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3 Disruptive Innovators
Clayton M. Christensen first coined the term “disruptive innovation” in a 1995 paper for Harvard Business School, noting how some giant players in business make the mistake of operating under false security. At first, they aren’t bothered by disrupters taking advantage of gaps at the bottom of the market. By underestimating new players, smaller, underrated companies eventually make their way up the market and go as far as upsetting or even toppling the heavyweights.
Three Disruptive Innovators
Defined by smaller target markets, lower gross margins, and enhanced products and services that prioritize user experience, these gamechangers are so commonplace now that you may not even know the industry giants they replaced.
Remember Blockbuster? Probably not. Before Disney Plus, Amazon Prime, and Hulu, there was Netflix. Nearly two decades after its launch, Netflix isn’t coasting, with sights on capturing the trillion-dollar Hollywood ecosystem through new content and production models. Like many disruptive innovators, they took hold of a niche market (movie buffs who didn’t care about new releases and didn’t mind waiting for DVDs to arrive via snail mail). Blockbuster didn’t see it coming. In 2008, their former CEO, Jim Keyes said Netflix wasn’t even on their radar in terms of competition. Two years, later, Blockbuster went bankrupt.
Believe it or not, Airbnb began as cheap accommodation (literally, people were renting airbeds) for the 2008 Democratic National Convention when visitors couldn’t find hotel rooms. Airbnb is a great example of peer-to-peer (P2P) commerce that happens when two people interact directly to buy and sell products and services to each other. Before Airbnb, travelers had to go through standardized hotel chains and were more or less confined to the standard destinations. With a quick swipe and click, today’s travelers can explore new getaways and stay in unique destinations that a hotel chain could never compete with.
The app business model and the smartphones they function on revolutionized the way we consume the internet. In Canada, 85% of time spent on mobile browsers were on apps. The smartphone also offers lessons on the nuance of disruption and how it works. While Apple’s iPhone is widely reputed as a disrupter of the mobile phone market, it didn’t disturb the smartphone market per se. Instead, it disrupted the laptop market. It changed the ways people consume products, services, and information - creating new markets for apps.