The Impact of Digital Business On Our Lives

This is Part 1 of a 3-part series on today’s Consumer Psychology. In the series, we will look at the impact of digital on the way businesses operate and on our buying habits.
Part 1 of a 3-part series on today’s Consumer Psychology

This is Part 1 of a 3-part series on today’s Consumer Psychology. In the series, we will look at the impact of digital on the way businesses operate and on our buying habits.

There’s an old story of a 12th Century King of England who was possibly one of the greatest tech analyst ever to have lived. The story goes like this.

King Cnut, son of Sweyn Forkbeard and Gunhild of Wenden was born in Denmark (it’s complicated!) around 990AD.

Cnut was interested in technology from a very young age, and with a rich father behind him, he could afford to buy the newest, shiniest tech toys. Every weekend he could be found playing with the very latest in siege breakers or sporting a state of the art long sword or driving yet another brand new cart with a panoramic sunroof. Despite his high-standing, the young lad was bullied relentlessly at school, until his father reluctantly agreed to a slight modification to the spelling of his name. He became Canute, the buying stopped and the geeky young lad grew to be a confident man, raided England and became King Canute in 1016.

His new subjects quickly came to love their new King, and he loved them.

As the story goes, one day Canute was telling his courtiers about a ‘tide of technology’ that would bring both ruin and opportunity to his Kingdom. Traders of all kinds would have to adapt their business to meet this new tide, and the good people of England would have more choice and more ways to hemorrhage time. Side note: Time had only been invented two years earlier so that upgrades to the tech gadgets could be released with predictable regularity.

Some of the courtiers were naturally very skeptical about the King’s story, believing that all technology was just a passing fad. So to hammer his point home, Canute set his throne on the sea shore, and facing the sea, raised his right hand and commanded the incoming tide to stop. Of course, despite his great power as a King, the tide kept on coming. The froth of the waves lapped his red velvet shoes. Seaweed carried to wrap his royal shins, and his finest robes quickly followed with a soaking.

Eventually, Canute jumped to his feet and bellowed “Let all men know how empty and worthless is the power of kings, for even a king cannot stop the march of Google, Facebook, Apple, and the World Wide Web.”

His courtiers politely smiled, bowed and applauded their King, but their concern for their beloved King’s mental state showed in their worried eyes. It was bad enough that he was trying to stop the waves landing ashore, but now the King had begun to ramble in a strange tongue. They had no idea what the feck a ‘Google’ was, but it sure didn’t sound good, and their concern turned to fear as they contemplated what may become of them.

As it was, they had no reason to fear anything at all. It would be another thousand years or so before the technological wave Canute foresaw would hit us. And when it came, things changed forever….

Digital Native or Digital Immigrant?

Let’s start off with a short quiz about the ‘digital you.’ After all, you’re a consumer, you choose things, you buy things, you have your brand likes and dislikes, and nobody really knows you as well as you do, right?

So, try these short questions.

Q1 When you get up in the morning do you read news feeds on a tablet or smartphone?

Q2 When you get to work and realise you don’t have your smartphone with you do you feel completely lost?

Q3 Do you use your smartphone mainly for apps, texting, and surfing?

Q4 Do you regularly update apps on your smartphone?

Q5 Do you get your music from Spotify, Sound Cloud or a similar service?

Q6 When you are watching TV do you have a laptop/tablet on your lap at the same time?

The chances are that if you answered ‘yes’ to all of these, then you were probably born after 1985. So, what’s significant about this year? Well, born in 1985 would put you at 16 years old by the year 2001, which is the year the digital revolution for consumers began to accelerate exponentially.

Born after 1985 you’ve grown up with digital technology and are more comfortable with it. It comes more natural to you to turn to digital for news, research, and communication.

In 2001, writer and motivational speaker Marc Prensky  http://marcprensky.com/ wrote an essay about how children’s education needed to change teaching methods to stimulate learning in the digital age. In it, he used the term ‘Digital Natives’’ to describe children raised in a digital world…

“Today’s students – … – represent the first generations to grow up with this new technology. They have spent their entire lives surrounded by and using computers, video games, digital music players, video cams, cell phones, and all the other toys and tools of the digital age. Today’s average college grads have spent less than 5,000 hours of their lives reading, but over 10,000 hours playing video games (not to mention 20,000 hours watching TV). Computer games, email, the Internet, cell phones and instant messaging are integral parts of their lives.”

And the rest of us? Marc describes the rest of us as ‘Digital Immigrants,’ fascinated by some aspects of this emerging digital world and adopting many in our daily lives, but still retaining a trace of our original, more traditional ‘accent.’ This is certainly true in my case, preferring to take notes in a handwritten form rather than typing directly to a digital device, even though like King Canute, I love my gadgets.

Digital technology has developed exceptionally fast over a period of more than three decades, with some of the biggest commercial advancements coming in the last 15 years. Dedicated to information on the World Wide Web project, the first website was launched in 1991, and the first search engine appeared two years later in the form of the W3Catalog.

The first banner ad appeared in 1994, sponsored by AT&T, to promote seven art museums to the readers of HotWired.com. A broken laser pointer was the first-ever sale on eBay in 1995 and Google launched in 1998. The first Skype call was 2003, and the first YouTube video appeared in 2005.

We started Tweeting in 2006, the same year that Facebook opened its doors to everyone. Just 5 years later it reached 1 billion users. Instagram launched in 2010 and was sold in 2012 for $1billion.

From the seed of that first website in 1991 through to the new millennium, much of the digital revolution can be thought of as more technical orientated, with the early web providing a means to transmit messages to users. Communication was 1-way.

It wasn’t until halfway through the first decade of the new millennium that the ‘social web’ and apps that we know today began to emerge. This social web is characterised by 2-way communication – it is conversational. It’s the social perspective that perhaps we digital immigrants have struggled to come to terms with as quickly as the digital natives have. Natives routinely share information, make recommendations and comment on brands and products. As the generations pass, this digital social behaviour is increasingly ingrained in consumer activity.

For example, did you know that over half of the people who read online comments believe that a single negative review, even from a stranger on the other side of the world, can put them off a brand?  And that a user is three times more likely to follow a brand online than follow a family member, and 66% will look up a store if they see a friend check-in online.

The Digital Impact

The impact on business isn’t just restricted to a massive increase in online e-commerce sales. Digital advances are also forcing us to re-imagine everything in our lives, from how and what we communicate with family, and friends, to how we make new friends; from how we buy things, to how we choose what we buy; from how we raise funds for our business, to how we market our products and services; from how we design new products to how and where we get our products manufactured; and much more.

Digital both dis-intermediates and disrupts traditional business models. 

In Part 2 we will explore this dis-intermediation and disruption more closely.

Oh, and you may be wondering what happened to King Cnut. Well, he choked to death in 1035 whilst making a point to his courtiers about something he called “gherkins and a Big Mac”

Canute image:https://commons.wikimedia.org/wiki/File:Pictures_of_English_History_Plate_X_-_Canute_and_His_Courtiers.jpg

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Andy Wood

Andy Wood

My mission is to guide and empower you with the tools, resources, strategies, and tactics to help you succeed in your online business, and (of course) EXPLODE your income so you can live life on your own terms.

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