August 11, 2010: Regular correspondent Alan Small (Taree Camera House), looks at the implications at retail of the beefed up broadband network on the political agenda for Australia:
Politics discounted, the national broadband network (NBN) is on the way and will cover as much as 70 percent of Australian homes sooner than we might currently be anticipating.
With the NBN will come change – big change – in how people (our customers) work, play, relax, entertain themselves, seek information, achieve medical and legal advice, communicate AND shop. We are on the cusp, perhaps, of the greatest revolution in human behaviour since the advent of the motor car and the telephone.
What are the implications for traditional bricks and mortar stores as the NBN not only comes online, but increases its coverage and speed using the enormous versatility of glass lines over copper wire?
The threat and the advantages are split 50-50, depending upon our reaction and planning for this major change to infrastructure.
Websites that today we think are fairly ‘cool’ will be like model T Fords in five years, and in a busy world it may well be that as much as 60 percent of all shopping is done online before 2020. So there is the threat. If traditional businesses don’t take advantage of the NBN they will simply fail and disappear. Those that embrace the new technology will not be guaranteed success, but are more likely to have a long-term future and enjoy growth if they do it well. And that for them, may be the benefit, with an equal measure of luck and planning.
So a successful business model today will need constant revision and modification in order to cope with possibly the greatest decade of overall change that we have ever experienced, at almost every level of our existence.
Even governments will govern in many different ways in just 10 years from now; life will continue to speed up for the majority of us and many new solutions will have to be found for us to all have just a reasonable life in this ever-crowded, complex, demographically changing and hectic existence.
The pace of life will push people more and more towards doing business online when it suits them. Time constraints alone will guarantee that. Those who accept that change is upon us and do their best to plan for it will possibly prosper and stay around in their activity of choice, those who don’t will simply fall by the wayside.
One of the keys to success in this different world will be how we communicate our message. Advertising will no longer be about informing or exposing your goods and services to potential buyers, it will be all about winning hearts and minds by the use of psychology and exploiting small differences that become major in the mind of the consumer. Doubly important as everyone strives for the cheapest prices.
The biggest losers in this new world, potentially, are the big and famous brands that we know so well today and who, due to lack of vision, may exchange brand value – and therefore brand loyalty – for sheer numbers. Some are already on that slippery slope.
Like it or not, ready or not, we are rapidly entering the era of the brave new world.
Taree Camera House