Sixteen key global market trends for 2007
What's going to happen in the global market in 2007 and beyond? The partners from strategic marketing firm Group 1066 have shared with The Wise Marketer what they think will be the sixteen most significant trends around the world, including the good news that spam is set to die out.
The prediction of trends is a hazardous business - definitely deserving of danger money - but the experts at strategic marketing firm, Group 1066, have been doing it successfully for some time for companies including Microsoft, MasterCard and Deloitte.
Global market trends Here are some of their predictions for the global world of marketing in 2007 and beyond:
- TV viewers demand more choice The expansion of on-demand television and the emergence of movie and TV show downloads on the internet will have consumers clamouring for more. The first victim will be big cable. Where legislation failed, consumers will prevail, demanding of cable operators that they gain the power to pick and choose exactly what television stations they get as part of their own viewing package.
- Services offered will proliferate Technology and the improved ability/desire to serve customers on a customised, one-to-one basis, and the increasing lack of ability to differentiate services in the marketplace, means we'll see ever more emphasis on new services introduction in companies. The idea being that if you can't make the service different, differentiate by having more services.
- iTunes will open to other devices The legions of iPod users who've spent fortunes on their music libraries will force Apple to open up the iTunes format to devices other than iPod or Apple will risk undermining its humanistic brand with accusations of anti-consumer business practices.
- Recommendations get more personal The long tail of entertainment will grow longer as recommendation technology improves to not only base recommendations on what others with similar tastes bought, but also to examine the actual content of music, movies, television, etc., to provide "thematic" recommendations. For example, take the Music Genome Project and its internet radio station, which allows you to enter a specific artist or song and then constructs a radio station based on the genre, tonality of the music, the key, phrasing, type of instrumentation, and other criteria that get at what it is you like about the music you like. (It's surprisingly accurate, by the way).
- Hollywood will turn to young influencers As movie studios recognise that word-of-mouth marketing has become supercharged through the likes of MySpace, FaceBook and YouTube, and that certain types of movies are "foolproof" from an opening weekend box office standpoint (e.g. horror, slapstick comedy), they will slowly move away from shotgun-style big television ad buys to focus on building goodwill with young influencers of the MySpace generation. Following this, the distribution model for movies will change, as well. You'll see more movies made for less money, many of which will go directly to DVD/download/on-demand. And, these movies will become the most profitable sector of the business.
- Terrestrial radio will go local As a competitive response to both satellite radio and the boring homogeneity of traditional FM, radio will become more localised. Music formats will reflect local tastes; DJs will develop stronger, local accents. Radio will offer more local content, live music, local bands, and try to engender hometown pride.
- Chinese brands will stand on their own The explosion of Chinese manufacturing is not news. However, until now Chinese manufacturing has primarily been a "behind-the-scenes" affair, creating products that are then sold under established brands. This will change as the US market sees the entrance of new Chinese brands that will take on established competitors. The case of Lenovo provides illumination here. That company has come out from behind its IBM ThinkPad manufacturing deal and in a relatively short time has established itself on the PC scene.
- Oversimplification will give way to being specific A few years ago on the advice of marketers, companies focused on simple messages about their point of difference. This went a bit too far; we heard about "innovative solutions" promised by everyone from the local plumber to Fortune 500 technology companies. Vague oversimplification may work if you happen to be selling some particularly inventive products but if you're like most companies, 2007 will be the year of getting more specific. Especially if the economy turns down, customers will be increasingly focused on the details of offerings and how they deliver value. Call it The Value Economy - it's time to get specific.
- Organic foods give way to local food The obsession with organic foods will blow back as people question the environmental costs. Take for example Whole Foods New Zealand organic apples. Is it really environmentally responsible to fly an apple half-way around the world? Many will begin to question the supremacy of organic and will rather focus on "local" foods.
- Patriotic marketing Immigration, the trade deficit, a potential shake-up of the housing market and the war in Iraq will be cause for a resurgence of patriotic sentiment throughout the US. In other words, American advertisers will most likely jump on the bandwagon and attempt to differentiate their products based on the "Made in the USA" theme.
- RFID to become more common Consumers will see more applications of RFID technology (see our sister publication, Using RFID) in everyday products. Consumers have been using RFID to pay highway tolls for years and - despite initial concerns of personal privacy - this kind of application is set to become much more common as banks and credit card companies push contactless payment cards for everyday purchases.
- The global middle class will play catch-up The further globalisation of the world economy and the expansion of economies in China and India is creating a new global middle class, which will provide a fertile new market for media, technology, electronics, healthcare and automotive products. As this new global consumer plays catch-up with western consumers, they will undergo major cultural shifts.
- Charities will gain The world of charitable giving is in the process of undergoing massive changes which will accelerate in the coming year. This year, Warren Buffet's announcement that he would be leaving 85% of his fortune to the Bill and Melinda Gates foundation set the charity world abuzz. As the baby boom generation mulls retirement, and what to do next, they will be drawn to "giving back" in record numbers. Boomers will look to leave their mark on the act of charity with innovative trusts, micro-credit initiatives and not-for-profit venture capital.
- Electioneering politicians will turn to YouTube Howard Dean changed campaign fundraising forever with his internet initiative. During the next election, smart politicians (and their supporters) will use YouTube as a cheap and effective way to get their message out and to embarrass opponents.
- SPAM will die Well, almost. SPAM will at least begin a decline. With the ongoing improvement of filtering software coupled with ever increasing sophistication of the average internet user, SPAM has almost reached the tipping point of ineffectiveness.
- Simply being "green" won't be enough We've already seen how companies such as BP have embraced "being green" as a marketing tactic. With companies touting hybrid cars (the Prius, etc.), ecologically-friendly packaging (e.g. P&G), free disposal of old computers (e.g. Apple), Green stands a chance of becoming "old news" in 2007. Companies will need to look for ways to differentiate their Green-ness by basing it in some unique truth that competitors can't easily match. Expect to see more marketing tied to community ¬the place from which products and services come or in which they will be used. With Google Earth already reemphasizing the link of a business to location, we can expect to see companies doing more to ground themselves properly in the concept of Green.
What's in a name? Incidentally, The Wise Marketer's team wondered where Group 1066's name came from - surely it wasn't arbitrarily named after the Battle of Hastings?
Not at all. In fact, when William the Conqueror triumphed over King Harold in 1066 and installed himself as King of England, Bishop Odo of Bayeux commissioned a tapestry to recount the details of the invasion. The tapestry is some 230 feet long and conveys the events of that fateful year in detail. More important, however, is the way the story is told: it reads like a 200-foot-long comic strip, with detailed and thrilling action scenes, a clear moral imperative, and no boring parts. If the people of England were to accept their new king, they would have to understand the legitimacy of his claim. William the Conqueror created the Bayeux Tapestry to convince them. Like history, strategy should be conveyed with emotion and a call to action. Group 1066 believes that the stories it tells, whether contemporary or 1,000 years old, give it its bearings and provide a context for creating history.