What Happens After What Comes Next
There’s a boom coming next year. Here’s 3 post-boom futures and 3 actions that strategy and innovation leaders can take now to get ready.
2021: The Boom
After a difficult fall and winter, the global economy will wake up in the spring of 2021. The arrival of effective vaccines that grant at least temporary protection from Covid-19 will roll out to at-risk populations and essential workers, then to the broader public. Most developed nations will have enough of their citizens protected by early summer, resulting in an explosion in spending on the deferred experiences over the last year.
Consumers, whether they have the money or not, will spend as much as they can on experiences: travel, dining, concerts, sporting events, and other entertainment. They will seek out novelty in what they are experiencing, and who they are experiencing it with. They will not know how long the vaccines will work, or if a new crisis is on the horizon, so they will live for the day, with little regard to the debt they pile up while seeking social experiences with other people.
The legacy of the recent pandemic will impact their choices, however. They will be mindful that their spending supports companies that have similar values, are actively participating in reducing climate change, and are equitable to their employees and communities.
2021 will be a year of Mindful Hedonism.
Then What? Three Roads to 2030
The phase of Mindful Hedonism will be short-lived. Without structural changes there will not be enough economic fuel to keep its fire burning into 2022. While businesses should be prepared for the Mindful Hedonism consumer, long-term profits may be captured very differently. Companies will need to explore three alternative economic scenarios to find the right arenas to create, deliver and capture value:
The Bubble
After a frenetic few quarters of growth due to pent up spending on experiences, consumers run out of money and capacity for debt. The US economy drops and begins a long, slow road of recovery that lasts until 2030.
The Flywheel
Spending on experiences during 2021 jump-starts the broader economy. Conditions return for 2–3% growth, mostly driven by pre-pandemic economic structures.
The Transformation
The combination of the shift to experiences and spending on values from the Mindful Hedonism phase creates structural changes in how the US economy works, transforming the country and consumers in significant ways.
3 Next Steps for Strategy and Innovation Leaders
These are high-level cross-industry paths the future could take. Leaders should build detailed scenarios of how the Mindful Headonism, Bubble, Flywheel, and Transformation alternative futures will evolve and impact their specific markets and customers. Scenario Planning will help leaders:
Imagine what it will mean for customers, end-consumers, competitors and marketplaces by developing immersive inductive scenarios
Identify milestones that signal the direction and impact of change
Act ahead of competitors to invent and deploy ways to serve new customer jobs-to-be-done
The next 5-10 years will have large and fast-moving areas of interconnected change. It will challenge most internal foresight and sense-making capabilities. Start investing now in people, training and partners.