As the calendar tips over into February, it is probably time to put to rest all those “top trends…”, “my predictions….” type articles but, before we do that, it is important to take a step back and look a little at the trends behind the trends. It is always interesting to know what the ‘next big thing’ might be but those new innovations are usually brought on as a result of bigger, macro trends that lie beneath. Here are 5 examples that will really shape Australia and our landscape in 2019:
1. The average Australian doesn’t exist.… if ever there was a lesson in why it is important to be wary of averages, this is it. If you take the average of all the census data, the “average” Australian is female, 38, has 2 kids, is still in their first marriage. They are of English descent but both they and their parents were all born here. They own their own home but have about $200k left on the mortgage to pay off. They earn about $80k and the household earns about $135k all together etc etc etc. All sounds fairly sensible, right? Well, the problem is that only 6000 (no, that number isn’t missing a zero), people actually fit that exact description. Just because it is the average of each characteristic, doesn’t mean its helpful.
This diversity that is hiding in plain sight is creating major structural shifts…
2. Realignment is a bigger story than uncertainty…. we’re all used to stories about uncertainty – “are we headed for GFC 2.0?”, “will media companies as we know them still exist in 5 years” etc etc etc – but a bigger story might actually be the realignment of traditional ways that broad demos view the world. It is super clear in politics right now. Labor which is traditionally about working-class economics, more socially liberal values etc are trying to figure out, for example, how to balance the need for blue-collar manufacturing and mining jobs and to protect the environment. Every vote they win in Fitzroy potentially loses them one in Mt Isa. The Liberals have the opposite issue – every vote they win in working-class suburbs of Brisbane by promising jobs, low taxes and tighter immigration controls, potentially loses them one in Manly. Something has got to give at some point and the new coalitions of parties, values, voters and policies will have a huge impact for years to come.
Part of the reason for all of this is that a new demographic is driving change…
3. The rise of the Xennials…. this is a truly hideous phrase which should never be repeated outside this email but what it essentially means is the generation that is at the crossroads of Gen X and Millennials. In other words, aged 35-45. Born between 1974-1983. This is the generation that is about to storm the barricades. They’ve got a reasonable amount of money but weren’t early enough into the housing market to make a life-defining killing in it. They care deeply about the environment but also don’t want their income taxed heavily as they’ve now worked their way into the top brackets. They have disposable income and love travelling but retirement is just about a near-enough event to be very worried about the state of their super fund. Their political power is about to go through the roof. At the next election, they will probably be the category of MPs who see the largest percentage increase in their numbers. Anyone who follows American politics will have seen what happened when that group flooded into the US House of Reps recently…. If you want to watch a demographic, watch this one. They will make the policies and decisions that will define our society for the next 10 years.
That audience as well as now being in charge of stuff increasingly are changing how our cities and towns look because…
4. That generation is changing the face of retail… whilst we’re all distracted by talking about Millennials (and assorted other definitions), the ‘Xennials’ (sorry, I promise that’s the last time I’ll use that word), are driving a quiet revolution in retail. People still want physical stores, they still want to touch, try, feel, hear and taste. “Amazon will kill the high street” is convenient shorthand but it is much more complex than that. Store design is frantically trying to keep up with what a new generation of shoppers actually want. And the focus is often on the 30 somethings. More informality, more “like home”, more ‘classy casual’. If you want to know how this will work, look at Luxury first. Luxury brands tend to get out ahead of trends like this first. The new Gucci store in New York (see JWT’s excellent Future 100 for more) is nothing like any retail space you’ve ever seen – all exposed brick and distressed chesterfield couches. Tiffany have cut their marketing budget significantly for the next year in order to fund a total overhaul of their flagship retail spaces. If you want to market to an audience, your in-store experience has to match the way they want to shop.
Talking of shopping, there’s one big thing this year which could change everything….
5. The most important election of your lifetime…. well, almost. Certainly one of the most divided. Normally elections are about shades of same. This time, the difference between Labor and the Liberals looks like it will be the starkest in a generation. Labor’s proposals on housing, franking, negative gearing etc could hurt consumer sentiment if your client’s target audience is older and wealthier. On the other hand, their proposals on low-income tax relief could help consumer sentiment if your client’s target audience is younger and more mass. The Liberals are the other way around. “Consumer confidence” is a dangerous average for marketers (see point 1) – this election could change a lot (for both positive and negative) for your clients’ audiences irrespective of what happens to the average number.
Riff over. Whatever 2019 has to bring, it certainly won’t be dull….