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Disinter . . . What?

by Mike Banks Valentine


Another new B2B buzzword? D I S I N T E R M E D I A T I O N

The first time I saw the term, I ignored it, thinking the
writer was a journalist charmed with a new word. The next
time I saw "disintermediation" was in an internet journal
for Information Technology Specialists so I thought I had
better pay attention, but still there was no definition
offered. So I went to dictionary.com and looked up the
term. Where I found the following:

"disáináterámeádiáaátion Withdrawal of funds from inter-
mediary financial institutions, such as banks and savings
and loan associations, in order to invest in instruments
yielding a higher return."

Hmmmm. Doesn't seem like it applies to this usage. OK so
I hopped over to NetLingo.com and typed in the term to
their search box "disintermediation" and got . . . nothing.

Let's take a look at that new "buzzword" glossary at
"Upside.com" where they say,

"Disintermediation: When the middleman gets cut out of the
deal. This is what all the buzz is about. Arthur Miller
predicted the whole thing decades ago with his portrait of
Willy Loman. "

http://www.upside.com/texis/mvm/ebiz/story?id=396b6c980

Eureka! I've found it! We're talking about removing links
in the supply chain here! Supply chain as the course of a
product from the supplier to the consumer!

1) supplier of raw materials
2) manufacturer of products
3) distributor or wholesaler
4) retailer at brick and mortar store
5) consumer purchase of product

Well I know this is website101 and not economics101, let's
look at the application of the term to web business and
ecommerce.

What is happening is that the supplier is selling directly
to the buyer online! No doubt this'll lead to one of those
social debates about the "value-added" segment of the economy
where things are packaged, shipped, arranged on store shelves,
priced and resold to the consumer from retail stores. But the
change just won't be stopped, whether or not you are opposed
to the transition!

This is no small issue friends! Where do you fit in the
supply chain? Is your link (pun intended) about to be
added or eliminated?

Sony is about to follow powerhouse computer marketers, Dell
and Compaq with a web-only marketing strategy! They announced
this week that it was to be "Manufacturer to Consumer" or M2C
for the electronics giant. They currently offer 250 products
online and are ready to expand that to include their full
line of over 2,000 products to be offered direct-to-consumer
via the web! Read more about it at the following link:

http://www.thestandard.com/article/display/0,1151,16906,00.html

I see the value of any company that makes delivery trucks
rising very quickly, not to mention those already established
big guys, FedEx and UPS. Anyone wanna place a large bet that
we'll see a distribution change more dramatic than anyone
could predict in the next five years. I'm betting on WebVan
to rule in the urban streetscape. Think they're going to
stick to groceries? NAH! (Update, July, 2001 They died
Well, I'm glad I had no money to invest or I woulda lost it!)

Envision this scenario: One nerd sees product promoted in
an ad on his mobile phone, points and clicks, customers order
made available for immediate pick-up from his choice of 10
outlet stores or delivered to his front door in 30 minutes.

How does that affect your business? Got Ya Thinkin?


-------------------------------------------------------- 
WebSite101 "Reading List" Weekly Netrepreneur Tip Sheet Ezine emphasizing small business online http://website101.com/arch/ e-tutorial online at: http://website101.com/shortcourse.html By week's end you're ready expand your business to the web! --------------------------------------------------------
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July 26, 2001