How the impact of connectivity will also affect your business model
- Business Model Innovation
A business model without digital connectivity? We hardly see them anymore. With the rapid advance of new technologies, being able to connect people and systems is even crucial for companies that want to win the game.
A doorbell that can be operated remotely. A chatbot that answers frequently asked questions from customers on its own. And do you want to track the efficiency of solar panels? Just use an app, it’s as simple as that. Nobody is surprised by hearing examples as these anymore. Nowadays connectivity is in the core of our daily lives. This makes it indispensable in the business model of companies as well. The ability to connect people and systems has evolved over the past fifteen years to become an absolute key condition for successful business.
Key resource in your business model
But hear this: we ain’t seen nothing yet. For companies, this is only just the beginning of a longer journey. We firmly believe connectivity will play a key role in the development of new business models. What’s driving this is a new wave of technology coming our way. Blockchain and the Internet of Things are already gaining ground. The Metaverse is still in its infancy, but many tech experts expect this new digital space will have a major impact on the way people connect with each other and organizations. To better understand the playing field in which these changes take place, let’s first take a step back.
Connectivity as oxygen
As mentioned, business models without any kind of connectivity no longer exist. Virtually every company has a website, does social media postings and offers customers the opportunity to get in touch by email or chat. But there is also a group of companies for whom connectivity is even the oxygen to stay alive. The core of their business model revolves around connecting people and systems. We have done some research and distinguish three variants:
- System to System
- System to People
- People to People
Three connectivity models explained
Let’s take a further look at these variants. First of all, there is ‘system to system’. Think of companies that lay the foundation for technological applications. They provide an underlayer that other players use to develop and run their own applications, tools and platforms. For their customers, these are essential tools to do business with. Well-known players in this segment are Microsoft and Amazon, which has the world’s most widely used cloud service with Amazon Web Services (AWS). In this list, we also include telecom-brands such as Verizon and T-Mobile.
The second group of connectivity-based companies has a business model that is about ‘system to people’. These are parties that connect people to content with their own platforms. Such a player is Netflix. The same applies to NEP Group, a large production company that provides broadcast services for major events around the world. Finally, there is the ‘people to people’ category. These are connectivity platforms that run entirely on the interaction between people. People not only consume the content, in many cases they are also the producing parties. Brands that everyone knows are YouTube, Facebook and Vinted.
New opportunities for your business model
The business model of these types of platforms are all about connectivity. However, this aspect has become the precondition for the success of other companies as well. And yes, probably for yours too. The website, customer contact, running applications; all those factors have to be properly regulated in the core. Without concessions. But on top of that, there is a growing number of opportunities that connectivity offers for your business model. We’ve seen this happen before with the transition from web 1.0 to web 2.0. With the rise of web 3.0 the possibilities to connect are expanding at an unprecedented rate. What to think about:
- Racing Max Verstappen live on the Zandvoort circuit with an Oculus Rift.
- A lunch with a business associate from Tokyo in the metaverse.
- View a home digitally, immediately make an offer and pay in cryptos.
- Retailers immediately have a sales history for every customer in their store.
- Manufacturing companies sell digital assets using NFTs.
Everything and everyone connected
You might think this is science fiction, but we believe the future is not far away. Just a simple example: until recently, we used a separate app for the latest traffic news. In only a few years the technology has gotten much smarter. Your smartphone now matches the current traffic situation with your agenda and you automatically receive the travel time to the office. Something that was complicated a few years ago, has become very normal. This will happen again in another two to three years. Products, devices and services will become more and more connected and major technological barriers will vanish. It’s connectivity in a way that many people can’t even imagine.
The question now is: what do these developments mean for your own business model? Where will you add value in the nearby future? What will be your revenue model? And who will be your strategic partner? Connectivity is a multi-stakeholder business. Don’t sit in a corner for too long. Now is the time for strategic choices about connectivity. It’s the only way you can make your business model future-proof again.
Are you ready for new connections? Get in touch and let’s create the future.
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