Are we moving from mass consumption to the wants of individuals?


It looks like a historic transition in capitalism is unfolding as a result of products like the iPod. Can’t help wondering if the young Steve Jobs knew he and Apple would start a new era?

They reinvented the consumption experience from the viewpoint of the individual, at a fraction of the old cost. And now that consumers have bitten the apple, companies will have to adapt to the “iPod syndrome”.

The world is constantly changing and I believe we are at the beginning of a new era which will fundamentally change the way we consume. New demands are created that the majority of companies are not yet able to satisfy.

During the time of Henry Ford focus shifted from the elite to the masses. Today however, we are moving from mass consumption to a new era catering to the wants of the individual. People want control over what matters to them, voice their opinion and have social connections on their own terms.

Mass production becoming less homogeneous

An good example is that you can order custom made sneakers from Nike. Many sectors are starting to distribute tailormade valued assets catering to individuals, hence enabling them to determine exactly what, when and how they consume.

Obviously this will change the basics of competition between companies as well as the boundaries between producers and customers. It just a question of how long it takes before almost all businesses will have to find ways to adapt to this new world in order to grow. Most likely we will order, for instance, our car online and decide all details such as what model, engine, gearbox, tyres and so forth it will have.

Companies that are able to create individualized ways to consume goods and services, preferably at a radically reduced cost, will prosper as they discover new sources of value that remain invisible to companies still bound by conventional business models and thinking.

Apple leading the way

The mass-production business model has come under assault during the past decade. An excellent example is, in my opinion,  Apple’s iPod and its music service, iTunes.

Apple rescued musical assets from a faltering business model, the compact disc, and bypassed the industry’s costly legacy systems and routes to the market. It enabled users to reconfigure their music as they saw fit. Apple is hence today the largest music retailer in the United States. But the reason for the success, which had been invisible to the music industry, was Apple’s ability to reinvent the consumption experience from the point of view of the individual, at a fraction of the old cost.

Identify the assets that represent value for each individual

The old focus of wealth creation worked from the perspective of the organization and its requirements. The new logic starts with the individual end user. Instead of “What do we have and how can we sell it to you?” good business practices will start by asking “Who are you?” “What do you need?” and “How can we help?” This inverted thinking will make it possible to identify what represent real value for each individual. And that’s how companies will make money.

Power really shifting from companies to consumers

The new sources of economic value can be discovered and realized only when consumption strengthens the sense of personal control, delivers opportunities for voicing ideas, and enables freely chosen social connections. The emerging logic of distributed capitalism will reward companies that realign their practices with the interests of the consumer and punish corporations that try to impose their own requirements or maximize their own benefit at the expense of the individual end user.

So what should executives do to ensure that their organizations will grow in this new world? For starters, it’s critical to question the old logic and vocabulary of competitive strategy. There will be an abundance of opportunities for companies that are able to decipher the emerging pattern and convert it into new business models that support the needs of the 21-century individual. Do you agree with me that the “iPod syndrome” will have a profound impact on all businesses and how we consume? If so, how do you believe the new consumer oriented capitalism will evolve? Will it take long before consumers are completely in control of what, when and how they consume? Obviously this new pattern will have a tremendous impact on the way we do business. How do you think companies will be restructured when we move from mass consumption to individual needs?

Photo: Flickr – Sigalakos

89 responses

  1. Catarina, I have to say, I really enjoyed your post. Especially when it comes to Apple, I completely agree that they have changed the way business is done. It came down to their marketing model. They did what most people strive to do, which is to make their products and services cooler than everyone elses. That's why people stand in line for a ridiculous amount of time and pay astronomical phone bills to have the iPhone. They made it so you're cool if you own their stuff. Gone is the term MP3 player — iPod is the norm. They've really helped to give the consumer to buy content how they choose to, but again, that marketing model makes it hard to go anywhere else but iTunes.

    • Glad you agree Dennis. Don't you think the main thing Apple has done with the iPod is reinvent the consumption experience from the viewpoint of the individual, at a fraction of the old cost? In other words started the move from mass consumption to the wants of individuals?

  2. Apple did it for a consumers-world in the musicfield.
    Pillkey is dsigned in 2006 to do the same for selfmanagement in Healthcare.
    So there are already products and companies focussed to the wants of individuals; the Pillkey with his facets and so each Pillkey-user has his or her own page for network for individual information, network-communication, downloading new applictions but also for co-creating to develop Pillkey according to individual needs.
    Such an economic innovation is a risk for big famous companies in countries known as economic leaders and only afterwards you can say it worked.
    There are also new small companies in countries following the economic rules and only if they become an international succes they reinforce this new economic rules.

    It was my first comment after the horror of 9-11 when recoverd from shock that week; old economy died from hart-attack and new jungle-economy will take its place.
    iPod had the benefit of this change.


    • Good Thom. Proves my point that the new era has started. How long do you believe it will take before all companies have to adapt to consumers deciding what, when and how they consume?

      • Very long.
        If I experience how deep the patterns are eroded of " higher" truth, knowledge, representation? Even in journalism, modern social media but for all in healthcare.
        It frightens me, but it will change.
        I think, this time the economic posession of goods, ideas, opinions will be the breaking movement.
        For years it was nature, gods and science with their representives and now it will be the posession of individual talents and with that money / energy will become more important.
        Greatst challenge is to find the exchange stimulus of traditional power of expertise; if this is not found people will not give up their power of expertise and so the evolution to your individual production will take more time.

        • Interesting points Thom. Obviously established companies will not be keen to adapt to the new "iPod era". However, the music industry didn't have a choice. They were just beaten to it by Apple. So maybe it will not take that long after all? If I had asked you before it happened if Apple could do what they did, I'm not sure you would have believed it was possible.

          • Sorry Catarina, but I made my Pillkey in that way not because I read some books or was inspired by iPod. I saw the technology and knew it was possible. I worked with that already for years and I saw the technology made it possible to put this individual adaption into a product.

            This is my talent; to feel the potentials, the talents or the upcoming or vanishing movements.
            The music industry was beaten to it but media are beaten by Social Media. Music Industry was bound to be modern, so that's why they took the hit as a clear signal.
            Paper-industry (media) is beaten by social media, but they don't take the hit.
            Your kind of interesting articles would make you a Times journalist, but more people react to your articles on blog and influence is higher. So this will replace papers soon even the digital ones; because they make articles for the mass not for the article written for even one person.

  3. I agree Catarina – consumption is becoming more individualized. Someday soon, I'm hoping, just one TV provider will "get it" and allow me to choose my station list a la carte. People want to customize to meet their needs. Thanks to social media, the individual has a strong voice. Each person counts and those companies who understand this will make the most money.

    • Glad we agree. Just imagine that that kind of choice will be available when it comes to everything. Not only music, TV, social media and what not. Thom above is for instance already doing it in healthcare.

  4. Catarina,

    Your article is very interesting and on the mark. It will be interesting to see what companies adapt and which ones get left behind. Some companies that have failed and have been on the brink of disaster have been able to rebound. Companies like Harley Davidson have been able to recover after failing to adapt in the past so it will be interesting who becomes more innovative as the market place continues to change.

    Thanks for sharing.


    • The Harley Davidson Company nearly died in the early 1980's. They were a victim of their inability to adapt to the Japanese competition, slowing sales, and a well earned reputation for poor quality. The quality got so bad that many dealerships had to place cardboard under the bikes in their showrooms to catch the leaking oil. I recall hearing on the radio that the grandson of one of the company founders was being laid off at one point.

      In 1981 thirteen members of Harley-Davidson management led by Vaughn Beals purchased the company. They transformed the company to one of high quality and innovation. The inspired innovation drove the demand for Harley Davidson motorcycles to the point that there were waiting lists to purchase any of their coveted machines. They have been winning awards and growing by more than 10 percent annually since.

    • Well Christian, with respect, Harley Davidson is more an example of giving better value and quality than your competitors. Not really of the new iPOd era. Maybe by now they have adapted to the iPod syndrome but they certainly hadn't in 1980.

      • You are right, Catarina. Time will tell what they do in the iPod era. My thought is that some companies initially failed to adapt during the quality revolution, nearly died, then bounced back. It will be interesting to see who adapts well to social media and who fail in the new market. It will also be interesting to see who are slow to respond but then excel in response to a crisis like Harley Davidson. Hopefully I'm making my point a little more clearly.

  5. Catarina
    I do not feel its Apple that has brought forth the individualism in marketing. We can not forget what Google, Facebook, Amazon have done or have been part of this transition. We will see more companies such as Medio Systems and cellular industry that are moving to words individualized marketing by tracking your whereabouts (GPS) and then sending you coupons or other info on companies services etc, this will truly create a way for companies to tab into consumers directly at a fraction of the cost of normal media advertising. Still we have not seen the harnessing of the consumer as an "individual". We have the tools – however the companies have not harnessed their resources to the maximum to allow true consumerism demand be driven by me the buyer and not by the seller. The other issue is that the FCC and regulatory/laws have not caught up to the explosion of technology. This must happen to protect the individual consumer.

    • Agree with you about Google, Facebook and so forth being part of the transition. How long to you believe it will take before all companies have moved from mass consumption into catering to the wants of individuals?

  6. A great post, Catarina. There's no question that mass customisation of just about everything is the key to success going forward.

    The old mantras of "one size fits all" and "you can have it in any colour you like, so long as it's black" just don't wash with today's consumers. We all want things that suit us in every way…

  7. Great post Catarina as it truly reflects this new world we live in. It is all about the ME generation and instant gratification. Consumers are only interested in two thing: 1) Who are you? and 2) Why should I care? I think it is easier for the smaller business owner to change their thinking and marketing strategies than their larger counterparts. Social media has opened the door for both small business owners and consumers to engage in interactive communications and makes it easier for the business owner to know what the consumer wants. The larger brands are producing much greater quantities and have less direct contact with consumers – it might be more difficult for them to change their business model and marketing methods to embrace this new world.

    • Yes Julie, not only will it be more difficult for larger companies to adapt many of them will resist as well since it moves power from them to the consumer. But I do believe that they will eventually have to. If not they will miss the boat like media did. And we all know how difficult it is for media to make profit nowadays. Now they are adapting to the iPod syndrome. If they had adapted earlier they would be in a much better position today.

  8. Great post and interesting comments. I would offer that the root of this transition to an individualized consumer economy is technology. As business managers in today's world you have the ability to reach your clients and better understand them through website development, marketing techniques, etc. This empowers the corporation to make better informed decisions on how consumers are using your products. Coca-cola cannot customize its products but it can offer more choices as it learns that consumers are becoming more health conscious. Technology (the internet) and 24 hour cable stations has given consumers a real voice- they can watch what they want, listen to what they want and thus corporations are getting more intelligence on the behaviors of consumers. The corporations that embrace technology and reach out to their customers are going to be the winners. In the past there was not a personal connection to consumers those corporations were forced to build one-size fits all because they could not determine everyone's sizes. That information is now available and technology allows us to grab it and analyze it. So, the "iPod syndrome" is just a metaphor for how advancements in technology continue to change the way we live, work and play.

  9. Without the consumer there is NO business so it behooves any company to follow Apple's example and appeal to what the customer wants. You are on to somthing great here Catarina and I hope the "suits" sitting in their ivory towers are taking notice.

  10. Catarina,

    I enjoy your insightful articles. I believe that the culture of consumption will dramatically change in the not-too-distant future due to the effects of peak oil. I look forward to your thoughts on the impact of peak oil upon modern civilization.

  11. Hi Catarina,

    The issue for some companies will be how to do it profitably as can be difficult to be that flexible. I am thinking about some consumer products. In the past it was done with line extensions so it will be interesting to see how they handle it in the future.

    I think the companies that have technology as part of their business such as Apple will have an easier time and be innovative. That said I am seeing more modular options available such as with furniture where you can choose the pieces to your individual taste.

    • Good comment Susan. I believe however in the future the technology will be available for all kinds of businesses to jump on the "iPod band waggon". The media industy didn't and we all know how they are struggling at the moment.

  12. I agree with Catharine that TV is the next frontier, Apple and Google are moving there. The concept of give the customer what they want and they will buy it has been with us a long time. We have moved to more and more individualized products over the years. It cannot go totally individualized because companies need to spread their costs over many units.

  13. In a sense, there is nothing new about mass customization. Consumers have always driven the process — if they don't buy, you don' t sell. With new technologies, it's possible to segregate unique product features for different classes of customers, but, in the end, the customer drives the transaction.

  14. Hi Catarina,
    Great post. Most producers push their product into the mass market. Competiton takes places via 1) innovation which is copied ever more rapidly 2) communication, marketsegmentation, 3) distribution, supply chain. It is a never ending spiral.
    As consumer,I want to be spared the endless spam and commercial calls and receive only information about products that are relevant to my needs, interests, lifestyle. The future may well be the role of gatekeepers who are very refined in understanding my needs in a whole domain of personal interest (clothing, entertainment, news, vacations, education,…). If I trust the gatekeeper, I may allow it to select producers and info for me, I could shield off a million other channels.
    The organization that pulls this off and effectively provides for my individual needs, can line up producers (and squeez them) and satisfy my needs. This implies awsome power and may change the capitalistic model as we know it. Some organizations are probably preparing.
    cheers, Sjuck

  15. I agree that the “iPod syndrome” will have a profound impact on some businesses. I think that companies that move to customization and respond to the needs of their customers will be in the best position to grow. Having said that, I think there will still be a market for cookie-cutter products that fit the immediate needs of the majority of the consumers. I can’t imagine that there won’t continue to be a need for mass produced products.

  16. I think businessess are beginning to think outside the box. A successful can see what a consumer wants and needs to make a product that fills the need.

  17. INDEED!

    Another force behind this is the advancing technology. 25 years ago, it was possible for a furniture store to advertise 5,000 custom made sofas. Actually, 6 styles with the option of choosing from a book of fabric.

    Now, Nike can punch up an order and through technology and cheap labour, have custom design sneakers.

    When the unions in the US resisted robotics because it would cost jobs, The Japanese embraced robotics increasing the per-person output of automobiles. (Read, cost-effective)

    With outsourcing, no one needs to build a metaphorical FORD Factory.

    Just as containerisation changed the shipping industry, components have changed the tech industry and by extension the product-market relationship. Technology and outsourcing make products less expensive and thus affordable to more people.

    My recent post Slim Was Right EuroCrats Were Wrong

  18. Part II

    Power shifts from the companies to the consumers in the marketplace. Power on the "supply-side" goes to those companies that are most flexible.

    You are correct in saying companies need to respond quickly to "the shift the paradigm."

    From an early "Quotation of Slim Fairview" "Do you want me to tell you how to sell what you make or tell you how to make what will sell?"

    "How do you think companies will be restructured when we move from mass consumption to individual needs?"

    It will be easier for new companies to enter the market fray with technology reducing the cost. The most flexible will be the most successful. There will be a shake out, companies will M&A, and those companies best able to spot a trend and stay ahead of the curve will be the ones to thrive.


    ps. Please excuse me. Until I can find my pencil sharpener I must use my pocket knife–if only I could remember where I left it.
    My recent post Slim Was Right EuroCrats Were Wrong

  19. Katrina,
    As always a well thought-out post on an interesting and useful topic .
    I believe the advancements in technology have made it possible to adopt the mass production methods to cater to the individual tastes, preferences, and needs.
    Some automobile manufacturing companies, especially in the luxury car sector, are already using the latest technology to custom design cars to the specific requirements of their customers.

    S Zafar Iqbal

  20. I find it interesting that that the iPod and iTunes are use examples of indivualization when I see exactly the opposite.

    I genius in the model is 'delayed customization.' I'm stealing the phrase but don't know from where, it was too many years ago. The first good example that I recall was HP. By taking the power supply out of the design of their printers they were able dramatically reduce their costs and better control their inventory. The printer itself was not dedicated to a country until it was boxed with the corresponding power unit.

    Apple has less that sixty main SKU's. I kind of think that falls into the catagory of mass production. Apple (last I saw) has only a 7% market share of handsets but controls 66% of the profit pool. I believe that besides the premium they get, Apple only really has one phone to worry about at any given time. Whether you look at it from R&D or production everything happens in bulk. That said, thanks to apps, no two iPhones are the same.


  21. This is not a new phenomena. It's been building for decades as communications has become more mobile, distributed and robust.
    What is somewhat new is the change in mindset that will be needed to successfully navigate the shoals of competition in the future. Companies will become much more adept at listening and sensing, and responding quickly.
    In the company of the not too distant future, the org chart will be turned upside down, with the CEO at the bottom, and the customer-by-served-segment at the top.

  22. You are absolutely correct in your assumptions. The new business model must focus not on what it is selling or telling but what the client needs— or needs to learn. Only by following that model will they be successful.

    Alan Guinn, Managing Director and CEO
    The Guinn Consultancy Group, Inc.
    My recent post The Importance of DCQV

  23. Great post Catarina. In my own organization, which delivers health and personal support services, we adopted LEAN management principles and a continuous improvement approach among other things. It meant better use of and more integration of technology, both in terms of infrastructure (SAP, PROCURA) but also more technology in the hands of front-line workers (tablets/smartphones) so that they could ask questions, send photos and receive expert answers in the field. The culture shift required was putting the client at the centre of all activity and adopting a continuous improvement mindset (we always did it like that, is not ever a good reason for doing something). This runs counter to most health service activity (arguably, most business behavior) which tends to put the professional, the institute or the product at the centre.

    Essentially we switched to doing whole jobs instead of the old factory style of doing partial jobs. This means that services can be adjusted faster and more efficiently to meet individual client needs. We also developed team-based activities. Clients are served by a team of people who huddle every day and discuss what is required. The process extends from corporate or government clients to individuals requiring clinical care. It also means the CEO is looking at many of the same metrics that the front-line workers are looking at. Data becomes very, very important because it tells us if we are meeting needs. Data has always been important but often sat in just a few hands, back to that transparency conversation. :)

    The ideal we are seeking is that no matter which client or who the client contacts, they will be served efficiently and effectively. We have seen increased client satisfaction and our productivity has also improved. In short, companies would need to be restructured to incorporate more technology in the infrastructure and in the hands of workers, continuous improvement philosophy, customer orientation throughout the organization, adoption of "whole" jobs and a heavy use of metrics. Apologies if the answer is too tactical, but it follows from what I think was an implementation question.

    My recent post Saturday Morning Chit Chat, Just A Minute…A Word On Procrastination

  24. I like the idea of individualising personally. That is a great way for business to adapt to the new environment and move forward.
    My recent post Welcome to Vegas Baby!

  25. For the most part I agree with your insightful post Catarina. We've been through the ME generation in the past. Maybe we go through cycles like this. If more people like Steve Jobs steer the way, and with the social media influence on individuals, then we will absolutely see the shift move faster from mass production to more personalization. Jeannette is so right: Jobs had a different way. And it was his way, not really researching what individuals wanted instead researching what he thought individuals would benefit from. Thanks Catarina.
    My recent post 6 Ways the Internet Works for Introverts

  26. I'm a consumer and not a business. I've loved apple from the start. They created a computer for the "rest of us." That is the one product I adore. I think there are too many "suits" who do not know how to connect.

  27. Catarina – Great post!! Your spot on! Customization of goods and services is definitely a direction that business is going. Those that can create a positive and inviting customer experience will thrive, while those that don't will be swallowed up.

    Thank you for sharing!!
    My recent post Keep Perspective

  28. Great points Catarina. I think you're absolutely right. Apple of course is a great example (I can't wait to get my iPhone 5S) and one of the first innovators of this new era. Many companies are trying to do the same…some are doing it well, others not so much.
    My recent post Best Time To Cold Call

  29. More and more consumers are driving what they want. Jobs was the exception in that he told us what we wanted. Perhaps if we have more like Jobs then we will see more new creativity versus the consumer demanding what they think they want. Interesting question…
    My recent post Herbs For Health: A New Series

    • Yes that seems to be the way forward, Cheryl. Regarding Steve Jobs, the iPod did give customers what they want at a reduced price. No need anymore to buy CD's. Just buy the songs you like and not the whole album.

  30. Technology is becoming the driving force today and we live in an instant gratification society. I couldn't have imaged 25 years ago we would be this advanced. The larger companies are going to have to adapt to more of what the consumer wants as we are driving force. Apple missed the boat on the new colorful Iphone where as Samsung was listening and developed the smartwatch which is making a comeback. Without my customers I have no business, it is important to know what they want.
    My recent post How To Successfully Market A Cause

  31. Catarina, there was a comment in this post that I’m not sure I understand how that could work – Companies that are able to create individualized ways to consume goods and services, preferably at a radically reduced cost – It makes sense that the assembly line system which is set up to pump out the same product keeps costs down. When you start making ‘one of a kind’ products you can’t have the equipment set up ahead of time or standardize the process which naturally means more labour costs which are always the biggest cost to any company. I can see it somewhat with cars because that would mean just inserting the different components but for things like the Nike sneakers you mentioned I don’t see how that could be done. Interesting thought though.

  32. I agree that the way we do business is very quickly changing and companies who thought they had established longevity are now in a place of scrambling. It is so easy for consumers to get specifically what they want these days. Amazon is a company as well that, at least in the U.S., has redefined how consumers get what they want. Now they have same day and 2 hour delivery systems which makes it very hard for their competition to keep up. The concept exists among consumers that we should be able to get exactly what we want when we want it Whether that means having instant access to the songs you like or ordering a gift for arrival within a 2-hour period, the retail experience is changing and businesses need to find a way to remain relevant.

  33. What a wonderfully thought provoking post! What you say re: targeting the individual consumer certainly makes sense and I've seen many indications of it from shoes, to books, music and many other things. What you say about the online custom built car is a dream come true for many. It wasn't until reading your post, when it occurred to me that maybe this shift is one of the reasons every company I do business with, expects me to take their survey. Your post is very well written.

  34. The photograph of Steve Jobs must have been taken in the late 70's/early 80's!

    I am wondering how it will be possible for companies to meet the needs of all individuals? Is it just those individuals "who matter" in a business sense rather than just your average Joe Bloggs?

    Great post as usual Catarina. I am always left questioning my lack of business knowledge after reading your posts. This is not a bad thing as it encourages me to become more knowledgeable in this area.

  35. I agree that there is a shift happening to individualism in consumerism. I’m not sure this is radically shifting power from the companies to individuals. Marketing and peer pressure still plays a huge role in determining what we think we want.

    • Don't you think it will gradually, Donn? Let's face it online shopping is going to take over from shops on the steets. Marketing and peer pressure actually have an impact on what people buy online as well.

  36. From the day I first laid my eyes on a Macintosh, I was in love with Apple. Now I have an iMac, iPad, iPhone and even an iPod.

    But to your point -in some regards, social media and/or internet is helping to speed the shift from mass consumption to individual needs. But not every company understands this but some of them do. You can see the trend as opposed to fad, picking up. This will be helpful in clearing out companies who just are not making the shift unless governments start more interference online/offline with the tenets of capitalism.

    Great post Catarina.
    My recent post Top Ten Introvert Ways To Put Fun Back In Dysfunctional

    • Good points, Patricia. In the future we will all tailor make what we buy online. Or whatever digital form. Personally love it because it gives power to the consumers and also to companies that understand how to make money that way.

  37. I think a really interesting aspect in the development of what you have termed consumer-oriented capitalism is the potential for DIY manufacturing to replace mass production. 3-D printing might ultimately provide this for some consumer products.

  38. I like the concept of the power shifting from companies to the consumers. Companies for far to long had an attitude of shoving products down consumers throats that they did not want.
    I am worried, that if mass production is reduced, does that mean prices will increase? If they do, will we go back to where more "elite" people can only get the best products? If we do, are we going backwards.
    Great article thanks for sharing it with us.

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