August 14, 2009

Commitment Models

Filed under: Digital Distribution, Information Supernova — Robert John Ed @ 10:06 pm

Mark Cuban wrote a good post on commitment business models, it reminds me of a piece of Permission Marketing where Seth Godin pontificates on the ability of large companies such as Ford to build permission assets with customers and rent cars as a service much like phone companies do for their networks (I have no clue how many times I’ve cited this as my most influential read career wise, if you’re a marketer, you should have read it years ago.  I should read it again.)

This is the kind of thought provoking ideation that makes the internet so valuable.  The base of the idea is that a diversified company such as P&G create permission assets with customers, commitments to buy on an ongoing basis in return for a discount.  The consumer uses the same products anyway, they enjoy the products and may as well not have to worry about picking it up.  It’s the modern day equivalent of the milk man stopping by every other morning.

The reason this is now feasible is that distribution companies such as Amazon (oh yes, I went there; IMHO Amazon will one day make more money from their data management and distribution ability than their Etail) allow for large companies to scale one to one service into the millions.  Billions.  That’s an amazing change from typical brick and mortar sales.

When will it happen?  When the profitability proves pudding.  Someone will take the leap, make a killing and the dominoes will fall.  All I want to know is when my box full of Raisin Bran Crunch, wild rice and peppers is on shipment.  Exciting times, no doubt.


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