Don't miss out on global markets, October 21, 2007, 2D.

In his book, “The World is Flat,” Thomas Friedman describes three eras of global trade.   The first stage occurred between the time of Columbus until around 1800—Friedman named that era Globalization 1.0.  The moving force behind the trade was countries and governments.   Global commerce and trade was conducted by and between countries. 

Globalization 2.0, as described by Friedman, lasted from 1800 until 2000.  The driving forces in this era of trade were multinational companies.  Falling transportation costs, brought about by the steam engine and railroad, and later falling communication costs helped drive the expansion of companies and the distribution of their products into new and international markets.

Around the turn of this century, we entered a third era of global trade and commerce.  In this new era, Globalization 3.0, the driving force is not countries or multinational organizations; it is individuals.  Today’s information and communication technology allows individuals to collaborate and engage in global commerce and trade like never before.

Amazon.com and eBay.com are two of the most popular retail destinations on the web.  Both allow individuals and small businesses to sell products to the millions of web surfers who visit and shop their sites.  Most small businesses have traditionally been limited to sales in their local markets.  By offering their products for sale through the web, small businesses can reach and exchange goods and services with customers in distant markets—across the country or around the world.

Personally, I have sold books and college apparel to dozens of customers across the country through eBay and its affiliated companies.  I have also bought hundreds of items through eBay and Amazon over the years including: wooden racquetball racquets, college apparel, shoes, books, DVDs, CDs, electronics, sporting goods, appliance parts, toys, and children’s clothing.  Almost all of the eBay exchanges and many of the Amazon purchases were conducted with individuals and small business owners.  Very few of the transactions occurred with people located in Texas—most occurred with buyers and sellers from across the United States. 

One of my favorite purchases, and one that clearly demonstrates Friedman’s Globalization 3.0, was my acquisition of a new nickel-plated, pocket trumpet.  The instrument sounds like a full-size trumpet, but is much smaller.   Through eBay, I bought the trumpet for $92.00 (including shipping and a money order fee) from a seller in New Delhi, India.  The trumpet was delivered to my house about three weeks after the transaction was completed.  By linking up with a seller in India through eBay, I unknowingly engaged in a “Globalization 3.0” business transaction.  By quickly setting up an eBay account and listing his products, the seller in India was able to offer his goods to millions of potential new customers in the United States. 

The transactions just described did not occur as the result of trade agreements between countries or through the reach of large-scale multinational companies.  Rather, they occurred between individuals and small businesses that found each other through worldwide e-commerce websites.  Is your organization missing out on today’s global market?

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