FUTURE : PROOF ?

Predicting the long-term future and what it means for your brand can feel exciting and refreshing, yet utterly far-fetched and implausible all at the same time.

Particularly when that unexpected opportunity to significantly grow your orderbook for next season crops up - suddenly the future-shaping exercise takes a back seat (or more likely gets thrown into the boot, only to be dusted off again next quarter or next year).

I’ve definitely been there and it’s understandably a difficult balance to strike.

In my view however, those organisations that have been able to act with urgency in the short-term, but always through the lens of what makes sense in the long-term, have been the most effective at delivering lasting success in both financial terms, and in growing their sphere of influence over their given sector.

Take the example of pure-play retailer Zalando, who have grown from a start-up business worth €6 million in 2009, to an online fashion powerhouse generating nearly €8 billion in revenue last year.

This kind of growth didn’t just happen organically - it’s the result of having a uniquely brave idea rooted in how that concept will fit into a future world.

Back when Zalando launched in 2008, inspired by US-based footwear e-tailer Zappos, the idea of “selling shoes on the internet without trying them on first” was met with apathy and bemusement.

“That’ll never work”, they were told. 

Fast forward a decade, and their model of extreme convenience for a digitally-attuned audience has been replicated the world over.

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So what were trend forecasts telling us before the start of the 2010s that gave Zalando’s founders the confidence to pursue their idea?

The most clear-cut insight (and it seems so obvious to us now in 2021) was the arrival of a generation that was born in the digital age. 

“Generation D”, as leading forecasting agency The Future Laboratory described them at the time:

“They can’t imagine a world without computers, smartphones and the internet.

This is the first native digital generation who don’t care if a product is physical or digital.

If they can pay for it, they probably will.

But they won’t wait for it.

These channel-hopping, instant-messaging, web-browsing kids are the consumers of the future.”

Generation D : The Future Laboratory, 2009.

There are a few elements to this description which are worth dissecting:

Digital product - “they don’t care if a product is physical or digital”. 

Though this has been more of a slow-burner, there is now a significant market developing for digital fashion, initially through the gaming sphere - where the “skins” market is expected to be worth $20bn by 2027 - and even more recently the explosion of the NFT market has added further weight to this foresight, growing from just $13m in the first half of 2020, to $2.5bn in 2021 so far.

Beeple’s Everydays - The First 5000 days NFT, sold for $69m at auction in March 2021.

Payment methods - “if they can pay for it, they probably will”. 

Clearly that doesn’t just mean earning enough through your regular 9-5 to pay for the things you want, but also discovering new ways to make money through your profound understanding of the digital world that you were born into.

Enter the cryptocurrency market - which is now estimated to be worth more than $2 trillion, putting it on a par with the amount of gold held as an investment.

Convenience - “they won’t wait for it”. 

Possibly the most salient point made here in terms of the impact this has had in the last decade.

The emergence of “Nowism” has both fed into and been facilitated by technological progress, to the point where customer convenience is reaching extreme levels - Amazon Prime is the obvious example and Zalando’s excellence here is central to their success, and this expectation has influenced brands too. 

Today fast fashion has gone into overdrive (as an example Chinese powerhouse Shein release 700-1000 items per day), and more elevated brands in the sportswear and luxury sectors aren’t trailing far behind, with the delivery of relentless newness being the modus operandi.

A Shein Clothing Haul : a video phenomenon that has taken TikTok and YouTube by storm.

A point for another article, but it’s not hard to see how this expectation has led us to the perilous position we are in today in terms of the strain on human and planetary resources needed to keep pace.

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Hindsight is obviously a wonderful thing as we look back on this, but the onset of a digitally-led world was the safest bet brands were able to make 10 years ago, and at the same time the most dangerous one to ignore. 

The parallels between the majority of major retail operations that have failed are pretty clear - those who remained reliant on their tried-and-tested business models, or at best lethargically moved towards embracing the digital age, put themselves at risk, and paid the ultimate price once a pandemic came along to stifle their trusted revenue stream of people physically coming into store. 

See the domino effect of department stores across the UK and US to have collapsed into administration and bankruptcy as recent proof.

Barneys New York : closed for good in February 2020.

That’s not to say however that there wasn’t a set of forecasts that were formed in direct opposition to this digital onslaught, that haven’t garnered success at a more niche level with potential for scale in the years ahead. 

“Revivalism” - which is about adopting forgotten skills, customs & technologies to help people take comfort from a more stable past - and the idea of rejecting hyper-connectedness in favour of more meaningful, wellbeing-centric experiences are notions that were offered in the early 2010s too. 

These are concepts that are gathering pace and gaining a greater audience as we look forward at the themes that may come to define the next decade of our lives.

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As we look ahead to what the route to 2030 looks like, what are the critical forecasts that brands need to be on top of to future-proof their business? 

Firstly, the theme that, in my view, rivals the opportunity presented by the digital expansion predicted back in 2010.

It’s abundantly clear that brands must understand and engage with the journey that the Generation Z individual is going on.

Unfortunately, there is not a one-size-fits-all approach here as a digital world has allowed this generation to forge new and many pathways, sub-cultures and ideologies.

Generational comparisons by McKinsey & Co.

What is valuable however is understanding that this group of people have been entirely ensconced in the digital world since birth, and will be the first to reach saturation point with the way brands are leveraging this space for their own benefit.

Any attempt to engage with this audience in a bogus way will become a risk in losing them altogether. 

There is even some suggestion that this consumer will be walking away from traditional big-box social media platforms altogether - with only 9% of the Gen Z cohort surveyed by the iconic publication DAZED actually wanting to stay on platforms such as Facebook or Instagram.

Instead they’ll search for more private platforms that can facilitate bespoke, intimate experiences and like-minded communities. 

So even in those brief points, there is a clear theme of authenticity that brands must double down on.

Those who continue being everything to everyone, will get caught out and suffer.

Whereas those that stay true to their purpose and act in support of their chosen community will thrive.

A purist approach will be a profitable one.

Hand-in-hand with this notion is that purpose is at the root of this generation’s motivations.

They are more well-informed than any previous generational cohort at their stage in life, and have the tools to challenge convention in a powerful way.

Future Feelings : DAZED’s Gen Z audience

A topic that is dear to many of them is the climate conversation, with nearly half of those surveyed for the DAZED Future World study labelling it as their “biggest fear for the future”. 

And very closely tied to this is the impact that a consumerist, capitalism-on-speed society has had on the climate crisis.

The links are becoming clearer, so brands that continue to ignore their contribution will be the first to fall into obsolescence, followed by those who are talking a good game but not backing up their words.

The traditional big players are particularly at risk here as they face up to the elephant in the room: the awkward transition away from the wasteful volume-based business models that their historical success is rooted in.

Will they be brave and take the plunge, with short-term impact to their bottom line being a real possibility?

I hope they will, but I have my reservations, at least until the long arm of the law catches up with them.

This scenario sets it up nicely for the start-up crowd, who have a real opportunity to position themselves as influential gathering points for the relevant section of this Gen Z audience.

If a start-up is born from authentic purpose, and gets behind responsible ways of conducting business and treating its workforce, I would not be surprised to see a few Zalando-esque growth stories playing out in the next decade - perhaps not in revenue size, but certainly in influence. 

Another reason to focus on purpose is the meaningfulness that comes with it.

We touched on it as an emerging trend of the 2010s, and now I’d expect the focus on individual meaning to step up a gear.

Again with an authentic purpose, your brand is set up to facilitate that personal fulfilment, but now genuine experiences that consumers can partake in are a critical component in maximising your connection to this audience.

Offering your audience a highly-curated experience of engagement with your brand and your people will need to occupy more of your time and resource, but will have the benefit of breeding a loyal community that will proudly champion your brand as much as you champion them.

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Business owners. 

Brand leaders. 

Dust off that “Futures” exercise and get planning - even if it’s an exercise that only serves to update your own world view, then it’s well worth doing.

There is abundant evidence from the past to suggest that business will look pretty good in a decade’s time if you’re brave enough to pivot your operations and invest your resources towards servicing future consumer needs. 

And for the next decade, the direction is clear in my view. 

Go deep on Gen Z : this is the most dynamic, most engaged youth generation of our lifetime with the means and knowledge required to mobilise towards meaningful change.

And given the backdrop of the social and environmental crossroads where we are all stood today, this meaningful change has clear opportunity to materialise.

Brands & Retailers : get clear on your purpose, and how your operations, product and people responsibly deliver that purpose in service to your community.

If you don’t, then expect to see your business stutter and stagnate at best, and at worst collapse entirely by the time the 2030s come around.