For business leaders, the new year is often a time to reflect on the biggest business trends shaping the corporate world. It’s a time to reset, as well as look forward.
There isn’t a shortage of predictions on what the next year will bring, and spotting the business trends that truly matter can be difficult. To help you separate the short-term fads from the disruptive trends, we’ve done the work for you. We’ve collected 10 of the most insightful predictions that we believe will define not just 2017, but also the years ahead.
1. Global uncertainty
After the shock of the Brexit vote and the U.S. presidential election, we’re entering the new year with a global geopolitical landscape that’s more uncertain and potentially more disruptive to businesses than 2016. Globalization, in particular, is in the crosshairs as new world leaders take charge.
“It’s not just Donald Trump’s election that’s signaling a change in the structure of globalism’s future,” says Mary Meehan, founder of research consultancy Panoramix Global, in a Forbes article. “Across Europe, candidates that embrace isolationism and nationalism have found favor with audiences unsure of or unmoved by globalism’s enticements.”
In this time of change, politicians need to listen to the communities they serve. Likewise, companies must get closer to their customers—both local and international—to continue to deliver products and services that are relevant and valuable to their target market.
2. Trust as a business currency
Consumers have less faith in brands than ever before. Gaining customer trust will become a more significant source of long-term competitive advantage.
Protecting customer data would be a good start. After a string of high-profile security breaches, the prognosis in the new year isn’t much better. Forrester Research is predicting more espionage, ransomware and privacy breaches in 2017. More customers will choose to do business only with trustworthy companies that demonstrate they’ve prioritized customer security and privacy.
“It’s going to be about creating that direct connection and trust with the individual on a much more personal level.”
Trust will be a big issue for marketers, too. According to Jennifer Putney, VP of full-service retirement marketing at the financial services company Prudential, marketers need to be more transparent in their interactions with customers. “It’s going to be about creating that direct connection and trust with the individual on a much more personal level,” she told CMO.com. “Marketers are going to have to get a lot smarter.”
3. Acceleration of customer intelligence tech adoption
Platforms that enable companies to make better business decisions will gain influence in the marketing technology space. According to SiriusDecisions, customer intelligence management and business intelligence tools are top technology investment priorities for CMOs in 2017.
“Driving better performance means understanding and orienting marketing efforts to buyer needs,” explains Jennifer Ross, service director of marketing leadership strategies at SiriusDecisions. “Customer intelligence technologies enable organizations to collect and analyze customer feedback from multiple channels.”
4. Imperfect, authentic social media sharing
Snapchat has tapped into people’s need for more authentic connections. As a result, the app is transforming the social media world. Since its launch, Snapchat ushered the rise of ephemeral sharing—an evolution of social media sharing where content disappears within 24 hours. Because photos and videos are only available for a day, users like celebrity Kylie Jenner tend to post more frequently in the app, sharing many of the imperfect, more mundane parts of their daily lives.
Farhad Majoo of the New York Times says Snapchat is “pioneering a model of social networking that feels more intimate and authentic than the Facebook-led ideas that now dominate the online world,” adding that what users see on Snapchat often feels more authentic and less like a performance compared to networks like Instagram. “People [on Snapchat] aren’t fishing for likes and follows and reshares. For better or worse, they’re trying to be real.”
This idea of ephemeral, authentic sharing is catching on. Other social networks like Instagram and Facebook have already rolled out Snapchat-like features that encourage users to share ‘imperfect’ moments of their lives. This new era in social sharing means companies must find ways to engage more authentically with the public—even if it means being less polished than they’re used to.
5. Boomerang employees as the new norm
Re-hiring former employees is becoming in vogue. One study shows that 76 percent of HR professionals are now more accepting of boomerang employees—workers who left on good terms and decided to rejoin the same company after a period of time. Millennials, in particular, are more likely to boomerang: 46 percent of Gen Y would consider returning to a former employer, while only 33 percent of Gen Xers and 29 percent of baby boomers would.
Brendan Browne, VP of global talent acquisition at LinkedIn, says boomerang employees could provide a lot of value to the business. Boomerangs “bring with them new experiences, connections, points-of-view and even potential customers,” he explains.
Managers and HR leaders need to be supportive of their employees’ career aspirations—even if those ambitions involve leaving the company—and should maintain a good relationship with former colleagues. At the same time, however, it’s crucial to avoid employee churn given the high cost of losing an employee. As boomerang employment becomes the norm, a solid employee engagement strategy needs to be in place to get a pulse on the motivations and aspirations of the workforce and gain actionable insight on how to keep people from leaving in the first place.
6. Never-ending consolidation
Virtually all industries saw some form of consolidation in 2016. From martech to health care, from media to consumer goods, mergers and acquisitions dominated business headlines this year.
Consolidation is far from done. In its annual predictions, Fortune says the merger boom will keep on rolling in 2017. Some of the publication’s intriguing predictions include a merger between Comcast and T-Mobile, and the acquisition of Slack and Netflix.
For many enterprises, merging with another company is a potential shortcut to boosting market share and reducing business costs. But it’s critical to take a long-term view. Companies must consider the effect mergers and acquisitions will have on the business and, more importantly, to key stakeholders like their customers and employees.
7. Content studios as revenue centers
Some companies have become so good at content generation that other brands are now coming to them for content. Consumer goods giant PepsiCo is a great example. Brad Jakeman, the company’s president for its global beverage group, revealed at Cannes 2016 that the brand’s content studio is starting to become a revenue generator as other companies approach it for content.
“I’m shocked at how many media platforms are coming to us to ask us to produce content for them,” Jakeman admitted, while highlighting PepsiCo’s recent deals with AOL and Microsoft.
Another company taking the content monetization route is snack food behemoth Mondelez, which recently revealed that it has started producing TV shows, online videos and other content for various companies.
However, content monetization is not for every brand. Creating content that other companies are willing to pay for requires significant investment in time and resources. To ensure content resonates with another company’s target audience, consider involving those consumers throughout the content-production process for inspiration and confirmation.
8. Impressive innovations in offline retailing
After spending years building their e-commerce presence, many retailers are now focusing on innovations in their brick-and-mortar stores. E-commerce giant Amazon is leading the way. In December 2016, the company announced Amazon Go, a grocery store without cashiers, registers and lines. Scheduled to open its first location in Seattle, the store is designed so that shoppers can use an app to add products they want to buy and walk out of the physical store without waiting in a checkout line. Amazon Go leverages machine learning to identify the products shoppers take out of the store.
Amazon Go is just tip of the iceberg. In 2017, expect many retailers (including those that started as purely e-commerce companies) to pursue new initiatives in physical retail, with new retail technologies like beacons and virtual reality improving significantly. As these innovations roll out, business leaders must track the impact on customer experience and ensure that shoppers get value and satisfaction from these changes.
9. Digital advertising spending finally overtakes TV spend
The TV advertising industry saw a healthy rebound in 2016, but don’t expect that to continue. In fact, a 2016 study by the advertising research firm Magna Global shows that digital media sales in 2017 will rise 13 percent, while TV ad sales will slip 0.1 percent. Overall budget for social media advertising, in particular, is projected to rise by 26 percent. Another study, from eMarketer, claims that digital ad spending already surpassed TV ad sales in late 2016.
That said, advertisers should not blindly direct their marketing dollars to digital advertising, especially if they’re going after young consumers. A 2016 Vision Critical study found that 75 percent of Millennials believe ads are disruptive—a sentiment that 69 percent of Gen Zers agree with. To see significant ROI from campaigns, marketers need to create innovative ads that reflect the true motivations and aspirations of their target audience regardless of the channel.
10. The emergence of data-driven, customer-centric CMOs
In the past, marketing leaders used to rely primarily on their intuition and creativity, but that’s quickly changing. Innovations in marketing technology—in particular, the emergence of tools that let companies tie marketing activities to business metrics—have given more power to CMOs.
With great power, however, comes even greater expectations. According to a 2016 report from the CMO Council, almost 70 percent of CEOs now expect CMOs to lead growth. To meet those increasing expectations, marketing leaders are leaning on data for insight—with 44 percent of CMOs saying that they use data to optimize campaigns.
Andrew Savage, director of marketing and products at Next Gen Health and Lifestyle Clubs, predicts that marketers will focus on customer data with the goal of creating a more holistic view of the customer. “It’s about data, data and data—in particular, the greater use of first-party data in effective audience targeting and in framing bid strategies around known audiences,” he tells CMO.com.au.
More data, however, isn’t necessarily the only path to higher marketing ROI. LinkedIn, Walmart and Amazon are using ‘small data’—the little, seemingly insignificant information about a customer’s lifestyle, habits, motivations and preferences—to give context to Big Data. These companies complement transactional data with qualitative insight to get a more complete picture of the customer.
In the new year, data-driven CMOs must look beyond Big Data and should aim to get a real understanding of the motivations and unspoken needs of their customers.
How to prepare for these business trends
As you can see, the challenges ahead for businesses in 2017 are enormous. More than ever, business executives and marketing leaders must stay agile and react quickly to changes. Building an authentic, two-way relationship with customers will ensure that no matter what happens in the business world, you have the insight and understanding necessary to make smarter business decisions.