Disintermediation

Description

In the digital marketing industry, disintermediation refers to the elimination of intermediaries between brands and consumers. This trend has been significantly accelerated by the internet, which allows companies to interact directly with their target audience. For instance, social media platforms, e-commerce websites, and digital advertising tools enable brands to reach consumers without relying on traditional middlemen like retailers or advertising agencies. By doing so, companies can reduce costs, gain more control over their brand messaging, and gather direct feedback from customers. Disintermediation also empowers consumers, providing them with direct access to products, services, and information, thereby enhancing their overall shopping experience.

Examples

• Netflix: Netflix originally started as a DVD rental service that relied on postal services to deliver DVDs to customers. By shifting to a streaming model, Netflix eliminated intermediaries like retail stores and postal services, allowing users to directly access digital content on their devices.
• Warby Parker: Warby Parker disrupted the eyewear industry by selling glasses directly to consumers through their website. By bypassing traditional retailers, they were able to offer high-quality eyewear at a more affordable price, while also providing a virtual try-on feature to enhance the online shopping experience.

Additional Information

• Disintermediation can lead to cost savings for both businesses and consumers.
• It can also create challenges, such as increased competition and the need for companies to develop new capabilities in digital marketing and customer service.