Here is a very simple thesis on how to disrupt billion dollar industries:
Content platform + user platform = BOOM!
That is a bit cryptic, so let me explain.
Traditional retailers like RadioShack and Barnes & Noble were great "content platforms"; they have millions of products on shelves across thousands of physical stores. Amazon disrupted them by moving online, and Amazon was able to build an even better content platform with many more products. In addition, the internet enabled the creation of "user platforms". Amazon is a great user platform as it knows the interests of the 250 million customers it has on file; it uses that customer information to recommend products to buy. Amazon built a great content and user platform.
Businesses with a content platform that aren't investing in a user platform will most likely get disrupted. To understand why user platforms matter, take a look at a traditional media company like The New York Times — one of the world's best content platforms, both online and offline. But it's also one of the world's poorest user platforms; they don't have a 1-on-1 relationship with all their readers. By aggregating the best content from many different sources, Flipboard is as good of a content platform as The New York Times, if not better. However, Flipboard is a much better user platform because all of its readers explicitly tell Flipboard what they are interested in and Flipboard matches content to users based on their interest. For The New York Times to survive, their strategy should be to invest in a better user platform: they should spend more time getting to know every single reader and serving curated content that matches the user's interest. The New York Times seems well aware of this problem, with its decision last week to host its articles directly on Facebook to get access to Facebook's user platform with 1.4 billion users.
Similarly, Netflix is disrupting both traditional broadcasters and cable companies because they built a great user platform capable of matching movies and shows to users. To many Netflix users' frustrations, traditional TV broadcasters still have the better content platform, but that hasn't stopped the growth of Netflix. Furthermore, Netflix is investing heavily in becoming a better content platform by producing their own shows, including original series such as House of Cards and Orange Is the New Black. Unless traditional broadcasters invest in becoming great user platforms and matching content to users, they risk losing against Netflix.
The challenge for newspaper organizations or cable providers is usually not with the technical evolution, but with changing their business model. Take the cable providers, for example. Legacy constraints like distribution models, FCC regulations and broadcast spectrum requirements prevent them from moving as fast in this direction as a Netflix might. Fortunately for most cable providers, they are also the internet providers, which allows them to become user platforms if they too can master the personalization and contextualization equation.
Facebook, Twitter, Apple and Google are some of the world's best user platforms; they know about their users' likes and dislikes, their location, their relationships and much more. For them, the opportunity is to become better content platforms and to match users with relevant products and articles. By organizing the world's information, Google is building a massive content platform, and by launching services like Gmail, Google+, Google Ads, Google Fiber and Google Wallet, they are building a massive user platform. Given that they have the world's largest content platform and the richest user platform, I have no doubt that Google could dominate the web the next couple of decades.
The examples above are focused on print media, television and radio, but the thinking can easily be extended to commerce, manufacturing, education, and much more. The thesis of content platforms adding user platforms (or vice versa) is very basic but also very powerful. Adding user platforms to existing content platforms enables a transformative change in the customer's user experience: content can find you, rather than you having to find content. Furthermore, brands are able to establish a 1-on-1 relationships with their customers allowing them to interact with them in a way they were never able to in the past. By establishing 1-on-1 relationships with their customers, brands will be able to "jump over" the traditional distribution channels. If we've learned one thing in the short history of the internet, it is that jumping over middlemen is a well-known recipe for success.
Anyone building a digital business should at least consider investing in building both a better content platform and a better user platform. It's no longer just about publishing content; it's about understanding what uniquely delights each user and using that information to manage the entire experience of a site visitor or customer over time. The idea of using interests, location, user feedback, past behavior and contextual information to deliver the best user experience is no longer a nice-to-have; it is becoming a make-or-break point. It is the next big challenge and opportunity for everyone building digital experiences. This is why I'm passionate about content management systems needing to evolve to digital experience management systems and why Acquia has spent the last two years building software that helps organizations build user platforms. As I talked and wrote about years ago, I believe personalization and contextualization will be a critical building block of the future of the web, and I'm excited to help make that a reality.
— Dries Buytaert
Dries Buytaert is an Open Source advocate and technology executive. More than 10,000 people are subscribed to his blog. Sign up to have new posts emailed to you or subscribe using RSS. Write to Dries Buytaert at firstname.lastname@example.org.