Digital Disruption and Design—What’s A Video Shop, Dad?

As a young lad, many a weekend would include a trip to the local video shop to grab a few new releases. Every shopping strip or mall had a store, if not more, all offering pretty much the same product. Fast forward (see what I did there?) to 2015 and you’d be hard pressed to find a video shop in existence. So what happened?

In 1997, Netflix broke onto the scene offering mail order movies you could rent online. No need for bricks and mortar stores or bored video store attendants, just cheap DVDs and a postpack. Jump ahead to improved internet speeds and digital downloads and Netflix was able to pivot its model into a totally digital business. Now Netflix, valued at $52 billion, has evolved into a complete entertainment company, with many traditional TV companies scrambling to copy its model.

And it left the treasured video shop in its wake.

But it’s not just our local video shop—it’s a wide-spread phenomenon. ‘Digital Disruption’ is a term used to describe companies that circumvent the usual business model by leveraging technology. They approach an existing market from a different angle or create an entirely new business that previously
didn’t exist.

Think about it: Uber, the world’s largest taxi company, owns no vehicles. Facebook, the world’s most popular media source, creates no content. And AirBnb, the world’s largest accommodation provider, owns no real estate.

What’s made this possible is our perpetual connectedness, the rapid growth of smartphone usage and Big Data tracking every aspect of our daily life. For a large majority of people in the developed world our social, business and consumer interactions mostly happen online. What this means is that the stages in between a consumer and the producer of a product or service is greatly reduced, levelling the playing field.

We’ve covered Netflix, let’s talk about Uber.

Uber relies on the fact that we’re always close to our mobile phones, which is also the case for the driver of an Uber car. All that needed to happen was to build a bridge between these two parties. In comes an easy to use app, a greatly simplified payment process, and a strong push for transparency in the deal between the passenger and driver. Traditional taxi companies simply can’t compete with this agile approach without offloading a lot of infrastructure.

Uber currently operates in 330 cities and has a valuation of $51 billion, all achieved in 5 years.²

And how about AirBnB?

While ‘house swap’ services have been around for years, AirBnB turned it into a real commercial venture. Creating the digital infrastructure for people to list, rent and promote their personal properties. And it’s giving the traditional accommodation industry a serious run for their money.

This Summer (in the Northern Hemisphere) nearly 17 million guests stayed with AirBnB hosts around the world. A growth of 353% over the last 5 years.³

Not even the music industry is spared—there’s Spotify, Rdio, Pandora!

First we had Napster with people ‘illegally’ sharing their digital music. So what did the record studios do? They tried to sue anyone involved to get them to stop. Maybe not the brightest idea.

Things shook up when Apple introduced the iTunes store offering digital music downloads and the iPod, the perfect product for these digital files. And now? We’ve jumped again with streaming services like Spotify, Rdio and Pandora, who thought—why buy music you’re just going to get sick of, when you could just as easily rent it? What’s interesting is Apple have now had to play catchup with their new Music service, showing you can’t rest on your laurels in this day and age.

Is the graphic design industry next?

So, should we as graphic designers be worried that the robots will take our jobs?

Will services like The Grid that uses algorithms to design your website replace the role of a designer? Not likely. A computer program can never talk to a client and really get to the crux of their communication issue, then offer viable options. Hell, it might be they don’t even need a website and that something else would better serve their business needs.

What it does mean is designers are perfectly placed to help companies ‘pivot’ to take advantages of opportunities offered up by advances in technology. Design thinking and the ability to look at problems from different perspectives makes designers a valuable addition to any team.

This doesn’t mean all designers need to know how to build an app or even write a line of code. Instead we’ll need to gain a broad overview of what’s possible. Which companies are doing interesting things with technology. Or how people are using technology in unique ways.

My advice to stay ahead of the robots? Observe, question and stay curious.

This article was originally published in Shillington Post Issue 03—The Maverick Issue. Read the whole issue online now!

¹Patrick Forth, is the global leader of The Boston Consulting Group’s Technology, Media & Telecommunications practice Source: https://www.ted.com/watch/ted-institute/ted-bcg/patrick-forth-technology-distruption-meets-the-change-monster-who-wins
²Source: http://www.fastcompany.com/3050250/what-makes-uber-run
³Source: http://blog.airbnb.com/wp-content/uploads/2015/09/Airbnb-Summer-Travel-Report-1.pdf