Our recent webinar “Megatrend Analysis and its Impact on Innovation” explored Euromonitor’s megatrend framework, examining our eight focus megatrends in some detail, before outlining the strategies business should employ to harness megatrend analysis to succeed in the marketplace of today and tomorrow. A thought-provoking Q&A session concluded the live broadcast, highlights of which follow below.
How closely correlated with each other are these factors? In other words, are they mutually exclusive or do they relate closely with each other?
The megatrends we were discussing are very closely related with many overlapping sub-trends. For instance the “Middle Class Retreat” sees consumers cutting back in some areas in order to prioritise others – a big factor itself in the “Premiumisation” megatrend. “Connected Consumers” embrace the sharing economy – the sharing economy would not have gained traction without access to technology and so on. Taken as a whole, the megatrends we discussed in the presentation are shaping consumer attitudes and behaviour, and although you can look at them in isolation, we believe taking a holistic approach provides a better insight into consumers’ lives.
Do these megatrends apply equal to consumer-facing companies and to those operating in the B2B space?
Our eight focus megatrends are more immediately relevant for B2C companies, with the possible exception of Shifting Market Frontiers – which is all about the rise of emerging markets. However B2B companies, such as ingredients manufacturers, can find competitive advantage in being on top of consumer trends. Having this knowledge enables B2B companies to advise the consumer-facing businesses that they work with, positioning themselves as a strategic partner, and also to respond quickly to changing consumer demands.
How important is it for brands to be authentic?
In today’s internet-savvy world it is more important than ever for brands to be authentic. Embracing imperfection is important; authenticity is a differentiator and a way to position the brand as premium. Many consumers have become increasingly cynical of big brands, especially those of large multinational corporations. Words that have resonance with today’s consumer include authentic, genuine, simple, natural and real.
Do you think scenario planning has a role to play in the megatrend planning process you've outlined?
Scenario planning has a strong potential role to play in megatrend analysis. We believe this fits best with steps 2 and 3 outlined in our previous blog post, where manifestations and potential quantification would shift dependent upon specific scenarios (e.g. greater economic growth vs. a recession). The way we have seen this best implemented is as a tool to identify which trends, regardless of scenario, will continue to be pertinent and a strong influencer shaping consumer's needs of tomorrow. For companies that understand megatrend analysis at its core, this is a great value added exercise to weave into the process for advanced analysis and ideation.
For a newcomer it could be overwhelming to look at these megatrends - any tips?
Our best advice is to start simple and small. Focus on narrowing to a smaller set of 3-5 megatrends and truly understanding what these megatrends mean for the future and for your company. Focus on the first two phases of the innovation process (Discovery and Idea Generation and Making the Business Case) from the webinar and use this to drive an internal brainstorm before taking analysis to the next step to quantify and perform advanced portfolio analysis. Just familiarizing yourself with megatrends and their meaning as a company is the best start. Our white paper is a great introduction as you begin to get your feet wet.
How can we quantify the effects of megatrends analysis and evaluate if our approach is successful?
That is an interesting and challenging question. Like many high level initiatives at a company, it can be difficult to quantify exact impact. There is an intangible value in changing your company culture to think longer-term, broader (beyond your immediate category for ideas/inspiration) and bigger in terms of innovation investment, i.e. disruption vs. incremental change. That is invaluable yet difficult to measure. The best practices we have seen partnering with companies who quantify impact is to track the specific whitespace opportunities and/or projects identified as a result of megatrend analysis and measure success in terms of new revenue to the business. Another metric can be the number of innovation opportunities/projects identified themselves. Lastly, looking at the number of projects you walk away from as a result of not pegging to a long-term megatrend may also indicate savings.
Watch the Megatrend Analysis and its Impact on Innovation here.