Published on May 11th, 2011 | by bubble0
Marketplaces – Virtual or Portobello?
Once again our industry pundit ‘Rubberneck’ gives us his own take on the web, the digital economy and life in general.
Disintermediation and cybermediaries. Gift economies, DRM technologies, and FLOSS development. This is all moving so quickly it is nearly gone before I have finished the paragraph.
Once upon a time in an economy not so very far from here there lived lots and lots of shopkeepers. The French even called us a Nation of Shopkeepers. These shopkeepers satisfied our need for goods and services on a daily local basis, then in district centres, and then also in regional town centres, and latterly in out of town retail parks. And then came the digital economy sweeping all before it in an inexorable wave of communication.
The shopkeepers have begun to disappear at the same inexorable rate; newsagents, chemists, off licences, butchers, all going, going, gone. Some services still survive; hairdressers, building societies (going), restaurants/coffee shops, and hardly anywhere for Postman Pat to sit with his very fine cat and have a cuppa.
So where is all this GDP creation going? Tesco and the Virtual Marketplace of course.
With the former it’s all about scale and price competitiveness, and the latter with the spectacular advances in information technology, its dissemination and simple and secure money transfer.
Manufacturers are thus taking advantage of this communication explosion to remove the intermediaries such as traditional retailers and other middlemen, and are able to deal with their consumers directly. This is labelled the disintermediary process (in case you didn’t know) and it provides a significant cost advantage over the traditional models.
Let me mention the ‘T’ word again – they have now evolved, added value over the manufacturer in order to continue to compete in the marketplace – the ‘one stop’ store adding value through convenience. Others add information and reviews for its customers, and there is also the trust based model where sellers are able to sell through a trusted intermediary (here it is….a cybermediary), with the customer gaining confidence from this. (was eBay the ultimate cybermediary? Yes imho)
But one of the most unusual aspects of the web is the free information that exists—the gift economies of the Internet—Wikipedia, Linux, and FLOSS (Free/Libre/Open Source Software) perhaps sometimes repackaged with added value features for sale.
So what on earth does the future hold for the Physical Marketplace?…The high street, the district centre, the retail park? Well we know that vested interests in property companies will try to sustain their importance for as long as they have monetary clout, but the slope is very slippery and the writing is on the wall in GIANT letters; it’s a goner.
We will still crave the social interaction we get from physically shopping (actually not if my local Tesco car park is anything to go by…I nearly get into a fight every time I go there !) No, perhaps I am thinking of the true marketplace; the smell, the colour, the touchy-feely nature of the merchandise. The street market will be the final bastion of the local trading interface. All the pokey shops will have disappeared in ten years and will be replaced by….what ?? Do we really want to use them for housing, right on busy noisy roads?
My suggestion?…let’s just widen the roads and push more traffic along them; not cars, we won’t need them, just lots and lots of tuk tuks delivering direct to your door all those things you will be sending back the next day.