Death of a salesman

E-commerce pundits, myself included, will tell you that the `middle man` is on his way out the door. When that is said, everyone gets real scared (or they shake their heads because they don`t understand what it means) and then go back to whatever they were doing before without paying much further attention. Today`s question is, "How profound is the disappearance of the middle man really?"

I`ve never entirely understood what will happen to atom-based goods: we`ll still need to feed the six billion people who live on planet Earth.

The new economy is a digital, networked environment. At least that`s what they tell us. Trading of any kind will take place mostly online, with intellectual capital replacing more and more tangible, physical goods over time. I`ve never entirely understood what will happen to atom-based goods: we`ll still need to feed the six billion people who live on planet Earth, they`ll continue to need clothes, shelter, tools, even computers of some kind (without which accessing the online economy won`t be possible, not even in the future).

Of course, there`s already one model implementation of e-commerce that`s been around for at least two decades: the money trade and banking. Almost every aspect of banking has been automated for much longer than the Internet`s commercial appearance: bank accounts and their maintenance, national and international transfers between bank accounts, ATM bank cards, even the cheque system of payments is a virtual, `metaphorical` one - no `hard cash` ever changes hands, but conditioning dictates that a cheque or electronic transfer is as good as exchanging a sack full of coins.

Perhaps the promise of the Internet is really just a further development of this idea. In the payment systems environment, the question of the disappearance of the middle man is primarily related to bank tellers losing their jobs - as banks introduce more Internet and electronic facilities to allow end users to effect transactions themselves, they hope to save money by either firing or re-deploying frontline customer service people elsewhere. The bank teller, traditionally a `middle man` broker between the bank`s computer system and the end user, might no longer be necessary, strictly speaking.

When you look at it this way, you realise that it`s far less profound (and much more inevitable) to say that the middle man is disappearing. Banks, however, are traditionally direct-to-market organisations - you`ve always dealt directly with your bank, and your particular purveyor of banking functions has always been a direct employee of your bank. So perhaps banks aren`t a good example of the disappearance of the middle man?

So what other types of middle men (and women!) are there? In every business venture, there are those who broker the relationship with the customer. Salespeople, telesales consultants, channel sales consultants in importers or distribution businesses, customer support people - there are hordes of employees in today`s so-called `marketing driven` organisation whose sole purpose is to shield end users from production lines or the backrooms of service operations; to broker, cleanly, relationships between suppliers and buyers. This is typically called a company`s frontline, and much emphasis is placed on ensuring proper conduct, training, responsiveness and eagerness in those echelons. Measurability is often quite simplistic, but always easy: the nicer and more convincing your frontline, the more you`ll sell. It`s easy to measure, performs relatively well (if it`s well-implemented) and doesn`t need changing, right?

Over time, traditional frontline jobs will indeed disappear. Relationships with consumers or business customers, especially in the service sector, will increasingly be brokered by online trading environments, and all those jobs mentioned above will not be around anymore in two decades. When buying insurance, for instance, what on earth does anyone need a salesperson for? Just sign up online. Banking, cellular phone services, share trading, software, any form of consulting - all those areas are experiencing dramatic changes already. Every South African financial services organisation that sticks up a Web site to sell unit trusts online means another few telephone or physical sales jobs lost.

Right now, this might not appear to be very dramatic, as people are easily re-deployed, either inside the same organisation, or in the current `dual` online/offline economic climate. Middle men and women can still find jobs.

But the times of high commissions for salespeople in the services sector will come to an end; and for some, that end might be painful. Practically everything can be sold online. However, until we figure out some Star Trek-like mechanism of remote-copying atom-based objects, mail order delivery and the difficulties of getting the goods will prevent manufacturers of both perishables and hard goods from entering into the online economy (at least as far as retail is concerned; supply chains are already being put online to good effect).

Because most services will soon only be available through online direct trading, the comparatively high commissions paid to service sector salespeople will disappear. With higher-end, costlier services, companies get cleverer, too: banks offering Internet banking pursue a very clear goal: cutting costs. The same goes for insurance companies and stock brokers. And commissions constitute unnecessary costs, if you think about it. Rather spend more money on developing convincing online sales facilities.

Those whose trade and experience is `selling stuff` will, over the course of the next two decades (that`s my prediction of time frame), find themselves confronted with some hard choices. `Selling`, in the traditional sense, will disappear from the service sector. Bye-bye high commissions. A new wave of technophobia, this time perhaps a little more appropriate, will occur: in the 80s, when technology first became prevalent in banks, everyone was scared because nothing worked very well. Soon, some people will hate technology because it will quite literally remove their jobs. But that will pass too.

I`ve discussed, in various columns here and articles elsewhere, how service selling will work in the future. The two main factors are the increasing commoditisation of services (making a sale easier to conclude) and the requirement for providing customers with valuable online content environments to make decision-making as easy as possible.

That, of course, is the real value of advanced tracking and customisation Web server software. Customers, whether they are serviced by a salesperson or a Web site, want to feel special and understood. As our technology gets better and as we change our thinking, the death of the salesman as we know him becomes immanent. Personal bravado and personality sales are out, "buy direct" is in.