Disintermediation is rapidly fragmenting industries from retail to music to transport. With a sharing economy, asset-light business models and the trend of young consumers being happy to pay for access over ownership, structural barriers are coming down. There is aggregation of spare capacity across many markets which is empowering people to disrupt each other's businesses. Take Uber - using real-time data, crowd-sourcing, innovative payments and capitalizing on unused inventory to transportation, Uber has started to remove middlemen. Uber has revolutionized the way people think of car travel, in fact of business models themselves, with the word ‘uberize’ officially entering the English dictionary in 2016. Postal services are 'uberizing' to become fulfillment platforms, taxis are delivering food and parcels, food technology companies like Innit are eating into the share of traditional restaurants and grocery retailers.
E-commerce is facing the brunt of disintermediation too. What began as an alternate channel or marketplace is evolving as consumers spend time across multiple platforms, consuming blogs, watching videos and reading tweets from friends, influencers, and celebrities; the intent to purchase could be triggered on any of these places at any time. An influencer could be anyone from a blogger, a celebrity, a YouTube star or a solo fashion aficionado. Influencers are what the brands of today congregate to, in order to get their product in front of an engaged and highly-targeted audience. Studies suggest that ninety-two percent of consumers trust recommendations from individuals - even if they do not know them, over brands. Influencers are becoming both more ubiquitous and significant. Influencer content is viewed 7x longer than the average digital ad. Given this new reality, retailers and brands have to understand how to remain relevant by opening up new ways of engaging with consumers.
We still see many retailers relying on a mix of intuition and historical data to predict what products they should stock several months in advance. This often results in overstocking and markdowns or out-of-stock situations. Retailers can leverage social platforms to sell directly to consumers and use the real-time insights to plan their range, improve allocation to channels and optimally manage inventory.
Imagine a blogger with thousands of followers. She’s a health enthusiast who promotes recipes, meal plans and workout tips across her blog, Instagram and Facebook. Organic food brands, plant based food companies, or even large corporations might tap her to promote their products. How can they do that? Already, they send free samples and pay for sponsored posts. But how can they encourage commerce? By opening up their inventory in a simplified yet secure way, giving her access to their products and infrastructure. By doing so, new revenue streams and previously unseen opportunities for innovation or collaboration with this powerful channel are instantly created.
What if you could create a safe, secure, commercial interface with a whole new ecosystem by exposing your inventory through a plugin that allows social influencers like this blogger to tap into your inventory and make recommendations to her fans.
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Thoughtworks created SockIT™ to help retailers open up inventory and products to a whole new ecosystem while playing by your rules. With SockIT™, retailers have secure, API driven opportunities for innovation. Bloggers, Affiliates, Digital Boutiques, Inventory as a Service, and Subscription models can all be enabled with this platform. With SockIT™ you can uncover new revenue streams, create long lasting connections, by effortlessly plugging into your inventory. These connections gather data and help you predict trends in the market, giving you more time to respond to changes as they happen. With this information, retailers can better plan their supply chain and respond to customer needs.
Disclaimer: The statements and opinions expressed in this article are those of the author(s) and do not necessarily reflect the positions of Thoughtworks.