Top 10 Forecasts, 2008 Let’s get right to it….

Why bother with the future "If you think that you can run an organization in the next 10 years… … as you've run it in the past 10 years… you're out of your mind." CEO, Coca Cola

“When the rate of change outside your company exceeds the rate of change inside your company, disaster is imminent” Lou Pritchet Senior VP, Procter & Gamble

Looking to the future: common mistakes Making predictions rather than attaching probabilities to possibilities Simply extrapolating current trends Thinking of only one future

“When faced with a totally new situation we tend to attach ourselves to the objects of the most recent past. Marshall McLuhan We look at the present through a rear view mirror ”

Looking to the future: common mistakes People consistently Overestimate the effect of short term change & Underestimate the effect of long term change. Ian Morrison, former president of the Institute for the Future Consider the "Historical Record of Inane Inaccuracies" ”Historical Record of Inane Inaccuracies

Effective Forecasting - The Desired vs The Likely

The best way to predict the future is to invent it– Alan Kay--‘Father’ of the PC and GUI interface

R E A C T I V E C R E A T I V E Change how you “C” things!

The point is not so much to predict “the” future… but to prepare for various contingencies Based on the logical extension of established trends The point is not so much to predict “the” future… but to prepare for various contingencies Based on the logical extension of established trends How best to prepare for the future

Some things are clear--

How best to think about the future Think of the drivers of change Use the drivers to imagine different scenarios of the future Imagine perhaps three; each should be plausible but different Extrapolate back from those future scenarios to think about what to do now to prepare

TechnoSphere InfoSphere SocioSphere PsychoSphere Bio & PowerSpheres TechnoSphere InfoSphere SocioSphere PsychoSphere Bio & PowerSpheres What “Drivers” Have We Observed?

What occurred in past few decades to precipitate a paradigm shift in Marketing… From product to customer centered From mass to micro strategy From customer acquisition to retention From regarding marketing as a function to envisioning it as a philosophy

 Enabled by Technologically  Precipitated by Globalization  Necessitated by Consumers

technology convergence is fueling a new economy Computing Technologies Communication Technologies Content Technologies The resulting Techno/Info-sphere is re- defining the business landscape for the 21 st century COMPUNICATIONS

CONVERGENT TECHNOLOGY Socio/Psycho-Graphic DIVERSITY Future Marketing Environment NONCONVERGENT TECHNOLOGIES Socio/Psycho- Graphic HOMOGENEITY Past Marketing Environment

TechnoSphere Drivers Ubiquitous- Imbedded Intelligence Information technology will transform our day-to-day lives. "The big trends - are the availability of cheap sensors that provide digital data, cheap computing power and ubiquitous connectivity - the ability to connect to networks," by 2020 everything large enough to carry a microchip probably will, and from there the possibilities are endless.

Imbedded intelligence & low-cost omnipresen t bandwidth 3G videophones w/ broadband – 2 meg per second – AI Enhanced PDA devices w/ speech recognition & avatars RFID – everywhere & in everything

 Enabled by Technologically  Precipitated by Globalization  Necessitated by Consumers

After more than a century of electric technology, we have extended our central nervous system in a global embrace, abolishing both space & time” -Marshall McLuhan, Understanding Media- 1955

Rise of the “Global Village” … … not just the “shrinking” of time & space The new electronic media have transcended time & space w/ “virtual mobility”

Borders have become meaningless Trans-National* Cross-Cultural High Speed/ Low Cost Transportation & Communication The entire globe is now tied together as a single community operating 24/7/365

The Compunications Driver The further, faster, easier, cheaper & more frequent people are able to travel & communicate… the greater the amount of interaction & influence The greater the degree of Globalization

 Enabled by Technologically  Precipitated by Globalization  Necessitated by Consumers

20 th Century Homogenous Consumers 21 st Century Fragmented Consumers % of population Extreme shifts in:  Age  Wealth  Ethnicity Culture  Lifestage patterns  Household composition  Value systems Source: IBM Institute for Business Value analysis Consumer values are fragmenting

X+ generation= techno-savvy accessing information whenever & wherever they want it Product knowledge Third-party commentary Ubiquitous networking Next-generation mobile devices Advanced infomediaries Source: IBM Institute for Business Value analysis

& Info Savvy Source: (1) GMA Forum, “Do We Have a Crisis in Brand Management,” Q3 2003; (2) Forrester Research, “Privacy for Sale,” 11 Jun 02; IBM Institute for Business Value analysis Blocking Out, Shutting Down Overexposed & “on” to marketing Ignore irrelevant, low- value messages Actively block unsolicited communications

Becoming more complex--age, sex & income reversals Becoming more self- centered & Home centered Have less time & more choices Are less brand loyal More connected & more informed Have lower attention spans & higher expectations Are living & shopping more for today… Less long range planning Seeking new/ heightened sensation & experiences Today’s Consumers

Preparing for the Future: A Quick N’ Dirty Environmental Scan

“By 2015, desktop operating systems will be largely irrelevant. The Web will be the only OS worth coding for. It won't matter what device you use, as long as it runs on the Web OS. You will reach the same distributed computer whether you log on via phone, PDA, laptop, or HDTV” The "global brain” is beginning to emerge We are the web—Kevin Kelly-Wired magazine-August 2005

Each time we forge a link between words, we teach it an idea…. That massive cross-referencing is how brains think and remember. What will most surprise us is how dependent we will be on what the Machine knows - about us and about what we want to know. We already find it easier to Google something a second or third time rather than remember it ourselves. The more we teach this megacomputer, the more it will assume responsibility for our knowing. It will become our memory. Then it will become our identity.

Within a quarter century, nonbiological intelligence will match the range and subtlety of human intelligence The Singularity is Near

rise of…atomic & molecular computers quantum computers nanotechnology optical computers DNA computers–or even a “computer in a pen” “computer in a pen” Age of Silicon is at an end!

More Concerned w/ Corporate citizenship More Eco-conscious Expect immediate personalized attention Health #1 Very tech savvy 70% music & books bought online shopping more on impulse… High levels dissatisfaction w/ retailing Tomorrows Consumers

Living/ Growing up in the Global Village Cross- generations Cross- cultural Cross- mediated experiences Emergence of an inter: National Cultural Changeable workforce Global- Psycho- Spheric Schizophrenia Multi-National Commercialization of Public Sector Services The De-Definition of American

Some things are clear--

Evolving Now into Just One Big Market: The Global Economy … … the increasing tendency of economies around the world to interact w/ one another as one market instead of many national markets For US- Presently about 1/3 of profits and 1/5 of economic growth are related to global business

The Global Village The Global Economy The Global Corporation

Growing divergence between those employed in highly skilled, highly paid professions, and those at the bottom.. The economy of work.. will be increasingly hourglass-shaped. "At the top end of the jobs hierarchy, people are likely to enjoy substantial discretion over their hours, places and patterns of working time… Outsourcing, … will continue. Reservation agents, computer programmers, database managers, financial analysts - all those whose jobs that depend, in part, on an ability to master repetitive tasks performed on a computer - will have been relocated abroad. "Only the customer-facing jobs will be left," Growing divergence between those employed in highly skilled, highly paid professions, and those at the bottom.. The economy of work.. will be increasingly hourglass-shaped. "At the top end of the jobs hierarchy, people are likely to enjoy substantial discretion over their hours, places and patterns of working time… Outsourcing, … will continue. Reservation agents, computer programmers, database managers, financial analysts - all those whose jobs that depend, in part, on an ability to master repetitive tasks performed on a computer - will have been relocated abroad. "Only the customer-facing jobs will be left,"

Networking is critical in building competency & competitiveness

2 nd Wave PowerSphere~Collapse " As the Second Wave produced a mass society, the Third Wave de-massifies us,………. moving the entire social system to a much higher level of diversity & complexity. This revolutionary process, much like the biological differentiation that occurs in evolution, helps explain one of today's most noted political phenomena - the collapse of consensus." Toffler, The Third Wave, p. 408

What, then, happens to the very notion of 'representative democracy ?' Under the convergence of speed & diversity, can any constituency can be "represented?" In a mass industrial society, when people and their needs were fairly uniform and basic, consensus was an attainable goal. In a de-massified society, we not only lack national purpose, we also lack regional, statewide, or city-wide purpose.... The elected representative cannot represent the general will for the simple reason that there is none Under the convergence of speed & diversity, can any constituency can be "represented?" In a mass industrial society, when people and their needs were fairly uniform and basic, consensus was an attainable goal. In a de-massified society, we not only lack national purpose, we also lack regional, statewide, or city-wide purpose.... The elected representative cannot represent the general will for the simple reason that there is none

Toffler, The Third Wave, p. 410 the collapse of consensus In 2nd Wave society a political leader could glue together half a dozen major blocs, as Roosevelt did in 1932, and expect the resulting coalition to remain locked in position for many years.

the collapse of consensus Today it is necessary to plug together hundreds, even thousands, of tiny, short-lived special interest groups… that cleave together just long enough to elect a president, then break apart again the day after the election, leaving him without a base of support for his programs “In all likelihood it will require the radical overhaul –or even scraping-of:.. all the unwieldy & unworkable apparatus of supposedly representative governments”… “In all likelihood it will require the radical overhaul –or even scraping-of:.. all the unwieldy & unworkable apparatus of supposedly representative governments”…

Toffler- The 3 rd Wave

“The onward march of individualism - either through choice or fate - is still probably the major force shaping our world” The central question is: Will the slow collapse of institutions that have been vehicles for our shared identity mean collapse of identity itself?

Frontline- The Persuaders

The Near Future: Marketing Considerations “ In today already walks tomorrow.” Friedrich von Schiller

Marketing’s Evolution Mirrors Civilization’s…. From 2 nd wave Manufacturing Mentality To 3 rd Wave Information & Relationship Mgt. Process

Welcome to the Future Real time data mining— conducted ‘round the world 24/7/365 On-going Consumer input & generated content Marketing messages constructed “on the fly”-and delived thru integrated & individualized communication channels…

Analytical marketing skills and processes will be paramount

Career Competencies Needed by New -Marketers… Traditional Skills Sales mgt Advertising mgt Sales promotion mgt Marketing research Pricing Traditional Skills Sales mgt Advertising mgt Sales promotion mgt Marketing research Pricing PLUS: Customer relationship management (CRM) Partner relationship management (PRM) Marketing Resource Mgt.: Database Mgt & Data-mining Lifetime Profitability analysis by segment, customer, channel Integrated marketing communications; Public relations - (including event & cause sponsorship, buzz marketing) PLUS: Customer relationship management (CRM) Partner relationship management (PRM) Marketing Resource Mgt.: Database Mgt & Data-mining Lifetime Profitability analysis by segment, customer, channel Integrated marketing communications; Public relations - (including event & cause sponsorship, buzz marketing)

From Decision Support to Decision Automation: A 2020 Vision Randolph E. Bucklin, Donald R. Lehmann, and John D. C. Little; combinations of data, models, and computers. In coming decades, a growing proportion of marketing decisions will be automated by ever- more-powerful combinations of data, models, and computers. New age of marketing decision support will usher in an era of decision automation. combinations of data, models, and computers. In coming decades, a growing proportion of marketing decisions will be automated by ever- more-powerful combinations of data, models, and computers. New age of marketing decision support will usher in an era of decision automation. Marketing Resource Mgt User Interface Workflow Collaboration Content Management Marketing Functionality Marketing Context

Living Tomorrow – Got Milk? Got Pants? Watching TV Washing Clothes Going to the Bathroom Going to the Bathroom Going to Bed & Most Significantly: Decision Support & Automation Systems- will be implemented within the consumer as well as business environments-- & Most Significantly: Decision Support & Automation Systems- will be implemented within the consumer as well as business environments--