20 trends you as a business leader need to know (and eventually master) as you draft and execute your long term growth (and survival) strategy - see more @ sws.ms
How the Heck do you Teach Level Design? Educating in the Studio
The 2016 Watch List
1. 20 trends you need to know when drafting
and executing your long term growth strategy
THE 2016 WATCH LIST
September 2015
2. Assume the world will be fully connected by 2020
Source: United Nations, 2015; emarketer, December 2015; Internet World Stats, 2015 (as of December 2014); Experience Think, 2015; Ericsson Mobility Report, June 2015.
1
2010 2015F 2020E
Global Population
6.9Bn
26%
42%
7.3Bn
60%
7.7Bn
Internet penetration
Smartphone penetration
10%
20%
3.1Bn
4.6Bn
1.9Bn
5.0Bn
0.7Bn
1.4Bn
Connected World
66%
3. Soon most devices, products -even clothes- will be connected2
Source: Business Insider, 2014. Cisco IBSG.
2005 2010 2015E 2020E
Personal
Computers
Smartphones
Tablets
Internet
of Things
Wearables
Smart TVs
0.5Bn
2Bn
12Bn
50Bn
Global connected device numbers grew 24X in just 10 years
Connected World
4. Consumer Business Security
Education Healthcare Government
All industries are playing the “digital catch-up” game to stay competitive
Source: KPCB, 2015.
3
Estimated global digital penetration, by industry
Connected World
5. GENERATION ZGENERATION ZMILLENNIALSMILLENNIALS
16 - 34 years old16 - 34 years oldweb firstweb first 0 - 15 years oldmobile firstmobile first
Young adults will redefine how we produce and sell our products and services
Source: Sparks & Honey, “Meet Generation Z:Forget Everything You Learned About Mille”nnials, 2014; Rob Norman’s, “Turning 13 in 2014”, BTIG, 2014, IAB México Teens, 2015.
Multimedia devices
Content focus
Socially integrated
TV prime-time chasm
2012 - 2014 hours per week change
On demand vs. linear
paid vs. free
2
share / mostly text
78%
-6hrs
create / mostly image/video
-5hrs
89%
5
50/50 90 on demand
mostly freePPV / DVR / ROD
( )
from
23 ( )
from
20
Millennials and Gen Z
4
6. People, values,
incentives and
global sourcing
5
Enhanced business
intelligence
Source: PSFK Labs, “The Future of Work,”, 2013.
“Great spaces”
Future of Work
Open
Knowledge
Constant learning
On-Demand
Staffing
Optimized skillsets
Optimal
Interaction
Digital + physical
employees-vendors-clients
The work enviroment must constantly adapt to an ever-shifting marketplace
7. 6 Technology investments and partnerships will drive productivity and growth
Worldwide enterprise software spending (Bn of USD)
2010 2017E
$55.2
$108.7
21.3
34.4
13.9
36.5
10.5
6.8
18.7
13.6
2.6 5.6
Source: Gartner, December, 2014.
Enterprise Resource Planning
CRM
Business Intelligence
Supply Chain Management
Web Conferencing
IT Spending
+$54Bn Bn
Bn
CAGR +10%
8. 7 Actionable business intelligence will be a mandatory competitive edge
Source: IBM Software Day, 2014.
Enterprises that apply
advanced analytics have...
33%more revenue growth
12xmore profit growth
&
Business Intelligence
Have a
consistent
view of the
business
Determine
where
to make
investments
Get
real-time
analysis
Identify
waste and
contain
costs
Improve
the decision-
making
process
Access
and share
information
easily
Business
Intelligence
9. Source: Forrester, eMarketer January, December; 2014; AMIPCI, 2015.
$2,541
$491
$75
$12
1998 2006 2014 2018E
Top 10 eCommerce
companies by revenue
eCommerce will enable accelerated growth and set new service standards
Share of e-commerce as part of total retail sales (Bn of USD)
0.1%
8.9%
8.5%
3.0%
2.9%
0.05%0.2%
0.3%
MEXICO
LATAM
GLOBAL
USA
eCommerce
8
10. 9
Source: Deloitle 2015. Bain & Company 2014.
Competition will lead us to embrace loyalty programs and new service standards
increase in profitabilityChurn
reduction
Loyalty-CRM
5
%
%
25-125
Retailers with loyalty programs are
88%
x
more
profitable
One new customer
=
cost of retaining a
current customer7
11. Recurrent revenue models generate exponential value based on lasting relationships10
Source: Gartner. BI, “Suscription Revenue Report ,” 2015 John Warrilow, “The automatic consumer,” 2015.
Higher multiples:
Enterprise Value / EBITDA (Aug 15)
of all media and digital businesses
embracing subscription services
incremental revenue of reported
global 2000 companies
40%
35%
Subscription Models
4in 5 CEOs believe customers are switching to
new consumption models like sharing or subscribing
128 44 4.28
12. Advertising grows 6%/yr through 2020; digital and mobile capture the lion's share11
Share of global marketing spend, 2004-2020 (% of total)
Source: Zenith Optimedia, 2014.
30%
12% 13%
0%
4%
6%
20%
11%
38% 37%
9%
6%
0.5%0.5%
6% 7%
@
2004
2017E
TV Radio Film OOHMagazinesNewspaper Digital Mobile
31%31%31%
Marketing Re-Mix
13. 37%
41%
11% 11%
4%
18%
8%
24%
24%23%
TV Radio Print Internet Mobile
Mobile marketing represents the biggest opportunity in terms of time
Source: IAB, emarketer, 2014; KPCB, 2015.
ADSPEND
TIMESPENT
OPPORTUNITY
$25BN
The mobile catch-up
opportunity
Time spent vs. ad spend (% of US 2015 total)
Marketing Re-Mix
11
14. 11 Marketing experts will dramatically change their marketing mix
Email marketing
LESS MORE
Mobile marketing
Social media
Search (SEO/PPC)
Online display advertising
Tradeshows and events
Direct mail
Public relations
Print advertising
Radio/TV advertising
61%
49%
40%
38%
37%
18%
17%
17%
12%
8%
4%
5%
1%
6%
8%
17%
22%
33%
18%
6%
Source: Sensorpro, Strong View Survey 2014.
% spend% spend
Investment increase/decrease based on "affirmative answers" (according to a survey of 377 global CMOs)
Marketing Re-Mix
15. 11 In Mexico alone, the “marketing re-mix” already happened
Source: CICOM, April 2015.
Marketing/advertising investment plus share change, 2005 vs. 2013 (Bn of USD)
Open TV
$2.9
-31%
Radio
$ 0.5
-15%
Newspaper
$ 0.4
-36%
Pay TV
$ 0.4
+20%
Outdoors
$ 0.4 -48%
Internet
$ 0.6
Magazines
$ 0.2
-58%
Movies
$ 0.1 -51%
Direct
Marketing
$ 2.1
Research
$ 0.4
PR
$ 0.4
GraphicDesign$0.1
Promotions and BTL
$ 3.8
+729%
+46% +85%-37%
+40%
Marketing Re-Mix
16. 33HRS
5HRS
22Min
29HRS
Hours spent watching video per week
Digital video is starting to compete head-to-head with live and linear TV
2010 2012 2014 2016 2018 2020 2022
Source: The Diffusion Group, 2014.
Digital Video
Live TV
Online Video
12
17. Mobile screens already capture one-third of all viewers13
Hours spent watching video, per day (adults 18+, USA)
2010 2015
7.2hrs
9.5hrs
0.4 6%
2.4 2.4
4.4
33%
61%
29%
26%
Source: eMarketer, April, 2015.
Mobile spikes from
6 to 29%
of screen share
Mobile spikes fromMobile spikes fromMobile spikes from
6 to 29%
of screen shareof screen shareof screen share
TV & Desktop
share drops 24%
total hours viewed remains flat!
Mobile
Desktop/laptop
TV
2.9
4.3
45%
Online Video
18. 14
Source: PwC, 2015.
Shared economy sector
Traditional rental sectorPeer-to-peer lending
and crowdfunding
Peer-to-peer
accommodations
Online
staffing
Car-sharing
Music and video
streaming
Equipment
rental
B&Bs/hostels
Lending libraries
Car rental
DVD rental
Global shared economy growth (Bn of USD)
Limited supply
Unlimited idle capacity
The sharing economy is impacting most service industries
$255
$670
50%
$335
50%
$335
94%
$240
6% $15
2014 2025E
The Sharing Economy
19. 15
Source: PWC, 2014; US Dep of Labor, 2015.
Future of Education
Education/learning systems and protocols are changing dramatically
77%of teachers use
technology to motivate
students in the classroom
43%of teachers using
gaming as a
learning resource
23%of total consumer/educational
book publishing revenues
derived from e-books
65%of today´s grade school kids
will end up at jobs that
haven’t been invented yet
1 in 3students take
an online
college course
Yesterday 2015-2018 2018-2025
Education/learning largely
fixed—centered on pre-programmed
computer or classroom
Peer-to-peer environment;
mobile media target kids in
general
Learning system adapted to
each child (vs. child adapting
to school)
20. 16
Source: Singularity 2015.
Artificial Intelligence
Machine learning is displacing numerous human tasks at accelerated speeds
1026
1020
1015
1010
105
0.0001
204520202015200019801960194019201900
1
Surpasses brainpower
of single human
Surpasses brainpower
of Insect
Surpasses brainpower
of mouse
Calculationspersecondper$1000
Surpasses brainpower
equivalent to that of all
human brains combined
Exponential
growth of
computing
The accelerating pace of change
Agricultural
Revolution
8000
years
120
years
90
years
22
years
Industrial
Revolution
Light
Bulb
Moon
Landing
World
Wide Web
Human genome
sequenced
9
years
Data
-
Information
-
Wisdom
21. 17 3D printing will disrupt a $10Tn manufacturing and design industry
Source: Peter Diamandis and Steven Kotler, "Bold: How to Go Big, Create Wealth and Impact the World," 2015.
On-demand parts in space
AEROSPACE
Co-design and co-creation with customers
RETAIL
AUTOMOTIVE
Sophisticated components/crowdsourced design
HEALTHCARE
Implants, prostheses, organs
COMMERCIAL AVIATION
Low-volume replacement parts
Disrupted
industries
3D Printing
material
reduction costs
energy use
reduction
Organic and
inorganic materials
Crowdsourced
design
Easy
prototyping
90%
50%
22. Gaming
18 The gaming industry will revolutionize how people interact, learn, love...
Source: Newzoo, 2014 Global Games Market Report & Service.
online population
1.8Bn 60%
gamers
2000$8Bn
$103Bn
3x Box Office
$32Bn
Gaming Industry
Revenue by
screen
24%
TV/Console
22%
Mobile
40%
PC
14%
Tablet
2017
23. Source: Rock Health funding database, 2015.
ANALYTICS AND BIG DATA DIGITAL MEDICAL DEVICES
Software/hardware designed
to treat a specific disease
or condition.
HEALTHCARE CONSUMER ENGAGEMENT
Consumer tools for the
purchasing of healthcare
services or health insurance
(B2B and B2C).
PAYER ADMINISTRATION
Management and
administration tools
for payers.
POPULATION HEALTH MANAGEMENT
Comprehensive platforms
for managing the health of
populations under the shift
to risk-based payment models.
TELEMEDICINE
Delivery of healthcare
services through non-physical
means (e.g. telephone, digital
imaging, videoconferencing).
Future of Health
The healthcare industry seeks to extend/improve quality-of-life
$381M $280M $238M
$223M $195M $172M
Data aggregation and
analysis to support a wide
range of healthcare use
cases.
19
24. New products
and services
Donations to
social causes
Quality
improvements
Social Value
BusinessValue
Source: Michael E. Porter and Mark R. Kramer, 2014.
Corporate shared-value models are effective and profitable20
Shared Value
Social-impact business modeling
Business
as usual
Charity
Shared-value
enterprises
Shared-value
initiatives
25. 2016
TRENDS TO
WATCH
MEDIA
& MKT
RE-MIX
DATA &
ANALYTICS
EXPLOSION
GAMING
3D
PRINTING
SUBSCRIPTION
BUSINESS MODELS
GLOBAL
CONNECTIVITY
THE FUTURE
OF HEALTH
NEW
CONSUMPTION
SHIFTS
MILLENNIALS
GEN Z
THE SHARE
ECONOMY
THE NEW
WAY TO SHOP:
E-COMMERCE
INTERNET &
SMARTPHONE
PENETRATION
DIGITAL VIDEO
TRUMPS
TRADITIONAL TV
MOBILE
FIRST
CORPORATE
SHARED
VALUE
DIGITAL
GROWTH VS.
TRADITIONAL
MEDIA
THE FUTURE
OF WORK
ARTIFICIAL
INTELLIGENCE
/ MACHINE
LEARNING
IT
SPENDING
GROWTH
BUSINESS
INTELLINGENCE
FOR COMPETITIVE
ADVANTAGE
LOYALTY
@THE CORE
INTERNET
26. ABOUT
info@sws.ms sws.ms
SWS is a hands-on consulting firm specialized in disruptive and
results-oriented strategy. Our client list includes global players and local
industry leaders in search for solid future positions that embrace the
powerful benefits the connected world can offer.
Focused on both the US Latino and Mexican markets, our strengths comprise
proven expertise in the telecom, media, marketing and digital space.