What happened to vinyl records, tapes, and CD’s? What happened to rental video? What is happening to retail and banks? They all experienced major disruption brought about by megatrends. In this case – digital disruption. So, megatrends are nothing new to business. What is new is the rapid cultural shifts that are occurring, often independent of megatrends.
Social media has connected cultures across borders in unprecedented ways, and technologies such as Google Translate are continuing to connect people in ways never before possible. Take it a step further with Mymanu’s Clik earbud and the human in abstracted away from handheld devices to wearable technology that instantly translates between 37 languages. And how did Mymanu get started? You guessed it – Kickstarter.
Every industry has its trend watchers, so its not difficult to isolate which trends will have a positive or negative impact on your business. Smart businesses are constantly scanning for the megatrend that is going to generate a wave of business growth for their products and services, or open a window for a new innovation. However, few businesses are actively engaging with signals in a way that fully explores the opportunities and threats each trend presents.
This is what most companies do…
Most companies watch for the peripheral signals that indicate a megatrend wave is forming. It might just be a ripple, but if it has an impact in several of the following areas of influence, then they track social sentiment around that signal. These areas of influence are well summarised in Frederic de Meyer’s diagram, categorising these areas external and internal opportunities:
- External – new competitors, new business models, new customer needs, and new customer segments
- Internal – new talents and competencies, new marketing mix, new ecosystems, new go-to-market models and new production processes.
This provides a very useful framework for assessing the impact in your business for each emerging trend.
Once a solid indication is clear, they then apply emerging changes to their current offerings and consider how they might leverage those changes in the future.
And that is pretty much where it stops in terms of analysis. And that is where the danger lies.
The Missing Ingredient – Cultural Shift
There is one missing ingredient that determines whether a market will respond to these opportunities as the business hopes – and that missing ingredient is cultural shift.
Changes in culture can amplify a ripple to a monster wave, and it can happen very, very quickly.
A seemingly unrelated cultural shift, when combined with a megatrend will change the way the market behaves. It changes what people want. And the way they want it delivered.
So how do you know which mega trends are important to your business?
Just as important, what trends inside your business control how you perceive external trends. For example, the founder of Ford established the culture, the trend of ‘uniformity’. Any colour as long as its black. Whilst this may be a sound strategy during early years of establishment, once a business enters into growth phase it needs to widen its options. Ford totally discounted the demand for colour. Fortunately, Fords CEO successor expanded the colour choices and the rest is history.
Look Beyond Your Roadmap
My point is this – look beyond the scope of your current product roadmap. Seek to understand how emerging technologies and cultural shifts will change the way people connect, travel, live, work and entertain themselves. Look at how markets are engaging in consumption. Who would have thought ten years ago that a trend in collaborative consumption would have people renting out their houses, driveways, or even their car during the hours they are not using it. Is this a sign that ‘retail’ intermediaries will become redundant in this peer-to-peer economy? To answer this question we need to ask…’what cultural shift needs to happen for people to replace retailers with peer-to-peer purchasing? Well, ask any woman whether she likes to ‘go shopping’; and there is just one answer. ‘Retail therapy’ is a well-accepted antidote for many women. So too is the social connection of youths [and the elderly] in ‘going to the mall’.
These two examples are cultural experiences well ingrained in many societies. What needs to happen to drive a cultural shift that will interrupt these behaviours and provide an acceptable substitute? When you find that, you have a recipe for success. So, it is not just megatrends that you need to consider. You must consider megatrends in conjunction with current and shifting culture.
Once you compile a list of megatrends and cultural behaviours, only then spend more time on looking at how your business ‘might’ merge into these new models, and not just on how many more features you can pack into already over-featured products.
For example, how will your products and services fit within a collaborative consumption market? What cultural shift needs to happen that will change the way your customers want to interact with the benefit your product provides.
So, the key takeaways are:
- Keep a watch on megatrends
- Analyse those megatrends across the nine impacts
- Determine what cultural shift needs to happen for that megatrend to have this impact.
- Schedule time to review megatrends in this way – about 30-45 minutes per megatrend
- Precede each review with a one page briefing document, to help promote discussion
- Uncover what cultural beliefs and values in your business might act as barriers to these changes.
What cultural shifts are you seeing in the market that will amplify current megatrends?