ALL BUSINESS leaders need to keep one eye on the future, thinking about when to expand, how to diversify and where the next opportunity lies.
It’s not easy to make a company future-proof. But here are six key trends that we think companies should be considering:
1. Gen Z is the one to watch
Now estimated to be around 70 million strong in the US alone, Generation Z is the first generation of true digital natives. Born between the mid-1990s and the mid-2000s, they are known for their strong sense of community and desire to positively influence the world through their work. Successful brands will respond by developing strategies to address this group as employees and consumers. Companies which live up to their values and understand how to do business in the digital age will be at an advantage.
2. We are social shoppers
More people are buying via social media platforms. When these consumers see a product that they like, they want to be able to buy it there and then. While social shopping is still in its infancy, research suggests it could generate revenues of USD165 billion globally by 2021. Brands seeking to attract customers this way will need to place more emphasis on their social media strategies and move from “like” to “buy” buttons, putting their products just a click away.
3. Green is the new black
Interest in ethical and environmentally friendly products is high in both emerging and advanced markets, according to research from HSBC. If brands want to be commercially successful, they will have to meet new consumer expectations. Large and small firms alike are starting to look at their network of buyers and suppliers to make sure everyone meets the right environmental and social standards.
4. Trade can skip borders
Services such as tourism, finance and education are expected to account for 25 per cent of global trade by 2030. Thanks to digital technology, more and more small firms are expanding overseas virtually, without ever setting foot abroad. This is a game-changer for trade, with expansion now being as much about a click of a button as bricks and mortar.
5. Be aware of blockchain
Recent years have seen a rise in interest in blockchain, or distributed ledger technology, across a number of industries. While usage is currently low (only 0.5 per cent of the world’s population use blockchain), every business leader should know if and how blockchain is being applied to their sector.
6. The AI march continues
More and more companies are incorporating artificial intelligence (AI) into their daily operations. It’s predicted that AI bots (applications performing automated tasks) will underpin 85 per cent of customer service interactions by 2020, and that this technology could increase productivity by at least 40 per cent by 2035. The most promising uses for business include customer segmentation, in which advanced analytics can be used to identify new customer trends, as well as segments – or clusters – of people who are |more likely to be interested in a particular product.
Business leaders who not only understand these trends but act on them are more likely to find competitive advantage. That’s because by future-proofing your firm over the long-term you win new customers, attract the brightest talent and anticipate where the best opportunities lie.
And that is something common to every successful business, from the smallest start up to the largest multinational.
Contributed by NOEL QUINN, Chief Executive, Global Commercial Banking, HSBC