Remember the first time you entered a credit card number online? For most of us, this singular act was filled with confusion, nervousness and doubt. Do I really want to do this? Will someone steal my number and buy things with my credit card? Will the retailer receive my order? Will the item get to my house? And at a higher level, will this idea of buying online actually take off?
It was all so mysterious and foreboding. Most of us couldn't grasp the transformation ahead. We couldn't envision a world where people didn't need to tramp through crowded malls, spend days going from store to store or phone calling to locate desired items.
Several years passed before we got comfortable with the idea of buying online. This year, online shopping is a mainstream act, with 50 percent of all holiday shoppers placing online orders this Christmas. Now "Cyber Monday" rivals "Black Friday." Forrester Research expects a 23 percent rise in online sales in 2006 this holiday season, to $27 billion.
As consumers, the retail world is at our virtual fingertips. We find what we want from the comfort of our home, in our pajamas, long after brick and mortar stores have closed.
Classic Web 1.0 success stories got the Web 2.0 ball rolling by giving consumers a voice they never had. Amazon enabled us to buy more easily, but it also gave ordinary folk a means to widely express their opinions about what they read, listened to and consumed. Rave, debate or berate, consumers could now influence the opinions of other consumers, and thus impact retail pocketbooks and actions.
Sites like eBay gave voice to ordinary people by letting them take advantage of the e-commerce wave. They could buy and sell directly with other consumers with a self-policing quality control intermediary in between.
Similarly, name-your-own price sites (Hotels.com; Priceline.com; Hotwire, etc.) enabled people to comparison shop and yield the benefits of group buying.
Portals enabled consumers to personalize how they experienced the Web and digested news and information. This consumer freedom wasn't possible in a non-Web world.
Think of this initial digital revolution as "Power to the People 1.0."
Now we are at another crossroads. A deeper level of community building is occurring. Here are a few examples:
- While Amazon and these other Web 1.0 examples gave voice to the consumer, it was on their terms and on their playground. Amazon, et al, enabled consumer voice in order to create "stickiness." But now with Web 2.0, consumers can build their own playground. Social networks like MySpace created vibrant communities where consumers dictated the conversation, not the vendors. Suddenly, Amazon, et al, had to come to them to engage the community; not the other way around. That's why participating in social networks has become such an important strategy in corporate marketing programs.
- The "stickiness" Web 1.0 companies craved was displaced by Web 2.0 technologies like RSS. RSS put consumers in the driving seat, letting the information they wanted come to them, the way they wanted it, rather than having to fetch it.
- In addition to letting consumers control the conversation, Web 2.0 communities also took control of "the product," in some cases. For example, Microsoft's Encarta encyclopedia was made largely irrelevant overnight by Wikipedia, the community-developed encyclopedia based on wikis, another Web 2.0 technology.
- Web 1.0 companies like Ofoto let consumers make picture albums on the Web. But, Web 2.0 networks like Flickr revolutionized the market by turning photo sharing into a vibrant social community using Web 2.0 "folksonomies" to tag, share and discuss content between like-minded shutterbugs.
- Web 1.0 news aggregators like Newsgator enabled people to get selective about the news they consumed, harvesting stories only from the news sources that they preferred. But the sources determined what constituted news. Web 2.0 social news sites like Digg enabled citizens to serve as a democratic editorial board, where news stories are submitted by users and promoted in popularity based on a voting system.
The net-net of this transformation is that Web 1.0 started the ball rolling by enabling participation of individual contributors on a massive scale. Suddenly millions of people had a voice online. But they were millions of singular voices, and they were largely looking out for themselves.
Web 2.0 turned those individuals into a collective consciousness. A million voices became one. Communities formed for a collective good; not merely individual gain. The hive mentality of these communities has the power to make or break products, companies, markets and reputations overnight. Citizen-driven communities now determine what's hot; not product marketers. Communities set the agenda; not corporate boardrooms. Communities determine what's news, not media. And most importantly, communities have the power to keep companies honest and call out those who don't behave ethically.
Think of this revolution as Power to the People 2.0.
- Andy Beaupre, CEO and Steve Hodgdon, SVP, Digital & Social Media
