Walpole Editorial | 2020 Vision by Daniel Franklin
Let’s focus on what’s in store for the luxury industry this year and beyond.
The year has a pleasing ring: 2020 is a nice round number, with associations of clear-sightedness. In truth, it does not take special powers of foresight to predict some of its highlights: America’s presidential-election campaign, the next chapter in the Brexit saga, worries about an economic slowdown. Concerns over the sustainability of the planet will be aired at summits in October in Kunming (on biodiversity) and in November in Glasgow (on the climate). The Olympics in Tokyo and football’s Euro 2020 will provide welcome distractions. So will a new Bond film and performances of Beethoven’s works to celebrate the 250th anniversary of his birth.
Yet 2020 is not just another year but the start of a new decade. This invites bigger-than-usual thoughts about the future. Looking far ahead can shed fresh light on the more immediate future. So, if we take out the binoculars, what can we spy?
One way of answering this is to imagine yourself in the future, looking back at today. My Economist colleague Tom Standage speculates on what we are doing now that will appal our grandchildren. Among today’s habits that could become tomorrow’s taboos, he suggests, are eating real meat (when synthetic alternatives will be so tasty and common), a decadent failure to do more to combat climate change (when elevated frequent-flyer status will bring shame rather than prestige), and hopelessly staid attitudes to gender identity and sexuality (when technology further separates sex from reproduction).
Another approach is to focus on a particular industry and ask where its underlying trends are likely to lead. Take energy. Hayden Wood of Bulb, a renewable-energy company, predicts that in the years ahead the switch from fossil fuels to renewables will be as dramatic as that from fixed telephony to mobile. Or take the travel industry. Jane Sun of Ctrip, a Chinese online-travel giant, expects that over the coming decade the number of foreign trips taken by Chinese (almost 150 million in 2018) will double. And growing numbers of Chinese will venture out not in big groups but alone or with a few friends, often exploring off-the-beaten-track places. Six out of ten Chinese solo travellers are women.
Demography provides some of the best pointers to our destiny. A lot of attention is rightly lavished on the rise of millennials. But don’t forget the baby boomers. The peak of baby-boom fertility in the rich world was 1955 to 60, so the 2020s will be peak retirement years for boomers. Those aged between 65 and 75 are not going to retire quietly. These ‘young old’, as the Japanese call them, will be more active, healthier and richer than their predecessors. They will disrupt all sorts of markets, not least luxury ones.
Delving into data can lead to surprising conclusions about the future. For instance, figures on the rising numbers of Japanese women going to university from the 1990s onwards lead Bill Emmott, the chairman of the Japan Society, to predict that the dismally low share of women in leadership roles in the country is about to soar: he expects that share to double over the next decade. Swelling quantities of data, and increasingly powerful tools to analyse them, mean that the scope for such insights will keep expanding.
The 2020s can also be viewed through the prism of technology. Pessimism about the damage tech could do (to everything from privacy to democracy) exists alongside optimism about its problem-solving potential. Joanne Chory, director of the plant biology lab at the Salk Institute in California, thinks that finding ways to make plants store more carbon than usual, and keeping it trapped for longer, could be part of the solution to climate change: she hopes this could enable carbon dioxide to be drawn down at a global scale in ten years. Demis Hassabis, chief executive of DeepMind, believes artificial intelligence to be the most important technology ever invented, which will “unlock whole new areas of scientific discovery, improving the lives of billions of people”.
All these trends – changing social attitudes, China’s global consumers, the coming boomer boom, increasing insights from data, accelerating tech advances – will have implications for luxury businesses. The precise impact in 2020 may be hard to discern. But the trends suggest that industry leaders ought to consider the effect on their brands of emerging taboos, explore the opportunities to cater to independent-minded Chinese and to high-spending ‘young old’, and make sure they are both positioned to harness the power of data and prepared for accelerating disruption from technology.
The broader point is about the value of focusing on the longer term. Anyone who wants to be at the forefront of luxury will surely not want to waste an opportunity to think bigger than usual. So why not start the decade with a simple question: what’s your 2020 vision?
Daniel Franklin is executive and diplomatic editor of The Economist and editor of The World in 2020.