All markets are becoming superfluid, as traditional frictions are greatly reduced. But which markets will be transformed first?
While companies operate within industries, they differentiate themselves through the quality and ease of their engagement in markets. This is true irrespective of exchange mechanism or customer type or whether whats being bought, sold, or traded is composed of atoms or bits.
Characteristics of a superfluid market
What exactly are markets moving toward when we say they are becoming superfluid? A superfluid market has the following characteristics:
Digital products and services. The product or service delivered is digital or has digital value drivers embedded.
Digital infrastructure. The infrastructure or plumbing for exchanging assets of value between buyers and sellers is digital.
Intermediary-light. The market is either free of intermediaries that siphon away value (exchanges are peer-to-peer or direct-to-consumer) or has digital intermediaries that add significant value for industry participants (e.g., aggregating demand).
Superfluid companies. Companies that participate successfully in the market invest in and leverage technologies such as artificial intelligence, robotics, IoT, data analytics, 3D printing and/ or blockchain to vastly improve their business interactions with partners, suppliers, customers and other stakeholders.
Technology advances continue to eradicate transaction costs, making commerce easier and less expensive. Some markets have already or nearly arrived at a superfluid state. Others are farther away. The journey to superfluidity will vary in speed from market to market, industry to industry.
Is there a way to gauge how fast this will happen? The following five questions provide guidance. The first two reference the ease of transition to superfluidity, while the last three point to the value such a transition can deliver.