This month Co-Founder, Rachel Clarke, assesses the three stand-out macro trends for 2023.

In The House

Innovations and initiatives from Strat House clients and partners.

• Unilever helping women farmers to grow pineapples and their incomes
• Adidas takes on Samsung’s controversial ‘Night Owls’ ad in women’s safety campaign
• Unilever Study Reveals Influence of Influencers in Sustainable Behavior Change
• Dove are standing up for #KidsOnlineSafety
• Gong cha named best food & drink franchise at the 2023 Global Franchise Awards
• Find out why LinkedIn And Dove Are In It Together To Help End Hair Discrimination

Changing world, changing tech, changing people.

The first month of the year. A time for assessing current positions and making ambitions (we think this is a far more positive framing than resolutions).  We’re also reading trends decks; from the future of work to the future of retail and many around how culture and behaviours are shaking out in a post-COVID world that is tackling concerns around wars, global supply issues and economic slowdowns. We’re working our way through over a 100 collections of thinking 😀. Across these many different viewpoints, there are three macro trends that stand out.

1. Changing world

VUCA!  Or rather Volatility, Uncertainty, Complexity and Ambiguity. Unlike FUD, which is more generally applied to the use of misinformation, this is associated with strategic leadership and its application in organisations. It’s everywhere.  The Collins Dictionary declared “permacrisis” its word of 2022 i.e. an extended period of instability and insecurity. The headlines talk about rising food prices, energy prices and supply chain issues all leading to a mix of inflation and stagnation. But dig deeper into some of the financial reports and the news could be a little brighter – or darker.  The one thing that is clear is that the “experts” across various markets disagree on the outlook – VUCA indeed.  Morgan Stanley, ING and Natwest think it will be a mixed year, painful in the short term, building for a better long-term, the WEF think it may have longer consequences.

So working with brands, what can we do?  A fascinating talk by Les Binet for the IPA gives us a recommended framework, based on previous times of turmoil:

• Reduce risk through research – and understand the long term brand impact as well as short term promotional profits
• Understand price pressures in your area
• Optimise your prices and promotions
• On media; tweak based on conditions, leverage max profit not ROI, take advantage of cheap media and increase share of voice if possible
• Use the irrational power of creativity to make your budgets go further.

The VUCA environment will lead to some drastic changes. Those who have been here before recommend holding course and maintaining brand investment at the same time as being responsive to changing consumer needs – a time for smarter spending.

2. Changing Tech

We’ve talked about the metaverse previously, how the rapid changes will impact consumer expectations about where and how they will interact with the brand. Now some of the hype is dissipating, you can start to see some of the longer term impacts potentially emerging.  Internally, the explosion of AI tools, for text and graphics, will shift content creation further away from a manual process to more automation.  If you have to create 1,000s of ecom images and product descriptions + translations, then automating this process makes sense.  On the consumer-facing side, we have new platforms and tools that allow far more connection. On the one hand there is a push away from the mass platforms where trust is declining to more specialist ones, especially for passion-led communities and on the other we have a whole new set of tools available as the underlying tech changes.  NFTs are moving away from an investment hype to something that can add value to consumer and brand: tokenized access that can adapt both offers and means of engagement.

Changing tech approaches mean consumers are now expecting more – looking to brands to adapt to their needs, whether that be in offers, experiences or platforms. Adapting and maintaining access throughout requires focus.

3. Changing People

The post-COVID behaviours are still here: the rapid pace of change across consumer expectations continues. There’s some reversion to previous behaviours driven by the wider context, but overall, it’s pushing people to new places.  With all of this in mind, Accenture has expanded its traditional reaction model about overall drivers for consumer behaviour:

• Fight: People are starting to push back. Whether it’s climate change, social restrictions or lack of funding, there’s a reaction against things that are perceived as behind the chaos.  As a brand, it could be too easy to get caught up in this and be seen as part of the problem. Wouldn’t you rather be part of a solution? 
• Flight: Alternatively, they’re running away from things that are uncomfortable – whether that is social platforms, jobs or brands.  This is a move away from the establishment, looking for something that is different and more in tune with what they want
• Freeze: Others are quitting or enduring, they’re not changing things, just stopping trying things, stopping exploring
• Focus: The final reaction is all about focusing on what can be controlled, ensuring they are not caught up  in the new or different. For brands, this may mean they move away from mass platforms, from large scale media to niche areas where they may have a say.

So as a brand, you need a final F – Flexibility! These behavioural changes are rapid and a brand can be caught out. We recommend constantly monitoring your audiences to understand the short and longer term behavioural changes that could impact you and your plan to meet the challenges of 2023.