Or, how the new generation of marketers will save us all.
The New Economy
The New Economy is upon us. People are demanding that the businesses they support, support them: their lives, their communities, their planet. It’s that simple, we don’t want to knowingly make the world worse by virtue of the products we purchase. And in the era of instantaneous feedback, if a business is lying- which is different than remaining silent- it will be exposed and profits will suffer (especially given a viable alternative).
But, if a brand is aiding in the betterment of the world, its customers will rally around it and dig into their pocket books to support them. AirBnB, Whole Food Market, and Tom’s Shoes are great examples of brands that have felt the upswell of the early New Economy shift.
This shift of values, from brands that focus blindly on shareholder value to brands that open their focus to include customer value, will represent the greatest wealth creation event in history. This difference between creating a product that generates immense profits for the share holders, at the cost of the health of its customers, to one that creates profits for the shareholders while increasing the overall health of the customer, is the central point in question.
If you start a brand today, and do both, you will profit to a greater extent than if the public finds out that you only care about the first. Simply look to the megalithic brands like Google, Facebook, and Amazon. They once claimed a virtuous allegiance to higher order ideals such as “don’t be evil” and “connect the world,” compared to simply “work hard.” And now Google and Facebook are getting railed for showing their true colors while Amazon- who never lied- is simply chugging along.
The Global Middle
The driver behind this shift is singular. The “economy” is the summation of all the wants and needs of everyone on Earth, this would mean that if the wants and/or needs of enough people on Earth change, so too will the economy. And if you look at the growth in the global middle class, you’ll see that they’ll be the majority of the world’s population by 2020. Which ultimately means that their wants and needs will determine the direction of the global economy.
Their [the global middle class’s] wants and needs will determine the direction of the global economy.See The Brookings Institution’s THE UNPRECEDENTED EXPANSION OF THE GLOBAL MIDDLE CLASS: AN UPDATE
What Is Middle Class?
The question of the next 60 years will be “what does the global middle class actually want and need?” For those who figure the answers out, they will become members of the next generation of billionaires. This global tsunami of purchasing power will send markets soaring and institutions crashing. But for the few that can channel this awesome power, they’ll see opportunities that can’t be imagined today.
It’ll be hard to predict the exact details of this new economy. But lets talk about the bigger picture here and try and extrapolate what the current middle class wants in order to understand what this new global middle class might want. Looking at the 2010 Commerce Department report prepared for Vice President Biden’s Middle Class Taskforce, they sum it up quite well: “Middle class families are defined by their aspirations more than their income,”
“Middle class families are defined by their aspirations more than their income,”https://www.commerce.gov/bureaus-and-offices/ousea#1/39/-77
“Middle class families and those who wish to be middle class have certain common aspirations for themselves and their children. They strive for economic stability and therefore desire to own a home and to save for retirement. They want economic opportunities for their children and therefore want to provide them with a college education. Middle class families want to protect their own and their children’s health. And they want enough income for each adult to have a car and for a family vacation each year. Middle class families are forward-looking, and they know that to achieve these goals, they must work hard, plan ahead and save for the future. Indeed, being middle class may be as much about setting goals and working to achieve them as it is about their attainment.”
The $60T Question
Where this $60T in purchasing power will be directed will change the course of history. And the marketers that connect those customers with what they want and need will become the key players in this shift. If it’s true that the middle class is more a mindset than a number, then the question really becomes what are the values of this new global middle class? What ado they actually want?
In a broader sense, this shift represents a key difference that occurs once economic concerns begin to fade in your life: you begin to consider deeper questions. What am I here for? What is my purpose? What makes me happy? These questions where once put into a framework called “Maslow’s hierarchy of needs.” And it makes sense, both as a scientific framework and as a personal one.
US vs Them
The key issue here is that the US’s economy is further up this hierarchy, while the new middle class has to spend a great deal of time catching up. Whichever you’re serving, it will be very important to consider this fact when launching a new brand.
In the US, you’ll have to address higher order ideals of “self actualization” while in other countries you might have to provide services that address such higher ideals such as “safety needs” or “love and belonging.”
Either way, this will be the single largest wealth creation event in human history and those that supply what the market is actually demanding will gain the most. While it is clear that the market is demanding more, it will be up to the marketers in these new brands to sell the products that by their very nature will improve the lives of their customers- as well as their shareholders.