30 Trends In 30 Minutes THE ONLY TREND STORY YOU'LL NEED THIS YEAR
(FORTUNE Small Business) – Here's something that has been impossible for anyone to miss: There are more experts like me spewing trends than ever before. Last year, according to my search engine, there were 372,356 articles in major business publications mentioning trends. It's tempting to be cynical, but actually our obsession with trends is well justified. No matter how hard you work or how smart you are, nothing happens if there's no wave to carry you along. That's where I come in. One of the things I do with our corporate clients is to spend time locked in rooms fastballing trends at them and trying to sort out what those trends might mean. We call it "60 trends in 60 minutes." Part of what makes it a valuable exercise is the format: With so many trends gusting around them, CEOs can't help having their minds blown out of their every-day thinking. And it gives them the chance to actually figure out which trends are likely to affect their businesses. What follows is an adaptation of that exercise for FSB readers--call it "30 Trends in 30 Minutes." I've culled the trends from my company's database and selected the ones that are most relevant to small businesses, covering areas from technology to the workplace. I've tried to define each trend and then give some idea of why it could matter. Of course, I can only go so far in guiding you toward what's important for the type of company you're building. You'll have to think it through for yourself. It won't be simple, but you can take comfort in this small truth: It's definitely not what everybody's doing these days.
1 BOOMERS: IT'S WHAT'S OUTSIDE THAT COUNTS. In cars, it's not just the model year, but also the mileage that determines the useful life of the vehicle. As it turns out, the same logic holds for people. We boomers aren't that old, but we have put on a lot of miles, and a lifetime of sunbathing, 5K races, skiing, and Rollerblading is taking its toll. Implications: If you make products or sell services that used to go to the elderly, expect the market to grow faster than the growth in seniors. And if you are looking forward to boomers aging so that you can market to them, you don't need to wait. You can start selling them those products now! But be careful, because boomers really, really don't like to be called old. (See next.)
2 PETER PAN-ISM. The best part of belonging to the biggest demographic group in history is that we control the media, which means that things are whatever we say they are. And we say old age is not us. We reserve the right to ride Razor scooters for as long as we damn well please. Consider this: Surveys have shown that approximately 40% of those over 65 claim they have sex more than twice a month. Implications: The name of the game for marketers to boomers will be to sell us the products our oldish bodies need without offending our youngish minds. Good news for brands and products that manage to stay hip. Bad news for any brand that gets tarred with the brush of being for the elderly (pull over, Cadillac).
3 PRE-MATURITY. Now here's the irony: Adults expect to be kids forever. So what do we expect from kids? You got it. One of the most attention-getting toys at the 2001 American International Toy Fair? Electronic organizers for kids. Implications: Well, somebody's got to fill those empty hours up. There's a new market for services for children, and it includes training in everything from computers to etiquette. Entrepreneurs are uniquely qualified to compete in this space, because it requires hands-on management.
4 UPSCALING. Somewhere along the way, we developed a taste not just for good stuff, but for the very best. The average size home has gone from 1,140 square feet to more than 2,225 square feet, according to Harvard University's Joint Center for Housing Studies. We're filling those houses with everything from professional quality tools (DeWalt) and refrigerators (Sub-Zero) to home theaters and hundred-thousand-dollar treehouses for the kids (see FSB, October 2000). Companies that sell very high-end products, like Tag Heuer and Waterford, have boomed. Implications: There is a market for the best in almost everything. And even if the economy turns down, that market won't go away. Luxury is hard for people to give up.
5 ESCALATING EXPECTATIONS (THE DEATH OF REALISM). Back in the '80s, experts told us the answer to competition was to always exceed customer expectations. What we didn't count on was just how unrealistic customer expectations could become. By 2003, more than half of cellular customers will change phone companies every year, according to International Data Corp. Implications: One thing a small company can do better than a big one is service, and dissatisfaction with the big guys is good news for you. Make it a policy to step in when customers even threaten to walk away.
6 BORN TO BE WIRED. Everybody now gets technology, at least in comparison with previous generations. Not only do we understand it, but we also demand it. Implications: Your customers expect you to be tech-savvy, and that ranges from having a useful Internet site to being able to answer questions about what you sell. Get smart, or get some help.
7 FAUX AUTHENTICITY. Perhaps to balance our affection for all things virtual, we now seek out authenticity, whether it's in television shows, in adventure vacations, or in antiques. Implications: Play on your authenticity. Jim Koch, founder of Samuel Adams Boston Lager (see page 41), advertised the fact that he used his grandfather's beer recipe, building a major beer brand in 15 years. Remember, by definition it is harder for the big guys to be authentic unless "authentically gigantic" counts.
8 LIGHT IS RIGHT. If we don't have to carry it, we want it big and substantial, like an SUV or a home theater. But if we do, we want it weightless, like the featherweight notebook computer this article is being written on. Implications: Take weight out of everything you make, as Sony, Nike, Patagonia, and Callaway do. But if you make or sell anything that is bulky or heavy, find a way to either make it easier to move or carry it for consumers.
9 DOWN IN THE DATA MINE. We live in an era when hotel doorknobs keep track of guests' comings and goings. Data mining is everywhere. At the local grocery store, they've used sophisticated programs to decide how many kinds of toothpaste to carry and where to put it. How much your plane ticket costs is the result of complex calculations based on expected demand. Implications: No matter how small the business, you've got to know the numbers. For example, who are your best customers and why? Which are most profitable? Who hasn't bought from you in 12 months? Dig into that shoebox of receipts to spot buying patterns and profit opportunities.
10 INFINITE REACH. GPS. Cell phones. Wireless e-mail. Satellite TV. The days are gone when anyone is truly out of touch. Implications: This may be the biggest trend of all, and we aren't close to figuring out all the ramifications. It changes all the boundaries, such as how and when we talk to customers. Just because we can have a two-way dialogue with our customers and colleagues no matter where they are, should we?
11 INSTANTANEOUS OBSOLESCENCE. Such inventions as electricity, the car, and the telephone took about 45 years to find their way into 25% of U.S. households, the economists' definition of a mass market. TVs, microwaves, and VCRs took around 30 years. Cell phones, PCs, and the Internet reached mass market penetration levels in about 10 years. The pace of adoption seems to be quickening. And once a product hits the mass market, it attracts competitors the way roadkill attracts flies. Implications: If you invest in developing new technology or brands, don't count on waiting decades to recoup your investment. Think years.
12 RETOOLING THE WORK FORCE. Products aren't the only things that become outdated way too fast. Extraordinary changes to our economy have resulted in huge groups of mid-career workers with obsolete skills. The University of Phoenix, a for-profit school for working adults who need to update or learn skills, has more than 84,000 students. Implications: There are lots of opportunities to provide training and services to mid-career workers.
13 BABEL-IZATION. One of those new skills those retooled workers will need will be a working knowledge of Spanish. The fact that more than a billion people now speak English as a first or second language leaves those of us who only speak one language (and English, at that) feeling pretty smug. But not so fast. First, the English that others use is not always understandable to other English speakers. Second, it is becoming obvious that even if people can speak English, they don't always want to. On the Web there are more than two million sites in languages other than English, according to the Far Eastern Economic Review. Implications: Americans will need to speak (and work in) at least two and maybe more languages, just as everyone else does.
14 THE TRUST DEFICIT. Even if you are speaking their language, customers still might not believe you. And the bigger you are, the more likely it is they won't. Several studies have shown that the percentage of Americans who trust the evening news has plummeted in recent years. Implications: Don't waste time (and money) touting lofty corporate goals or making vague promises to employees or consumers. Instead, make concrete claims and prove them.
15 THE GREAT SCREEN MACHINE. Marketers have consistently found more and more ways to pitch their wares to consumers--more TV channels, more ways to call them at home during dinnertime, and more places to put advertisements (my favorite: on the wall across from the mirror in restrooms). So people found new technologies to block those messages--TV remote controls to skip commercials, answering machines to screen calls, and a conditioned ability to ignore most marketing messages. The typical consumer sees thousands of ad messages a day. Implications: Advertising effectiveness is falling, and it's going to continue to fall, and simply turning up the volume isn't going to work. If you advertise, remember TLC: Targeting, Lean, and Creativity. That is, be very focused on whom you talk to, lean with the message, and do something different.
16 24/7/365. We have become an around-the-clock society, with 24 million Americans now working at night. Implications: Consumers expect to be able to transact business at any time. That means you should think about extending your hours or finding an after-hours partner to cater to all those night owls out there.
ECONOMICS AND POLITICS
17 THE INCREDIBLE GROWING GOVERNMENT. Despite perceptions to the contrary, the last time there was actually a reduction in the size of the government was 1965, one of only six such years since 1936. Implications: The government is regarded as a boom market, and it is a particularly good customer for small businesses, since it has programs in place to encourage them. Sure, the paperwork is tedious and the delays can be maddening, but many large corporations (like EDS) made the jump from little to big by using government contracts as a springboard.
18 COMPANY STATES. The largest companies are becoming larger than countries, and maybe more autonomous. Companies including General Motors, Exxon Mobil, Wal-Mart, and Ford have revenues that outstrip the GDP of countries such as Libya, Bahrain, and Israel. Implications: It's no longer enough to think in terms of, Do we sell our product in the U.S. and Canada? Now you need to think about whether you sell in the U.S. and GM. Both have their own ponderous set of regulations and requirements, their own language, and their own customs.
19 WORLDLINESS. In fact, in some ways, the U.S. is becoming less like a single country even as IBM and Exxon are approaching statehood. Widespread travel has created demand for high-end products made in London and Provence. At the same time, pockets of unassimilated immigrants, like Chicago's Little India, create demand for everyday products not stocked at Safeway. Implications: Anywhere there's a micromarket--yes, even outside of New York City or Chicago--there's a new opportunity.
20 WHAT, ME WORK? The work ethic may not be dead, it may just be retired, wearing plaid pants and playing golf in Palm Springs. But it sure is hard to find. Implications: Downturn or no downturn, good young talent with a strong work ethic is in very short supply. Expect to pay a premium to recruit such talent and keep it.
21 MERCENARY MANAGERS. Today's CEOs, it has been said, are in the same situation as barons were in the Middle Ages. Back then, they couldn't afford to keep a large standing army, but never knew when they might need one. Their solution: a small standing garrison of highly paid, highly competent and loyal soldiers supplemented by mercenaries. Implications: Like big firms, small companies now have the option of renting high-end mercenaries, like CFOs, part-time--say for two days a week for the month before the IPO.
22 PROJECT-BASED CAREERS. Many people actually like being mercenaries. Even within corporations, increasingly there are groups of employees who never hold a traditional job, but cycle through a series of projects instead. Implications: Instead of line managers, think producers, working for two years at a time on a project, managing a team of both in-house and outside resources.
23 CELEBRITY CEOS. The marquee names on these new productions belong to CEOs who get superstar billing, get superstar contracts, and endure superstar expectations. Implications: Expect it to be hard to keep those talented second bananas. Companies who expect CEOs to work miracles with the financial markets are going to continue to bid the market up.
24 NICHE-PICKING. A natural consequence of any large, technically sophisticated and well-organized society is specialization. The U.S. is already the most hyper-specialized nation in history. The Internet is going to accelerate this by creating true national markets even for the smallest of businesses. Implications: It will be harder and harder for the small generalist to survive. Be known for something specific or find yourself second choice to a specialized competitor.
25 NOWHERE TO HIDE. You're going to need to be specialized, because worldclass competition--The Home Depot, Starbucks, 7-Eleven--is coming to a street corner near you. Implications: See above. Find a niche. Own it.
26 DOT-COMMUNISM. The biggest change in manufacturing during the past 20 years has been the outsourcing of major elements of production and service, such as marketing and PR. Ninety percent of the people working on designing and launching GM's new Hummer don't actually work for GM. Implications: You don't have to build a complete soup-to-nuts manufacturing company from day one. Instead, create a virtual business model and leverage someone else's infrastructure.
27 EXPERIENCE THIS. Can't find that perfect gift for the wife for your 10th anniversary? How about 15 minutes driving a WWII tank in Bedfordshire, or a ride in a MIG 21 over Moscow? We have moved from peddling products to selling experiences. Implications: Think of ways to put a measure of fun into all of your transactions.
28 THE NEW NEW MATH. Assets used to be something you could touch and feel. But just as virtual business models mean that you don't need to own hard assets to utilize them, many of the assets you do own are intangible. Brands, customer and channel relationships, and organizational know-how are all valuable. Implications: Be sure to value your business with a range of yardsticks as you go for financing or consider selling.
29 RE-INTERMEDIATION. The Internet was supposed to signal the death of middle-men, from stockbrokers to car dealers. But what's really changing is how those intermediaries are structured and who they are. We still get mail, but now it comes through varied channels such as UPS, or with the help of Mail Boxes Etc., not just through the U.S. Postal Service. Implications: Watch for suppliers and customers who seem to be encroaching on your space. But don't react with threats. Instead try to understand the underlying customer needs or economics that are pulling them into your backyard. If you can't beat them, partner with them.
30 THE PRICE IS WRONG. Priceline.com may be fading, but the idea that every price is negotiable is once again acceptable. Savvy travelers already are un-embarrassed wheedling at hotel desks and airline counters. Implications: Take it or leave it has left the building. Expect to haggle and be haggled, and be prepared. Know your costs, and know how low you can afford to go. And make your pricing scheme as complex as possible, just in case you ever have to explain to a customer why somebody else got his fence for 50% less.
THERE YOU HAVE IT: 30 trends. Is your brain cramping? It should be. Think of what you've just been through as an over-the-top version of a common sport known as trend-catching. Such extreme sports are very popular these days--but you already knew that, didn't you?
Hill is president of Helios Consulting, a marketing strategy firm headquartered in New York City.