2022 has brought a renewed focus on environmental, social, and governance impacts of businesses worldwide, as we have discussed in our previous article, The Disastrous Effects of Climate Change on Your Business.
The Great Resignation is prevailing, with people skipping the job hunt and pursuing entrepreneurship.
According to Census data analysis by the EIG (1), Economic Innovation Group, a record 1.4 million Americans had filed applications to start a new business in 2021 alone. Over 54 billion USD was invested in more than 2k companies worldwide in October (2).
As a founder, we believe that you will have to prepare yourself for anything this year, and here is a glimpse of a new startup and industry trends that are here to stay in 2022.
Focus on ESG, Environmental, Social, and Governance Impact
This year has brought a renewed focus on businesses’ environmental, social, and governance impacts. It means businesses will have to put more emphasis on climate sustainability, procurement of raw materials, production, and the impact of their operations worldwide (3).
And we believe that the trend won’t stop with customers and the products they prefer. The trend is likely to take root for employees since younger generations want their employer’s values to align with theirs.
Overall, the complex challenges the world is facing today, including climate change, growing inequality, and energy transition, to name a few, have pushed organizations worldwide to take action. Businesses have started reinventing their business models, which is crucial for a sustainable future.
And companies that can help other businesses are set to win big in the upcoming years. Businesses need to evolve their practices and capabilities and be more ready and aware to incorporate ESG objectives. Entrepreneurs can help businesses assess, monitor, and advise ESG performance from value creation and risk mitigation standpoints.
Hybrid, Flexibility, and Personalization For Everyone
According to Alon Alroy, CMO and co-founder of events platform Bizzabi, the future of events will be hybrid (6).
“The future will be about choice and flexibility. There will be large and small in-person events, and however, each of those new ways for the gathering will also have a virtual component. And it creates a lot of room for innovation,” says Alroy (7).
We believe that whether it is events, education, or jobs, we will see an abundance of options for businesses and people in 2022. It is about finding what works best for you. To do so, you will need to be prepared to shape your future within the dynamic business landscape.
Flexibility is set to rise big in 2022, not only in workplaces but also among consumers (Suggested Reading: Forget the 9-to-5 and Get Ready For The New Workforce Trend).
“In times of uncertainty, people crave a sense of control over their lives,” says Simon Moriarty, director of Mintel Trends, EMEA (8).
Today’s consumers want to make informed decisions. Hence they look for flexibility, clarity, and transparency.
“Businesses will need to work harder to provide trustworthy information and strike a balance between authenticity and censorship. This trend can lead to a rising desire for products and services that cater to individual and personalized needs. For instance, people will seek more flexible options when it comes to online shopping, ordering, and delivery,” explained Moriarty.
Meaning, retailers who offer shipping information and availability upfront, omnichannel retailers offering real-time data on in-store inventory online are most likely to be successful in this new era (9).
Personalization is another key trend for brands in 2022 to win customers’ trust and build brand loyalty (Suggested Reading: 5 Tips About Building a Strong Brand Loyalty and Community).
People communicate with brands via multiple devices, with an average of three and 10+ channels. However, only a handful of brands offer personalized and optimized omnichannel customer experience (10). And if a brand doesn’t adapt to the trend with rising customer expectations, they are at risk of being left behind.
There is also an increasing awareness of data privacy among consumers. They demand businesses with the highest levels of privacy and security from brands they choose to interact with.
In the upcoming years, companies will have to dedicate more resources to ensure data privacy while also offering the customer-first personalized experiences that people expect (Suggested Reading: Your Ultimate Guide for Customer-First Content Marketing Plan).
Blockchain, Cryptocurrency, and No-Code Technology
We will see more disruption in traditional business models with blockchain, crypto, and no-code technologies in 2022. There is also room for crypto DeFi blockchain businesses to disrupt traditional markets with new business models (Suggested Reading: Democratization of the Tech World with Low-Code and No-Code Platforms).
It means there will be more innovation in the upcoming years, with no-code and financial technology becoming more accessible (11). It also means that legacy businesses, including insurance and finance, will see more competition from startups. Startups and small business owners can use these tools to overcome their inefficiencies and challenge established businesses (Suggested Reading: Big Impact on Banks with Fintech Players Entering the AMC Space).
Rise of Social Innovation
The series of challenges the world is facing right now, including the pandemic, climate change, rise of inequality, etc., has led to high demand for new and effective approaches to make positive social changes more than ever (12).
“It is the society that offers us the right to be active and license us to operate. Business leaders have to think about solving today’s societal challenges to have a thriving business tomorrow,” Peter Barabeck, Chairman of Nestlé (13).
Of course, corporate involvement in issues of society is nothing new. However, in 2022, it will become even more relevant to businesses (14).
Benefits of social innovation to businesses:
- Restoring Trust in Business: Brands that can enhance their net positive contributions to society are well poised to earn stakeholders’ trust.
- Adapting to Environmental Concerns and Resource Scarcity: We will see more pressure on companies to invest in transit to a sustainable business model and reduce their carbon footprint. Brands that will pursue operations and growth strategies focused on economic prosperity will be in a good position for long-term competitiveness.
- Attracting and Retaining Talent: As we mentioned, young generations look at business success differently than previous generations. They prioritize long-term sustainability over profit maximization for the short-term. Millennials and Gen Zers look at a “Sense of purpose” major factor when choosing their employers. In addition, there is also a minimum to a total absence of loyalty, which makes it crucial for companies to stand out. Businesses need to improve their efforts and adapt to the new generation to attract new talent, improve talent retention, increase loyalty, or face a high turnover cost.
- Search for Inclusion and Growth at Scale: Businesses that will turn society’s challenges like unemployment or lack of proper healthcare services into business opportunities will be in a good position for long-term growth and sustainable success.
- Transforming Performance Metrics: Growing number of investors have started considering environmental and social considerations into their investment decisions and performance metrics.
“In the long-term, environmental and social issues become financial issues,” – Lars Revein Sørensen, former CEO of Novo Nordisk (15).
Real Estate is Embracing Technology
In 2022, real estate will catch up to technology, which has become a core part of our lives. (16).
“2022 will be a year of enormous secular growth for real estate and property technology, proptech. Despite being one of the most important asset classes and lending categories, real estate has been sluggish to incorporate technological innovations,” says Brendan Wallace, Managing Partner and Cofounder of an investment firm, Fifth Wall (17).
Even though still in a nascent stage, developers are using virtual walkthroughs and online bookings to boost sales. Many have also started adopting 3D printing, IoT, and AI to improve construction quality and crunch lead time (Suggested Reading: 3D Printing is Growing Up in the Indian Market).
In short, developers leveraging technology are in a better position for improved decision-making and gaining higher long-term value.
Digital communication is also becoming normal in the real estate market, with buyers and sellers assessing information and offering consultations online (18). The industry has also started adapting online catalogs, video and virtual tours, and online transactions to make processors more efficient, swift, and user-friendly.
At present, the real estate industry seems to be bifurcated between companies embracing technology and those that don’t. We believe that the larger, more tech-forward, and more sustainability forward real estate companies are in a better position to grow and scale.
Overall, the coronavirus pandemic has transformed how we live, work, and socialize. Everyone is increasingly becoming proficient in navigating digital technologies in the new era.
As businesses and economies have started to open up, most of these trends are set to evolve. And businesses that follow suit are set to win big in the long run. The goal is to stay on top of new, emerging, and evolving trends and come up with creative ways to make them more efficient!