5 CONSUMER TRENDS FOR 2016

SO MANY ‘FOR 2016’ LISTS. SO LITTLE TIME.

We get it. But here’s why our 5 trends for 2016 are different.

First, they don’t cover the big economic, social and technological trends that are ahead. After all, The Economist is already a thing.

Instead, we’re all about consumer trends. Regular readers will know that trends emerge as innovators address consumers’ basic needs and wants in novel ways.

As trend watchers, that’s why we look for clusters of innovations which are defining (and redefining) customer expectations. These innovations – and the trends they represent – show what consumers will want next, and present you with actionable innovation opportunities in 2016.

But readers who are serious about understanding the direction of consumerism across multiple dimensions will have already spotted that these trends don’t sit in splendid isolation. They are a handful of near-future fragments of the Bigger Picture – more on how to handle that below. But each one is also a killer opportunity to take to your team right now.

Read, think, argue. Then get going, and make a start on new products, services and campaigns that consumers will love in 2016!

part I
5 Consumer Trends for 2016

status tests
Contextual Omnipresence
Insider
trading
Beneficial intelligence
Perspective
shifts

Status Tests

Only the worthy will be served.

Parent mega-trend: status seekers — The relentless, often subconscious, yet ever-present force that underpins almost all consumer behaviour.

Consider the endless search for status, and you‘re on the path that leads to the heart of consumer behavior. Because in affluent consumer societies, status is the No.1 motivator driving much of what people do (whether they acknowledge it or not;) So what‘s next for status?
In 2016, consumers will embrace a new twist on a traditional form of cachet: exclusivity. That means STATUS TESTS that force them to actively prove their worth to the brands they want to buy from.Yep, consumers proving themselves to brands. We all know that many have shifted their status fixation away from ownership and towards experiences (so far, so 1998…). But when ice-cream can be delivered on demand by a taxi company, it‘s clear that the doors to the experience economy have been flung wide open. And there’s little status in anything that comes easily.

Meanwhile, experienced and savvy consumers have become more comfortable with the idea of brand-led demands that ultimately serve customers‘ best interests. And STATUS TEST do just that, by allowing consumers the chance to prove skills, creativity, good taste, [insert status marker of choice here]. And, what‘s more, to join a gated community of others who’ve done the same.

Ready to devise your own STATUS TEST? See how these brands did it.

Real world examples of
Status
Tests

Lee Jeans: WeChat users who brave the cold and explore Chinese cities earn Warmth Index points

Running a STATUS TEST can mean asking customers to undergo a trial to prove their commitment. In October 2015, Lee Jeans launched a campaign across 32 cities in China to promote a range of heat-retaining denim. Consumers were encouraged to get outside (even in the cold) and explore their cities while tracking their movements with the Warmth Tracker WeChat app. Warmth Index points were accumulated when users scanned QR codes at scattered locations. By collecting points, users could earn Magma Fusion denim products and access to exclusive events.
1930: Single Tinder user turns on old-school charm to access speakeasy bar

Exclusive access goes hand-in-hand with high-status physical spaces. One smart STATUS TEST? Find new, digital takes on that exclusivity. Milan‘s iconic speakeasy bar 1930 is typically only open to a select few who know who to ask. In May 2015, the bar turned to Tinder to recreate its strict door policy in the digital world. 1930 set up a Tinder profile of a girl from 1930, asking potential entrants to “court me like they used to in the old days”. The profile had 4,000 matches in the first week, with applicants asked  to “act like gentlemen” and pick up digital handkerchiefs. In what it described as the lowest conversion ever,  the bar eventually let one winner enter its premises.
Netflix: One-touch “Netflix and chill” button has to be made by user

The more stringent the TEST, the greater the STATUS. And difficult tests are a great way to bring a likeminded community together, around your brand. In September 2015, Netflix unveiled The Switch, a button that automatically switches on the TV, launches Netflix,  silences the phones, dims the lights and can even order takeout! The button was debuted at the NYC Maker Faire, and Netflix released a step-by-step online tutorial showing people how to make  their own, and a list of all the kit needed. Netflix recommended those hoping to make the button have “a solid understanding of electronics and programming”. The brand also encouraged makers to share their own product hacks and ideas online.

Parent mega-trend: status seekers — The relentless, often subconscious, yet ever-present force that underpins almost all consumer behaviour.

Three things to consider when you roll out your STATUS TEST in 2016:

Be fearless. Yes, asking customers to prove themselves to you is counter-intuitive. But the more stringent the test, the greater the status hit.

Think beyond traditional credentials and markers of brand loyalty. Who do your customers aspire to be? How can you set a STATUS TEST that lets them prove something meaningful?

For rising numbers, crowdfunding has normalized a mode of consumerism where people are not mere consumers, but a community of evangelists. Once you’ve set a STATUS TEST, those who pass are a ready-made, high-status community of like-minded (or like-skilled) peers. Foster it!

Parent mega-trend: status seekers — The relentless, often subconscious, yet ever-present force that underpins almost all consumer behaviour.

Contextual Omnipresence

Forget omnichannel.
Get ready for new channels and new contexts.

Parent mega-trend: helpfull — Be part of the solution, not the problem.

In 2016, you could be forgiven for thinking that a brand must be everywhere at once. After all, expectations around customer service now defy the laws of physics. Miss a customer’s moment of need, and you might not get another chance.

That’s why you’ve probably sat through multiple brainstorms around your (or your client‘s) omnichannel strategy debating “how will we use [insert latest hot new ephemeral geo-fenced live-streaming video social platform]?”

In the coming 12 months, average brands will keep pursuing that strategy. But these discussions are like having an “Internet of Things strategy”. They focus on the how rather than the why. They focus on technology possibilities, rather than putting customers’ needs and wants first.

Meanwhile, smart brands will focus on answering a more meaningful equation: innovative channels + nuanced contexts = right place + right time.

Real world examples of
Contextual Omnipresence

Hotel Banks & Pimkie: Guests can choose curated items from in-room “Mini Fashion Bar”

2015 saw new channels appear everywhere. Washing machines and other domestic appliances became retail channels via Amazon’s Dash Buttons. One other innovative new approach to distribution:

May 2015 saw Antwerp’s Hotel Banks unveil the Mini Fashion Bar: an initiative created in partnership with French fashion brand Pimkie. Rooms were stocked with a range of apparel and accessories, chosen according to the weather and activities in the local area. Guests could use clothes from the fashion bar and purchase items upon checkout. A dedicated fashion concierge could be contacted for additional sizes or different garments.
Telefónica Research: Bored mobile users engaged with timely content notifications

New contexts mean new opportunities. Just look at how knowing people’s locations has unlocked and transformed mobile commerce. Now, even newer and more sophisticated contexts are just around the corner. “Attention” is just one example:

In September 2015, Barcelona-based Telefónica Research published a report showing researchers are able to tell from a smartphone user’s mobile activity whether the user is bored with an 83% accuracy rate. Participants were then sent notifications recommending content on Buzzfeed. Those users that had been identified as being in a “bored” state were more likely to read the suggested content (unsurprisingly!).
Domino’s: Taking pizza orders in novel, ultra-convenient ways

When you consider an omnichannel strategy, you can learn a lot from Domino’s highly-regarded Pizza AnyWare initiative.

The pizza chain has continuously expanded the variety of ways that impatient and hungry pizza-lovers can place their orders. Customers can voice order using the Siri-like app Dom, by tweeting or texting the pizza emoji, and while driving home in a compatible Ford. After ordering, they can track their pizza’s arrival time via the Domino’s smartwatch app.

Parent mega-trend: helpfull — Be part of the solution, not the problem.

So, the next time someone suggests addressing your omnichannel strategy, use this trend to have a more productive conversation with them (we’ll leave it to you to decide if you want to tell them where they’re going wrong first ;)

Start by asking why customers might embrace you using a channel. Next, challenge whether existing channels really satisfy the deep needs and wants of your customers. Could you create any new ones? Finally, imagine entirely new contexts you could leverage (perhaps even those that customers aren’t yet consciously aware of).

Bring all those together and deliver CONTEXTUAL OMNIPRESENCE: being in the right place at the right time.

Parent mega-trend: helpfull — Be part of the solution, not the problem.

Insider trading

Internal culture.
Your next marketing initiative?

Parent mega-trend: better business — Why 'good' business will be good for business.

The epic quest for a more sustainable and ethical consumerism continues unabated. Yet consumers were (again) left sorely wanting in 2015: from Volkswagen’s emissions to FIFA’s corruption to Nestlé’s slave labour in Thailand to Yum! Brands’ tainted meat in China. Amid all this, it’s hard for brands to know where to turn. One suggestion for 2016:
turn inwards, and start by ensuring your internal culture is something to flaunt, rather than hide.

Why now? Consumers have long been concerned about purchasing goods produced by vulnerable workers in developing countries. Now, rising inequality and growing job insecurity in affluent countries means their empathy is expanding to white-collar workers, too. Who knew people cared so much about Amazon’s highly-paid developers, marketers and middle managers featured in the NYT’s controversial exposé?

So, take inspiration from the examples below, and in doing so allow customers to celebrate supporting your brand, as you support those who work for you.

Real world examples of
Insider
trading

GrabTaxi: Taxi app launches worker welfare fund for drivers in Thailand

While Uber continues to trigger social concerns and face legal challenges with regards to its treatment of “workers”, GrabTaxi (a taxi booking app which operates across South East Asia) expanded its GrabLife driver welfare program to Thailand in May 2015, after launching a similar fund in Singapore. The initiative sees the company deposit 14% of the THB 7 (USD 0.21) journey fee it receives into the GrabLife fund. Drivers who meet the quality and loyalty criteria are then eligible for life insurance, income protection and crisis support. Further benefits include English language lessons and educational scholarships.
REI: #OptOutside campaign closes stores and pays employees to take Black Friday off

In October 2015, REI announced that all of its 143 stores would be closed on Black Friday (the day after Thanksgiving), to allow staff and shoppers to spend the day outside. The outdoor apparel retailer’s 1,200 employees were still paid for a day’s work, and both staff and shoppers were invited to share their shopping-free time using the hashtag #OptOutside on social media. A co-op with more that 5.5 million members, REI’s profits topped USD 2 billion in 2014, with Black Friday in the top 10 of the retailer’s highest-grossing sales days.
Flipkart: Indian ecommerce giant offers employees adoption allowance

July 2015 saw Flipkart unveil a policy giving staff members adopting children a one-off allowance of INR 50,000 (USD 787). Employees of the Indian online retailer (often referred to as the “Amazon of India”) can use the fee towards any expenses occurring during the adoption process, such as legal or agency costs. According to government guidelines, the cost of the entire adoption process is RS 46,000.
Intel: CEO announces USD 300 million diversity fund

During his keynote at the 2015 Consumer Electronics Show, Intel CEO Brian Krzanich announced plans to greatly increase the diversity of the Intel workforce. Citing the pervasive lack of diversity in the tech industry, Krzanich said he wanted Intel to lead by example and pledged USD 300 million ensure its workforce would reach full representation of women and minorities by 2020.

Parent mega-trend: better business — Why 'good' business will be good for business.

Asking hard questions about your internal culture isn’t easy. For those needing a steer on which questions to ask, start by addressing common pain points in your industry:

REI used the retail industry’s focus on Black Friday to make a compelling point about its brand values. Intel is focusing on diversity, a big issue in the tech industry. GrabTaxi is differentiating itself by addressing drivers’ concerns about working in the gig economy.

But whichever questions you ask, consumers will expect the answers to be more than just lip service: note how all the companies in all the examples featured took concrete (and costly!) steps to support their initiatives. Which aspects of your internal culture would you splash on a billboard?

Parent mega-trend: better business — Why 'good' business will be good for business.

Beneficial intelligence

AI is about to destroy the world make life amazing.

Parent mega-trend: ubitech — The ever-greater pervasiveness of technology.

As long as the onslaught of technological change continues, we’ll keep shouting this mantra from the rooftops: stop viewing the world through the lens of technology, and start viewing technology through the lens of basic human needs and wants.

Put another way: all those tech trends you’re obsessed with are fine, but can you use them to deliver something people actually want?

In 2016, rising numbers of consumers will demand that brands use increasingly powerful and accessible artificial intelligence technologies to put truly smart products and services into their pockets, homes, inboxes, and more.

The underlying motivations that drive embrace of BENEFICIAL INTELLIGENCE are ancient. Save me time! Save me money! Make me a better person! Make everything easier!

But now that seemingly every big brand is trumpeting their AI efforts – Toyota announced a USD 1 billion investment in November 2015 – consumer expectation that AI should be deployed to make their lives better will rapidly increase, too. Meanwhile, even small developers are now able to leverage big AI resources. IBM’s Watson Developer Cloud lets developers access cognitive computing; it’s used by 77,000 developers globally.

Humans have limits. Their expectations do not. Maybe AI is the only hope you’ve got ;)

Real world examples of
Beneficial intelligence

Stockholmståg: Rail algorithm anticipates train delays hours before they occur

In September 2015, Swedish train operator Stockholmståg announced it had developed an algorithm that uses big data to anticipate train delays two hours in advance.

The Commuter Prognosis, developed by Swedish mathematician Wilhelm Landerholm, gives warning of anticipated delays and so allows traffic control to intervene and prevent  the ripple effects often caused by delays. Meanwhile, an app warns passengers of changes in departure times.
Google: Machine learning service automagically crafts email responses

Announced in November 2015, Smart Reply is a machine learning program from Google that automatically crafts individual email responses for Gmail users. Smart Reply scans email content and suggests three responses; users simply select their preferred option and press send. Over time, the program learns the user’s response habits, and tailors future suggestions to provide more natural communication. Smart Reply was initially available in Google’s Inbox app for Android and iOS users.
CogniToys: Smart toy uses machine learning to “evolve” with its child owner

Raising more than four times its original Kickstarter funding target in March 2015, CogniToys are internet-connected smart toys that evolve with their child owners. Priced from USD 99, the toys use artificial intelligence driven by IBM Watson (a machine learning system made famous when it won US game show Jeopardy), to understand spoken questions and give age-appropriate answers, and can interact with stories and tell jokes. In an only mildly-dystopian fashion, over time the toy’s personality will evolve based on its interactions with its child overlord.
Paribus: Email plugin protects shoppers by automatically filing price match claims

Raising USD 2.1 million in seed funding in October 2015, Paribus is an email plugin that automatically requests price match guarantee claims from a range of retailers. Dynamic pricing can make it hard for online shoppers to know if they’re getting the best price – Amazon makes over 80 million price changes per day – but retailers often offer price match guarantees. Paribus scans email purchase receipts from brands including Amazon, Walmart and Best Buy, and will automatically email the retailer when it detects a that a claim could be made. Paribus takes a 25% commission on savings and is on track to protect USD 100 million of purchases per year.

Parent mega-trend: ubitech — The ever-greater pervasiveness of technology.

You don’t have to be a tech giant to deliver some BENEFICIAL INTELLIGENCE (IBM’s Watson is being leveraged by CogniToys’ developers; Google, Facebook and Airbnb have recently all open sourced their machine learning libraries).

Indeed, here’s the real secret of applying this trend: you don’t even need true AI (though it is easier to leverage than ever). Rather, this trend is about serving the expectations that all of 2016’s AI hype will create. Serve those, and you’ll delight customers. That’s the real point of this, and every, consumer trend.

So if you’re low on funds, developers or time, simply ask: what are my customers trying to get done? How can I use some smart (!) digital tricks to hack a solution for them?

Parent mega-trend: ubitech — The ever-greater pervasiveness of technology.

Perspective
shifts

Same price. New perspective.

Parent mega-trend: pricing pandemonium — Pricing: more fluid and flexible than ever.

In 2016, the consumer arena is a hall of mirrors that renders a dizzying and fragmented view of value. But in a hall of mirrors, perceptions can be shifted.

One way? Playfully reposition your product or service in order to offer PERSPECTIVE SHIFTS that shock customers into a radically new appreciation of the value you’re offering.

Driving this trend are the new funding mechanisms and business models, digital innovations and new perceptions of value that have rendered pricing more fluid than ever. In 2015, they only accelerated – and became more visible. For just one glimpse of that, consider the music industry. Pay for music on Jay-Z’s Tidal platform? No way! Directly fund a musician on crowdfunding site Patreon? Sure – musician Amanda Palmer is now raising USD 36,000 a month direct from fans on the site.

The result? Consumers will be more open than ever to innovations that play with – and attempt to disrupt – their thinking around value. Just make it fun!

Real world examples of
Perspective
shifts

Transavia: Budget airline turns chip and candy packets into plane tickets

In April 2015, French budget airline Transavia reframed the value of their low-cost flights via a campaign that compared their ticket prices to casual spending decisions made in a grocery store. The airline created branded packets of chips, candy and cereal bars that doubled as tickets for a Transavia flight. The products were sold at participating Carrefour City shops, in Selecta vending machines at two Paris metro stations, and at an Mk2 cinema in Paris, and cost between EUR 30 and EUR 40. Customers who bought the products could use a code printed on the packet to secure a flight to Barcelona, Lisbon or Dublin.
Stockpile: Gift cards are shares in publicly traded companies

US-based startup Stockpile produces gift cards that reframe thinking around buying or gifting shares. The startup produces gift cards available to purchase at between USD 1 and 1000, which can be redeemed for shares or a fraction of a share in NYSE-traded companies. The giftcards are available to buy in leading retail chains including Lowe’s and Kmart. In October 2015, Stockpile received a USD 15 million funding round.
Dutch AIDS Foundation: Charity donations triggered by buying pills for “first world problems”

In July 2015, the Dutch AIDS Foundation ran a campaign that encouraged consumers to re-examine their own good fortune, and consider the good that their money can do for those less fortunate. The charity opened a pop-up store in Amsterdam selling “medication” for first world problems, including Snore Like A Fairy, Ability To See Unicorns, and Flowery Farts. The First World Problem Pills are 100% drug-free peppermints, and cost EUR 4.95. All proceeds from sales were donated to the AIDS Fond charity to provide HIV medication for those in need.
Greek Bailout Fund: Londoner crowdfunds “to save Greek economy”

June 2015 saw the launch of an attention-grabbing crowdfunding campaign to aid the Greek economy. A 29-year-old individual from the UK, Tom Feeney, started the Greek Bailout Fund on crowdfunding site Indiegogo, inviting people to contribute as little as EUR 3. While conceding that it was unlikely he’d hit his EUR 1.6 billion target, Feeney said the project aimed to give Europe’s 500 million citizens a new understanding of their combined financial power to help Greece. More than 100,000 backers pledged almost EUR 2 million; their money was refunded when the campaign “failed”.

Parent mega-trend: pricing pandemonium — Pricing: more fluid and flexible than ever.

Sure, this is a playful trend. But it’s made possible by epic shifts in expectation when it comes to value and pricing.

How can you reframe your product or service as something else altogether in order to offer a PERSPECTIVE SHIFT on the value you bring? One starter question: if you had to pick a product that’s the opposite of yours when it comes to value positioning, what would it be?

If chip packets (casual purchase, grab quickly, ephemeral) can be airline tickets (considered purchase, carefully researched, memorable)... anything goes!

Parent mega-trend: pricing pandemonium — Pricing: more fluid and flexible than ever.

Part 2
The Bigger Picture

i. The Trend Framework

16 mega-trends which provide structure and context when tracking innovation.

Too often, professional trend watchers imply they have an inherent gift that enables them to divine the future. Now, we don’t want to be the ones to spoil the party, but the five trends you’ve just read didn’t just emerge from a top-secret, caffeine-fueled brainstorming session.

Instead, they simply capture new and emerging directions of travel of certain, ‘bigger’ mega-trends that are shaping the consumer arena. We track these big, slow-moving currents in our Trend Framework, which you can glimpse below (and which clients of our Premium Service have full access to).

Having a robust and comprehensive Trend Framework allows us to assess the implications of the hundreds, if not thousands, of innovations we see on a daily basis and that we receive from our spotter network.

Indeed you’ll now understand how, while tracking innovation initiatives in frontier markets as part of our REMAPPED mega-trend*, identifying a cluster of innovations which disrupt customer expectations around the informal economy led us to the ORGANIZED MASS trend.

*Macro trends, mega-trends, micro trends, mini trends. We admit the world of trend classification is somewhat confused (and confusing!). The truth is, there is no definitive answer, and we’re not going to even try and claim one here. In the end it doesn’t matter, just as long as you’re all speaking the same language.

ii. Industry HeatMaps

Data-driven collective intelligence gives insights into what industries are focused on.

Okay, so now you buy into the concept of a Trend Framework as a tool to help navigate the changes in the consumer arena. But that just leaves you with another question: “which trends should I be focused on?”

The nature of our Premium Service offers us an unrivalled view into the collective intelligence of the 4,500+ professionals using our online trend platform. Our Industry HeatMaps aggregate data to show which mega-trends our users are focusing on, by industry. Which are the most important mega-trends to users in the Automotive industry? In the fashion industry? Retail?

The Industry HeatMaps answer these questions and, as a result, give unique and powerful insights into the direction of an industry while enabling you to see at-a-glance how your strategy and areas of focus compare to your peers. Use the demo of the tool below to check out how the “parent“ mega-trends of the five trends featured in this Trend Briefing rank across a variety of sectors.

However, true trend experts know that you can run with almost any trend, if you adapt it to cater to your customers’ future expectations. Indeed, disruptive innovations always appear unconventional at first. In other words, fearless innovators will find rich opportunities in even the “smallest“ mega-trends in these heatmaps.

Part 3
Next

Now:
Get going!

As always, we wrap up these annual Trend Briefings with a call to action...

While it‘s our job just to watch trends, ambitious business professionals should read these trends with only one thing in mind: how to apply these trends and create compelling new innovations that will delight your customers (and win new ones!).

We can help with that too!

Yes, customers have never been more demanding. Yes, there‘s never been more competition. Blah blah blah. None of this is going away in 2016 (or 2017, or 2018…). However, trends are the secret weapon that help you turn this overwhelm to your advantage. But you already knew that ;)

So, take our CONSUMER TREND CANVAS, a free one-page guide to analyzing and applying trends. Dive into its simple, practical, step-by-step process to creating innovations that are deeply grounded in what customers want, desire and expect. Then win.

5 CONSUMER TRENDS FOR 2016

SO MANY ‘FOR 2016’ LISTS. SO LITTLE TIME.

We get it. But here’s why our 5 trends for 2016 are different.

In this briefing

part I