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Mass Market is Turning into a Mass of Niches

Attendees at IDC's European IT Forum heard that the major challenge facing companies is to bring new technology-based products and services to market to make Europe more innovation friendly and better able to use ICT to improve productivity and counter the growing pressure of globalization.

Keynote speakers at the forum emphasized that sustainable economic growth could be achieved through a new process of strategic planning and evolution of business models that reflects market changes.

“The fundamental challenge for most organizations, particularly in the ICT industry, is to alter their strategic planning processes in order to embrace more frequent changes in their external environment," said Jeff Sampler, professor of strategy and technology, Oxford University. "Many organizations have reduced strategic planning to an annual weekend retreat. This is hardly a situation that can detect weak signals and emerging trends. Unless companies do this they will continue to be astonished by the next surprising trends."

Chris Anderson, author of The Long Tail, focused on new business models that show the best way to take advantage of the shifts in culture and economy, from a focus on a relatively small number of hits -- mainstream products and markets -- at the head of the demand curve to a huge number of niches in the tail.

In short, he said, the mass market is turning into a mass of niches. The ability to reach niche markets represents a big opportunity for growth, and technology plays a key role in this process. "As the costs of production and distribution fall, especially online, there is now less need to lump products and consumers into one-size-fits-all containers," said Anderson. "In an era without the constraints of physical shelf space and other bottlenecks of distribution, narrowly-targeted goods and services can be as economically attractive as mainstream fare."

The common theme of the panel was that innovation must be nurtured, as technology-passionate employees bring in the new tools and usage models after experiencing them at home, and the CIO must find a way to leverage these employees’ knowledge and passion to the benefit of the organization.

As Web 2.0 technologies and concepts are expected to be offered to the enterprises, CIOs must not conclude in advance that these are time-wasters and prohibit any attempt to integrate them within the organization.

A great benefit for the information worker can be achieved by using Web 2.0 technologies, including RSS, blogs, Wikis, widgets, tagging, and an overall information sharing concept, which would enable faster and easier access to existing corporate data, such as ERP and CRM systems, and also enhance the enterprise’s ability to gather employees’ particular knowledge into a shared data pool, for the benefit of most corporate positions.

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