New technologies, evolving customer demands, and societal shifts are rapidly changing the business landscape. To help you out with these changes, I have compiled some data on the different industry shifts to look out for in 2020 and beyond.
First and foremost, let's analyze the reasons because of which startups fail.
It is really hard to become a successful entrepreneur. To illustrate, of all the new startups that were put up in 2014, only about 56% survived until their fifth year. This is attributed to the many hurdles and challenges that lurk in the ever-changing business landscape.
Many new (and even seasoned) entrepreneurs fail to keep up. Thus, they get selected out of their respective evolutionary markets. You don’t want to fall into these early traps. So, it might be best to keep up with emerging trends in entrepreneurship today. This way, you’d get more chances of lasting longer in your market’s evolutionary path.
1. Rise of Digital Nomadism - A few years ago, we started witnessing the rise of digital nomadism. Although, we believe that it hasn’t reached its peak yet and it will grow even more in the next 5 years. A huge percentage of the workforce has chosen to work from home or to keep several freelance jobs. This, as many can attest, is a gateway to entrepreneurship. Many who start out freelancing end up creating their own consultancy or professional services business.
Moreover, this gives other established entrepreneurs more employment options. Having remote workers may help entrepreneurs save money on electricity, overhead costs, and equipment upkeep.
With the popularity of online shopping, the prevalence of social media use, the nearing implementation of 4G & 5G networks, and the increasingly sophisticated computers available on the market, it seems that having a commercial space is no longer a requirement for building a thriving company.
2. Globalized Business - While digital nomadism enabled entrepreneurs to manage their business all around the world, globalism is the practice of working with international teams to build, support, and expand their businesses. This has been a general trend for several years now and it has still made its place in 2020.
With the level of connectivity, we have today, more and more businesses are choosing to go international to expand their customer reach.
Many businesses now, more or less, cater to customers worldwide. So, it makes sense that entrepreneurs build connections with people from across the globe to understand their target markets better.
3. Mobile Commerce - Consumers are glued to their phones. People clock in around three hours and fifteen minutes a day on average on their phones. Most people also check their mobile phones about 58 times a day. Thus, clever entrepreneurs leverage this to their advantage.
From 2010 to 2017, eCommerce's total sales rose to 166%. Thanks to companies like Amazon and entrepreneurs that use the platform. Moreover, by 2021, mobile commerce is expected to account for 54% of total e-commerce sales. Thus, entrepreneurs and start-ups should keep this trend in mind. The pie is growing and there may be more slices for them.
4. Social Commerce - As mobile phones became an avenue for e-commerce, so has social media. As social media becomes more popular, many people just started doing something quite natural — they started selling and buying online social media sites and apps.
In 2016 the social networking giant relaunched Facebook Marketplace. This project came to the fore as executives noticed how their platform was being used by customers for buying and selling organically.
In fact, 450 million people have visited “buy and sell” Facebook groups. Thus, Facebook leveraged this use and made social commerce better.
We should not only expect an increase in the number of people in social commerce. We should also anticipate that social selling will be more sophisticated in the coming years.
5. Increasingly Niche Markets - Most people want to be unique. This is a universally shared preference. this is the trajectory where being customer-centric will lead. And, high customer-centricity is the breeding ground for more niche markets. Take the food industry for instance. Many giants are now catering to niche preferences by customers. Vegan and vegetarian consumers are given attention now by fast-food joints.
Thus, entrepreneurs need to keep an eye on these niche developments. There may be opportunities there.
6. The Rise of Subscription-based business - According to recent research, the global subscription market will be worth $10.5 billion by 2025. This is because of two main factors–the rise of subscribers to existing brands and the increase of new subscription-based models.
Today, the subscription-based model in businesses is picking up more steam. Think about music and movie streaming or even planned meals. Our local gyms have a subscription-based scheme as well. Now, online classes and apps do too.
Getting steady revenue streams just makes more sense than intermittent sales. Subscription-based models are also more convenient to customers, especially with automatic recurrent payment schemes.
7. Adoption of Disruptive Technology - Disruption has been a buzzword for many years now. In the original intent of its authors, a disruption only happens when a product or service takes root in simple applications at the bottom of a market. Then, it moves up this market and eventually displaces more established competing businesses.
Technologies like Uber and Airbnb can be considered as disruptive technologies. Think of Airbnb providers taking up chunks of hotel revenues. In fact, Airbnb beats Hilton in terms of revenues.
8. Growing Importance of Social Responsibility - In the age of social media, people tend to find and share information in an instant. Today, around 92% of Millennials prefer buying from ethical brands. This is one societal shift that creates new niche markets. Many entrepreneurs also take advantage of them somehow by providing the right products for the socially-responsible consumer.
One piece of advice, though. When you take up ethical marketing, be authentic about it. Don’t just do it for the bucks. Sure, the bucks will come when your selling point resonates with your target customers. However, when ethical branding is not consistent, you’d get backlash. And, this is bad for business.
9. Younger Entrepreneurs - The last “Great Recession” created economic conditions that made it hard for Millennials to find good-paying jobs. So, many seek out non-traditional career paths like going into business. Thus, the entrepreneurs of today are younger than ever. This also creates other entrepreneurship trends as well.
Entrepreneurship for many is all about freedom. Many young people (26%) go into business because they want to be their own bosses. Others want to pursue their passions (23%).
10. More Internet Media Outfits - Many entrepreneurial young people resort to creating internet content. The Great Recession and other factors have contributed to creating this type of niches.
Gamers, comedians, artists, educators, and many more flock to social networks to create and monetize content. Enterprising young people don’t have to start their own brick-and-mortar business. They can now create media outfits on their interwebs.
There are many avenues to share and promote media. Gamers have Twitch. Musicians have Spotify. Everybody else, has YouTube.
Internet media and content seems to be a good fit for entrepreneurial young people. This is because 96% of internet users that are on YouTube are in the age range of 18 to 24. This makes it easier for younger creators to make relatable and engaging content for their peers. In the next few years, we expect more and more entrepreneurial youth to venture into creating internet media outfits.
11. Mobile Businesses -
Mobile businesses are booming. In fact, experts estimate that the food truck industry is worth more than $2.7 billion today globally.
Non-culinary-inclined entrepreneurs have other mobile business options. They can venture into other services like moving services, health services, beauty services, junk removal, cleaning services, tutorial, auto detailing, and many more. In this way, they can monetize the skills they pick up from their hobbies or their backgrounds and upbringing.
The barrier to entry in mobile businesses is quite low. Also, the chances of getting into a niche market are quite high. This is why it is attractive to many entrepreneurial people.
12. Hyperlocal Specialty Shops - There are many kinds of hyperlocal specialty businesses out there. Their common ground is that they sell products and services uniquely relevant to their localities. Hyperlocal specialty shops examples include religious shops, thrift stores, fireworks retail, smokers’ accessories, art supplies, and antiques among many others.
They cater to the interests of various segments or niche markets in their localities. The barrier to entry is also quite low for many of them. Thus, we expect that more of them will be put up in the next few years.
13. Green Businesses - Today, many entrepreneurs are gunning for environment-friendly products. Environmentally-conscious policies, products, and information drives have affected the psyche of consumers. Example: The global electric vehicle market rose by 63% in 2018, reaching 5 million.
With the green movement slowly getting traction, we expect more businesses that cater to this niche. These include companies offering recycled office supplies, green architecture services, non-toxic cleaners, and social innovation firms.
Young entrepreneurs could definitely ride the wave of this trend.
No trend is in a vacuum. All of these play different roles in the concurrent shaping of the socioeconomic landscape today. It is wise for entrepreneurs and, more so, to aspiring entrepreneurs to recognize the interrelations between them.
Sources: Guidant Financial | CB Insights | Finances Online | And.co Anywhere Workers Study | Pew Research Center | Big Commerce | Master Card 2018 | Shopify | Education Dive