Drivers
1
The function of drivers
Drivers provide the evidence base
from which the trends are built. They
ensure that our hypotheses about
future change are grounded in
evidence of change that is going on
in the present.
The drivers are split into five
themes that together, provide a
holistic view of what is driving
change in the world and in people’s
lives.
Evidence has been drawn from a
variety of data sources in the
public domain as well as The Futures
Company’s own proprietary research.
2
Detailing a trend
Sub-trend
Driver
Driver
Driver
The forces and
energies shaping the
trend
Sustained change
in consumer
attitudes, needs,
wants and
behaviours
Sub-trend
Sub-trend
Ways in which the
trends are playing out
in today‟s world
3
Many drivers are shaping consumers‟ lives
Theme
Specific drivers
FEAR &
ANXIETY
•
•
•
•
Continuing economic uncertainty
Declining trust in governments and big business
Scientific advances
Growing impact of resource shortages
CHANGING
LIFESTYLES
•
•
•
•
•
Increasing life expectancy
Changing working patterns
Increasing mobility
Rising prevalence of lifestyle diseases
Growing pressure on health care resources
EVOLVING
ASPIRATIONS
•
•
Growing knowledge of the world‟s opportunities
Rising consumer curiosity and desire for transparency
•
•
•
•
Proliferation of new media and telecommunications technology and
devices
Growing awareness of environmental and social issues
Increasing availability of information
Increasing availability of health information
•
•
Growing market competition and choice
Resurgence of localism
GROWING
KNOWLEDGE &
INFORMATION
DYNAMIC
MARKETS
4
How the drivers map onto the trends
Fluid Lives
Simple
Pleasures
Responsible
Living
Quest for
Health &
Wellness
Consumers
in Control
Keeping it
Real
Continuing economic
uncertainty
Declining trust in
governments and big
business
Scientific advances
Growing impact of resource
shortages
Increasing life expectancy
Changing working patterns
Increasing mobility
Rising prevalence of lifestyle
diseases
Growing pressure on health
care resources
5
How the drivers map onto the trends
Fluid Lives
Simple
Pleasures
Responsible
Living
Quest for
Health &
Wellness
Consumers
in Control
Keeping it
Real
Growing knowledge of the
world’s opportunities
Rising consumer curiosity and
desire for transparency
Proliferation of new media
and telecommunications
technology and devices
Growing awareness of
environmental and social
issues
Increasing availability of
information
Increasing availability of
health information
Growing market competition
and choice
Resurgence of localism
6
FEAR AND ANXIETY
7
Continuing economic uncertainty
It is clear that economic uncertainty, high unemployment and austerity are here to stay.
Developed markets are the worst affected but the troubles of the Eurozone could impact
growth in emerging economies.
The Global Economy
The European Commission forecasts a mere 0.5%
growth in the Eurozone for 2012 with several
countries facing recessionary risks. As European
economies struggle to pick up, a prolonged period
of slow growth and sluggish job creation is
increasingly likely in the region.
The US economy shows signs of recovery, with
household debt decreasing, however, this is
happening at a slow pace.
The largest emerging economies also experienced
a slight slowdown in late 2011, mainly driven by
government response to inflationary pressures.
Although they continue to perform well, troubles
in the Eurozone threaten output in markets such
as China, India and Brazil.
Source: IMF Regional Economic Outlook-Europe 2011, The
Financial Times 2011, World Bank World Economic Prospects
2012
Irish economy remains depressed
The Irish economy shrunk in late 2011, mainly as
a result of weak domestic demand. Consumers
increasingly feel the impact of the austerity
measures that were introduced with Ireland’s
2010 bailout package. Ireland faces one of the
highest youth unemployment rates in Europe,
reaching nearly 30%. However, the finance
ministry expects 1.3% growth for 2012, mostly
driven by exports.
Source: The Wall Street Journal, The Economist 2011
Squeezed disposable incomes in the UK
According to the Bank of England disposable
incomes have fallen for the fifth year in a row as
a result of pay freezes, government cuts and
inflation. Squeezes on consumer demand have led
to a slower overall recovery. In April 2012 the UK
economy fell back into recession, and the impact
of the Eurozone crisis remains a threat.
Source: The Economist, BBC News 2012
8
Declining trust in governments and big business
Ongoing economic difficulties and the failure of leaders to address them effectively have
further eroded people‟s trust in government and big business. Equally, people are increasingly
suspicious about the motivations behind the corporate social responsibility efforts of
companies.
Growing distrust in corporations and
governments, UK & Ireland
Consumers are losing their trust in corporations
and governments in most regions of the world. In
the UK, people increasingly distrust both
businesses and the government, with 62%
reporting distrust in both (up from 56% and 57%
respectively in 2011). In Ireland trust in
businesses has also declined with 57% of people
not trusting corporations.
Source: Edelman Trust Barometer 2012
People protest corporate influence on
politics, Global
2011 has seen the rise of protest movements
around the world, including the Occupy
movement. Protesters around the world called
attention to corporate influence on politics, which
they see as an important factor behind rising
inequality and government failure to serve the
interests of citizens.
Source: Reuters 2012
People increasingly feel let down by
institutions, UK
75% of UK consumers have less trust in banks
and feel that banks serve their own interests and
not the interests of their customers. 68% are not
confident that the current government can bring
about an improvement in the economy.
Source: The Futures Company, Feeling the Pinch Survey
2012. Base size: n=1000.
“Most companies only make claims about their socially
responsible efforts to try to sell me more of their
products”
(% Agree)
100
90
77
80
70
66
62
70
52
60
50
40
30
20
10
0
Ireland
UK
Western
USA
BRIC
Europe
Source: Global MONITOR. See appendix for base sizes
9
Scientific advances
Scientific advances continue to reshape our understanding of health, wellness and nutrition.
Consumer skepticism around technologies, such as genetic modification remain high.
Concerns over GMO products continue,
Europe
Europeans continue to be wary of GMO foods, with
95% of European respondents rating them as
potentially unsafe and lacking real benefits,
according to the European Commission. Nearly
60% also believe GMOs are a threat to their
health and their families.
Personalised nutrition gaining momentum,
Global
With the development of nutrigenomics it will be
soon possible to track how individual genetic
make up responds differently to specific
nutrients. This will allow the creation of
personalised diets that ensure better health
outcomes for individuals.
The first ever European Union Citizen’s Initiative,
attracting over 1 million signatures in 2010 called
the European Commission to put a moratorium on
the introduction of GM crops into the EU. Currently
France, Luxembourg, Germany, Austria, Hungary,
Bulgaria and Greece block the use of GMOs.
In order to explore the applicability of
personalised nutrition, the European Union has
launched the Food4Me project, which over the
course of the next four years will investigate
consumer attitudes towards personalised nutrition
and the production and implementation of
nutrigenomic technologies.
Source: The Independent, Euractiv 2011
Source: Science Daily 2011
10
Growing impact of resource shortages
Awareness of the global shortage of key resources such as water, oil and food has increased
rapidly. People are becoming more aware of the impact of their consumption on natural
resources and are being impacted by higher food prices as a result of increasing demand and
environmental factors.
The rising impact of biofuels on resources,
Global
Biofuel production is on the rise as a result of
projections about declining oil reserves. The
International Energy Agency estimates that in
2012 biofuel output will average the equivalent of
2m barrels a day, which is above Libya’s of 1.6m
b/d before the recent civil war.
It is estimated that by 2030 around 20% of EU
and U.S. transport will be fuelled by biofuel. The
increasing use of arable land for biofuel production
is likely to exacerbate water shortages and
deforestation and put pressure on food production.
Source: Reuters 2011
Rising food prices, Global
Food prices have risen by 45 percent since the
end of 2006, with sharp spikes in 2008 and 2011.
This has been driven by higher demand from fast
growing economies like China and India, high oil
prices raising the cost of inputs, less available
land as a result of biofuel production and
environmental factors, such as droughts in key
grain growing areas.
Source: IMF 2012
Increasing water shortages, Global
Around 700 million people in 43 countries already
suffer from water scarcity. By 2030, nearly 50%
of the world’s population will be living in areas
with high water stress, including both developed
and developing regions such as India and China.
Water shortage leads to further degradation of
arable land putting pressure on food production
globally.
Source: United Nations Water for Life Decade
11
CHANGING LIFESTYLES
12
Increasing life expectancy
Improvements in health care and nutrition continue to drive life expectancy upwards. As
populations age, older people remain healthier and active for longer and are calling for
products and services to better cater to their needs.
Ageing populations, Global
From 2000 until 2050, the world's population aged
60 and over will more than triple from 600 million
to 2 billion. Most of this increase is occurring in
less developed countries, where the number of
older people will rise from 400 million in 2000 to
1.7 billion by 2050. Population ageing trends are
also starting to affect key emerging markets, such
as China and Brazil.
Source: WHO 2011
Rising state pension age, UK
The UK government introduced new pension
legislation in 2011, setting a roadmap for gradual
increases in the state pension age over coming
years. Women’s state pension age will increase to
65 from April 2016. From December 2018 the
state pension age for both men and women will
increase to 66. The current law already provides
for the state pension age to increase to 67
between 2034 and 2036 and 68 between 2044
and 2046.
Source: Directgov 2012
The promotion of active ageing, Europe
2012 has been designated the Year of Active
Ageing by the European Commission, showcasing
the policy interest in encouraging late retirement
and promoting active lifestyles that keep costly
lifestyle diseases at bay.
Source: European Commission 2012
Marketing focus likely to change in coming
years, Global
As older consumers achieve increasing economic
importance in the coming years, marketers are
likely to step up efforts to target this group more
effectively both in terms of product development
and communications. In the UK, age specific
marketing has to appeal to both men and
women, as at 4.1 years, the UK has the smallest
gap between male and female life expectancy in
the European Union
Source: Marketing Week, Office for National Statistics 2011
13
Changing working patterns
Increasing numbers of workers are moving away from the 9-5 Monday-to-Friday working
model and adapting more flexible working patterns. The number of self-employed workers and
freelancers is also growing as a way out of unemployment and underemployment.
The rise in self-employment, UK
In the 12 months to October 2011 a record 4.1
million people registered as self-employed in the
UK. According to Labour Force Survey figures this
peak in self-employment represents a 4% increase
since 2010 and is the highest since records began.
About 37% of these start-ups are run by women.
This marked rise in entrepreneurial activity is
primarily driven by the lack of jobs and is often a
shift from unemployment to self-employment.
Growing unemployment rates for women,
UK
Unemployment among women in the UK is at its
highest level for more than two decades and is
expected to rise further as a result of job losses
in the public sector and retail. The high cost of
childcare puts further pressure on women to stay
at home, contributing to a lower than OECD
average female employment rate in the UK.
Source: The Guardian 2011
Source: Freelance UK 2012
More people working from home, UK
Home-working trends continue in the UK where in
2010 1.3 million people worked from home and
3.7m employees reported working sometimes
from home. During the London Olympics many
companies will encourage their employees to
work from home to avoid congested
transportation, which may lead to the further
consolidation of flexible working patterns.
Source: BBC News 2011
14
Increasing mobility
Commuting times continue to be long in many parts of the world. The increasing use of
smartphones enables people to complete work related tasks and find services on the go.
Using commuting time for work, UK
As commuting times continue to grow, people are
making use of digital devices to complete work
tasks on the go. A London based survey by the
Chartered Management Institute found that 23%
of managers use the internet for work during their
commute, 21 percent read work documents and
17 percent do work on laptops.
Source: Bizgene 2011
Location based apps and services, Global
The proliferation of smartphones has also driven
the increasing use of location based services.
Smart phone apps now enable people to find
services, such as restaurants, pharmacies or
cinemas while on the go. Retailers are also using
location based apps to attract consumers, for
example Debenhams and Starbucks offer
promotions to people who use their phones to
“check in” to their stores via Facebook.
Source: The Telegraph 2011
Rising interest in healthy on-the-go snacks,
Global
Working long and busy days in the recessionary
economy allows people less time for proper sitdown meals. This has created many opportunities
for the snacking category. With consumers looking
to maintain good health, there is a growing
interest in healthy and convenient snacks with the
adequate nutritional value to replace meals.
Source: Caterer 2011
15
Rising prevalence of lifestyle diseases
The incidence of lifestyle related diseases, such as diabetes and obesity are on the rise
globally. This is placing an increased burden on health care systems and individuals to take
more responsibility for managing their health.
Rise in obesity and alcohol related diseases,
UK
An estimated 60.8 per cent of adults and 31.1 per
cent of children are overweight in the UK, the
highest rate in Western Europe. As a result,
diabetes is rising, especially among overweight
older people - there are 1.7 million people aged
60-79 with diabetes in the UK and 1.1 million
aged 40-59.
Increasing burden of lifestyle diseases,
Global
Lifestyle related diseases are now globally the
leading cause of death. 63% of all global deaths
are due to non-communicable diseases, such as
heart disease, diabetes and cancers, many of
which are influenced by lifestyle factors. Each
year 9 million people die from NCDs before the
age of 60.
Source: WHO 2011
In 2010 the number of deaths from liver disease
in England rose above the Western European
average, largely as a result of high levels of
alcohol consumption.
Source: BBC Health, The Telegraph, International Diabetes
Federation 2011
Childhood obesity, UK & Ireland
Around 27% of children are estimated to be
overweight in the UK and 20% in Ireland. As a
result of squeezed disposable incomes, low
income children now also eat less fruit and
vegetables in the UK. In addition, government
cuts to youth sports programmes are also likely
to contribute to worsening obesity rates among
British children.
Source: BBC Health, The Irish Examiner, The Guardian
2012
16
Growing pressure on health care resources
Health care resources are coming under increasing pressure as governments battle with
austerity measures and the rising cost of treating burgeoning rates of lifestyle and age-related
diseases. This is prompting some people to take more personal responsibility for protecting
their health and preventing illness.
Public health care cuts, Ireland
As part of ongoing austerity measures public
health services face severe cuts in many parts of
Europe. The Irish government is looking to shave
€2.5bn from its €20bn annual public sector wage
bill to help the country meet the deficit reduction
targets of its bailout package. This strongly affects
the numbers of health care staff.
Source: The Financial Times 2012
Promotion of personal responsibility for
health, UK
As part of its mission to reduce health and social
care spending the UK government has been
placing increased emphasis on prevention and the
personal responsibility of citizens to safeguard
their health.
Fear and consequences of health care cuts,
UK
The UK government envisions large-scale reforms
to the NHS but this has not yet materialised.
Nevertheless, cost cutting measures already
include hospital bed closures, pressure to
prescribe cheaper, slower-acting drugs, cuts to
occupational health support and community
health services.
In a survey done by Doctors.net.uk, a
professional networking site to which almost all
British doctors belong, 79% of medics said that
cuts to staff and/or services affected patient care
in their department, area or surgery during the
last 12 months.
Source: The Guardian 2011
Source: UK Department of Health, 2010
17
EVOLVING ASPIRATIONS
18
Growing knowledge of the world‟s opportunities
The hunger for new experiences, increased connectivity, migration and international
exchanges over the internet all contribute to the global flow of cultural influences. For many
this brings greater opportunities to experience all the world has to offer.
The rising complexity of cultural flows,
Global
Cultural flows are becoming increasingly complex
and more multidirectional. The exposure of local
cultures to an array of influences creates hybrid
identities and cultures.
“I appreciate the influence that other cultures
have on our way of life in this country”
(% Agree)
100
90
80
63
70
56
60
50
40
30
20
10
0 Ireland
49 45
UK
52
46
Western
Europe
54
49
USA
52
Growing ethnic foods retail market, UK
Ethnic foods are becoming an increasingly
important revenue source for retailers. Mintel
predicts that by 2013 the market for ethnic foods
will reach £1.5 billion in the UK. Sales of ready
meals have declined, while the value of
accompaniments and sauces has risen,
suggesting that more and more people cook
foreign dishes at home and are willing to
experiment with flavours from other cultures.
Source: The Grocery Trader 2011
44
BRIC
Source: Global MONITOR. See appendix for base sizes
19
Rising consumer curiosity and desire for
transparency
Alongside the rise of distrust in businesses and governments, consumers are increasingly
demanding transparency about how businesses operate.
Increasing scrutiny of executive pay, Global
As people feel the effects of the financial crisis
public attention is turning to executive pay,
especially that of financial services companies
bailed out by public money.
Growing role of digital connections in
promoting transparency, Global
Increasing connectivity means more and more
people can access information about the activities
of companies and governments.
ING customers in the Netherlands used online
platforms to mobilise against the executive
bonuses of the company. Dutch consumers
threatened to collectively withdraw deposits in
protest against bonuses awarded to executives.
This fuelled a political storm over the possible
introduction of a 100% retrospective tax on all
bonuses paid to executives at institutions that
received state aid during the financial crisis in the
Netherlands.
Websites such as WikiLeaks demonstrates the
fact that information is increasingly available to
everyone. This can serve as a catalyst for large
scale social mobilization – such as the Arab
Spring - where disclosures about corrupt leaders
helped spur revolts.
Source: The Guardian 2011
Source: The Guardian 2011
20
GROWING KNOWLEDGE & INFORMATION
21
Proliferation of new media and
telecommunications technology and devices
Media and communications technology is becoming cheaper and more advanced. The growing
penetration of smartphones is reshaping the way people communicate and interact with
products, services and the spaces around them.
The proliferation of smartphones, Europe
Between 2010 and 2011 smartphone use in the
EU5 (France, Germany, Italy, Spain, UK) rose by
46%, reaching 91.4 million smartphone owners in
August 2011. It is estimated that 37% of Irish
adults own a smartphone and this figure is
projected to reach 50% by the end of 2012. In the
UK nearly one in 3 adults use a smartphone
according to OfCom estimates.
Source: New Media Trend Watch 2011, Independent 2012
The rise of mobile wallets, Global
Tech companies including Google are launching
mobile payment systems that enable consumers
to use their phones to make payments.
Companies such as Starbucks have also created
apps that help consumers locate stores where
they can pick up products they have paid for
through their phones.
Source: Wired Magazine 2011
Increasing mobile social network use,
Europe
In 2011 the audience for mobile social networking
in the EU5 region (France, Germany, Italy, Spain
and the United Kingdom) grew 44% with 55.1
million mobile users accessing social networking
sites or blogs via their mobile devices during
September 2011. 47% of these users access
social networks via their mobiles on a daily basis.
Source: ComScore 2011
22
Growing awareness of environmental and social
issues
Media exposure and the visibility of environmental degradation has led to rising awareness of
the social and environmental impacts of consumption. Operating in an ethical and
environmentally friendly way is becoming a cost of doing business as consumers increasingly
expect companies and brands to „do the right thing‟.
Growing expectation of responsibility, Global
Consumers increasingly expect companies to
operate responsibly. This is especially true in
developed markets where consumers regard the
way companies function with increasing distrust.
“Companies have a responsibility to help support the
society in which they operate”
(% Agree)
100
90
80
70
60
50
40
30
20
10
0
80 84
Ireland
71
UK
76
70 71
Western
Europe
69
74
USA
64 64
BRIC
Source: Global MONITOR. See appendix for base sizes
“I expect the companies whose products I buy to
take steps to avoid damaging the environment”
(% Agree)
100
90
80
70
60
50
40
30
20
10
0
89
Ireland
84
UK
84
Western
Europe
80
USA
72
BRIC
Source: Global MONITOR. See appendix for base sizes
Digital information flow raises awareness,
Global
The rise of social networks and increasing
connectivity enable people to rapidly raise
awareness about social and environmental issues.
As evinced by recent upheaval in the Middle East
and Russia, social networks are becoming essential
elements of protest movements around the world.
Source: New York Times 2011
23
Increasing availability of information
Increased connectivity through the internet and smart phones has led to growing access to
information. The rise of social media and peer to peer review sites is moving the centre of
gravity around sources of trusted information and advice away from businesses and towards
other consumers.
Smart phone apps strengthen consumer
control, Global
There is an increasing choice of smart phone apps
that allow users to scan product barcodes in order
to receive price-comparisons, user ratings and
product information on sustainability etc. Amazon
recently launched its own price comparison app,
offering a 5% discount to shoppers who made a
purchase using its Price Check app.
The increasing role of social media, Global
Social media is becoming increasingly important
for consumers to discover, research and share
information about products and brands.
Source: Mobile Commerce Daily 2011
Consumer-generated reviews and product ratings
are now the most preferred sources of
information among social media users.
Growing penetration of broadband internet,
Europe
Broadband internet is reaching a growing number
of households across Europe. In the UK broadband
subscription rates rose 7% between 2010-2011.
In Ireland there was a 6% increase in the same
period. Wireless connections are gradually
becoming dominant with 54.2 per 100 inhabitants
subscribing to wireless internet in Ireland and
44.4 per 100 inhabitants in the UK.
60% of US consumers who research products
through the internet report learning about brands
and retailers via social networking sites.
63% of social media users say consumer ratings
are their preferred source of information on
products and services against 50% using
company websites for their research.
Source: Nielsen 2011
Source: OECD Broadband Portal 2011
24
Increasing availability of health information
The rise of digital technology has empowered consumers to take more control over their health
by researching health and wellness information online and by monitoring their health through
easily accessible apps and devices.
The rise of self-diagnosis, Global
55% of UK and 68% of Irish consumers often look
on the internet to research an illness or injury
they have or might have. 42% of UK and 47% of
Irish consumers also prefer to do their own
research on an illness or condition rather than rely
solely on what healthcare professionals tell them.
The increased proliferation of health
monitoring apps, Global
As increased pressure is placed on individuals to
take care of their own health, monitoring devices
are gaining popularity. 55% of UK and 68% of
Irish consumers would like to be able to monitor
their own health more effectively.
A research project by the London School of
Economics found in 2011 that 68% of people
globally used the internet to research information
about specific medicines and nearly 40 % use it to
look for other patients' experiences of a condition.
Smart phone apps now enable users to monitor
their blood pressure or heart rates and send
these to a physician.
Source: Global MONITOR. See appendix for base sizes, Tech
Eye Base size= n=12,000
Apps also help people drink less, sleep better or
exercise more. Health monitoring apps enable a
constant flow of personalised health data,
however, strict European legislation on data
protection could be an obstacle to the
mainstreaming of these technologies.
Source: Global MONITOR. See appendix for base sizes,
Guardian 2012
25
DYNAMIC MARKETS
26
Growing market competition and choice
As the range of products and services available to consumers grows, the marketplace has
become increasingly competitive in a bid to win customers. Consumers now expect a huge
choice and variety of products and services and look for help in navigating all the options
available to them.
Discount supermarkets continue to perform
well, UK
As consumers confront food price inflation,
discount supermarkets are gaining increased
market share. Aldi and Lidl are enjoying a
resurgence in popularity and have achieved record
market shares in 2011. The largest grocers Tesco, Asda and Sainsburys - are all losing ground
to discounters and premium retailers such as
Waitrose.
Consumers continue to look to simplify their
lives, Global
With the abundance of choice and the intensity of
information flows, people are still interested in
looking for ways to simplify their lives.
“More and more, I find I am looking for ways to
simplify my life”
(% Agree)
Source: The Guardian 2011
Brands offer unlimited choice and selection
of flavour, Global
Coca-Cola recently launched its Freestyle vending
machines which offer consumers 125 different
drinks. Consumers can put together their own
drink and flavour combinations using the machine.
Some consumers are looking to create their own
inventions and are sharing them through social
networking.
Source: Marketing Week 2011
100
90
80
70
70
60
50
40
30
20
10
0 Ireland
60
UK
63
Western
Europe
66
USA
59
BRIC
Source: Global MONITOR. See appendix for base sizes
27
Resurgence of localism
Although consumers have more opportunities than ever to connect to cultures around the
world, there is an increasing interest in exploring and valuing local products and cultures
Interest in buying local produce, UK
76% of UK consumer now agree that buying local
or regional food supports jobs and boosts the
economy in troubled times. 60% of respondents
also say they want to buy British meat, poultry,
fish, milk, cream and bread products.
The appetite for regional food has overtaken
organic as the main food sustainability issue and
is driven by a combination of rising patriotism,
being green and the desire for self-sufficiency.
Retail chains are also responding to the interest in
provenance by sourcing products from their own
wholly-owned farms and by emphasising local
origins on food packaging.
Source: The Grocer 2011
Growing interest in British cuisine, UK
There is a growing interest in exploring long
undervalued British cuisine. Celebrity chefs such
as Jamie Oliver now dedicate cooking shows and
books to British food, tapping into the interest in
locally sourced and seasonal products.
Source: Channel 4, 2012
The importance of locally produced food,
Ireland
In 2011 60% of Irish consumers reported that it
is extremely/ very important for them to buy food
that is locally grown or produced. This represents
a 4 percentage point increase since 2010,
reflecting an interest in supporting the domestic
economy in difficult times.
Source: Global MONITOR. See appendix for base sizes
28