Trend and Future Research

Foresight

What do consumers want in 2015? How will or could the business of bankers and retailers change in the coming years? Under what circumstances will consumers view technology as a personal enrichment and under what circumstances will they reject it? Matthias Horx, one of the most influential trend and future researchers in the German speaking-region, provides answers.

How do you research the future?
First, I try to understand and interpret the current change processes. It makes sense, mentally and systematically, to focus straight ahead and ask the questions: What could happen? This leads to a reflexive process.

What does futurism seek to achieve?
I don’t view the role of a futurist in making a prognosis about something but rather in presenting the future as a shapeable task. I’ve established that people often aren’t interested in the future; they’re more interested in extending the past into tomorrow. But that’s exactly what the future doesn’t have to offer. By the way, you can only understand the future and shape it when you stop with all the moaning and groaning and with pushing responsibility to others.

Companies have their market researchers. Should they also have a futurist?
I’ll answer that question with a quote from one of our customers from the business world: “Our market researchers are bean-counters who are only primarily occupied with the status quo and who only develop concepts related to the present. We have commissioned you because that is exactly what we don’t want.”

So you compete with market researchers?
That’s unavoidable. Companies require not only market research but also trend research. Trend research requires businesses to critically confront themselves, their products and strategy with the processes of change in society, business and culture, and to develop an evolutionary path that is clearly different from the competition and pushes the company far ahead.

What can trend research say about consumption in the future?
In general, consumption will have increasingly less to do with acquiring things. It will be more about how to deal with less time and attention. The consumer markets will become service markets, and business economics will become the economics of time and attention.

And what does trend research know about the consumers of the future?
It knows, in particular, that in the future, consumers will be more individualistic. They’ll stick with a trend only long enough to turn the next corner. As such, the future will be a mix of styles, of “life-morphing.”

That makes a general characterization difficult.
The individual is like a puzzle, which consists of various style elements, worldly views and mind fractions. But many pieces of the puzzle have something in common with each other. From this, we can develop a general characterization. We identify the avant-garde today as a relatively small group of trendsetters from whom we can assume with a high level of certainty that they are at the forefront of an emerging new trend.

What roles doe the Internet play?
The impact of the Internet – this universal knowledge machine – has resulted in us having to deal with consumers who very clearly want to satisfy their own needs and are highly demanding. The Americans refer to these types as “conscious consumers” or “prosumers.” The version 1.0 prosumer, who selects mass-market products from the shelf of home-furnishing giant Ikea, will be replaced by the version 2.0 prosumer, a consumer who is highly informed, collaborative and creative and who has mastered the role-change from buyer to seller thanks to eBay. In our networked culture, these new consumers can modify their roles as they wish. They can become people-to-people (P2P) credit providers, exchange dealers, niche shop operators or recommendation bloggers.

Which avant-garde consumers are you tracking?
In our new study, we analyze shopping scenarios of four distinct types, which we’ve given names: space of identity, neo noblesse, stand-up consuming and social consuming (see boxes). Let’s look at the first group, the identity shoppers. As conscience consumers, they are true followers of communicative shopping in small downs or downtowns, where their senses are aroused. They want to shop in a way that is ecological, time and location-independent. They seek a certain familiarity and personal contacts. And they seek quality and healthy nutrition.

How do you go about winning over these consumers?
Numerous concepts are imaginable. For instance, we’re noticing that globally operating retailers are suddenly developing neighborhood stores, which have several square meters of space, limited offerings, around-the-clock operating hours and quality service. The new “Daily Monop” micro-markets operated by Groupe Galeries Lafayette are a good example of this development. Another example is the U.K. chain of “Grocer on Elgin” delicatessen neighborhood stores. The chain perfectly meets the needs of its local shoppers.

How and where does the neo noblesse group maneuver?
This group isn’t made of jetsetters. The luxury shoppers of the future aren’t consumers who show off. They’re shoppers who seek a special, intensive experience, something that transcends everyday life. For them, luxury shopping is an ideal way to break away and experience something new.

Can you give us an example?
Let’s look at banking. This area has developed some concepts that I would refer to as “lounge banking” or “club banking.” One example is the Quarter 110 concept of the Deutsche Bank branch office in Berlin. The branch shows just about every new personal technology and lifestyle trend that there is. It includes a very upscale café and boutique in which you can find trendsetting urban design, a kindergarten and a retail banking area with individual consulting rooms. These are rooms target customers from the neo noblesse and the urban upper middleclass groups.

So they’re not exactly suited for smaller, suburb branches.
Since the middle of the 1990s, many banks in Germany believed that they could make a lot of money with customer-free branches and decided to retreat from their retail banking customers. They were penalized for that move. They quickly realized that they will only win new customers if they offer concepts that are particularly consumer and service-oriented, like lounge banking and convenience banking. Banks in the suburbs will also have to depart with their “afternoon siesta” mentality and become much more focused on convenience and service.

Back to the consumer characterization: What are stand-up consumers?
They’re the new Joe Blow nomad. They define shopping in a fundamentally different way: “I’m the point of sale. Selling and consuming are no longer confined to the rooms of providers but rather to where I happen to be.” Stand-up commerce will become the norm thanks to rising demands for mobility in the coming years. It will fundamentally change the anatomy of commerce. Shopping will be increasingly defined as an activity that is situational and circumstantial.

That puts high demands on retailers.
It puts a high demand on retailers to be creative. They need to deal with the fact that an ever-faster moving society takes care of things on the fly. Mobile markets will establish themselves over the next decade. This means that vending machines will experience a significant change in public image – away from “trash supplier” to “stand-up supporter.”

A renaissance of vending machines?
New York’s Bamnfood is a good example of the return of the automated kitchen. The company, with a mixture of retro and trendy lifestyle design, has conquered the convenience market in the lower east side of the city. Its offerings range from pizza and teriyaki burgers to donuts and Asian specialties. The store is manned around the clock to keep the vending machines full of fresh food. Products that aren’t sold within 15 minutes are removed. Food must be something that can be held and consumed on the run. This is the perfect offering for the chronically time-starved, stand-up consumer.

What sort of relationship does this new generation of consumers have with technology?
They are generally comfortable with technology, as long as they don’t have the feeling that it’s there to rationalize service at their expense. There’s a serious problem with technology at the moment. Many people almost hate it largely because of the telecommunications sector that has repeatedly pushed them to buy systems they don’t need. The sector has all but destroyed consumer markets. The entire electronics industry, which has to deal with the man-machine relationships, is suffering as a result. Trust needs to be restored again.

What is your relationship with technology?
I love technology. But I don’t always have the impression that technology companies always love me. Manufacturers often design devices that patronize us, drive us up a wall or just simply overwhelm us. I wish we had technology that is reliably stupid enough to allow us to be more creative, and that trains our human capabilities instead of crippling them. I call this “homotech,” or technology for becoming a human.

How should we understand homotech concretely?
Look at the iPhone and you know what I mean. It’s touchable and has a user interface that is designed to human norms. With one finger, you can navigate street maps, enlarge them or minimize them.

Are touch functions the future?
Unlike command buttons, touch screens can establish an entirely different interface logic between man and machine or, put another way, between technology and humanity. This form of intelligent user access, I believe, is state of the art. This is really how people want to deal with technology. It’s the requirement for man-machine contacts of the future.

Have technology manufacturers understood this?
I believe that technology innovation is divided. Some companies will succeed in the future to build man-machine systems that, indeed, take account of human needs and make technology “fun” to deal with. Other companies will continue to construct devices that can only be viewed as a hassle and that will deliver the message: “Costs are being rationalized at my expense.” The self-service POS systems in the retail sector are a good example of the crossroads now facing technology.

What is the right path?
My thesis is that self-service technology could take over checkout in around 10 years, but only under two conditions: first, terminals have to be extremely intelligent and user-friendly; and second, retailers must create the right social field. In the complex social environment of a supermarket, the cashier is someone viewed as an authority of sorts. This person can’t be totally replaced by a machine.

With what then?
As a customer at a self-service checkout point, I first of all have the feeling that I’m now doing something that was done for me in the past. That’s frustrating. But if there is someone around to answer my questions and who is friendly and willing to help pack my groceries, then I could overcome my frustration. The basic rule is: Companies that want technology to be accepted by their customers need to create the right the social environment.