In economics, disintermediation is the removal of intermediaries in a supply chain: "cutting out the middleman".
Entire industries have been designed using "intermediaries" to sell and distribute products and services. Dis-intermediation initiated by consumers is often the result of high market transparency, in that buyers are aware of supplier prices direct from the seller.
At the beginnings of the Internet revolution, electronic commerce brought the idea of dis-intermediation to many producers, as a way of cutting costs or increasing profits.
It was thought that the Internet would "dis-intermediate" middlemen and drive them out of business by having producers sell directly to users. The internet did in fact create dis-intermediation within numerous sales and distribution channels across numerous industries.
Equipped with web pages and reach intermediaries disrupted traditional sales channels and created a proliferation of choices, information and access for consumers. Over the years consumers have become adaptive and comfortable with making purchases over the internet for anything and everything. We are now entering a new "marketplace" with greater influence over distribution.
Enter Reintermediation
Re-intermediation can be defined as the reintroduction of an intermediary between end users (consumers) and a producer. This term applies especially to instances in which dis-intermediation has occurred first. Both re-intermediation and dis-intermediation are results of the dynamic nature of the Internet. The internet advancements and increase in adoption has created a set of moving dynamics that disrupt traditional sales and marketing channels at the click of a mouse.
The end user, armed with free technology, is now the major force of re-intermediation and the new dynamic is the influence of relationships, one to one to millions.
There are numerous potentials for re-intermediation resulting from the increased adoption of the social web and creative applications integrated within social networks. Widgets now enable bloggers to add many unique product and service offerings and users make money selling to their readers, i.e. books that relate to the blog topic. Widgets are also exploding on networks such as Facebook and soon there will be widgets there for users to sell products directly from their profiles.
Today's dominate revenue stream on networks and blogs is advertising . With the introduction of new social commerce applications users will become the distribution point for marketers and re-intermediation will spread as a result of affinity attraction and traction between " connections" i.e. relationships.
A Shift in Trust and Influence
The primary driver of re-intermediation will be trust, or distrust. Tired of rational media hype, unfulfilled promises and "tricks of the trade" the social web empowers individuals to become the new media and the synergy of influence is developed based on trust and affinity. This dynamic has been well established in our physical world represented by the influence of co-workers as they discuss a supplier, by customers as they share common experiences, good and bad, with firms and people they buy from. Now those very dynamics have been accelerated by the reach of the social web.
No longer constrained by barriers of input the collective power of conversational rivers represents a wave of of influence with global reach. The more the barriers of reach come down (i.e. Doc Searls VRM Project) and the greater the adoption of the social web the stronger the wave becomes as the force of change. There is truly a learning curve for the masses but motivated to become the force of change people are thirsty to learn.
We can either be changed by future events or become the change of future events. The choice is ours, one to one to millions. Which do you prefer?
What say you?
