5 Drivers Shaping Megatrends
To stay ahead of changing consumer preferences and values, companies must embrace megatrend analysis. It is important to recognise and have a clear understanding of the social, economic, technological and environmental factors, which form an ever-shifting backdrop to consumer behaviour.
In 2017, Euromonitor International’s team of economic, consumer and industry trend experts identified 20 megatrends shaping consumer markets with the power to transform and disrupt entire categories. Our analysis also identified the underlying forces driving change and propelling long-term shifts in consumer attitudes and behaviour.
These we call “Drivers”. Our launch of a megatrends framework and subsequent megatrend and driver report series, provide thought leadership on the trends with the strongest influence on the world of tomorrow. These are the five socio-economic drivers generating and shaping consumer megatrends:
Shifting Economic Power
Global economic growth has seen a huge shift to emerging markets. By 2030, the Chinese economy will be 1.8 times larger than that of the USA. These economies have seen strong growth at a time when development in advanced economies has faced headwinds.
With the rising importance of emerging and frontier markets and fears over advanced economy stagnation, the global economy has witnessed a paradigm shift.
Technology plays a pivotal role in consumer decision-making and the ability of business to meet the needs of today’s consumer. It has created massive upheavals in consumer expectations, lowered the barriers of entry for fast-moving companies and inspired new digital-first business models.
Connectivity is the new normal. The number of internet users has more than doubled over the last decade, giving way to a truly mass participation technology.
Population trends, such as urbanisation, migration and ageing, are combining to reshape consumer lifestyles and purchasing decisions. Ageing, urbanisation and migration drive consumer demand including the demand for a convenient and technologically advanced experience.
In 2030, 61% of the world’s population will live in urban areas, 995 million will be aged 65. Rapid urbanisation and population growth in Asia and Africa will give rise to more connected consumers on the back of an expanding youth population and better connectivity
Environmental Shifts and Pressures
Competition for resources and increasing awareness of environmental challenges are having a transformative effect on consumer behaviour, sometimes at a rapid pace. Competing demands and supply constraints combine with economic, environmental and geo-political risks to create pressures on environmental resources.
The effects of climate change are becoming more visible, from changing weather patterns, ice caps melting and water stress, to deforestation, reduced crop yield and biodiversity loss.
Conscious consumption has replaced conspicuous consumption and is at the heart of changing values and priorities. Gone are the days of ownership as a status symbol.
Developed economies will add US$3,839 billion to their spending on services between 2018 and 2030, in comparison the figure for durable goods will be US$503 million. Consumers tend no longer to have deep relationships with the things they own, but instead find emotional attachment in experiences and achievements.
To learn more about the megatrend analysis download our whitepaper “Understanding the Socioeconomic Drivers of Megatrends”