The one thing that marketers cherish the most is a fleeting glimpse of the future. That glimpse would make the challenge of planning strategies, of devising the appropriate marketing mix elements, much simpler and less fraught with risk. This need accounts for the many articles and books generated each year, all proclaiming to understand and forecast future developments.
Forecasts of future social trends can only be developed with an understanding and utilization of underlying demographic and economic trends. This article captures some of the most important social trends that will unfold over the next 20 years, in the hope of providing some of those glimpses into the future that astute marketers seek.
1. The Emergence of China as the World's Largest Economic Power
With a purchasing-power parity GDP of more than $7.8 trillion in 2008, China ranks second in global economies behind only the United States, with a GDP of about $14.6 trillion in 2008. China's growth rate of about 10% annually will allow it to overtake the United States in the next few years, assuming that China's government allows the country's hypergrowth rate to continue and that the U.S. growth rate continues in the range of 2% to 4% per year. China has absorbed much of the manufacturing businesses formerly done in the United States, and China's economic composition is now about 49% manufacturing and 40% services, compared with about 20% manufacturing and 79% services in the United States.
Doing business with China--either as a company that wants to utilize the country's large, skilled labor force or as a consumer of goods made in China--requires a higher level of understanding of the Chinese culture than most Americans currently possess. In their book, China Now, authors N. Mark Lam and John L. Graham discuss some of these challenges. Nonverbal cues are different, standards of business practices are different, and protections of intellectual property and patents by the respective governments are different. Software and video piracy are particular concerns in this area.
2. Global Demographic and Migration Shifts
Populations of countries change in several predictable ways. Babies are born, people live a certain number of years and the, and new people migrate into the countries.
The United States had about 430,000 births in 2008, compared with 251,000 deaths, according to the U.S. Census Bureau. By tracking this ratio over time, and looking at unusual variances in the data, one can get a good understanding of a population's characteristics and even project those characteristics forward. In the United States, for example, the baby-boom cohort, consisting of those born between 1946 and 1964, is a large bulge in the population numbers. Even larger is the group labeled the echo boomers, those children of the baby boomers born in the 1970-1985 time frame. These two bulges represent large pools of economic activity and will shape the types of products and services consumed in the United States for several decades.
During 2008, the United States also experienced a net legal migration of almost a million persons. The lifespan of U.S. residents continues to lengthen, enhanced by better health care and medical options than their ancestors enjoyed. A child born in the United States today has a life expectancy of more than 78 years. The U.S. population, recently cresting 300 million, is projected by the U.S. Census Bureau to exceed 345 million in 2025 and 400 million by 2045.
The population growth trends seen in the United States are not seen uniformly around the world, however. Japan has a relatively strict policy regarding incoming migration and is not replacing deaths at the same rate with new births. As a result, the Japanese population is rapidly growing older and starting to shrink. Already, elementary schools around Japan are closing for lack of students. …