Many of the products we use were not there 100 years back: Mobile Phones, Personal Computer, Microwave Oven, Refrigerators, Televisions, Washing Machines, Dishwashers, Frozen Foods, etc. And, many products we use are endangered to extinguish. Technological advances must be seen as ‘constructive’ or ‘creative destruction’ which often has a fatal effect on existing products. The invention of xerography photocopying destroyed the market for carbon paper, mobile phone replaced pagers, and development of cars dented demand for public transport. Technology provides both opportunities and threats.
The business of greeting cards, postal letters and fax significantly eroded when people started to send emails. Some of the important trends illustrate the future impact of technology in our changing world: “Smart dust”, or network of cheap, low-power computerized sensors will start monitoring the food, workplaces, and the welfare of nations. There will be increased convergence among core technologies, with PCs and TVs and entertainment becoming more integrated. There is already convergence of different gadgets into one. For example, a mobile phone provides the service of a phone, camera, e-mail, organiser, clock, radio, telephone directory, etc.
The mobile phone’s use for camera has made Kodak bankrupt. Open source, the free software movement that was started by Linux, will become the norm for further innovation. Virtual auctioning and new methods of pricing will emerge on the Internet. The proliferation of wireless broadband products and services will increase connectivity and spur globalisation.
Neurotechnology, defined as the application of tools, drugs, and diagnostics for influencing human nervous system, especially the brain, will have a far reaching impact on treating mental illness, such as Alzheimer’s disease and schizophrenia, as well as bolstering the immune system, and eventually one’s longevity. Mesh networks, of connections between nodes that are self-healing or are enabled to hop from node to node, will accelerate broadband connectivity that will, in turn, create radically new business models and transform patterns of work and recreation. In times to come 50% of the telephones will be made through internet. The technology has made manufacturing faster. It took just six days to build the 15-storied Ark Hotel in Changsha in China. Technology has forced firms to go in for innovation.
Innovation has become a great tool for creating differentiation. Foster and Kaplan have classified innovation into incremental (to make product more attractive but not changing it fundamentally), substantial (involve major change – in between newness and impact), and Transformational (new value proposition and a new way to manufacture, distribute, and/or market the offering). The pace of technological change has become very fast. Now a new generation of computer is out every three months. It is why, the pace of new product launches has become faster and products are simultaneously launched across the globe. All new products replace the old products.
LCD has changed DVD and DVD had changed VCR; diesel-electric locomotives replaced steam engines, transistors have replaced vacuum tubes, ball point pens have replaced fountain pens, nuclear power is overtaking fossil fuel plants, and electric razors are overtaking safety razors. There are unlimited opportunities for innovation. The technological changes have provided many marketers opportunities, then a many are also feeling the heat of threats. Internet has posed a threat for the postal services, mobile phone posed a threat for STD booths, e-mail has outpaced fax services, and electronic watches have posed a threat to mechanical watch industry of Switzerland. Biotechnology, microelectronics, robotics, and designer goods are undertaking some of the exciting R&D. Information and telecom technology through computers, laptops, mobile phones, internet, tablets, etc. have revolutionised the business world.
Cost of logistics has come down because of technology. Everyday new products are introduced and new media are used to promote them – all because of technology. But one thing is important that advent of new technology does not mean end of the growth of existing technology. Technology has made a great impact on customer value – first, the cost of technology is plummating, thus customer is concentrating on other features of the product; second, technology provides value through the development of new products; third, it can change existing products; and it provides internet, intranet and extranets to bring down the cost. Some of the technological changes are delayed by regulatory framework. At the same time some of the technological changes have become debatable, like cloaning, and Genetically modified food.
Thus a marketer will have to be innovative, otherwise the survival will be endangered. From the customers’ perspective technology impacts all activities from eating to drinking to sleeping to sex to health care and work performance.