How Technology Has Changed How We Value Things
AUG 10, 2017 13:17 PM
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How Technology Has Changed How We Value Things

by Larry Alton
 
Technology is responsible for many changes to how we live, including how we communicate and what we can learn about the world. But some of the most profound effects of technology are hard to articulate, or even notice.
 
For example, when a piece of technology allows us to efficiently tackle some process that used to be manual, the time savings is calculable; GPS navigation forgoes the need for map-based navigation, and even calculators spare us the need to perform basic math functions. But technology is also changing our subjective experiences on some level, including how we value both tangible and intangible goods.
 
How exactly is this happening, and what does it mean for our society? 
 
Information Availability
The first and most obvious effect stems from the sheer availability of information online. Thanks to the internet, any consumer with a Wi-Fi connection can instantly compare goods and services, and learn the “real” value of whatever they’re buying or selling. For example, if you were selling a junk car before the age of the internet, you’d rely on valuations provided by people in the real world, which could take days and several external visits. Now, reading a single article on your mobile device can provide you with a reliable estimate
 
The Abundance of Goods
The sheer abundance of available goods online—including products and intangible services—has also warped our sense of value. There are hundreds of similar online retailers, even within specific niches, and it’s incredibly hard to compete for visibility. Simply having the lowest price often isn’t enough to offer consumers the best value; you also have to have a reputation of trust, and a unique brand to attract loyalty from customers who could probably shop elsewhere.
 
Bubble Risks
Financial bubbles form as a result of a discrepancy between prices and value, or between value and perceived value. Consumers or investors who get excited about an investment, such as stocks, homes, or even a new technology, tend to push prices higher than the values they’re supposed to reflect. Those high expectations, in turn, attract even more investors, and the bubble grows further. Eventually, a climactic action sends investors fleeing as a corrective action, and the price rapidly shrinks to reflect the “true” value, as what happened in the 2000 dotcom bubble and the 2008 housing market bubble. The presence of communications technology means that word and excitement about investments spreads faster, and trends rise and fall faster, accelerating the possible timeline for bubbles to form and pop. This represents a serious risk to accurate valuation from a high-level perspective.
 
Tech-Related Fluctuations 
Technology has also changed how we expect certain goods and services to be priced, especially in relation to fees, extra charges, and extra services. Ordering from a catalog, over the phone, or even in a store before the internet would allow you to have certain goods delivered to your home—assuming you were willing to pay the delivery fee. Today, free shipping has become the new normal (thanks to retailers like Amazon setting a new online standard). New online retailers entering the space are all but forced to adopt a free-shipping system—even if that means raising the prices of their goods slightly to make up for it. We’re willing to pay more for an item with free shipping than we are for a combined item and shipping price that is cumulatively lower. It makes no logical sense, but it’s one example of how different fee structures have changed how we value things.
 
What It All Means
What can we take away from these effects? Is our changing system of valuation a good thing or a bad thing, and do we have control over how it manifests? Rather than drifting toward something better or worse, we’re simply moving to a different system, and only the vendors and consumers willing to adapt to fit that system are going to survive—assuming equal distribution of technology availability. One of our biggest imperatives, then, is ensuring equal access to the internet and related technologies across the globe; otherwise, there are bound to be major populations exploited or damaged by these forcefully changing trends. 
 
Larry is an independent business consultant specializing in tech, social media trends, business, and entrepreneurship. Follow him on Twitter and LinkedIn.
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