Disrupting the Customer Interface

by Jörgen Eriksson on June 19, 2015

Breaking chainI read an article on Tech Crunch this morning, where the author made the point that Uber, the world’s largest taxi company, owns no vehicles. Facebook, the world’s most popular media owner, creates no content. Alibaba, the most valuable retailer, has no inventory. And Airbnb, the world’s largest accommodation provider, owns no real estate.

Clearly, something interesting is happening with value chains, and it is that we finally see the internets breakthrough as the primary platform for commerce.

Since the Industrial Revolution, the world has developed complex supply chains, from designers to manufacturers, from distributors to importers, wholesalers and retailers. It is what allowed billions of products to be made, shipped, bought and enjoyed in all corners of the world. In recent times  the power of the Internet, especially the mobile phone, has unleashed a movement that  is rapidly destroying these layers and moving power to new places.

The article on Tech Crunch makes the point that the balance of power between the different service layers in the value chain is a battle for control. Price-comparison sites first seemed to provide welcome traffic to airlines before airlines tried and failed to starve them of their business and promoted their own apps and websites as the preferred route. Last week Lufthansa announced a new service charge for third party internet retailers of flight tickets, to try to get sales to return to their own website.

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In this age, the customer interface is everything. The new breed of companies are the fastest-growing in history. Uber, Amazon, Alibaba, Airbnb, Twitter, WhatsApp, Facebook, Google and so on… These companies are independent, thin user interface layers that sit on top of vast and costly third party supply systems, and they interface with a huge number of people, channelling customers orders to suppliers for a margin or kick-back at close to zero cost per transaction.

There is no better business to be in. The user interface layer is today where all the value and profit is.

About Jörgen Eriksson :

Jörgen Eriksson is the founder of Bearing and is the Chairman of the firm since it was created. He has successfully expanded Bearing into covering projects on four continents. He is also Adjunct Professor of Innovation Management at the International University of Monaco and at Universitat Politècnica de Catalunya in Barcelona and he is an active member of the Founders Alliance organisation.

Working with consulting engagements across Bearings practices, he has over the past fifteen years participated in and supervised a large number of client projects, from innovation system development and place development and branding, to merger and acquisition assignments and leading edge research and business development activities for key clients.

His new book, Branding for Hooligans, will be published in 2015. It is about how innovation and branding are key survival factors in our modern times of hyper competitive markets.

Prior to Bearing, he was Director of Europe, Middle East, and Africa for Trema Treasury Management, a technology and consulting services provider, supplying financial software solutions for the global financial industry, Clients included The European Central Bank, Citibank, SEB, South African reserve Bank, Deutsche Bank, Abu Dhabi Investment Authority (ADIA), as well as many other large financial institutions and Fortune 500 companies.

Early in his career Eriksson was educated at the Stockholm School of Economics, where he studied economics, financial economics and philosophy. He then worked in Scandinavian investment banks and also for the Swedish Institute of National Defense Research.

You can contact Jörgen on e-mail jorgen.eriksson@bearing-consulting.com, connect on LinkedIn on http://fr.linkedin.com/pub/jörgen-eriksson/0/38/8a0/ and follow him on twitter on joreri508.

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