Views on five mega trends shaping global industry today
As we fast approach the end of the 21st century's first decade, the emergence of five mega trends can be observed, the future ramifications of which need to be addressed by industry and business leaders carefully. At the core of these five trends is the increasing importance of consumer voice and the ability of businesses to effectively communicate their message to different stakeholders.
Philip Seng, CEO of the U.S. Meat Export Federation identified the following five mega trends as an important road map for the future. I believe the impact of these trends will be felt for a long time to come.
- The growing need for for stringent attention to food safety
- The increasing importance of science and biotechnology and the importance of communicating the benefits of science to the public
- The increasing importance of industry image, and the need to be part of an ethical proposition
- The importance of brand - the need for consumers to know the intrinsic value of what they are buying
- The increasing role of the consumer
A common thread that runs through each of these five mega trends is the importance of ethical behavior in business and the communication of that behavior to consumers.
A good reputation is built and maintained through an open and honest dialogue with customers. Now more than ever reputations benefit from two-way communications that not only educate and inform consumers, but also monitor and respond quickly to feedback. Companies which fail to do so are in danger of being caught unprepared when the inevitable scandal hits their industry leaving them exposed to fallout and facing a greater struggle to recover public trust.
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1. The growing need for stringent attention to food safety
The public needs to know that the food they consume is of high quality and safe. Central to communicating the message of food safety in Japan is the ability to influence consumers' attitudes towards the terms "Anzen" and "Anshin" – respectively meaning safety and peace-of-mind. The first is a rational judgment based on reason and science, the second is purely emotional. The Japanese are among the most food-safety conscious consumers in the world and a crisis such as the one seen in January 2008, in which Chinese-made dumplings exported to Japan were found be to be contaminated with a poisonous substance, can deliver a death blow to an organization if not handled correctly.
The behavior of one or two unscrupulous companies can shake consumer confidence in an entire industry and negatively affect the perception of even ethical brands. Businesses with high standards of safety and ethical behavior would be foolish to be complacent when communicating these standards to consumers. Back
2. The increasing importance of science and biotechnology and the importance of communicating the benefits of science to the public
As the world faces greater food shortages, the benefits of genetically-modified (GMO) crops will likely lead to their increased prevalence in the market. As this happens, consumers will need and demand a better understanding of products that have been genetically modified. There is, in general, a negative perception of these products in Japan. The ability to communicate the sciences so that the average person understands the growing role of genetically modified foods, and can make informed choices, is therefore of critical importance. The media must regularly be given the opportunity to hear from food science experts, in order to correct unfounded negative perceptions, leading to a better-balanced view of the importance of science in our daily consumption habits. Better-educated consumers are an asset to both industry and society as they demand higher standards of quality and accountability and are less vulnerable to the unfounded scare-mongering that can often accompany food science. Back
3. The increasing importance of industry image and the need to be a part of an ethical proposition
Corporations need to establish themselves as good citizens by investing in corporate social responsibility (CSR) activities and take a more accountable approach to corporate governance. Communicating their credibility to the public and businesses that want to deal with them is more important now than ever before with a public that is increasingly skeptical of big industry and businesses. One only needs to look at the beating the finance industry is currently receiving, thanks in part to the lack of transparency and ethics that has obliterated consumer confidence. This industry needs to restore itself and work hard to re-gain the trust of the public by effectively communicating its efforts at reform and build the kind of reputation and image that will garner public goodwill, even in tough times. Back
4. The importance of brand - the need for consumers to know the intrinsic value of what they are buying
Corporate branding will be increasingly important and companies will need to effectively communicate to consumers and other stakeholders the intrinsic value of their goods and services. The value of the brand is important in protecting the business from outside influences that can cripple any goodwill earned, and ultimately bring down a company.
Independent studies have shown that companies with a favorable image enjoy benefits unattainable to companies without. In the event of man-made catastrophes both "reputable" and "non-reputable" companies predictably lose market value but the drop in value of "reputables" is significantly less that that of "non-reputables". In addition, "reputables generally recover ground within 10 weeks and are often in a better position than before the catastrophe, while "non-reputables" continue to lag well below pre-catastrophe levels.
There will always be challenges and unforeseen catastrophes but a reputable image, built through clear communication and ethical behavior, can provide a buffer against the worst of a public backlash and ensure a quicker recovery once the storm has passed. Back
5. The increasing role of the consumer
Companies and industry representatives cannot afford to ignore what consumers are saying about their brand. With the advent of the prosumer as well as patient advocacy in the healthcare industry, it is now widely recognised that individuals play a major role in developing a brand and that the days of the passive consumer are coming to an end. The education of consumers through advocay activities is paramount. Businesses cannot ignore this increasing trend as seen throughout not only Japan, but the entire world. Back