"Digitalization doesn't work for us". A sentence that we have all heard many times. Yet digital champions such as Airbnb, Uber, Spotify and others inspire us every day and revolutionize entire markets in the process. Their current size and market power overshadow what originally created their success: the evolution from product to service.
But let's take a step back together. To where success stories begin. In the head of a person. More precisely, in the head of Daniel Ek, founder and CEO of the billion-dollar company Spotify.
When he founded Spotify in 2006, Daniel Ek would never have guessed that he would change the entire music market forever.
"I'm not an inventor. I just want to make things better."
Daniel Eck
For people who have never heard of Spotify, here's what you need to know in a nutshell: Spotify is a music streaming service that brings artists and their listeners together. The idea is simple and ingenious at the same time: every song and every artist are on a platform that can be accessed anytime and anywhere. The more users, the more listeners the artists reach. The more artists, the more likely it is that users' every music wish can be fulfilled. If you don't want to pay, you listen to advertising. If you don't want to listen to advertising, you become a subscriber. In this way, it continues to build up and cross-fertilize each other. But at its core is the simple idea of making something simple, of making something better.
"I'm not an inventor. I just want to make things better." - and Daniel Ek has achieved this for millions of music-loving subscribers. Because listening to the song you want anytime and anywhere used to be simply unimaginable. For today's Generation Z, it must be an amusing thought to record your favorite songs from the radio on cassette or spend hours rummaging through CD stores for the latest album. Even the advent of the first MP3 format in the 90s did not bring the hoped-for positive change. Although listeners were able to enjoy greater mobility, this only led to a rapid increase in pirated copies for the music industry. At the turn of the millennium, the music industry was at rock bottom - because nobody wanted to pay anymore. And even Apple itself did not achieve a major turnaround for the music industry with iTunes. Because the product remained the product - only digital and, of course, legal. But it was still not convincing.
This evolution from product to service has not only made Spotify successful
In 2008, Spotify showed that it doesn't have to be that way. Instead of a single product, they offered their subscribers something more: a service. Put simply, they don't fulfill the one wish of their customers, but give them the flexibility to fulfill all their wishes themselves at any time, in any place and according to their own ideas. This evolution from product to service has not only made Spotify successful. Airbnb, Uber, Tier and many other success stories show that the journey is far from over. Because in our digital age, customer wishes are more individual and demanding than ever. Not everyone likes that - but this growing expectation cannot be stopped.
Digitalization doesn't work for us! That's what cab companies, musicians and hoteliers thought for a long time. And lo and behold, they were wrong. Because the digital champions are demonstrating what other industries finally need to understand. It's not about the digitalization of every business, it's about the evolution towards service. More flexibility and individuality for everyone.