Do you remember the Jetsons? Houses are suspended in the air by massive supports, George Jetson drives an aero car, works three hours a day, three days a week at Jupiter Gears, and his family vacation to Venus. Are we getting closer to that reality?
We still can’t predict what the world may look like in 2062, but we have an idea of what the next year may hold for people and businesses. Will 2023 be remembered as the year of cost of living crisis and recession? Or will it be a year of resilience and turning the corner after Covid?
As we discussed in our Sussex Pioneers episode about trends, predicting the future is not like having a crystal ball. You have to keep your eyes and ears wide open to take in what is happening around the world at government level, in industry, activist movements, media and new technologies. It seems complicated to stay afloat in a world that changes every morning, but here are ten of the experts’ best guesses about what will happen next.
- The Ukrainian war: It still seems incredible to talk about turf wars this year. The eyes of the world are on Ukraine, and the reason is straightforward: energy prices, inflation, interest rates, economic growth and food security all depend on how the conflict unfolds in the coming months. Amid these geopolitical changes, alliances are responding. NATO, revitalized by the Ukraine war, will welcome two new members.
- Recession and inflation: According to The Economist, major economies will enter recession as central banks raise interest rates to quell inflation, an ongoing side effect of the pandemic and high energy prices. Experts say that the recession in the United States and Latin America will be relatively mild compared to that in Europe. However, the pain will be global since the dollar’s strength hurts emerging countries that have already been affected by the rise of food prices.
- Post-covid recovery?: A year ago, we predicted growth for athleisure, casual and comfortable fashion as people embraced a permanent hybrid work life. Tourism was also beginning to rebound with borders opening up again. However, not all of us can afford to take that dream trip, and the reason is very simple: inflation. Traveller spending is set to return to its 2019 level of $1.4 trillion, but only because inflation has pushed prices up. The actual number of international tourist trips, at 1.6 billion, will remain below the pre-pandemic level of 1.8 billion in 2019. Business travel will also remain weak as companies cut costs.
- Changing social media: A recurring question at our events is how to sell more through social media. Should we give up on Twitter? Do we need a TikTok account? Unfortunately, dear reader, the answer to any of these questions is usually “yes and no”, but here are a few insights from the experts:
- In its 2023 Big Ideas report, leading voices on LinkedIn predicted that technologies like artificial intelligence and Web3 would thrive. The prediction is already coming true as AI art and writing goes viral on social media and Web3 continues to influence the fashion and finance industries. The report also predicts that sustainable business will continue to be a hot topic for customers and investors, while physical retail and ecommerce are beginning to reach an equilibrium as developers renovate and reinvent existing bricks-and-mortar outlets.
- TikTok published its 2023 trends report in December 2022. It suggests that companies should continue to use content creators to build their brands, but keep on the lookout for creators who buy and share their products without brand deals, because these can lead to more genuine and lucrative partnerships. For example, #Mustahaves had 5.7 billion views and 284% YoY growth in 2022, while #TikTokMadeMeBuyIt had 31.8 billion views and 382% YoY growth in 2022.
- Travelling local: Public transport strikes permitting, trains will make a big comeback in 2023 as more people search for sustainable alternatives to car and plane travel. When it comes to attractions in the city, people are opting for experiential appointments like going to bookstores, aquariums, picnic spots and museums.
- Side jobs and new income: ‘Side hustles’ have been a valuable lifeline for many since the pandemic began, as workers sought additional income, were laid off or left their unfulfilling jobs, or finally had the time and flexibility to work on something they were passionate about. “About 25% of Gen Z have a side job,” according to a recent McKinsey survey, compared to 16% of all other ages, adding that young people were looking for additional money, identities and hobbies outside of the workplace and the 9 to 5 job. All this means that employers will have to work harder to recruit and win the loyalty of younger team members.
- Maintaining self-care: The rapid growth of wellbeing awareness in all its forms, from mental health to fitness, public health and work-life balance, shows no sign of abating. TikTok suggests that products and services in the health and wellbeing space will continue to sell strongly, and brands should aim to emphasise humour and positivity in their marketing.
- Sustainability as a “must”: Is sustainability still just a “nice to have”? It’s important to remember that sustainability is about much more than environmental issues; it also involves diversity, inclusion, ethical and fair work, human rights and more. More than half of SMEs invested in sustainability in 2022 and plan to do more next year. One of the most significant incentives is consumer behaviour change. Deloitte reports that consumers are increasingly driven by concerns about the climate crisis and income inequality. They are also choosing brands that share their values and discarding those that do not, especially regarding the most frequently purchased products such as food, beverages, clothing, and home and beauty products. However, affordability remains a barrier for many in the face of rising living costs, and presents a great opportunity for small businesses.
- Green supply chains: Connected with the previous trend, suppliers and distributors are expected to help clients meet their sustainability objectives. As the world moves towards net zero, brands are increasingly looking to green their supply chains—82% of FTSE 100 companies in the UK target net zero emissions by 2050. Demonstrating your credentials as a sustainable company will put you in a better position to be chosen as a green supplier or partner. Plus, many bigger brands are starting to incentivise and support their suppliers to become more sustainable, so you may not have to go it alone.
- Deeper digital transformation: We all know well that the pandemic accelerated the digitization of small businesses. Research by Sage found that 8 out of 10 SMEs now need digital tools to start, survive and grow their business across all sectors and parts of the UK. However, there are a number of barriers to further technology adoption, including a need for more time, expertise, and money to invest. Globally, digital trends for 2023 include more accessible and affordable artificial intelligence (AI) solutions, an enhanced Internet of Things (IoT), sustainable technology, including greener data centres, and a more immersive digital world. Social commerce, e-commerce and subscription commerce are expected to grow. Many payment trends are also here to stay, including frictionless payment methods such as digital wallets, in-app payments, and Buy Now Pay Later (BNPL).
What’s Next? What do I do with all this information?
The above trends are opening up new opportunities for small business owners, from new industries to growing sectors and changing behaviours in established sectors. Before it closes next month, check out the government’s Help to Grow: Digital programme, which provides free, unbiased advice and a £5,000 discount to invest in productivity-enhancing software, including e-commerce, customer relationship management and accounting software.
Digging deeper into small business trends and using data will help you identify potential gaps in the market. Search engine data can help you find the products and services customers are looking for, and spot challenges that your business could help solve. Customer feedback data is a gold mine of information that enables you to improve your marketing, products and services and identify emerging trends. This information is invaluable, regardless of the industry in which you operate. 2023 will be challenging but also full of opportunities for small businesses with the agility to respond quickly to changing trends.
2023 will be another year of rapid change, but at Sussex Innovation, we can help you find the key macro and micro trends in your business. Let’s have a chat in out centres in Falmer and Croydon to discuss your challenges and opportunities!