Story image

Is there such a thing as a little disruption?

01 Apr 16

When people think about disruptive technology or market disrupters they tend to think of Uber, Google (now Alphabet), Amazon and other fairly massive sized (now) companies. Of course, this makes sense given the scale of these entities by almost any measure, whether that is market capitalisation, revenues or their impact on people and culture; indeed, two of those three are now verbs, while Amazon will likely generate several verbs (“Prime that!” “Just Dash it!”) and at least one interesting proper noun (Alexa). But does every disrupter have to be ginormous?

For example, one might ask if Dollar Shave Club (DSC) is a disrupter. Let’s look at its market,  the $3B men’s shaving and razor blade market. Based simply on revenue, DSC can’t compare to market leader Gillette in spite of its $565M valuation (on VC investments totaling over $163M). But culturally, DSC was the first to make the purchase of mail order shaving products acceptable.

Now, DSC owns more than twice as much of the on-line market as Gillette does (though both can hear footsteps from Harry’s), it’s captured about 10% the total market for razor blades and last year, Gillette both filed suit against DSC for allegedly infringing on a razor patent (December; DSC has counter-sued) and created its own on-line shaving club (June).

Despite the fact that many men still have beards after Movember, this sounds disruptive to me.

That said, it’s important to note a couple items: there was no specific technical invention employed here; and notwithstanding the status of shaving and its related markets, disruption in this situation is on a different scale relative to the likes of Alphabet, Tencent, Amazon, Tesla.

These are companies whose actions in some cases have forced state and federal governments to legislate, and their financial resources – and often their core cultures – enable them to pivot quickly to disrupt anew. Let’s take our example above. What if DSC were acquired by Amazon (given Amazon’s stock valuation and nearly $20B cash on hand), who has a proclivity for buying on-line sellers? Imagine asking Alexa to add a new set of razors to your order through Amazon Prime, or having a Dash button on your bathroom vanity. It is fairly easy for Amazon (or other disrupters) to enter adjacent markets given ever-increasingly available sets of digital information and systems, not to mention cash on hand and Monopoly money-esque stock prices.

The moral of the story is that a market – or a company within it – is never too big or too small to be disrupted. Disrupters are coming in all shapes and sizes, and traditional organisations, whether they have digital business strategies or not and regardless of their market positions, ignore potential disruption at their peril.

Article by David Yockelson, Gartner research VP

Wine firm uses AR to tell its story right on the bottle
A Central Otago wine company is using augmented reality (AR) and a ‘digital first’ strategy to change the way it builds its brand and engages with customers.
DigiCert conquers Google's distrust of Symantec certs
“This could have been an extremely disruptive event to online commerce," comments DigiCert CEO John Merrill. 
Protecting organisations against internal fraud
Most companies tend to take a basic approach that focuses on numbers and compliance, without much room for grey areas or negotiation.
Telesmart to deliver Cloud Calling for Microsoft Teams
The integration will allow Telesmart’s Cloud Calling for Microsoft Teams to natively enable external voice connectivity from within Teams collaborative workflow environment.
Jade Software & Ambit take chatbots to next level of AI
“Conversation Agents present a huge opportunity to increase customer and employee engagement in a cost-effective manner."
52mil users affected by Google+’s second data breach
Google+ APIs will be shut down within the next 90 days, and the consumer platform will be disabled in April 2019 instead of August 2019 as originally planned.
GirlBoss wins 2018 YES Emerging Alumni of the Year Award
The people have spoken – GirlBoss CEO and founder Alexia Hilbertidou has been crowned this year’s Young Enterprise Scheme (YES) Emerging Alumni of the Year.
SingleSource scores R&D grant to explore digital identity over blockchain
Callaghan Innovation has awarded a $318,000 R&D grant to Auckland-based firm SingleSource, a company that applies risk scoring to digital identity.