Outlook 2022: EMEA POV
Four trends shaping the future of media & technology in the EMEA region
Written by Kate Walkom, Group Account Director & Luke Rossi, Strategy Associate Director, UM Worldwide
With contributions from; Archard Yabsley, Digital Transformation Manager; Olivia Morton, Communication Planner; Hannah Sanderson, Strategy Manager; James Marsh, Strategy Executive; Aisha Kalokoh, Media Executive; Isabelle Milnes, Media Executive, UM Worldwide
Welcome to the IPG Media Lab’s 2022 Outlook. Each year, we round up the ideas that excite us for the next few years: new technologies, market forces, and shifts in consumer behavior that are changing the media landscape. Since 2006, the Lab has worked with clients to help them best adapt to disruptive change.
Guided by a forward-thinking perspective, the Lab team explores emerging technologies and their potential to become new media platforms. Our focus on research and strategy enables us to analyze the latest platform developments, understand how they will impact consumers, and advise our clients on how to navigate the disruption they bring. Through a finely tuned vetting process, the team organizes their findings, manages introductions, and recommends these partners to solve client challenges or bring forward new opportunities.
The Outlook is informed by our growing team across EMEA and is an overview of the trends and topics that we expect to break out in the next few years, why we’re convinced they’re important, and how you should respond. We hope you enjoy it.
EMBRACING ENTROPY
As COVID becomes endemic in much of the world, we are starting to see which cultural changes and behaviors from the past two years will become permanent, and which will recede. It’s becoming increasingly clear that the only common theme of the 2020’s will be entropy.
There are still so many unknowns still to be answered: When will our supply chain issues be resolved? What will the future of work look like? And what will the “new normal” look like? The answers to these conundrums will probably be influenced by when you are asking them. The obvious answers today will likely be different from the answers that emerge next month, if not next week. It’s safe to say that the world is in a constant state of flux. What’s clear is that over the next three to five years, the most reliable prediction will be disorder, with multiple possibilities happening at once, and sometimes even changing daily. The only thing we are left to do is to embrace the entropy with flexibility and adaptability.
The future of work is a main area where we see this agility is being exercised. Will we all go back to the office? Will we be remote or hybrid, or will we work in the metaverse? The answer is Yes, and more specifically, probably multiple different versions at once, depending on the person, the company, and where they are. Studies show that 89% of European businesses have or plan to have a flexible hybrid approach — whether that be core hours, working from home or flexible time.
And even though the entropy of the world seems like an issue too big for brands to tackle, consumers are asking us to. And the most innovative brands and businesses are beginning to find opportunity in the entropy! As 2022 and beyond is looking destined to be full of VUCA — Volatility, Uncertainty, Complexity and Ambiguity. Fueled by digitalization, increased complexity in supply and demand, globalization and hyper connectivity. However, once we begin to accept that entropy is no longer something we should try to resist, we can begin to see the opportunities that lay beyond.
Because we are more capable and adaptable than ever before. Computing power and speed, complex algorithms, artificial intelligence, instant communication, all helps to make our businesses faster and more efficient than we could have ever imagined. The next step is for us to look beyond the physical constraints of our situations and consider what our fundamental approach will be to the challenges we face.
One way of doing this for organizations and marketers in this age of entropy is looking to balance the “inside-out” approach with an “outside-in” one. The outside-in approach is guided by the belief that customer value creation is the key to success. This means that they must get totally immersed in what their consumers are thinking, constantly finding new ways to expand demand. On the flip side an inside-out approach is guided by the belief that the inner strengths and capabilities of the organization will produce a sustainable future. This approach starts by evaluating what is absolutely fundamental and core to the business, and leverages this to build customer relationships, distributions and comms, starting with core values.
What we know particularly in these challenging times of rapid change is that the best organizations skillfully employ both approaches. Such organizations know that the most effective business strategies need to consider both internal values and external tides if they are to win in the modern-day world of entropy.
Though this entropy poses significant challenges, it also presents opportunities. Many consumers will be overwhelmed, and trusted brands may be able to provide a beacon, both in terms of how to navigate the world, and in providing actual solutions in the face of monumental global problems. The only real danger is in assuming that the world won’t change quickly, that the rest of the decade will look or behave as it did at the start. By embracing the change and welcoming the unexpected, we can use the entropy of the 2020’s to upgrade and modernize the pieces of our culture which are still clinging to twentieth century models, and truly future-proof ourselves against whatever may come next.
POWER TO THE PEOPLE
The pandemic has reshuffled the balance of power in our culture — but not in the way we might expect.
Though the physical restrains of COVID may be slowly coming to an end, there’s many other major disrupters on our doorstep. Turbulent politics and climate change are affecting daily life in countries around the world. With individuals being louder and prouder than ever, we are seeing people come together to create room for their voices to be heard. The Washington Post reports that that 54% of protests are due to perceived failure of political systems and 28% of people are prompted by the demand for real democracy.
This re-distribution of power and influence has been particularly evident amongst climate crisis campaigners. Research from the BBC shows that 60% of young people feel either worried or extremely worried about climate change. And with many governments perceived as relatively averse to drastic climate change legislation, we’ve seen grassroots movements such as Extinction Rebellion and Insulate Britain, among others, catapult into the zeitgeist across Europe. Younger consumers have bolstered the cause, with 66% of Gen Z and 57% of millennials agreeing that environmental concerns should take priority over economic growth, according to a study by the Policy Institute.
As a response, brands are taking sustainability more seriously than ever. While some companies are openly supporting these climate activists and movements, others are more subtly helping consumers do their part for the environment, by banning eco-buzzwords to help them make more environmentally conscious decisions. Acknowledging the inherent structural issues that the fashion industry face when it comes to sustainability, Patagonia recently decided to remove the word ‘sustainability’ from all their comms and advertising. Until the structural issue is addressed, any ‘sustainability’ claims would merely be “green-washing.”
There is a growing number of consumers recognizing how they can use their financial power to drive pro-environmental action. And they’re turning to technology to help them do this. App Sugi shows users how much carbon their investments generate and teaches them how to offset these emissions. Interestingly, some apps are becoming important tools and platforms for activists, campaigners, and the general public to make their voices heard, further tipping the balance of power to the people.
In the Middle East, activists are harnessing social apps to bypass government censorship and social taboos. For activists concerned with sexual health in the region, social media has become the sole way to avoid public censure and connect with Arab women. Besides the physicians using common social platforms like Instagram and TikTok to spread information on feminine and reproductive health, some activists have come together to set up the Mauj, a pan-Arab project that provides a safe space for women to discuss “taboo” issues such as sex, body shaming, and harassment.
A mixture of pandemic-induced economic uncertainty and burnout has led to a shift in power dynamics when it comes to work. We’re seeing many of the younger generations upright leaving their jobs and industries with what’s being dubbed “The Great Resignation.” A YPulse survey estimated that 20% of millennials in Western Europe quit their job in the past year, and new research from Right Management predicted that 24% of UK employees are looking to change their job in 2022. Design consultancy firm Arup is giving employees the flexibility to work anytime they please across the week to help combat this, and a new legislation in Belgium now entitles workers to a four-day work week, with the option to ignore all work related messages during after-hours. This shift in power is providing employees much greater control with their work-life balance and helping people re-prioritize their lives all together.
With a growing number of employees reassessing their priorities and values, combined with the empowerment given by digital platforms, we are seeing many employees taking the leap into the creator economy. And the creator economy is in fact enabling enterprising creators from video game streamers to fashion designers — to grow, engage with, and monetize their online communities and fandoms. The European creator economy is starting to boom, and Forbes predicts it could well be the next defining region for this bourgeoning sector.
Creators are increasingly exploring new ways to generate income and diversify their revenue streams. This will lead to more tools and platforms being built for service creators, with some possible consolidations. NFTs will also have a large role to play in the creator economy going forward. Helping creators establish the originality of their work. With fractional ownership comes a whole new host of possibilities. Where brands will need to consider how they maintain some level of authority, whilst giving up enough control for allow for consumers to put their own stamp on the assets they now own.
The era of passive consumption is over, brands need to consider their customers more when it comes to co-creation and community building. Empowered consumers expect a more reciprocal relationship with companies and content creators. Many are open to being consulted as stakeholders, with the power to consult, co-create and ultimately determine commercial offerings for themselves. We are entering a new era where customers are treated like peers and collaborators, rather than anonymous economic units whose sole purpose is to consume, without input or question, the latest marketing message or offering.
Global research company Foresight Factory states that 51% of consumers agree that they would like it if their favorite brand asked for their ideas for new products. And we’ve already started to see this. In France, beauty brand Nidè financially incentivizes and rewards consumers for their input into new product ideas. The brand describes itself as “the cosmetics brand that will never do anything without you!”. It believes that customers have the best ideas for products and facilitates co-creation within its community. Moving forward, co-creation will become a common NPD approach. Featuring consumer-led beta testing and community ideation, with more consumers wanting to be treated like peers rather than passive consumers.
LIFECYCLE LOYALTY
As we look beyond the typical consumer-brand relationship, we see a shift in focus on how brands are now reinventing the customer experience in order to retain their loyalty and optimize the lifetime revenue potential of a customer.
It’s no longer enough for companies to encourage purchase simply through high-quality customer service. They must now seek to maintain beneficial and active relationships with the consumer over the long term to encourage loyalty. Industries such as car dealerships already maintain this type of contact with vehicle owners by offering further services they’ll most likely need in the future. This strategy is also widely deployed by tech brands like Apple through consistent software update and hardware trade-in services.
Across industries, companies are starting to realize that maintaining this relationship over the long term increases the likelihood that, when the time comes for the consumer to replace that purchase or make an upgrade, the consumer will simply choose the latest from the same brand they already know and love. After all, according to Gallup research, highly-engaged customers are likely to buy more and can produce 23% more revenue than the average buyer, resulting from an emotional bond that the smartest brands seek to cultivate with their best customers.
Today, conscious consumerism is on the rise, as consumers look to shop in ways which make a positive social, environmental, or economic impact to balance some of the negative impact consumerism can have on our planet. Brands like IKEA are aware of the ethical concerns and are actively changing perception of their items being bad for the environment. The furniture company has taken steps to improve that outlook by focusing on the durability of their products. They now provide shoppers with guides on how to disassemble their furniture, so the consumer has more options on whether they’d like to put their IKEA items in storage in case they are moving homes or reuse it at another time. Whilst this initiative may result in the customer having to make less purchases from the company, the upside is the improved customer satisfaction which will likely generate more loyalty to the brand.
To establish a long-term relationship with the consumer, brands can either expand their service or product offerings or, re-focus on extending their product lifecycles to appeal to more conscious consumers.
Over the years, we’ve seen the increasingly popular trend of second-hand shopping. Consumers are now looking for ways in which they can do their part. Therefore, it is key for brands to identify ways in which they can aid this and align with their audience values. For example, Furniture company Made have partnered with the tech company Geev. Geev is an app-based marketplace designed for donating items such as furniture between individuals free of charge. Made also incentives their users as the furniture company donates 10% of the customer’s order value across five charities, one of which helps disadvantaged kids across the UK. This is a fantastic initiative as it enables embedded sustainable and charitable practices quickly and efficiently at every stage of purchase. It also creates a circular business model that has positive impacts not just within communities but also the planet, forging a new way for the brand to earn customer and lifecycle loyalty.
Other businesses are naturally structured in a no waste way which aligns with consumers today who are consciously stepping away from fast fashion. An example is Vinted, the largest online consumer-to-consumer marketplace and app in Europe. Vinted have partnered with InPost to provide users with an eco-friendly parcel locker service to collect and return parcels quickly with contact-free delivery. The service operates across Europe offering an economical and convenient option that benefits both brand and consumer. This service helps reduce CO2 emissions by as much as two-thirds in cities compared to door-to-door services.
Being aware of the values consumers hold is crucial. For Gen Z, when making a purchase, this group are not just considering a product’s upfront cost, but also its resale value and responsible recycle options. From resale, swapping and upcycling, to charity donations and returns, big brands like Primark, H&M, and Balenciaga are tapping into a digital wardrobe app called LOOP, launched by sustainable fashion company Yellow Octopus, to ensure their customers of the secondary life of their products. Offering authentic solutions that not only maximizes the life of the product but also creates a fast and effective way to create meaningful difference.
In high-consideration categories like appliances, we’re seeing brands are using software to improve their customers experience over time. Home appliance company Whirlpool just announced that all their Wifi-enabled ovens are getting a software update. This update will enable an air fry mode — a cooking trend we’ve seen gain increasing traction over the last few years. With an average replacement cycle of 13 years for most appliances, being able to promise this kind of continuous improvement via software is a sure way to win consumers and allow them to feel comfortable with higher price points. All of which will prolong the lifecycle loyalty of their consumers.
The constant but necessary need for reinvention isn’t just seen in offline products. Netflix have been at the forefront of innovation for years yet continue to look for opportunities to reinvent and expand their offerings. Whether that be through new content or new business lines such as their acquisition of Finnish gaming platform NextGames. The streamer has identified the rise of gaming through its increasing popularity. And have ventured into the territory to offer a diversified platform that now extends far beyond traditional entertainment. For Netflix, constant innovation is future-proofing their business, whilst maintaining that ever important connection with the consumers for this generation and next.
Lifecycle Loyalty looks far beyond the standard consumer-brand relationship and focuses on how the brand can actively win consumer’s loyalty through aligning with the ever-changing values of the consumer, increasing their product offerings and maintain long term communications.
THE MULITPLAYER INTERNET
The metaverse is a topic that everyone is talking about, and here at the Lab, we’ve been talking about it by focusing on platforms and strategies that are driving it, such as Facebook’s investment in VR and Fortnite’s live events. That truly immersive internet is going to take years to come to fruition. In the meantime, we’re going to start to see bits and pieces of it integrated into products we’re already using today — No headset required.
The world of online avatars is nothing new: Second Life made them mainstream in the early 2000s and now Apples Memojis are incorporating them into our day to day lives. It’s the caveat of interoperability however that has seen massive growth over recent months and that is set to continue in 2022. Twitter has even rolled out an NFT integration for its app in the form of hexagonal profile pictures. However, initial exploration into the space has been dominated by the wealthy and famous, or those in the know when it comes to the space. As the industry moves out of its infancy, companies in the space are gearing up to encourage wider adoption.
Estonian studio Wolf3D’s ReadyPlayerMe offers a far more accessible way for building a “digital twin,” offering cross-game, metaverse-ready avatars for over 1500 platforms such as VRChat, Spatial, and Animaze. With the platform recently securing €13 million in Series A Funding, they plan to help developers drive growth through avatars, in-game asset sales, and NFT’s. There is also a major opportunity for brands who can partner with these developers, similar to the Roblox model.
The entertainment industry took a big hit with the pandemic, but they have restructured and come back with more opportunities than ever. You’ve probably seen the Travis Scott x Fortnite concert by now, but in Europe, everyone is talking about ABBA! They are embarking on a world tour later this year, but their physical form will stay at home. Holographic avatars, also known as ABBAtars, use cutting-edge tech to provide ticket buyers with a hybrid reunion tour like no other.
It’s not only how we are perceived on purely superficial level that is set to shape the future of online personas. It will be the overall increased sense of presence, an awareness of who’s online with us, who was there before us, and what they found most interesting or important. We already have an ambient sense of awareness for our digital presence, but it’s the coming together of communities online, in real time, that will shape the future.
2022 was the year of many sporting moments, but the one that captured audiences the most was Lionel Messi’s PSG Twitch interview with the Spanish influencer Ibai Llanos. Broadcast live on his Twitch channel, it was arguably the biggest sports interview of the year. And the front row seat offered to Twitch viewers was a blow to the traditional offline world of broadcast media. That once passive viewing experience of a sports interview is now transformed into an active and social experience shared among sports fans online.
We are also seeing this connectivity and presence bleed into other forms of entertainment. Spotify, whilst not the most social of platforms has a strong track record on personalization, as well a focus as shared presence with their Friend Activity side bar. With the introduction of the ‘Blend’ feature, they’ve combined the two. Blend combines the music you and friends listen to, updating daily with songs based on all of your listening habits. This not only speaks to everyone’s innate love of sharing passions, but connects these in a live, digital experience that pushes the boundaries of connectivity online.
The idea of a time shifted togetherness also lends itself to more niche interests and communities. Discord as a platform embodies this perfectly. While it has roots in gaming communities, the live chat platform has surged in popularity with those seeking to connect with others over shared passions and topics, from Formula 1 to Uno. The real-time nature of Discord makes it well suited for virtual events, something the platform is prioritizing with the launch of its ‘Stage Channels’, a voice only channel that splits crowds into moderators, speakers, and audiences a la Clubhouse and Twitter spaces.
Italian fashion house Gucci is a good example of a brand that has explored the idea of shared presence. As part of its wider Metaverse strategy, the Gucci Vault server on Discord acts as a place for them to experiment with live communications. As well as acting as a hub of information on the latest drops — Gucci also encourages everyone to connect with other members and find common obsessions on Fashion, Art & Vintage Styles.
This kind of presence online isn’t just a new feature, its fundamentally transforming the experience. In the physical world, a crowd may draw curious on-lookers, but it may also deter more people from joining; In the digital world, capacity is rarely an issue and communities keep growing.
But what Discord offers consumers is just one small piece of the puzzle. The tools for enabling this kind of presence are developing quickly. The most recent iOS update included several developer tools focused on live presence. SharePlay is designed to let you share an in-app experiences with friends via a FaceTime call — a lot of video services supported it on day one like Mubi, for watching movies together remotely, but it can really apply to any experience.
Before long, live presence and time-shifted togetherness will be the minimum for every platform, and something that users are going to start to expect. By experimenting with them now, we can figure out what works for our brand, our category, and our consumers.
THE GREAT ESCAPE
With Entropy, and the anxiety that it fosters, we foresee an increase in the collective desire for escapes, both physical and virtual, among consumers in the coming years. As we gradually learn to live with the coronavirus and gingerly step into the new unknown, it goes without saying that we could do with a break. But what exactly is a break? In this advanced technological era, do we need to take a step back from the digital realm, or can the metaverse provide a brand new world to provide us with the escapism we all desperately look for?
From the digital metaverse to simply binge-watching Netflix shows, escapism is now more accessible than ever. While techno-utopianism drives hard towards the metaverse, which promises the chance to start fresh in the digital world. On the contrary, excessive screen time has led some people to become Neo-Luddites who strives to limit their usage of digital devices, leaving their phones behind to explore the nature without digital distractions. With this contrast in mind, we will need to find ways to embrace the contradiction. By engaging meaningfully with the issues of the era, whilst also offering consumers an unforgettable escape from their daily lives.
We all know fitness was a huge trend during the first stages of the pandemic, with one of the major fitness trends that remains a driving force moving into 2022 being running, with the number of people who run once or twice a week have increased by 117% year over year in 2021. Therefore, it is no surprise that there has been a surge in the popularity of innovative running apps.
One such example is Running Stories, an audio-based entertainment platform that turns running routes into immersive experiences using live data. As the world’s first app that guides, monitors and entertains runners, the app uses data on location, weather, running speed, and others to make the runners feel like the main character in their own story. Creating a seamless hybrid between fiction and fitness has emerged as a ground-breaking development, opening up new opportunities for brands to integrate wellbeing values into their products whilst enhancing consumer experiences.
Sometimes, escapism comes with a side of educational value, and some brands are tapping into this type of informative entertainment to delight their audiences. Museums are now delving into virtual and augmented reality to increase engagement too. Microsoft’s HoloLens technology has allowed The Natural History Museum in Paris to launch its first exclusive Augmented Reality experience. The project titled “REVIVRE” lets visitors come face to face with digital artifacts and animals. Similarly, The National Gallery in London immersed their paintings beyond the museum walls, scattering QR codes around the busy streets of London which transformed to artwork once activated via their app.
The Netherlands have taken a slightly different approach, by experimenting with lessons in magic mushrooms. Radix Motion and Red Light Holland Corporation created WisdomVR, an educational VR experience designed to explain the effects of magic mushrooms. The game allows you to see exactly how psychedelics changes the way your brain operates within a neuroscience framework, adapting sensory experiences. As we can see, VR & AR is not only shifting but enlightening the ways in which we can escape through learning, moving into 2022 we expect this trend to drip into many other areas in which entertainment can promote educational values.
The tourism sector is also seeing a huge rise in digital integrations. According to research, almost 50% of people would use VR as a tool for choosing their holiday destination. 13% were willing to pay for VR headsets to experience the true element of travel. From planning to packing, exploration to flying; digital is revolutionizing the way we travel. Companies such as Zamna are developing ways to verify the identity, travel details, and even the health of passengers before they leave home. This applies blockchain technology to digitally verify and connect passenger data between airlines, governments and security agencies so, once within the airport, all parties know who is who and who is traveling where.
But it’s not just VR and tech that attracts those searching for the ultimate disconnect. 2022 is set to see a new and emerging wellness trend, the emotional escape room. This abode is a mysterious new movement that Pinterest predicts will reset our modern decorating ideas as the ultimate fusion of interior design and wellness trends. Whether it’s to unload stress in a meditation space, or to let out some anger in a rage room — If you need a place to go to “feel all the feels,” there’s a room for that. The next generation of great escapists are not just addicted to their phones, but they are in fact creating the escapes from their negative emotions in their own homes.
All in all, with the abundance of escape routes, new working structures and sustainability at the top of mind, technology will continue to constantly fold itself into the architecture of our normal lives. Resolving issues from efficiency, to simply enhancing experiences, educational skills and togetherness, the key for brands will be threading a needle, carefully and with authenticity. Not expecting all consumers to have the energy to engage with value-driven activities all the time, and not presuming that the definition of escape is the same for everyone. The brands that can do both; be both meaningful, and offer a uniquely fun buying experience, will continue to cement their standings in the world, and be a source of order in all the chaos.
