Is Your Business Using Social Commerce The Right Way?
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Last week, 300+ leaders of business gathered in Sun Valley, Idaho for an annual summit where handshake deals set the agenda for all U.S. businesses. The event, hosted by secretive investment firm Allen & Co., is informally known as “Summer Camp For Billionaires,” with heavy-hitter guests like Mark Zuckerberg, Tim Cook, Reed Hastings, Jeff Bezos, and Andy Jassy.
In addition to overloading the local airport with double-parked private jets, these celebrity business leaders convened to build lucrative alliances on a massive scale. As Rick Wilson explains on the Dragonproof Podcast, this year their deals will reflect a trinity of pressing issues facing all U.S. businesses in 2021.
While 56% of U.S. adults have already received at least one Covid vaccine dose and state restrictions on commerce and gathering have largely lifted, the business uncertainties around the pandemic have not abated. At the scale of companies like Apple, Amazon, and Microsoft, decisions about workforce safety impact millions of employees directly. Furthermore, how Wall Street’s superstars prepare for the looming threat of deadly variants will affect supply chain and consumer behavior for all businesses. SMBs need to follow their cues.
“We are not home free yet,” Rick says, “and businesses cannot just assume that this problem has been solved.” Leaders must remain focused on managing the pandemic, ranging from how to handle in-person events, to how to interact with customers.
“This is the prime definition of a “fog of war” moment,” Rick cautions. Just like Sun Valley attendees, SMB entrepreneurs must remain flexible as things change.
While the conference was underway, President Biden simultaneously signed a new executive order with broad anti-trust measures that will directly affect many attendees’ monopolistic business practices. The goal of the order is to preserve fair competition by curbing “bad” mergers, anti-competitive sales tactics, and data privacy violations by the biggest companies in America.
What does this new anti-trust focus mean for entrepreneurs? As Rick points out, “a vibrant, free market requires multiple businesses. If your only option for consumer goods is Procter & Gamble, that's not really a free market.”
The scale of our biggest corporations is such that they can only be countered by entities of similar or greater scale, which in this case is the U.S. government. Rick admonishes sellers to follow the regulation issue carefully. While the real world impacts of these rules on Amazon are in question, indie sellers should be encouraged. “Overall,” Rick says, “better anti-trust regulation will create more entrepreneurship, more business protection, and will result in more successful businesses in the future.”
The third major issue in the air during this year’s gathering was the early July ransomware attack on IT developer Keseya, and what it portends for data security going forward. Up to 1500 SMB Keseya clients were compromised by a code vulnerability which allowed hackers to deliver ransomware to member businesses. The reason this attack is so frightening to tech leaders is the daunting new frontier of supply chain threats--in this case the software supply chain. With one keystroke, cybercriminals can now target entire networks of businesses and even national infrastructure.
This is a wake-up call for businesses. Rick posits that state-sponsored ransomware assaults on supply chain will constitute a new cold war.
“Does this ultimately get so bad that we have to have “tech borders” for our country,” he asks, “wherein the only web traffic allowed in is tightly controlled?”
The growing interconnectedness of digital systems is one key to the strength of ecommerce, but those same connections set the stage for exponentially more risk than everyday sellers may be prepared for. To prevent this from happening, network security must stay top-of-mind for every business in the ecommerce space, not just the majors.
While Allen & Co.’s guests ponder such large-scale impacts on their businesses, it’s instructive to note what they aren’t paying attention to. The law of large numbers suggests that massive, fast-growing companies cannot maintain their rate of growth indefinitely. This leads to companies consolidating resources around initiatives with the largest possible payoffs. The scale of their operations renders small, ground-up disruptors invisible. Rick calls this “dragon unit math.” Upstart entrepreneurial innovation is too small for a mega-corp to pay attention to until it has already become a true disruptor, at which time large companies take notice (and often attempt to acquire).
An example of this is Apple’s 1997 decision to stop manufacturing its physical printer line. While consumer printers constituted a multi-million dollar business for Apple, this was a small amount of revenue for a company that was already earning 6-10 billion per year by the end of the 90s.
A side effect of this decision was that Apple would be late to the game for future disruptions happening in the space, such as a consumer 3D printing market that will reach more than 60 billion in sales per year by the end of the decade.
“No one, not even the dragons,” Rick says, “can predict the next disruption.”
This means that future disruptions benefitting smaller businesses are all but assured. While the “dragons” are gathered in Sun Valley, sellers should balance big picture economic forces like those listed above with a continued focus on honing the best possible product and shopping experience. This is a tangible goal which best prepares sellers for any disruption good or bad.
“The ultimate point,” Rick concludes, “is to create the thing you want to create, which provides customers with solutions to their problems, provides employees with a career, and provides family with resources to blossom. Keep that as your focal length,” he says, “and the rest will fall into place.”
To hear Rick’s full thoughts on the “Summer Camp for Billionaires,” stream the new Dragonproof Podcast here.
Miva offers a flexible and adaptable ecommerce platform that evolves with businesses and allows them to drive sales, maximize average order value, cut overhead costs, and increase revenue. Miva has been helping businesses realize their ecommerce potential for over 20 years and empowering retail, wholesale, and direct-to-consumer sellers across all industries to transform their business through ecommerce.