By Adam Walker, Economics Correspondent
The Digital-Savvy Generation Rises To Power
Facebook has acquired mobile phone messaging app WhatsApp for a total of $19 billion, giving them a bigger corporate value than giants such as American Airlines, Ralph Lauren and Tiffany.
Launched in 2009 the app was based on a £0.79 subscription model for all of its users. Following the explosive growth of smartphone ownership and the immense popularity of the application it became one of the most prominent pieces of software on the market with over 450 million users across the globe.
More importantly, however, the big Facebook buyout acts as a milestone indicating that the generations who adopted smartphones and digital technology in their mid-to-late teens have created a new era in business and economics around the world. As the old-guard of CEOs and Directors begin to step down from the seats of power there has been a real shift in where the wealth of markets lies with younger, more creative technophiles who are looking at new approaches to commercial direction and revolutionising the way businesses and consumers behave.
Social Media = Power To The People
At the beginning of 2014 I wrote an article on the Digital Trends of 2014 which discussed some of the most exceptional failures of businesses attempting to usurp social media for corporate gain. Many saw a massive backlash from users and hastily retreated with their tails between their legs.
As individuals, the digital generation has not only been able to use platforms such as Twitter and Facebook to voice their opinions and complaints at businesses but they’ve also been able to shape the economic landscape around them. As a result, multinational corporations have found themselves at the mercy of a single tweet or have had to radically rethink products/business campaigns to cater for the voice of popular demand.
More interesting revolutions have been found in the way younger companies have taken advantage of this and not only used social media in their day-to-day business, but actually develop their entire business infrastructure around their followers. Websites such as Buzzfeed, which was founded in 2006 and focuses purely around user-driven content and popular blog posts, have now found themselves being valued at over $200 million and has a higher volume of readers than the Huffington Post. With business models like this breaking barriers in their markets and leaving the seemingly archaic corporate giants, such as His Master’s Voice, in their wake.
It therefore comes as no surprise that tech-lovers are controlling more economic influence than ever before.
Single Authors Are Mightier Than the Biggest Brands
Those who jumped on digital trends early have become stars and thought-leaders in their own right. Where the more traditional businesses shied away from platforms such as YouTube in the early years, individuals saw the potential influence they could have and began creating new experiences and communities for people to explore the internet with.
Red Bull, the biggest brand on YouTube, has approximately 3.3 million subscribers to its channel and is widely considered to be one of the most creative brands within the digital market. However, they are dwarfed by individuals like Ray William Johnson, a single ‘vlogger’ who does reviews of viral videos, who has 10.7 million subscribers and his videos regularly gets more than one million views within 24 hours of them being posted. He has been approached by some of the largest broadcasters in US television and is widely regarded as one of the biggest stars of the digital world.
Even on an industry level there has been a real role-reversal as bloggers like Fleur de Force, an exceptionally talented vlogger in the fashion and beauty world, attract millions of subscribers whilst big publishing names, like Grazia, can barely drive one per cent of that number of subscriptions.
This generation of digitally-dynamic personalities has set the bar for informing others, engaging with users and ultimately influencing tastes on a massive scale by simply being relatable and clever. A skill that, nearly a decade after YouTube’s launch, businesses are struggling to even begin to touch.
In the past three years industries have found themselves against yet another digital barrier as users demand access to websites, data and information on the move. The tablet and smartphone movements saw businesses scrambling to make themselves mobile-friendly, whilst smarter developers have seen money in mobile gaming and apps. Hence, when the adoption of smartphone technology really took off apps like Angry Birds, WhatsApp and Instagram had already developed and grown a following of millions of users with the potential for making billions along the way.
But this is only the beginning of the revolution and the smartest money has already moved to wearable technology such as Google Glass, the Samsung Gear and Apple’s “iWatch” all beginning to forge the path for technology that fits seamlessly into our physical and digital lifestyle. We will soon see this technology blossom into a new way of living and a new definition of digital-lifestyle before businesses begin to latch on and rollout their ham-fisted campaigns to monetize the marketplace.
Techonomic Take Over
It’s not that businesses can’t make money from digital markets, they are growing with more adopters every day and new channels to engage with. But the power, control and influence over these markets no longer resides in the hands of the Fortune 500s but with the 30-year olds who grew up with this technology and were ready when it reached its fruition.
This era is one of creative mastery, individual authority, mass popularity and technological understanding. If 140 characters of text can stop billions of dollars of capital in its tracks then this is our revolution and it’s only just begun.