E-marketer approach to disintermediation

The intermediaries are the middle man in any industry. Disintermediation is to remove or eliminate the role of retailers, distributors, brokers, and other middlemen between the producer and the customer; hence the transaction becomes liner between the two. With the advent of web and related technologies it has now become easier to apply disintermediation in one’s business. This leads to delivery of products to the customer at cheaper rates as it saves the commission that went to the middlemen. Though it may seem that disintermediation is a boon but it is posing a threat to the e-commerce industry too. How does it sound if we get to know www.Amazone.com shuts down because all the writers plan to sell their books directly to the customers and does not need intermediary; that is disintermediation. Like a brick and mortar business, even e-commerce faces a threat to disintermediation. The only approach to disintermediation decision is to earn the importance of being the middle man.

Below are approaches that will help e-commerce business to address disintermediation.

Living with values:

It is for the fact that the intermediaries operate only because it adds some value to the customers. It does not need a web or technology to replace any intermediaries if it does not render values; competition eats them up. But when the market-game-play is changing with new technologies it becomes very important for them to adapt, or be ready to be replaced by another powerful intermediary. Google is a perfect example of middle man at work. It has almost become the face of today’s web world.

Going on the same lines e-commerce industry, though being the middleman (at most of the cases) needs to add value to the customers. Taking the example of www.makemytrip.com we can illustrate the same:

Though all the airlines sell their tickets from their private portals, makemytrip holds its place due to the values it renders to the customers in terms of choices, services and deals.

Thus clearly the survival approach of intermediaries against disintermediation is to add value to the customer. Life span of the market solely driven by customers and value addition will help customers to cling to middleman.

Symbiosis:

Any business would like to concentrate on in its core area of expertise. For example a movie theatre will always work upon delivering excellent movie shows rather than pondering upon how to sell its ticket online. For a theatre putting up a good movie is the core work. Whereas www.bookmyshow.com which is a middleman will make sure that the customers are driven to the theatre. This kind of middleman service is always invited which is symbiotic. This can also be held to be the reason why www.makemytrip.com is still in business (as it helps the airlines to focus on its core area that is maintaining and synchronizing their flights). Disintermediation is almost curbed out in such cases and instead helps the e-commerce to prosper.

It is also important to note that the two methods that are discussed are not optional but requirement for e-business.

It is to be noted that disintermediation can be fought by social protectors by enforcing laws. A short sighted view may make us believe that disintermediation is bringing unemployment and posing business threat. But it won’t be hard for us to recall how web technologies and IT was opposed at the early years of its advent in India in the name of automating industries and killing job opportunities. Presently IT caters to large number of jobs in India.  Disintermediation can be taken as the force that may compel the e-commerce to bring about even more value added services to the customers.

The answer to the e-marketer’s approach to disintermediation is to complement the business and keep customers happy with benefits and delivering values. It is very important for a e-marketer to make the business and the customer believe that they got the best deal.

Digital is lot more than Digital

It is a layman’s understanding if they feel web is all about Google and on the same lines it is a layman’s understanding if digital is taken to be facebook, twitter, websites etc.
Like any sort of advertising and marketing it is important for any digital guy to understand that digital also has a purpose and any work on it will certainly have an expiry date. These discussions will come in detail as I progress with this blog. Being a student I get a chance to look at different industry experts critically and also appreciatively and amalgamate with the knowledge that I gain from the institute like MICA.
Looking forward to contribute a bit from my side.

Cheers!
Zoy