"It's specialized."
These are the words Andy Grove used years ago to describe new economy that was emerging. Referring to the old economy being founded on the idea of mass marketing, production and media, he saw the new way of doing business as individualized or customized.
A number of people had of course sounded the trumpet, yet many refused to hear the call. The music industry is the most obvious one, as people had a demand for consuming music on their terms, yet the industry refused to believe competition would emerge that would allow consumers to do it. They will probably never recover, as they still aren't doing much more than offering downloads for a small fee through Apple iTunes (AAPL) and other companies.
This all comes down to understanding what fragmenting of the market really means. It's not simply niches, although it's all of that, it's also a declaration of individuality and wanting to consume products or services directly connected to their interests.
For example, using the music industry as a case study again, people tired of buying albums loaded with songs, which for the most part consumers may have only enjoyed two or three of them at best. That, along with the increasing mobile lifestyle of consumers, dramatically changed the industry and the CD.
People just didn't want a mobile device alone, if that was the case, the mobile cassette and CD players would have done the job. They also wanted the ability to customize their music and create their own albums or song lists on their own terms. More than that, they also wanted access to songs when they wanted them. Now whenever they're in the mood, they can download whatever song they want when they want. That's also a part of mobility, as far as it related to flexibility.
Another fairly recent addition to the entire industry is the desire by consumers to take music and other media and do mashups with them. That means simply taking the various pieces of the puzzle and recreating them to make their own statements. It includes music, video and photos, which can be taking apart and put together again. People love it!
Anyway, Grove and others saw all this coming, and willingly embraced and pursued it.
We will continue to live in a specialized, customized, individualized and flexible world. Those able to meet the needs of people on this basis will enjoy incredible success.
Other Andy Grove Resources:
Andy Grove's Rational Exuberance
The Digital Age . . . driven by the passion of Intel's Andrew Grove
The History and Influence of Andy Grove
Andy Grove enters new post-Intel role as activist capitalist
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