by Kian Bakhtiari, Founder and Director of The People
The pandemic was an unprecedented shock in 2020. More than two years later it serves as the backdrop to everyday life. Billions of people around the world have adjusted their routines to this new reality. The human ability to adapt is truly remarkable.
New behavioral patterns—driven by physical distancing and lockdowns—have reshaped our collective psyche. A global health crisis has exposed outdated economic, political and social systems. For the first time since the Industrial Revolution, we have the facility to reimagine our world. Here are seven cultural trends that will shape the next decade.
Return to traditions
Uncertainty has created a strong nostalgia for the good old days and a newfound desire to be rooted in tradition. We, humans, tell ourselves stories to make sense of the world. Stories make us feel like we have control. They allow people to find meaning where there is chaos. In moments of crisis, we often choose to escape the present by seeking refuge in the past. As seen with Gen-Z’s fascination with Y2K fashion, 90’s sitcoms and even wired headphones.
At a macro level, we have experienced record levels of globalization. Powered by free trade policies, improvements in technology and expansion of global brands. However, we are now seeing a backlash against globalization. Many countries and communities feel like they have lost their local traditions and identity. The move towards localization is further compounded by nations prioritizing self-reliance. As demonstrated with the rise of populism in advanced economies.
The return to local traditions and values poses a major challenge for global brands. They need to find ways to remain culturally relevant in different markets—with divergent needs and values—while maintaining global consistency. This can only be achieved by working with local markets to produce consumer segments, including different communities and sub-cultures.
The pandemic has changed our relationship with the physical world. Lockdown restrictions have forced people to spend more time online. The physical world is now competing with the virtual world for resources. The metaverse can be described as a shared virtual space where people can create new identities, explore new possibilities and interact with other users. Currently, there is no social contract governing the metaverse.
Unchained from physical limitations, brands and people have the creative freedom to design whatever narrative or identity they desire. But the ability to create new digital identities raises new questions about representation. Such as white creators developing Black virtual influencers. Brands using avatars not reflective of their internal organization. And users assuming characters outside of their identity in the physical world.
Despite Web 3.0 being heralded as a new era of decentralization, big tech companies are vying to dominate the space. Major players like Meta (formerly known as Facebook), Microsoft, Epic Games and Apple are battling to control the virtual world. If successful, they will not only control market share but the actual market. Will the metaverse be ruled by the old laws? Or will big tech create their own rules? The expansion of the metaverse could tip the balance of power from national governments to corporations. In the future, we will all be citizens of the metaverse. As the adoption curve continues to skyrocket, there’s a looming question: who will own the future of the internet? There are two probable options. We will either be under the digital reign of big tech companies. Or active members of DAO’s (decentralized autonomous organizations) with no central leadership and complete transparency.
Last year, I wrote about the creator economy and its potential to empower ordinary people. At the time of writing, the creator economy felt like an escape from centralized corporations. Creators suddenly had the power to cut brands and advertising agencies out of the picture and go direct to community. Yet, early data suggest the model only benefits a small number of creators. On Twitch, 1% of streamers earn more than half of all revenue. The top 1% of podcasts receive 99% of downloads. Meanwhile, the top twenty YouTubers earned about $300 million in 2021. In many ways, the creator economy is mirroring the structural inequalities built into our existing economic system.
Globally, more than 50 million people now consider themselves to be creators. But the majority aren’t making enough money to survive without additional income streams. What’s more, BIPOC (Black, Indigenous, People of Color) creators are paid less than their white counterparts. Crucially, brands, advertising agencies and platforms need to find a way to support and remunerate emerging and overlooked creators.
Unless brands distribute wealth and opportunities, we won’t realize the full potential of the creator economy. Brands have the chance to build dedicated funds to amplify the voices of up-and-coming creators that align with their mission. And so, building meaningful connections beyond any flashy advert or big celebrity endorsement. This is a chance to be part of the culture and add value to different communities. In a fragmented media landscape, investing in micro creators is one of the most effective ways to engage with digital tribes with shared values, interests and desires.
Divisions in diversity
Gen-Z is now the largest generation globally and the most racially and ethnically diverse generation in American history. According to Pew Research: one in four is Hispanic, 14% are African American and 6% are Asian. And their views on gender and identity are more fluid than previous generations. In the U.K, 40% of the population is estimated to be non-white by 2061. This generation is not only diverse but inclusive. It’s not about being labeled or stuck in boxes. It’s all about self-identity, self-love and self-expression.
However, Gen-Z’s diversity of background and viewpoints creates tension between their world and their parent’s world. After all, Baby Boomers and Generation X control the majority of wealth and hold key positions in most organizations. For companies, the generational divide creates a precarious tight rope. Brands need to choose a side—they can no longer remain neutral. Young people want to know where brands stand on the causes that matter most to them. While being too political could alienate Baby Boomers with considerable purchasing power.
Young consumers want to see products and services that are inclusively designed. A diverse marketing campaign no longer cuts it. They want to know what’s happening behind the camera and if the leadership team of global brands is reflective of society. In addition, companies need to start looking at their list of suppliers and assess if they reflect their consumer base. If not, then the brand will become increasingly distant from a new generation that demands equal opportunity. Young consumer activists occupy a huge share of voice on media. Not taking action will upset allies too. For most brands, the journey to inclusion should start with anti-racist policies, inclusive hiring practices and only then external communications highlighting commitments to racial and social justice.
During the last decade, young people have been consuming based on values. Now they are investing based on values. This new school of investors are using their money to invest in socially responsible companies and sell stocks when they think a company is not serving the best interest of people and the planet. Young investors are mobilizing their capital for social and environmental good. A move that could completely transform our financial system.
Finance has become decentralized thanks to blockchain technology. New platforms like Coinbase, Binance and FTX have proliferated and democratized investment. Mainly by removing barriers and gatekeepers like asset managers and minimum capital. In 2022, investment is no longer restricted to Wall Street or the City of London. What’s more, investment has gained extra cultural and social dimensions. As seen with the rise of meme stocks: a stock that gains a cult-like following online through social media. The performance of meme stocks is largely dependent on the level of hype and popularity. Examples include Game Stop, Nokia and AMC.
Young people don’t have the same trust in central institutions as their parents. They want finance to be more inclusive. In fact, 95% of people who own crypto are Millennials or Gen-Z. At the same time, 57% report that they have sold stock when they think the company is not serving the best interest of our planet or society. Public companies need to adapt their business models or get left behind on the stock market.
Employee activism will become one of the defining features of the workplace in the next decade. It can be defined as when employees speak up against their company on issues that impact workers, customers, the environment or society at large. Before companies only had to answer to shareholders and more recently, consumers. Young people have always been at the forefront of social movements. But as activism becomes more mainstream, they are bringing their views and values into the world of work. Gen-Z and Millennials want to work with companies that share their beliefs and where they can make a meaningful impact. A ping pong table, free breakfast and competitive salary are no longer sufficient.
There are many examples of employee activism damaging the reputation of companies and leaders. Examples include the Kellogg employee strikes. Coinbase employees leaving after a ban on political views. And the open letter from McKinsey employees urging the firm to stop working with oil and gas companies. Young employees demand more power in decision making. In direct contrast of the top-down leadership models in most corporations. When not listened to these groups are not afraid to use their voice to speak truth to power on social media.
Most companies and leaders haven’t yet planned how to approach employee activism. Every future-facing company will need an employee activism strategy with leaders willing to listen and take action based on the values of employees and customers, not just shareholders. On the flip side, employees can be the biggest advocates of your brand. According to Nielsen, 92% of people trust recommendations from friends and family over any other type of advertising. If companies can communicate decisions, listen to employee demands and set up advocacy programs. Employees can become one of the most powerful channels for recruitment, brand-building and sales.
Consumerism in crisis
The climate crisis is the defining challenge of our time. Despite all promises at COP26 and a host of brands declaring their sustainability pledges. We simply can’t continue our current level of consumption if we want to meet the 1.5C Paris Agreement target. Household consumption accounts for 60% of global gross domestic product (GDP). Hyper-consumption is the main engine upholding our global economic system. If consumption declines, gross domestic product (GDP) will decline. Meaning the economy would stop growing in the traditional sense. But maybe it’s time to rethink how we measure human progress. Beyond how much stuff we buy and sell.
A new generation of consumers are opting to reuse, recycle and reduce. As seen with the popularity of second-hand fashion amongst Gen Z. The resale market is growing 11 times faster than traditional retail. Unfettered capitalism has prioritized economic growth – often at the expense of social and environmental development. But as we enter the decade of action, companies need to rethink their business models. Many need to plan for a future where they no longer sell products. Some brands are already taking action. Patagonia allows people to trade in their already worn clothes. Loop lets customers shop for their favorite products in reusable containers. And IKEA is diversifying its portfolio by investing in renewable energy.
Climate justice requires system change and mass behavior change. Young consumers are now using their voice and dollar to put pressure on companies to transform and become part of the solution. This is a difficult move for legacy brands that need to self-disrupt and make short-term sacrifices for long-term gains. But if they don’t, consumers will simply choose their competitors. Becoming circular and sustainable will become a prerequisite for business.