Of all the innovation going on these days, one of the hottest topics around is e-commerce. E-Commerce 1.0 was one of the most successful implementations of internet technology to truly revolutionize an industry(s). The act of buying and selling goods has been the backbone of any economy since day 1. It was only natural to use the internet as a tool to breakdown the traditional barriers that inhibited the exchange of goods.
Of course there were other elements at work, namely the developments of transportation and shipping, currency markets, identity security, and so on that created a world ripe for such innovation. The culmination of these elements came to brew the very fruitful process we now know as e-commerce.
After a decade or so of success, we are now starting to hear people claim that this process is antiquated compared to other areas of technological innovation… and I would tend to agree. This is not to say that the process is flawed; it most certainly is not and there is still huge opportunity to implement these relatively stale methodologies in countless industries with wild success. But the proliferation of new technologies, specifically with respect to contextual and social elements, are creating huge potential for HOW we exchange goods.
First, it’s important to take a step back and look at how a market is created. At its core, the market is made up of both a willing buyer and seller. Now e-commerce 1.0 championed the process of bringing these 2 crucial entities to a single location in order to facilitate the trade but one thing that gets overlooked in the discussion is the good itself.
Before talking about market participants you’ve got to address the good. What is it? Why should I want it? What will it do for me? These questions, or more aptly, the answers are often taken for granted. Most of the markets that have migrated online have been in existence for many years before the internet. The value of the goods are inherently understood among participants. Still, in order to understand the inner workings, and potential, of any market you need to focus on this question.
Yeah yeah you’re thinking…. I don’t need a lesson on the nature of a market. And to that I would argue, as markets and commerce move more and more into a virtual world we begin to lose some of the tangible elements that qualify the value of a good. Simply stating the description of a product is only effective when the buyer can naturally understand the value of that description. In a farmers market or at Best Buy there are contextual and societal elements that help the buyer understand why something is, or should be, of value to them. These are the elements that have greased the engines of commerce for thousands of years and will continue to for another thousand.
And while e-commerce 1.0 has done a tremendous job of bringing together buyers and sellers into a new marketplace and even succeeded in defining tangible products in a virtual world. It is the intangible market forces that qualify the value which are so often missing.
If e-commerce is ever going to truly replace walking into a Best Buy or strolling through a farmers market on a Saturday afternoon, it is the act of qualification that must be championed.
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