What you sell, who you sell to and how you sell it is being disrupted by these megatrends.
Five demographic megatrends are now driving business success. What you sell, who you sell to and how you sell it is being disrupted by these megatrends. Companies like Apple and Netflix that align with these megatrends are realizing explosive customer growth.
Companies like McDonalds and your local cable company are struggling with these demographic mega-shift and their ability to retain customers. Here are the five demographic megatrends that are driving 21st Century business success:
1. Multicultural Consumers.
Today there are 120 million multi-cultural consumers. They represent almost 40% of all U.S. consumers. This trend will accelerate. By 2044 it is estimated that the majority of consumers will be multicultural. Today’s multi-cultural consumer is younger than the average consumer. They are trendsetters in a number of product areas including food, fashion and entertainment.
Media savvy, they rely heavily on smart phones and their social network in making a purchase. They are a key demographic group for new family formations. No business can ignore this customer segment and expect to achieve sustained revenue growth.
2. Millennial Generation.
In 2015 this generation passed the Baby Boomer Generation in terms of employment. By 2017 they will exceed the Baby Boomer Generation in annual buying power. The Millennial Generation is also the most diverse generation in America’s history as well as the most educated. They demand product and company authenticity.
This authenticity is gained not by what a company says but by what their customers and work associates say about them and their products. The key to truly engaging a millennial generation customer is to offer them a product that is cool with a purpose. Patagonia and TOMS (formerly Tom’s Shoes) are companies that the Millennial Generation align with in terms of being cool with a purpose.
3. Diverse Families.
The days of Ozzie and Harriet symbolizing the American family are over. What defines a family is being redefined. One major change is that single women now lead 40% of households. On the one hand women control almost 80% of household spending. On the other hand single parent households have the largest percentage of kids living in poverty. LGBT families are growing and today have almost a trillion dollars in annual spending power.
Another major change is the increase in multi-generational households with more Millennial Generation children living with their parents as they struggle with school debt and starting their careers during the Great Recession. There is also the beginning of a potential megatrend where aging Baby Boomer Generation parents move in with their children.
4. Connected and distracted consumer.
The American consumer has never been more connected and distracted. We are on information overload. Multi-tasking is the norm. Connectivity is now a necessity and for the Millennial Generation connectivity can be more important than owning a car. The connected but distracted customer is a marketing challenge facing every business.
The path to gaining the consumer’s attention now requires strong social media engagement. This engagement is increasingly be sourced through smart phones. Conversion is the new sales path for selling products.
Next- Mega-trend #5 and Your Bottom Line