Tracey Follows explains how brands should begin preparing for an increasingly decentralised, virtual and identity focused world
I don’t do lists of trends on an annual basis. Mainly because it is better to monitor and analyse the implications of all kinds of trends all year round.
What follows therefore is a set of three interconnected trends that we will see ‘more’ of over the short to mid-term, and reasons why brands should take note.
First thing is to get some ‘situational analysis’: where are we? The world feels topsy-turvy at the moment, and everywhere we look there is potential for conflict and division.
This can in part be blamed on the global context; it is also thanks to new modes of business like digitisation, automation, networked societies and the decentralisation of authority. Plus, at the same time, a longing for control.
VUCA is a term that was coined by the military about 30 years ago, but has now found its way into boardrooms. It is a good way of thinking about the world we inhabit now.
V= volatility; U = uncertainty; C = complexity and A = ambiguity.
The world is Volatile because events (seem to) happen at lightening speed, and it is that speed that often catches business unaware. Often due to the number of players and the lack of formal decision making abilities, we are all feeling Uncertain.
Thanks to digitisation - fragmenting businesses - anything a brand tries to do is more Complex than before; and finally, Ambiguity: we will come back to this later, but essentially, because there is no longer one ‘authority’ whose word we can trust, many perspectives jostle for status and it becomes harder and harder to know the ‘truth’.
Within that context then, where are we heading, how will we cope?
Business, brands and organisations as well as communities want to feel closer to the levers of power.
If the world feels out of control, one wants to impose one’s will on it and be able to manage it ‘on the ground’ - so we’ll see more and more efforts to decentralise power and share it among the communities or networks that make things happen.
This does include blockchain, and of course there has been much said about that over the past 18 months. We will see it come to fruition in media trading as with any transactional area where people need to exchange units of value along a chain but want to cut some of the chain out.
That will be one of the ways to increase efficiencies and cut costs in the future - and don’t be surprised if at some point in the future Universal Credit gets put on the blockchain. Why not pay welfare in this way?
It is also a way to feel like one has more control over some of the more unjust practices that might exist in an opaque system or chain of command - retail and media over time will be affected. But so will manufacturing.
Years ago, José Neves, the founder of Farfetch, declared that "we fundamentally do not believe in making a specific order for the online channel, sending it off to a remote warehouse in the middle of nowhere and shipping it from there to the world.
That is the old e-commerce model. It’s not the model of the future.
"The model of the future is distributed stock. The inventory is made up of dozens - hundreds, in our cases - of micro-warehouses." Indeed, for Farfetch the warehouse is everywhere, distributed across its global network of luxury stores.
Adidas’ Speed Factory, that transforms its flagship stores into micro factories manufacturing a part-customised product for each customer, is also a sign of this.
The point is that in a globally networked world, scale does not matter anymore - flexibility does. In fact Morgan Stanley has stated that flexibility and agility like this adds more value to a business than scale, predicting faster growth, more sales and higher stock prices for these kinds of businesses.
It is the decentralisation of what was once a very centralised manufacturing process that will in the end culminate in factories being able to deliver products over a shorter and shorter time: "In two weeks, but it should be two days, then overnight," says Neves in a recent Fast Company article.
In essence, decentralisation has more chance of delivering to consumers who want things on-demand.
Google’s proposed Sidewalk Lab on Toronto’s Quayside
2018 was a breakthrough year in which we saw the beginning of the end of smartphones and the beginning of digital assistance. 2018 was the year when ‘conversational interfaces’ took off in the mainstream.
Finally, we started to see how brands could at last properly deliver ‘experiences’ using AI to facilitate human-sounding, responsive and intelligent conversations with individual customers with individual needs. Google’s showcase of Duplex at their I/O was the first time the magic of a machine-conversation could be seen at scale.
AI allows for anyone to create an ‘experiential’ platform for communication that does not exist in reality, but is moderated through the cloud. As people get more used to conversations in the cloud, they will come to expect the facilitation of services in this way too.
Indeed, our expectation for things we experience to have a physical element will lessen. Or rather, we will expect to overcome the physical element of the things we experience.
There is nothing more physical than a country - a block of territory - that occupies a space on the planet, but even the physical borders that once existed, can be overcome.
Estonia is probably the best example. Their offer of e-residency to businesses not in their county of origin was groundbreaking when it launched a few years ago.
But what we are really seeing there is a small country that understands it needs to compete with its neighbouring countries, not on the basis of its natural resources or physical industry, but on the quality of its user interface.
Just as you might switch your bank if one has a better mobile app, the Estonian government hopes you will switch your business to a country with an infrastructure that is easier to use.
We will increasingly see this in cities. For a long time I (and others) have been talking and warning about the forthcoming collection of biometric information in public spaces - and this weekend in the UK, the Metropolitan Police announced it would be trialling facial recognition on the streets.
Once the technology companies take over our cities and civilian services, offering us ‘smart cities’ where citizen data helps urban areas run like a well-oiled but intelligent machine, those cities will too feel more virtual.
In his book Live Work Work Work Die, Corey Pein makes explicit that tech companies see the future of cities as a ‘cloud governance structure’, in which people choose their countries as a patchwork of city states - or corporate dictatorships - that run like nation states but, "if you don’t like your government, you pick up and leave".
Will it be Google’s Sidewalk Lab on Toronto’s Quayside that is the first ‘cloud governance city’ in which citizens are merely bits of data to be managed, or will it be Amazon, which already runs the cloud?
This is a longer term trend, but ask yourself: why are these tech companies suddenly expanding into new cities like New York or Austin? It’s not just to acquire talent, it’s to acquire test-beds as utilities move into the cloud and governance becomes increasingly virtual.
Your nationality used to be a marker of identity, but we have seen that in a globalised world this has started to break down. This year, we saw the same with the idea of gender as a demographic descriptor.
Ever since the beginning of social media - which by its very nature is more matriarchal, being flatter, broader and non-hierarchical in structure - voices that had found it hard to be heard suddenly entered the conversation. Women were one of those groups, and ever since we have been undergoing a process of re-balancing the power between the genders.
What we are seeing in the media is a result is the breakdown of traditional stereotypes; some people no longer want to be defined by traditional demographics. They don’t want to be forced into thinking that they have to put on hyperbolic masculine or hyperbolic feminine performances in social situations, or buy into brands that themselves portray their consumers like that.
We are going to have to revisit the way we make and market products as a result. Entire categories need to re-think the semiotics they use, and whether they are actually inviting or intimidating to a consumer who does not identify with overtly feminine or masculine extremes.
We are still stuck in that to some extent - even ‘made by women, for women’ is still an extreme hyperbolic femininity - but over time, culturally, we will make our way to an understanding of the fluidity of gender. Rain Dove, the non-binary fashion model appearing on two magazine covers at the same time - on one looking feminine, on the other more masculine - shows how the media is signalling this change.
But the signs of this going further are there in virtual media too. And just as when social media allowed women to find their voices and express their ideas, virtual media will allow anyone to find and express their identity.
Miquela Sousa for instance, better known as Lil’ Miquela, is an influencer whose Instagram shows a stream of ‘outfit-of-the-day’ shots and features her in clothing from Supreme to Chanel. She shares pictures of herself attending various fashion events but also in everyday surroundings, alongside the obligatory inspirational quotes that her 1.5m fans follow with delight.
There is just one thing: she is not real. She is generated by computer, a purpose-built influencer, and at some level poses the question: who can you trust?
Her followers trust her - they know she is not real in the traditional sense, but she is real in terms of her story and her feelings. Prada have bought into her, running a marketing campaign with her this year, and since then brands such as Fendi and Balenciaga have sent avatar models down the catwalk to promote ‘real’ fashion collections.
There has been a lot of negativity around influencers in the marketing press of late, but those commentators miss the point. It is signalling something about the ability of everyone in the future to manipulate their own identity and perhaps monetise that in a virtual world.
This virtual world of ever-versioning identities will be where we discover content in the future, and where we discover many products and brands. We will create our own avatars and use them to explore our own identities for ourselves; we will meet not only other people’s avatars in this virtual space but other versions of ourselves too.
So not only will we be able to discover new content and new people, but new things about ourselves in the course of this adventure.
For those who think this is fantastical, it’s not. Why did Amazon buy Body Labs a couple of years back? So that you can do a 3D scan of your body and create an avatar that will be able to wander around an Amazon shopping aisle one day.
There are lots of signals like this pointing to a future that is more decentralised, that is increasingly virtual, and in which one can explore one’s own identity - not only because it is interesting and we are narcissistic, but because we need to create new means of social and economic capital in the longer-term.
Tracey Follows is the founder of Futuremade and writes on the subject of strategic foresight each month for Mediatel.
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