can grow to a size substantial enough to bring your company to its knees.

You must know these new players and see them coming. You must understand how they think, what rules they play by, who is funding them, what their business models are, so you can create your own Digital Transformation strategy and take your future into your own hands.

We can help you with this, contact us to start your own transformation.

If you believe Digital Disruption is NOT happening in your sector, tweet us @DuvalUnionC and we’ll show you some examples.

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