5.3: Technology

Is the car of the future the electric car? They are called zero-emission vehicles by their advocates, but they do not have zero emissions according to some experts. While an electric car does not emit exhaust, the technology required to charge their batteries does, according to the US Environmental Protection Agency (EPA).6. Critics argue that the more electric cars that are driven, the more pollution from smokestacks at the plants that provide the electric power. You are familiar with the complaints about gas-driven automobiles, but, if the electric-powered auto is no different in terms of its impact on the environment, then there could be some interesting battles ahead between proponents of the electric car and environmental groups. In fact, some auto industry executives felt that the EPA report did not go far enough in discrediting the electric car.

Technology is the knowledge of how to accomplish tasks and goals. Technology affects marketers in several ways. First, aggressively advancing technology is spawning new products and processes at an accelerating rate that threatens almost every existing product. Second, competition continues to intensify from broad and new organizations and many substitute technologies compete with established products. Third, product innovations that result in superior performance or cost advantages are the best means of protecting or building market position without sacrificing profit margins. This is especially true in today's world, when many markets are experiencing flat or slow growth and when excess capacity is commonplace.

History provides many examples of companies that have lost their competitive advantage–and perhaps even their entire business–because a competitor came into the market with a product that had superior cost advantage or performance characteristics. These examples are not limited to small or weak companies; even industrial giants like IBM, General Electric, and AT&T have seen certain parts of their markets eroded by competition that surprised them with a distinctly superior product. IBM, despite its dominant position in the computer market, lost position in the late 1970s to several smaller companies that were first to develop powerful minicomputers to replace the larger mainframe computers that were the cornerstone of IBM's business.

All organizations must make assumptions about the future in technology and its impact on their business activities. The results of technology cannot be ignored. For example, the Japanese promote the use of electronic circuits and have used them almost exclusively in their controls. However, US based organizations have been slower to change and many have continued to use electromechanical controls in their products.

Everyone enjoys thinking about the future and the kinds of technology that will evolve. Let us fast forward a few years to see what opportunities technology will open up for marketers:

• How about ads that are targeted not t0 a demographic or psychographic group, but to you specifically—ads that know what you need and what you want?

• How about a house of smart appliances with Internet connections—refrigerators that tell you when you are running out of milk and dryers that know to call the repairman when they break?

• How about a cell phone that knows where you are and can direct you to a great new Korean restaurant, or a Palm handheld device that delivers streaming video right to your hand?

• How about a TV that airs a pizza ad from which you can order at the click of a button, with total integration between a channel and its Web site?

• How about underwear that knows your glucose level is rising and automatically injects you with insulin or clothing that senses a heart attack coming and tells you to take a pill?

Integrated marketing

Not in love with online—imagine! There are people who are Net-free, and they plan to stay that way. This seems to be especially true with many of the rich and famous. Mark McCormack, agent to Tiger Woods and tennis phenoms Venus and Serena Williams, surrounds himself with tech-savvy folks but has never used a computer himself. Actress Daryl Hannah has a computer, but has not turned it on in three years. Author Harlan Ellison, who churns out novels and short stories by typing with two fingers on a manual typewriter, is simply turned off by the Internet. "It is a massive waste of time," he says. "Does Skippy peanut butter really need a website?" Lest you think these are the attitudes of the slightly demented, a report conducted by Pew Internet and American Life Project indicate that half of US adults are not online and the majority of those non-users are unlikely to hit the Net any time soon: Fifty-seven per cent have little or no interest in getting online. More than one in ten adults who are not online tried the Net before disconnection. More than 14 per cent of Americans have computers but are not online. The results seem to contradict predictions that Internet growth will continue to boom in coming years. "It may take another generation", says Lee Rainie, director of the Pew Project, "before the Net becomes as ubiquitous and essential as the telephone and television are today." To study the 94 million Americans who are not online, interviewers questioned 1,158 non-Internet and non-computer users in depth. Findings included the following: Thirty-two per cent or 31 million Americans, said they "definitely will not" go online. Twenty-five per cent say they "probably will not" venture online. Twenty-nine per cent "probably will" get Internet access. Twelve per cent say they "definitely will" get Internet access. Those surveyed by Pew said their primary reasons for shunning the Internet are fear and lack of interest. More than half of those not online believe that the Internet is a dangerous thing and that they are not missing anything by staying away.[1]

All these miracles are possible in the amazing world of tomorrow. These are not technologies in a lab, but working prototypes, many just about to hit the market. The potential for marketers in just five years makes today's Web offerings look like a warm up act. While these services will rely on the Internet to communicate between newfangled gadgets and more intelligent servers, most of the services will not be based on HTML, for practical reasons. For example, you cannot effectively run a Web browser on a cell phone screen, and you do not want one inside your shirt.

The pitfalls for marketers are also obvious. While today's Web is open, each of these new technologies has a potential gatekeeper cell phone operators, cable companies, appliance makers, and, as noted in “Integrated marketing”, consumers who are not enthralled with the computer.

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1. [1]Sources: Karen Thomas, "Not Everyone's E-Namored With the Net," USA Today, September 25, 2000, p. 3D; Dana Blankenhorn, "Hype Blasters," Advertising Age, June 9, 2000, pp. 58-62.