We live in a time of evolving free markets and an increasingly connected global economy. These and other mega trends create the need for change in how marketers position their products and services in a diverse and dynamic marketplace. The big question is: How can businesses leverage these important trends as an opportunity to grow and #StayTopRight?
Certainly, there are many trends and sub trends that may impact various industries, but here is my list of the top six trends to consider when driving innovation and revenue growth:
1. The Emerging Middle Class
Welcome to the “next billions” market: According to estimative from the World Bank, the global middle class has grown from under two billion consumers in 2011 to nearly five billion within two decades, thanks to the economic growth in emerging markets. This tremendous new market is a key driver of growth and seeks for innovative products that may increase their quality of life.
This consumer demographic trend is not only evident in emerging countries, but also in more developed countries. In US, for example, the increasing purchasing power of Hispanics, now eclipsing $1.2 trillion annually, directs marketer focus on attracting and engaging this lucrative segment with their brands. A Share of Wallet study from Nielsen shows that Hispanics spend at least $10 more per visit in Consumer Packaged Goods than the total market.
2. The New Form of Capitalism
Creating Shared Value (CSV) is a new form of capitalism that works to generate positive results not only for the business, but also for the society. According to Porter and Kramer, shared value is not social responsibility, philanthropy, or even sustainability, but a new way to achieve economic success, by “reconceiving” products and markets in line with the society’s needs such as health, better housing, improved nutrition, help for the aging and less environmental damage.
Food companies, for example, that used to focus on taste and quantity to drive more and more consumption, are now innovating based on the need for better nutrition.
3. The Fortune at the Bottom of the Pyramid
The Bottom of the Pyramid (BOP) opportunity also emerges from the CSV concept. It represents 5 billion of underserved people – about two thirds of the world population — who are looking for innovation for a better quality of life with the right value. While the traditional market is growing only 2-3% a year, the BOP market is growing 8-9% a year and represents an enormous opportunity for the future.
4. The Graying of the Globe
The world’s nations have been facing the challenge to maintain levels of productivity due to the aging of populations. In Japan, for example, people aged 65 or older made up 25% of the total population, the highest-ever percentage. Clearly, “There is a great need for innovation to offer affordable social services to the worldwide aging populations”, says Warren Keegan, MBA and doctor from Harvard Business School and author of the book Global Marketing Management.
5. The Mastery of the Internet of Things
Studies have shown an interesting transformation in the priorities of consumers: Led by Millennials, people now want a personalized digital experience. The interconnection of a wide variety of devices to the Internet redefines the competitive landscape, by enabling firms to monitor, optimize and completely personalize customer experiences. By 2020, it is expected that there will be 26 billion devices on the Internet of Things! This amazing new world of technology will set new standards for marketing to execute relevant customers’ interactions in real time.
6. The Rise of the Maker Culture
In contrast with the adoption of this whole new world of technology and wearable gadgets, there is a trend where customers look for “old ways of doing modern things.”
According to C.K. Prahalad, “The meaning of value and the process of value creation are rapidly shifting from a product- and firm-centric view to personalized consumer experiences.” Customers want to create their own products, unleashing the sub trend of DIY. Not only home solutions or furniture categories, where Home Depot and IKEA have shown extreme success, DIY is now influencing a range of industries, including advertising, kids entertainment, food and fashion.
What do you think of these trends? What would you add? Since the ability to asses and leverage mega-trends is a critical competency of modern business success, how are you assessing your market opportunities to leverage these trends? Take advantage of these trends and position your business at the #TopRight corner of the market.