The business environment can be broken down into segmented forces, referred to as demographic, socio-cultural, political-legal, economic and technological. Within each force are a series of changes and trends. Those changes and trends create new needs, or change or diminish existing needs. Technological innovation is currently affecting those needs at unheard of paces. Changes dramatically affect product development, marketing plans and advertising strategies.
Pace of Change
Throughout history, the pace of technological change has been slow, happening over centuries or decades. Today’s technological changes, however, are just years and months apart. The Internet, smartphones, GPS, Facebook, iPods, Streaming Content and other innovations have happened at a rapid pace. The whole marketing process has to change to accommodate this increased pace. Early adopters stand in line for days to be the first to buy the latest item, since being the first to own a new product can be a status symbol. Your advertising program should be designed to take advantage of this frantic activity and the buzz it creates.
Almost every new technological development will make an earlier one obsolete. Email and attachments decreased the need for a fax machine. The ubiquity of cell phones has eliminated the need for pay telephone booths. Accordingly, products today have a dramatically shorter life cycle. That in turn means there is more importance on getting to the market first, and recovering your product development costs before your product becomes obsolete. It means you have to spend more on research and development just to keep up with competition. Your next product has to be in development before your newest one is even on store shelves.
While you still need a traditional advertising program, high technology products must also have a strong New Media presence that uniquely appeals to your high tech customers. A New Media presence combines Internet advertising, Web 2.0 use and web design. Search engine ads and search engine optimization have proven to be effective. Display ads and banner ads can be effective if they are based on previous online behavior. Permission-based marketing is slow to accumulate, but targets very loyal customers. Mobile advertising may be the fastest growing method. Web 2.0 involves the use of social networking sites, blogs, podcasting and video sites.
Perhaps the biggest challenge for markers is avoiding a bunker mentality, where you either refuse to acknowledge how a technology change will affect you, or you fail to see it altogether. Kodak was once one of the leading American companies, but later declared bankruptcy because it failed to understand how digital photography would change their industry forever. If you are the industry leader, never assume you are too large to be affected by a new technology. Don’t underestimate new technology in another industry, assuming it won’t impact your industry. And never assume that a new technology is just a fad that will pass.
After a 30-year career in the business world in more than 15 countries, Jim Tischler moved to university academia to teach and write about business, international trade and economics for the past 12 years. He earned an MBA in 1977.