Author: CAD Partners - CFO Oncall
Date Posted: January 12, 2012
12 Trends that Will Define Business in the “New Normal”
I recently read an insightful paper written by Paul Diamond of Vistage and distributed by The Executive Connection, an international leadership organization. Here’s a summary of this priceless advice for those who want to capitalise on current trends:
“Business as usual” is undergoing a transformation due to changing consumer tastes and economic pressures. Companies have to find new ways to appeal to consumers scarred by the economic crisis. Consumers spend less and save more; many are jobless, many lack trust in businesses, and many expect government to provide a high level of service.
Business operations are under other pressures, including constrained credit, economic uncertainty, threat of increased inflation, low dollar valuation in the US, excessive consolidation in many industries, the rapid pace of innovation, rising commodity prices and a constant pressure to do things better, faster and cheaper.
The good news is: business is reorganising and finding its way forward. To help ensure the future of business, we offer 12 trends that range from new consumer attitudes and emerging disruptive technologies to the latest marketing and business practices.
Think of these trends as opportunities you can seize to give customers more of what they want.
Consumer Trends
Trend 1: Short Termism
The financial crisis made people less trusting of large organisations. People buy based on immediate requirements. They understand that innovation outdates expensive technology. They have learned a ‘wait and see’ attitude.
Trend 2: Brand Aid
Companies are building brand loyalty by helping consumers navigate today’s complexities. E.g. American Express created openforum.com to help business owners find success.
Trend 3: Conscious Consumerism
With less money to spend people will look for aesthetics to durability, heritage to sustainability. Business will need to target products more to attitudinal and needs segments.
Trend 4: Simplification
Consumers suffer ‘choice fatigue’ and will seek edited choice in future. Multi use products such as a single device that can perform many tasks will reduce luggage and cost.
Trend 5: Mobile Purchasing
Mobile phones are becoming virtual credit cards and mobile processing terminals. Customers can swipe their phone to purchase and business can buy a small card reader that hooks to your hand-held device.
Trend 6: Emotional Branding
Brands with strong emotional content will command the highest prices. Businesses who develop a strong relationship and understanding of customers will win. The most common failure of a brand to resonate emotionally, is when customers perceive indifference.
Trend 7: Reputation Management
You’ll have to keep your online reputation in good standing if you want to be trusted or have influence online.
To do this you need to
· Know what’s being said about you online
· Participate in social media so you can reply
· Ask those who like you to recommend you on online sites
· Don’t do anything online you wouldn’t want people to find out about – because they will!
Trend 8: Behavioural Segmentation
Segmenting customers by demographics will become antiquated. You can create profiles by what customers do on your website so you can predict what offers and content they may respond to and increase your sales conversion.
Business Operation Trends
Trend 9: Green, The Second Act
A carbon footprint will be on the business balance sheet in future. Carbon auditing will be performed on companies so they can prove their carbon credentials. You should get a lifecycle impact audit done on products. Start reducing environmental impact and advertise what you’re doing to give yourself a competitive advantage in future.
Trend 10: Collective Intelligence
Distil the wisdom of the crowd; quickly, cost effectively and get solutions for business issues. Crowdsourcing and Freelancers on demand, are a couple of examples. You can broadcast a request for help online and offer a prize as payment for people’s time.
Trend 11: Evolution of Traditional Sales Models
Sales models are being disrupted by robust websites, social media and online reviews.
It’s about ‘pull’ marketing rather than ‘push’ selling. Some elements required to ‘pull in’ customers are:
A robust website detailing information about your offerings.
Easy purchase of products or services online
Real (and honest) reviews posted on third-party sites by customers
Targeted ads pointing to your website
A website optimised for search terms
New initiation points for big purchases occur in places like Linkedin groups and industry-focused user groups. When people look for solutions they get recommendations from peers, read online reviews and view videos, then they go to a company’s website.
To create trust in the marketplace, take the following steps:
Capture your fan base on video and put in on your website
Build credentials by publishing articles, blogging and speaking
Affiliate your business with thought leaders. Sponsor their talks, publish their white papers, and invite them onto your board of directors or advisors.
Get certifications and credentials in your industry.
Trend 12: Constant Business Pressure
It’s all about ‘better, faster and cheaper’. Operating during the recession has required tight controls and creative business models going forward. It’s vital to have better cash-flow control and manage the balance sheet.
To offset slower growth in traditional business lines, companies should look for opportunities in industries and sectors that have revenue growth potential.
Adapted from an article by Paul Diamond for The Executive Connection (TEC), a peer-to-peer mentoring organisation for Australia’s chief executives. For more information, visit www.tec.com.au
CAD Partners CFO On-Call is a team of financial and business advisors who work with open minded people committed to business growth and achieving success. For help call us on 1300 36 24 36 or visit our website www.CFOonCall.com.au
