I first heard this curious term, “Creator Economy” used on a public radio interview @ NPR with Paul Saffo, a Silicon Valley technologist and well respected futurist.
Months later, I watched @ TED.com as Tim Brown, CEO of IDEO referred ever so eloquently to the change in how brands interact in the future with their customers as:
“The shift from a passive relationship between producer and consumer, to the active engagement of everyone in experiences that are meaningful, productive and profitable.”
Tim Brown and Professor Saffo are referring to the same phenomenon. We are in the midst of a transformation into a new economy. One where value is derived through participation. This is not a newly created social function. The initial push of technology to drive business processes was without much consideration for consumer behavior and seemingly for the sole sake of short term profit margins. It took us out of a world where we were already participating in an offline manner. The democratized internet is the great equalizer in that those who leverage it can seek out and correct inefficiencies in an organizations structure with relative ease. Thus, increasing the speed and decreasing the cost at which the fulfillment of tasks can take place. Like it was for efficiency, the internet is also the catalyst for this fundamental shift in our economy. However, while technology and the increasing ubiquity of the internet are the root from which this movement grows, human social behavior is certainly what fuels it.
Geoff Mulgan, the director of The Young Foundation in his book, Connexity: How to live in a connected world, does a great job of demonstrating how profits will now be derived more from relationships over consumption. I recommend giving it a read.
Like the increasing demand on behalf of citizens for transparency from big companies and government, participation will once again become a mutually understood part of commerce. No industry or issue based organization is exempt. Some before others, but eventually adapting to this way of thinking is imperative to surviving amongst more agile competition emerging in your industry. If you are not fully engaged with your customers and prospects, acting as the full time curator of your customers experience, you will lose.
I’m not talking about losing a little market share. You will sooner or later cease to exist.
It seems most businesses view the internet as simply another medium, like television or radio before it. This is a costly error. One that will in the end be the demise of many companies. While all three mediums are like in the sense that they are all delivery devices, the internet and more specifically social media are the most efficient way to both talk and listen. To allow people to participate and add value to their own experiences and thereby to your company. Technology has given us once again the ability to improve upon the processes and products that make up the everyday experiences we enjoy as well as those we have to endure a little bit easier to bear.
In Jeff Jarvis’ book, What Would Google Do, the Professor @ City University talks about different industry models as a platform. The book is must read for anyone looking to emerge as a leader in their industry during the advent of the new creator economy. This shift breeds huge opportunities for the forward thinking. While it means different things for different businesses in terms of practical application, whether you run a restaurant, sell B2B or operate a cruise ship — no matter what type of business you manage, you are more and more going to be in the participation business.
Like with all market transformations there are first-movers. These are just a handful of the the companies doing exciting things and having success participating with their customers.
- Sun Run PPA - Consumer driven solar energy utility company.
- Mod Cloth - Inventory purchasing dictated by customers.
- Hype Machine - Radio station editorialized by the buzz on blogs and twitter.
- Give Water - Donations are made with purchase selected by buyer.
- Tosh.0 - Hit TV show curating the internet and tweeting live at showtime.
- Paranormal Activity - This films roll out was totally driven by viewer request.
- M Prize - a community powered medical research platform.
- Spot.us - Community powered news reporting.
- 20 X 200 - Limited Edition community Art Gallery.
- Threadless - Tee Shirts chose for production and sold by the community.
- B-Cycle - Call to action for bike sharing enthusiasts.
- Ponoko - Community powered product manufacturing.
Existing companies are at a disadvantage with complex organization structures to operate within. To truly tackle this problem and give yourself a chance to complete against more agile competitors creating disruptive models as I write this, you must look at it like a platform and that means starting from scratch. Obviously, you are not going to close up shop and start over (although some of you should) but you must be willing to develop and incubate a post-internet version of your pre-internet business model to be incorporated slowly going forward. Have no doubt, the platform model is your future or you have none at all.