Teeth, your consumers and short-term trends
It’s said that a country’s prosperity can be judged by how busy its dentists are. People visiting their dentists is apparently a good measure of disposable income and availability of credit. Nothing to do with innovation. Just a practical response to short-term trends.
Here’s how it goes: families struggling to make ends meet focus on paying bills today and getting by. There’s not much long-term planning going on here. When they claw their way into a better situation, they can begin to plan for a longer horizon. This is where health and education get a boost.
At the same time, aspirational home ownership drives demand for consumables. Step up Amazon, Hermes and others, who are more than happy to deliver whatever you want within 24 hours, and if you pay by credit card, the banks are happy too.
But new stuff for the home can be too readily available. Over-consumption means debts aren’t so easy to service, and consumers slide back into short-termism, albeit with a new TV to watch the perfectly-targeted, psychologically-nuanced adverts for all those things they can’t afford anymore – unless they go for interest-free credit…
This kind of cycle goes on in the consumer’s world the same as it does in a business context. And because it does, we can read some signals of change. There’s a new dynamic looming right now, and it’s terrifying to some because it’s unimaginable. We may talk about the ’fuzzy front end’ when looking at future market landscapes, but this one is so unspecific as to be almost ghost-like. Yep, Brexit is scary.
Some forecasts would have the UK entering a(nother) period of austerity, with inflation rising to 5% or higher. In any case, it’s hard to find a forecast of a positive fiscal outcome in the months (years?) after the UK exits the European union.
The response from almost everyone we talk to is to hunker down and build a war chest to try to mitigate the inevitable rising costs – the business version of a jam jar to save for a rainy day. Few companies, large or small, are anticipating growth born of innovation.
Quoted businesses are obliged to make Viability Statements to reassure investors that they are planning for all eventualities. This is what PwC says a Viability Statement should look like:
Taking account of the company’s current position and principal risks, the directors should explain in the annual report how they have assessed the prospects of the company, over what period they have done so and why they consider that period to be appropriate. The directors should state whether they have a reasonable expectation that the company will be able to continue in operation and meet its liabilities as they fall due over the period of their assessment, drawing attention to any qualifications or assumptions as necessary. [UK Corporate Governance Code > Provision C.2.2]
What would yours look like?
There are only two kinds of business: those that need help and those that are doing well. In both cases, a conscious effort to anticipate how your market will change, irrespective of what the short-term influences might be, is a constructive way of developing a growth vision with practical steps built in.
We believe that innovation with a strong sense of consumer focus is how you achieve an outlook that supports a growth trend, or corrects a downward slide.
Design Thinking: it’s powerful. Let’s talk about that.
Seeing it differently. Future-proofing. It’s what we do.