Arup Thoughts: How the digital world is shaping our cities

In developed nations, Internet-powered smartphone apps have already started to transform many daily tasks, changing the way we think about the provision of goods and services, from travel to food shopping.

08/22/2016


Digital lifestyles and the smartphone economy are driving city growth in the 21st century; successful cities need to embrace and support this trend. Courtesy: ArupTo thrive in the digital era, cities must offer innovative digital services that support the rapidly changing lifestyles and behaviors of their populations. I believe that this digital-driven ability to continuously improve efficiency is now central to a city's long-term success. In developed nations, Internet-powered smartphone apps have already started to transform many daily tasks, changing the way we think about the provision of goods and services, from travel to food shopping.

Cities with a powerful supporting network of these services become more attractive for people who want to be able to get things done, whether it's running a business or just managing their family life more easily. This, in turn, creates a virtuous circle by attracting more potential users or customers for these online services, helping them to grow and profit.

In dense and diverse cities, developing new mobile businesses is easier with a larger addressable market for new services and established interest in innovation. Digital and location-based services are helping entrepreneurs, individuals, and even governments to rethink services in new ways.

Cities in developed nations should not assume they are leading in this area; some developing cities are pushing forward at greater speeds with superior levels of adoption and innovation. In China, more than 550 million people use WeChat daily—to quickly set up and run a business and communicate with social media followers and customers. Users can also make and receive payments, pay utility bills, access government offices, book hospital appointments, make transport reservations, read the news, and much more, all from a single app. It doesn't have a direct equivalent in either the U.S. or Europe.

In a highly digital city, people's access to services and goods is also less restricted by location than they once were. Affordable delivery-based businesses are helping both busy workers and older, less mobile people take advantage of vital services.

Instead of replacing traditional brick-and-mortar businesses, these new online-to-offline (o2o) businesses are providing additional employment opportunities on top of existing ones. For example, more than 250 million Chinese people are use Dianping, which offers portal-like access to group-buying, online restaurant reservations, take-out delivery, e-coupon promotions, and many other services, making it a valuable online partner to traditional local businesses.

In this way, these platform businesses are helping small local suppliers find bigger audiences for their products or services while expanding employment in fields like warehousing, delivery, information technology infrastructure, and marketing. They are helping build these cities' long-term economic resilience.

Digital innovation is also driving city popularity. A LinkedIn China survey has revealed how digitally innovative cities like Hangzhou or Wuhan are becoming the new "Tier-1" cities, leapfrogging over traditional centers like Beijing and Shanghai. Hangzhou is where China's huge trade website Alibaba is headquartered, and its cluster of surrounding tech startups is encouraging growing numbers of people to relocate there.

The digital world's ability to reshape the fortunes of the physical city is now clear. City stakeholders including governments, academic institutions, investors, and property developers need to cultivate an innovative environment through policy making, governance, and administrative support. And by offering attractive working environments for tech incubators, cities can foster collaboration and skills sharing.

-Ran Wang is a consultant in Arup's London City economics team. Before joining this team, she was an economic planner in the company's Shanghai planning team for 3 years. This article originally appeared on Arup. Arup is a CFE Media content partner.



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