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Berkonomics

How will you ride the next wave?

“Re-imagining” our lives

The world is experiencing a new era of re-imagination, in which virtually all our old ways of doing things are being uprooted by new, more efficient and more widely available methods of accomplishing old tasks.

We collaborate using Zoom, Teams, Salesforce, Yammer, Skype, GoToMeeting, Fuze and hundreds of other tools not available to the last generation of whiteboard, personal meeting or teleconference users.  We read increasingly using our digital devices.  We compute using our smartphones and tablets.  We use gestures or our voice to control our engagement with our technology.  We take courses on-line.  We bypass the middle person for services and information.

We are learning to use new tools.

ChatGBT and Bing AI are just two of the new tools that are already changing our lives.  It won’t be long before another round of layoffs comes, and these new tools will create new jobs to fill the gap.

We watch our news and entertainment anywhere we want to on any kind of device we choose.  We move boarding passes, coupons and more off paper and into the digital world.  Many of us now never physically touch our music.   We recruit and hire using LinkedIn or other resources, replacing job fairs, campus events and paper resumes. We use QR codes to simplify the process.

Examples of re-imagining the business.

There are hundreds of other examples of re-imagination everywhere we look, making our lives easier and our reach greater than ever before.

The principal drivers of this re-imagination are the hyper-growth of the mobile Internet, consumer-controlled commerce, the rise of big data, and “globality.”  Let’s explore examples of these and more.

The mobile Internet – The latest major computing cycle

[Email readers, continue here…]   Over the last fifty years, the world transitioned from mainframe computing to mini-computers to PCs to the desktop Internet.  And now we have made the largest cycle of all – the move to mobile Internet computing.   With 7 billion people on the planet today, there are more than 6 billion mobile subscriptions, up from just 720 million in 2000.  Mobile workers are quickly overtaking the fixed desk worker and long-distance traveler.  Mobile commerce is up 552% in one year (measuring cyber-Mondays).  The mobile web will become what desktop Internet became in the 1990’s – the standard platform for anyone doing business.

In three years, as web browsing and TV watching minutes per day remained constant, mobile consumption rose by double to over two hours per day.   Fifty-seven percent of teenagers say that their mobile device is the “center of their universe.”   We are entering the smartphone era, where 65% of time on our mobile devices is spent in non-communicating activities.  We are treating these more as computers and less as phones. And almost half of all homes have at least one tablet device, replacing traditional computers for most tasks.  And we carry access to our entertainment with us, bypassing the need to be entertained by others while away from home.

Big Data – threading the needle while still in the haystack

By 2024, there will be an estimated 8,200 gigabytes of stored data for every person on earth.  That adds up to 80 with 21 trailing zeros.  In my country, USA, there are three million data centers in all, accounting for 2.2% of our nation’s use of electricity.  Examples of this massive accumulation of data abound. We could store all the world’s music on just three four-terabyte disc drives. There are thirty billion pieces of content shared on Facebook each month.   If we analyze the potential value of that data to various industries, we can imagine a 60% increase in retailers’ operating margins, or $600 billion in value to various enterprises from mining personal location data.  An estimated $180 billion will be invested in data analytics by 2024.  This is big business.

How do we use big data? 

We will enable segmentation of the population to produce customized messages and actions.  We will replace or support human decision-making with automated algorithms. We will enable a generation of experimentation with innovative business models, in our industry making today’s form of revenue management look like a primitive art.

The true value to us will be in analyzing unstructured data, estimated to be 80% of all data stored, from blogs, social media, pictures and video.  None of this could be mined successfully in the past generation of technology.  Think of 6 million automobile comments, or 30 million political comments, 200 million travel comments, or 150 million consumer electronic comments posted each month.

Retailers such as Staples and Home Depot are already charging shoppers different prices based upon where they live, income levels and proximity to a competitor’s store, among other mined attributes.  Will hotels be next?

We are in the “age of recommendation”

Already, 69% of consumers research their product, service and guest stay decisions online.  62% look at online peer reviews.  And 39% compare prices across alternatives.  This cat is out of the bag, driving prices down, democratizing search and supply between branded chains and independent properties.

With this little space and time, it is not possible to expand upon other macro-trends, such as socializing commerce, increased trust in the cloud for storage and transactions, exponential growth in computing power, green technologies, and the continued amazing growth of the Internet in Asia, Latin America and now in  Africa.

But it is certain that being informed and planning well for that future will give you a competitive advantage over those who do not.   An African proverb states “Tomorrow belongs to the people who prepare for it today.”

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