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The Transition to a World Run on Software
“Software is eating the world,” a modest venture capitalist once said.
What that means is that software applications—more than new types of machinery or computers—are upending every industry, streamlining or otherwise transforming them.
If you need examples of that, Senior Vice President of Strategy and Innovation at Havas Media Tom Goodwin offered some when he argued that there’s a battle over the customer interface:
“Uber, the world’s largest taxi company, owns no vehicles. Facebook, the world’s most popular media owner, creates no content. Alibaba, the most valuable retailer, has no inventory. And Airbnb, the world’s largest accommodation provider, owns no real estate.”
There is a battle over customer interfaces—the thin layer of front-end software that sits between users and the infrastructure that actually delivers the service—but that’s just a small slice of how software is changing business disciplines. BuzzFeed doesn’t just produce viral articles by accident; it scripted a program to understand how content spreads online. Flatiron Health’s software isn’t just an interface—it’s a data analytics tool that helps oncologists make diagnoses and recommend ideal treatments. Granular (and its predecessor, Solum) isn’t purely about a farmer’s user experience—the software helps them make data-informed decisions on matters like field selection and water efficiency in the age of climate uncertainty.
In other words, software isn’t just making it easier for people to order take-out—it’s finding new, better ways to do business, from the bottom of the supply-chain all the way to the customer. And it will increasingly place Marketing at the center of commerce, mediating between increasingly connected (but distracted) buyers and the companies looking to sell their products.
It’s a transition we’ll explore further at our upcoming Transition conference. But how did we get here in the first place?
Installation and Deployment
When technology takes hold, it does so in two phases, economist Carlota Perez says: installation and deployment.
We’ve discussed this concept in detail, but simply put:
- Installation refers to the initial launch of new, connected sets of technology—whether that’s steam engines and rails, or cars and mass production factories.
- Deployment refers to the period where those technologies start to transform the economy.
In between those periods, expect a bubble (or two, as we saw during the information age we live in today) during which the expectations of technology outpace what it can currently do.
The chart below illustrates that pattern.
Software can’t eat the world without the widespread installation of hardware and the internet.
The necessity of hardware is self-evident; software can’t run on thin air alone. “Hardware” naturally refers to personal computers—which at least 71% of US adults since 2004 have owned, according to the Pew Research Center. But it also includes other items like smartphones (now owned by about two-thirds of US adults, according to the Pew Research Center), wearables, and Internet of Things devices.
But the special ingredient that lets software revolutionize life and commerce is interconnectivity. Globally, almost 40% of the population is online, according to Mary Meeker’s 2015 Internet Trends report. That’s up from 0.6% two decades ago. The internet makes it possible for hardware and software to distribute, receive, house, analyze, and interpret more information than ever before.
As new hardware takes hold and more of the global population joins the internet, new software and applications will continue to reshape the world.
How Marketing Fits In: Mediators of Commerce
So the world is increasingly being run on software. What’s that mean for Marketing?
Most immediately, there are the business opportunities of being able to reach out to—and tailor messages for—a larger online audience than ever.
Software, combined with the web and a new set of increasingly mobile hardware, has led to a surge of digital information. With the amount of data we’re producing about our preferences and how we come into contact with brands online and offline, it’s easier to parse what the most relevant, persuasive messages might consist of or when and where we would receive them.
And today there are thousands of software companies vying to help marketers understand what those perfect messages should consist of. They’re also aiming to help you create those messages, understand how you’re perceived, provide operational analytics to increase your department’s efficiency, share assets, and allocate budgets and resources effectively.
Making the right software choices will automate the least valuable aspects of marketing so you can concentrate on what’s creative.
All this takes place within a larger context. Marketing sits at the center between a brand and its potential customers. That means that companies need effective, software-empowered marketing departments to grow—so the heads of marketing that can make the most of this transition will be the ones who ascend.
It also means customers need effective marketing. In a world submerged by products, one-click purchase buttons, and advertisements that all bleed into each other, buyers have never had as complicated a path to purchase as they have today. This is a big reason why touting your mission or your unique values doesn’t work as much as many marketers think; more important is distinctly branded and creative messages. Buyers need marketers to focus on distinctiveness so that they can recognize a product, consider it, and decide whether it will fit their preferences.
The transition to a world run on software means that marketers will be the chief mediators of commerce; like the thin layer of code between an Uber user and his or her taxi, marketing acts as the interface between a customer and a company’s services.
As mediators of commerce, as the creative team in the enterprise, and as the visionaries communicating a brand’s message to the world, it’s Marketing that sits at the center of this transition. At our upcoming Transition conference, we’ll talk about what else a world run on software means. That includes how the nature of work itself will change, how software can help build sustainable brands, and how software can contribute directly to creativity. Join us as we embrace marketing’s higher calling.
To see more highlights from Transition, read the full collection of speaker profiles here.