Radio Shack. Borders. Future Shop. What do these firms have in common? They all fell victim to the “Amazon effect”—a term describing the impact the massive online retailer has had on eroding market share for many long established retail chains in North America. In fact, to the point of closure.
The rise of online shopping has been a disruptive trend changing the retail industry with those failing to adopt falling behind. And despite the fact that many of these failed groups had strong products and good business ideas—they still couldn’t keep up with the Internet age.
For commercial real estate, the parallels could not be truer. Over the last few years technology has become transformative for the industry, affecting virtually every aspect of the sector. For firms that are still on the fence about adopting the latest technology to enhance business operations, here are three compelling reasons you shouldn’t wait to do so:
1) Your competitors are doing it
Looking within one’s company alone as an indicator of operational strength provides limited prospects for future growth and innovation. Thinking that the current status quo is good enough means a competitor is getting ahead, often by adopting the latest business trends to drive more profit. As with the case of Amazon, it wasn’t until competitors started shutting down stores that other retailers started to take e-commerce technology seriously with some still struggling to adapt.
2) Historically, advancing technology has wiped out firms who were not efficient
Flexibility remains a key virtue for successful organizations and there has been proof over time that companies who failed to adapt to changing business and customer conditions faced the most profit risk. Take Kodak for example, who after reaching dominance in the 1980s and 1990s, failed to adapt to changing consumer preferences, namely with digital photography. In fact, Kodak invented the digital camera as early as 1975, but did not pursue its growth fearing cannibalism of its film business. As such, rival firms (and the advent of the smartphone) moved in and starting chipping away at Kodak’s market share—a trend the firm has never been able to recover from.
3) Your clients want it
The ability to tell clients you have their best interests in mind is a common line across all organizations. However, if it takes you 10 hours to complete a task and it takes a competitive firm two hours (and with more accuracy), who do you think has the advantage and ability to truly support their client’s needs? Clients, especially ones well versed in technology, can easily spot firms who lack it—something that can draw questions about organizational efficiency and strength. Part of being ahead of the latest technology is having the confidence to tell your clients you have the latest tools to be successful. The value proposition for your company accordingly, becomes inherent in everything you do.
As technology continues to advance in the commercial real estate industry, there is significant opportunity for firms to integrate the latest business tools. At 4tell, we’ve developed our iPlan software to change the way CRE firms capture, consolidate, and organize data to create a centralized knowledge base for your assets. The choice, therefore, is clear: do you want to be Borders, or do you want to be Amazon?
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