Last week, I traveled to Dallas, TX for a guys’ weekend with my son Tony, his close friend Steven, and my brother Mark. While there, we also attended the Bills vs. Cowboys football game. Having grown up in Rochester, NY, I am a Bills fan, which is often difficult to endure. That weekend was no exception. Even after a great start to the season, the Bills lost 44 to 7. Other than that, we had a great time, and the Cowboys’ stadium is off the charts!

You seem to open your eyes more to what is around you when you’re in a new environment, so being a bit more observant, I watched the nonstop mobile usage around me. These observations made me want to share some recent research that has been released. Based on the research and my own thoughts, mobile devices are becoming a powerful force in our lives.

As we went to restaurants, the social watering holes, the tailgate party, and even in the stadium, I noticed how many people were using their mobile devices to stay in touch, update Facebook and Twitter, and take pictures to upload or send out to everyone. Sitting in Cracker Barrel next to a table filled with the 60 plus crowd waiting on their food, I watched all of them tapping away, or reading what was on their phones. This is universal and will expand as speed increases and apps are introduced, making our lives easier as well as more resourceful and connected.

In a previous blog, I discussed the research of Mary Meeker, a leader in mobile technology research. She released new data at the Web 2.0 Summitrecently, and it showed the continued surge of mobile usage, traffic, and e-commerce.

In the area of e-commerce, she discussed how eBay’s mobile sales have reached $4-billion, Paypal has hit $3-billion, Amazon has made $2-billion, and Square is at $1-billion. All had big increases with Square up 20,000% year over year growth! From what I observed, it is just going to continue to be off the charts!

Meeker explained that over the past year, the use of mobile search has increased four times, and the mobile app and advertising revenue combined has been growing at 153% annual compound rate since 2008. At that time, the revenue was at $700-million, and now it has hit $12-billion! This is amazing growth!

For internet services like Pandora, Twitter, and Facebook, a large portion of their traffic is from mobile devices. Actually, for Pandora and Twitter, the majority of their traffic is mobile with Pandora generating 65% of traffic and Twitter gaining 55% of traffic this way. Approximately 33% of Facebook traffic comes from mobile devices, and it is increasing dramatically.

This all means we are entering a world much different from where we have been, and it is changing fast. We will be doing so much more on our mobile devices, and this will drive how we work and play. How does this affect you and your business? Can you improve your service to allow easier access to your products and services over mobile devices?

As I contemplated these questions over the weekend, I had an idea dealing with mobile devices and connecting people that has been brewing for awhile now, but it was solidified in Dallas. What ideas do you have to connect people, share information, or simplify things? The next Gates, Jobs, or Zuckerberg is brewing and will show up soon. Why not you?

This week when I was reading about all the trouble that Netflix is experiencing with their pricing, it got me thinking about all of their success and how they got their start.  Did you know that back in 2000, Netflix founder Reed Hastings went to Blockbuster and proposed running an online brand for them?  They laughed at him, so he went out on his own.  Now look at all that has transpired.  Blockbuster is going sneakers up, while Netflix has become the single largest source of web traffic in North America this year.

How the tables turn, wouldn’t you say?!  It’s fun to see the little guy with the big idea get brushed off by the big corporation, then go on to dominate or even wipe out that very corporation that blew him off.   Repeatedly in my career I’ve seen changes in technology push out the well established businesses that wouldn’t evolve with the new technology.  Consider for a moment the evolution of music: from the LP to the 8 Track Tape, then on to the cassette, the CD and now the mp3.  Take a look around, it’s everywhere.  When was the last time you had to use a pay phone?  How many books did you download on Amazon instead of buying from Borders?

So why is it that these well established businesses can’t (or won’t) grasp this and get on board with new age technology?  Technology is a game changer and they’re simply not playing?  Do they lack the competency, the strategy, are they blind, complacent or just plain unaware?  Do you think you’re immune to it?

Back in my investment days I thought about this often as businesses described by those same adjectives failed to progress into the new age. Surprisingly, however, it was also happening to businesses filled with smart, competent, strategic and visionary people. 

In the late 90’s Clayton Christensen published a a book called The Innovator’s Dilemma: When New Technologies Cause Great Firms to Fail.  He talked about how even good business practices, like focusing on the best customers and investing in technology, can’t prevent new technology entrants from sneaking up on you.  The reason is that new technologies are rejected from your best customers, and if you’re listening to them, you reject them, too.

In addition, when you’re a big guy in the market, in order to grow your business you have to have things that are meaningful in real dollars.  If a new location can make you $20M in new revenue, it won’t make that big of a difference if you’re already doing $20B in annual revenue.

So how do we prevent it from happening to us?

To begin with, listening to your customer’s is good, but excessive customer focus distracts a company from looking at new markets and products/services of the future.  Unless becoming the next Blockbuster or Borders is the objective, paying attention to where all the attention is going is something to consider.

In my next blog I will get into more detail on the rules that Christensen discussed on how managers can know when to listen to customers and when to invest in what might be a low payoff technology now, but could potentially turn into your core business.