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Causes and Impacts of Digital Disruption

Paper Type: Free Essay Subject: Technology
Wordcount: 1084 words Published: 8th Feb 2020

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Digital disruption is a shift in market trends caused by innovation in technologies and business models (OXFORD College of Marketing, 2016). The emergence of innovative digital technologies and business models disrupts current markets by changing the business environment as it impacts existing products and services. The disruption in the market is subject to a shift in consumer and supplier behaviours as new introductions of products and systems may change the dynamics around the use of digital technology to improve business. Digital innovation is a wicked problem to business as it threatens existing markets and industries with modern products and systems but also allows for new firms to compete in established markets.

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There are three sources of digital innovation power, free digital tools that can rapidly build new products and services, digital platforms are subject to exploitation by competitors in markets and a burgeoning class of digital consumers (Forrester, 2013). These three forces unleash a disruptive force that completely alters every business in all industries, globally (Forrester, 2013). Under old disruption in business, only large corporations had access to a large amount of capital necessary to develop new ideas and technology (Forrester, 2013). This created few innovations in the market but due to digital disruption, everyone has access to digital tools that allow them to bring more ideas to the market, multiplying innovation (Forrester, 2013). Digital innovators are intensely customer focused as they offer free tools, services and access over competitors (Forrester, 2013). Digital disruption makes for a more competitive market but builds stronger communication bridges from business innovators to customers.

Most disruptions create new growth opportunity in traditional markets (Byerley, 2013). Digital disruption is so effective because the digital industry is a very modern market that has penetrated nearly all global industries. Disruption in the digital world has knock-on effects in all markets because of this.

Digital disruption is very effective as the digital market is a high growth industry built on the foundations of disruptive innovation. Mobile phones are great examples of digital disruption as before the iPhone was released all phones were very similar and accustomed to when new technology was introduced, the market was exposed overnight to a revolutionised industry of ‘smart’ phones. As most consumers are accustomed to the functionality it is very easy for disruptive innovation to become very appealing in the market. An introduction of digital innovation into a traditional market saw a market shift in consumer demands as they were given new technology, free digital tools, a new digital platform creating a ‘burgeoning class of new digital consumers.’ (Forrester, 2013)

Digital disruption is dangerous to the marketplace as it tears down barriers between competitors and their customers as digital innovation is about strategically allying with customers to introduce them to looking outside the product experience. This is a completely opposite business strategy to the traditional methods of obtaining and serving customers. An example of this is the way Amazon, Netflix and YouTube disrupted the media and entertainment industries by modernising the way content is accessed and sold to customers and monetized by third parties (Rouse, 2017). The only way for business to compete is to copy and adapt to new digital innovations that disrupt the marketplace (Forrester, 2013).

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The disadvantages to digital disruption is that there is uncertainty in the success of innovation as new products introduced in established industries can be rejected are accustomed to traditional methods (Feldman, 2014), like how the Segway failed because it was too innovative to replace customers’ traditions of walking and biking (Hartung, 2015). There is another perspective to the largest benefit of digital disruption giving power to firms to destabilize larger traditional industries that hold market share. Whereby the cost of research and development of digital disruptors stops many smaller firms from innovating and mainly larger traditional firms like Google, Facebook and Apple can only afford to create and carry out digital innovation (Feldman, 2014).

Digital disruption is unstoppable as the industry is built on innovation because there is ‘unique value’ (Byerley, 2013) in the high pace of the market. Without progress and change, there can be very little growth in industries like the digital market. The people who benefit from digital innovation are the consumers and the large corporations who can afford to modernise. Ultimately other business’ who fail to adjust to changing markets go out of business. Embracing digital innovation, even planning for it (OXFORD College of Marketing, 2016) is the only successful long-term business strategies facing this wicked problem of disruption.


  • Byerley, L. (2013, April 30). Online Journalism: Pros and Cons of Digital Disruption. Retrieved from UT NEWS: https://news.utexas.edu/2013/04/30/online-journalism-pros-and-cons-of-digital-disruption/
  • Feldman, B. (2014, June 23). What are the pros and cons of working on disruptive innovation. Retrieved from Quora: https://www.quora.com/What-are-the-pros-and-cons-of-working-on-disruptive-innovation
  • Forrester. (2013, October 1). Digital Disruption: Unleashing the Next Wave of Innovation. Retrieved from YouTube: https://youtu.be/neShgTczCM0
  • Hartung, A. (2015). The Reason Why Google Glass, Amazon Fire Phone and Segway All Failed. Retrieved from Forbes: https://www.forbes.com/sites/adamhartung/2015/02/12/the-reason-why-google-glass-amazon-firephone-and-segway-all-failed/#43717b87c05c
  • OXFORD College Of Marketing. (2016, June 22). Digital Disruption: What Is It and How Does It Impact Businesses? Retrieved from OXFORD College Of Marketing: https://blog.oxfordcollegeofmarketing.com/2016/02/22/what-is-digital-disruption/
  • Rouse, M. (2017). Digital transformation strategy guide: From e-fax to AI. Retrieved from SearchCIO: https://searchcio.techtarget.com/definition/digital-disruption


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