LIVE FROM COMMUNICASIA, SINGAPORE: Changing consumer demand and priorities will force companies to replace their traditional “value for money” business model with a “value for many” model, said Ajay Sunder, Frost & Sullivan’s VP of telecoms for Asia Pacific.
This is one of a handful of megatrends that telecoms service providers need to prepare for over the next 10 to 15 years that Sunder outlined in his keynote at the event today.
Sunder noted that the rise of generation 21ME (me, myself, mine) is drastically changing the way companies do business, as this group wants everything personalised, available 24/7 and immediately. This generation also tends to be more caring and environmentally conscious.
Frost & Sullivan expects this group to increase to 2.5 billion by 2020, with 61 per cent in Asia.
This attitude, which is shared beyond generation 21ME, has given birth to shared buying and more efficient use of resources and capital.
A common characteristic of the key megatrends, he said, is that they are all connected and intertwined and have global ramifications, which offer scalable opportunities for organisations. “These forces are changing rapidly and bringing new competencies into play at half the life-cycle speed of the past decade.”
He said organisations need a megatrend champion and teams to exploit future opportunities by identifying relevant new business models.
Organisations are also being pushed to “innovate to zero”, which means setting goals such as zero emissions, carbon neutral cities, zero defects and faults, zero accidents and zero crime rates.
A trend that isn’t new — connectivity leading to the convergence of more products – is now accelerating and driving transformation across all industries. He gave the example of pay-as-you-drive models.
By 2020 the average consumer will have 10 connected devices, he said.
The move away from brick-and-mortar stores is having a huge impact on retail space. Frost & Sullivan predicts that by 2020 store size will decrease by 15-20 per cent from 2011 levels. The retail sector is being transformed by the integration of in-store, online and mobile applications to create an omni-channel shopping experience.
Another key trend is urbanisation and the rise of mega infrastructures, which Sunder said includes mega regions, megacities and, unfortunately, mega slums. The world has 34 megacities, defined as having a population of more than eight million and a GDP of at least $250 million.
China is projected to have 13 megacities by 2025, contributing $6.24 trillion to total GDP.
As an example of the power of cities, he said Seoul currently accounts for 50 per cent of South Korea’s GDP, while Jakarta accounts for 30 per cent of Indonesia’s.
Companies also need to explore beyond the BRIC countries for the next wave of game changers. He said look out for Mexico, Poland, Turkey, Egypt, South Africa, Indonesia, Thailand, Vietnam and Philippines over the next 10 years.