Future thinking - Digital Connectivity

Future Thinking

#DIGITAL CONNECTIVITY* SOPHIE OTTEWELL // N0630284 BA (HONS) FASHION MARKETING & BRANDING Word Count: 3298

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INTRODUCTION & METHODOLOGY

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TREND DRIVERS

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TRAVEL & TOURISM

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DIGITAL CONNECTIVITY

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SOCIAL MEDIA

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FUTURE THINKING

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CONSUMER BEHAVIOUR

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FASHION & RETAIL

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FUTURE RESEARCH

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FUTURE THINKING INTRODUCTION

INTRO*

Introduction In 2009, Alloy Media and Marketing (2009) highlighted the fact that emerging adults were spending more of their time enjoying digital media than any other activity. Today, 45% of the global population uses the internet, and this is expected to rise to 76% by 2030. (Euromonitor, 2017) Vast technological advancements that the world has seen over recent years has only seen consumer dependence on technology continue to grow stronger. Whilst Alloy Media and Marketing pay attention to the millennial generation, Euromonitor’s data proves that the growing realms of connectivity is not just confined to one single generation and is instead a widespread trend which impacts a variety of consumer groups.

The following report aims to critically explore and analyse the key drivers and consequences of the macro trend ‘Digital Connectivity.’ Whilst a broad trend which has had a robust impact on a variety of industries, this report will concentrate on its effects on social media, fashion & retail, and travel & tourism and explore how this has shaped consumer behaviour, not only now but how it may continue to do so in the future.

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FUTURE THINKING: DIGITAL CONNECTIVITY SOPHIE OTTEWELL

FUTURE THINKING METHODOLOGY

The METHODOLOGY* A variety of secondary research has been gathered for the sake of this report, from sources such as online reports from the likes of Pew Research Center and Wired, journals, books and databases such as WGSN and Euromonitor. Whilst exploring potential resources for the report, attention was paid to the following themes: •

The impact of technology on consumer behaviour

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Technologies impact on fashion, travel and social media

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The power of social media, uses and impacts

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Blurring realities between virtual life and real life

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The future of digital connectivity including the influence on Generation Alpha

A lack of primary research is a limitation of the report analysis. However, the work aims to generate potential ideas for further research into the subject.

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FUTURE THINKING DIGITAL CONNECTIVITY

Introdu #DIGIT

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FUTURE THINKING: DIGITAL CONNECTIVITY SOPHIE OTTEWELL

FUTURE THINKING DIGITAL CONNECTIVITY

“Digital connectivity has altered all of life."

(Euromonitor, 2017) Digital can be defined as ‘involving or related to the use of computer technology.’ Whereas connectivity can be defined as ‘the state of being connected or interconnected.’ (Oxford Dictionaries | English, 2017) The two terms combined have created a megatrend which has dramatically altered consumer behaviour: digital connectivity.

Whilst a trend of recent years, the origins in which it began to form can be traced back to the creation of Web 1.0 in 1996

by Tim Berners-Lee. Tim refers to the Web as the largest repository for information and knowledge the world has yet seen and our most powerful communications tool. (Berners-Lee, 2017) Whilst the idea of connectivity began back in 1996, the creation of the smartphone in 2007 (Arthur, 2012) fuelled the concept of having the ability to be constantly interconnected between

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multiple digital devices, no matter where you are in the world. [Fig 1.] demonstrates the dramatic growth in ownership of smartphones between 2011 and 2016 in the US, growing from 35% to 77%.

(Pew Research Center: Internet, Science & Tech, 2017) However, due to underdeveloped countries, smartphone penetration cannot be regarded in such high numbers on a global level, with 44% of the worldwide population owning a smartphone.

(Statista, 2017) Nevertheless, the figures based on the US show a clear reflection of the growing impact the creation of the smartphone has had and is forecast to continue to have on consumers. One way in which the dramatic effect of the trend can be documented is through the introduction of the several different consumer types in which ceased to exist before the introduction of digital connectivity.

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Fig.1

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FUTURE THINKING THE CONNECTED CONSUMER

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connected

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FUTURE THINKING: DIGITAL CONNECTIVITY SOPHIE OTTEWELL

FUTURE THINKING THE CONNECTED CONSUMER

Connected Consumers have been dramatically affected by digital technologies disruption within society. Their almost constant levels of connectivity means they are always available to brands at a variety of different touchpoints. Digital has infiltrated all life activities with them now using their devices for a wide range of tasks such as shopping, entertainment, communication and even education.

Connected devices, social networks, online forms and hidden website cookies have added to the list of traditional data sources brands are able to collect about consumers. Consumers expect this information to be utilised to create more personalised and targeted campaigns and experiences, as 73% of consumers said they prefer to do business with retailers who use personal information to make their shopping experience more relevant.

(Gigya, 2017) However, this vast amount of data brands have the ability to collect on consumers creates a certain amount of distrust. Accenture (2016) stated that 54% of digital consumers are cautious about the information they share.

However, figures show that confidence in sharing data decreases with ages, which could potentially suggest that older consumers are less trusting of digital due to their lesser involvement with the act of connectivity.

As a consequence, this could potentially create a future trend amongst consumers in which they become more understanding and willing to share their personal data with brands.

Social networking and the ability to share and communicate about brands online has caused the connected consumer to become more empowered than ever before. Forbes (2017) even dubbed 2017 ‘The Year Of The Empowered Consumer’ creating a whole new

consumer type entirely.

Online review sites allow consumers voices to be heard and give them a stronger power over brands than ever before.

Complaints are no longer private and praises are no longer via word-ofmouth. Whilst everything is online, brands face higher levels of transparency than ever before.

A report claims that “Today, everyone is a connected consumer.” (GFK, 2017) A bold statement which executes the dramatic effect digital connectivity has had on an extensive number of consumers. Whilst smartphone penetration figures validate that the demand for connectivity is growing, to assume that the global population are all digitally connected would be an over assumption.

However, growing smartphone and internet usage figures demonstrate that the consumers created because of digital connectivity’s very existence are within growing numbers and have the power to become the majority, rather than a minority. “The “connected customer” describes anyone that has a smartphone – and uses it.” In contrast to this 80% of connected consumers report using a mobile phone to access the internet on a weekly basis as compared with the 20% buying a service or item. (Evans, 2017) So whilst consumers are actively participating in using their smartphone online frequently, purchases are still preferred on different devices. This reflects the importance for brands to consider that whilst mobile is important, it isn’t everything and particular attention needs to be paid to different digital devices on the path to purchase.

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"Today,

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GFK (2017)

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FUTURE THINKING TREND DRIVERS

THE* TREND DR Technology can be highlighted as the main driver for the rise of digital connectivity.

Trend Drivers Technology can be highlighted as the main driver for the rise of digital connectivity. Constant technological innovations have made once complex life processes simpler, quicker and safer and are continuing to do so. Speeding up simple tasks gives consumers more time, which makes it hard to stray from such innovations. For example, take self-driving cars. [Fig 2] demonstrates how whilst still in testing, driverless vehicles are expected to become mainstream in 2065. Driverless vehicles introduced into society will not only help to reduce traffic accidents (Pew Internet, 2017) but also, like many innovations, will give consumers more time on their hands in which they would usu-

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ally spend driving or commuting. However, The Guardian (2011) argued that whilst technology innovations provide more time, consumers are then using this time to complete more tasks than ever before. In short, technology actually makes us busier as consumer expectations get higher. Therefore, this could potentially be recognised as the reason that technological advancements are so favoured by consumers, as they are constantly looking for a quicker way to complete new tasks within their lives, in order to make way for new ones.

FUTURE THINKING: DIGITAL CONNECTIVITY SOPHIE OTTEWELL

FUTURE THINKING TREND DRIVERS

Impact & Influences

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A report by Euromonitor (2017) highlights how regions such as Asia Pacific are driving the constant need for connectivity more than any other regions. Home to the world's most urban population, lower-priced digital networks and devices have caused China to rise as the first mobilecentric nation. (Forbes, 2017) A nation turning to their smartphones and social channels such as Wechat for their purchases, the nation is currently one step ahead of regions such as the UK and the US who currently feel more comfortable purchasing from larger digital devices such as laptops. China is an example of where the rest of the world may head within the future.

However, it needs to be taken into account that consumer attitudes differ by region and therefore it may take time for different consumers to accustom to the way China lives.

Finally, environmental shifts and pressures for

the world to become more sustainable have driven a need for products and tasks to be completed with fewer materials in order to protect the environment. This has promoted the shift from things being physical to digital (Euromonitor, 2017) However, whilst products such as smartphones allows consumers to complete a variety of tasks within one handset, a recent report

by MarketWatch (2017) highlights the vast carbon footprint constant manufacturing of Apple iPhone devices has on the environment. In order to establish whether being able to carry out multiple tasks on one devices, or actually owning multiple products would be more sustainable, further research would need to be carried out.

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ing economy encourages consumers to use less resources by sharing with one and other. One example of this is ridesharing apps such as Lyft, which encourages people to share lifts rather than travel separately. This is expected to have a huge positive effect on this environment.

However, due to the personal element of technology such as mobile phones it is unlikely that the same attitude will be put towards these devices, which in turn does not solve the problem of sustainability.

Another way in which environmental shifts have inspired technology is by the creation of the sharing economy. The shar-

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FUTURE THINKING SOCIAL MEDIA

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Social Media is a group of Internetbased applications that build on the ideological and technological foundations of Web 2.0, and that allow the creation and exchange of User Generated Content. (Kaplan and Haenlein, M. 2010) 73% of adults now have a social networking profile (Ofcom, 2017) as a form of communication, and an opportunity to express views and thoughts online.

Social Media is an example of an industry in which has been heavily influenced by digital connectivity and also created by it. This section of the report will aim to explore the effects of social media as a part of consumers everyday life.

Masur et al (2014) [Fig 3] explores how people frequently use their social profiles to fulfil an unmet need for social contact, the third element of Maslow’s hierarchy of needs structure. It has been debated that Maslow’s theory is outdated and needs updating to reflect the digital society we live in today, which can be seen in Fig. 5. Given the fact that Maslow’s theory works on a hierarchical structure, it would assume that consumers need to have one form of social media in place before they can progress to the other, which is not the case. Highlighting that whilst social media does aid the third tier in the hierarchy of belonging and love needs, it is not a basic need. However, it does reflect how different social profiles may help consumers to fulfil each tier on the hierarchy. For example, Blogger may work at the top tier of self-realisation as it is a platform based on consumers expressing their individual thoughts and opinions. The following quote from the UN states that ‘Disconnecting people from the internet is a human rights violation’ (Kravets et al., 2011) which con-

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“Almost 2 in 5 people spend more time socialising online than they do face-to-face.” notes the idea that whilst social media alone may not be a basic human need, the internet and connectivity is.

In contrast to this, the concept of relying on social media as a tool for human interaction is contradicted in the idea that it involves no physical real-life human to human interaction. “Almost 2 in 5 people spend more time socialising online than they do face-to-face.” (Bennett, 2012) This creates a juxtaposition that whilst social media allows consumers to communicate with brands, friends and even strangers like never before, it is actually making consumers more antisocial - rather than social.

Some studies explore that the act of constantly being connected having the potential to translate into a social media addictions. One study found that Generation Y shows symptoms of addiction when surveyed in regards to social

media. (Cabral, 2011) However, as within the study participants were never studied when social media was physically taken away, it can be assumed that results are based purely on opinion. Nevertheless, members of Generation Y recognising that they have a problem with being addicted to social media proves that there could be some scope of the concept. However, this does depend on whether the individuals who have taken the study were influenced by others suggesting that social media addiction may be a problem. Furthermore, technological advancements within digital media since the study was taken could potentially change the results of the study if it was to be replicated.

Since the rise and success of social media, brands have recognised the opportunity to utilise channels such as Instagram and Facebook to market their products to consumers. This has pathed

FUTURE THINKING: DIGITAL CONNECTIVITY SOPHIE OTTEWELL

FUTURE THINKING SOCIAL MEDIA

#SOCIAL

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the way for a new form of celebrity status powered by many social followers – social media influencers (SMI’s).

The word influence can be defined as “the capacity to have an effect on the character, development or behaviour of someone or something, or the effect itself.” (Oxford Dictionaries | English, 2017) A recent report by Google found that 40% of millennial subscribers think their favourite creator (SMI) understands them better than their friends and 94% of brands who used influencer marketing believed the tactic to be effective. (O’Neil-Hart and Blumenstein, 2017) However, it needs to be noted that Google has the potential to create biased reports in favour of social media sites they own such as Youtube.

The success of SMI’s over general celebrities is their ability to appear authentic and a report by Fullerton (2016) found that consumers are more likely to interact with an influencers profile if it appeared this way. However, reports have found that consumers currently struggle to tell the difference between a genuine and sponsored advertisement. (Sterling, 2017) [Fig 3] shows that even advertisements marked with ad regulation hashtags are not recognised as paid advertisements. Consequently, some influencers are encouraging consumer purchases under potentially false attributes of authenticity. Influencers themselves have admitted to altering the image of their lives to look perfect online. “You’re filtering your life to make it look a certain way. It isn’t your life; you’re creating a version of your life to appeal to other people.”

(Harris, 2017) Chae (2017) explores the concept that those who choose to look up to SMI’s face the possibility of feelings of low self-esteem and envy. Whilst the report faces geographic limitations, it shows the potential damage the false perceptions of social media can have on mental health. One concept which has yet to have been explored is the well-being of the SMI’s who feel the pressure to portray this perfection to their followers. Rosen (2012) links a constant desire to share ideal lives on their social profiles with the likes of common psychological disorders such as obsessive-compulsive disorder. This portrays the idea that SMI’s are not only potentially influencing consumers in their choice of products, but also in their mental health.

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FUTURE THINKING: DIGITAL CONNECTIVITY SOPHIE OTTEWELL

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- Tom Ford

creation of imagery for online and social media."

Having a runway show has become so much about the

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FUTURE THINKING FASHION AND RETAIL

SHION TAIL Digital connectivity has encouraged a complete shift in the way consumers share, discover and explore the fashion industry, making even the luxury fashion industry more accessible to consumers. Designer Tom Ford stated, “Having a runway show has become so much about the creation of imagery for online and social media.”

(The Business of Fashion, 2015) The rise of social influencers and fashion bloggers means that consumers now look to social profiles such as Instagram

to experience catwalk collections first hand. These collections which were before exclusively shown to ‘elite’ members of society are now shared online in real time, and available to purchase almost instantly. Burberry was the first fashion brand to produce their very own ‘See Now Buy Now’ catwalk, which allowed consumers to purchase items from their brand-new collection as soon as it hit the runway.

Whilst this is a positive way for a whole new spec-

FUTURE THINKING: DIGITAL CONNECTIVITY SOPHIE OTTEWELL

trum of people to consume fashion collections, it can be argued that the essence of the beautifully and technically curated designs can be lost through the mere sight of a 2D image. “Now fashion people don't really wear that much black, at least not to fashion shows. Despite black being scientifically proven to be slimming—and who doesn't want to look thinner?—the details are missed by the cameras: You see, black is notoriously difficult to photograph.”

(Furniss, 2014) This can poten-

tially have an impact on the style and colours in which brands choose to curate their collections, in favour of their appearance online, which could potentially damage the artistic exploration element of fashion in which designers such as Charlie James worked hard to create. “I spent my life making fashion an art form.”

(Dazed, 2014) The introduction of virtual reality to fashion has worked to overcome this and allowed consumers to experience catwalk shows within virtual realms.

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"IT'S A BIG CHANGE FOR HIGH FASHION BRANDS." (Moore, 2017) 0016

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FUTURE THINKING FASHION AND RETAIL

WGSN (2015) documented how Tommy Hilfiger engaged store visitors by allowing them to watch their catwalk show live on VR headsets from the realms of their retail store. As the possibilities of virtual reality broaden there is the opportunity for the act of consumers viewing shows virtually and in real time to become mainstream in order to capture garments in their true form. Expansion of virtual reality to create physical retail environments is also a possibility.

Instant buy catwalks fueled by social media sharing has driven a vast rise in consumption which is causing fast fashion retailers to come on top. Online e-commerce retailer PrettyLittleThing. com was recently crowned the fastest growing online company (Hitwise | Competitive Intelligence & Consumer Insights, 2017) driven by a strategy of harnessing catwalk trends with daily updated new in sections, next day delivery models and collaborating with fashion SMI’s. Whilst technology has revolutionised the capabilities for fast fashion and online shopping, it also creates huge issues in terms of sustainability. “One in every four fashion items Hongkongers buy online not worn more than two times before being thrown away.” (Kao, 2017) Whilst this figure may highlight problems with displaying fashion items online for purchase in terms of style and fit, it also shows how severe fashion consumption may be becoming - which has the potential to have a detrimental effect on the environment. Cheaper prices within Asia Pacific may encourage the concept of fast fashion to its fullest potential. However, the success of online fashion brands globally displays how the issue cannot be confined to just one region. Whilst many may recognise the issue of consumption within fast fashion and want to make a change, the reality of changing already perfectly curated online business models in which deliver consumers the products they want as soon as they desire them, may prove difficult.

FUTURE THINKING: DIGITAL CONNECTIVITY SOPHIE OTTEWELL

In fact, e-commerce retailing has made purchasing so convenient to consumers that visiting physical retail locations is on the decline. (Dennis, 2017) One report noted how “Consumers encounter brands online before they experience the physical shop.” (Moes and Vliet, 2017) Whilst this may not be true for classic retailers who have been within consumers minds for years, it suggests the idea that whether bad or good, consumers have premeditated expectations for retailers to live up to before even physically entering the store. Research recently discovered that consumers are more likely to have the desire to visit a store after virtually experiencing the location beforehand. (Moes and Vliet, 2017) This displays one way to overcome premeditated consumer opinions and the opportunity for brands to incorporate virtual reality into their online offerings as the technology develops in order to entice store visits.

One way in which brands are adapting their stores is through the utilisation of technology. Marie Claire recently teamed up with finance provider Master Card to create the ‘Store Of The Future.’ (Keyes, 2017) Featuring touchscreen shoppable surfaces and personalised recommendations, the store aims to replicate the essence of online shopping within a physical location.

Whilst it can be debated that the store may be revolutionary to many consumers, regions such as the Asia Pacific are already utilising the online world with allowing shoppers to utilise their social media following as currency, highlighting how some regions are ahead of others. A shift from materialism to experiences has caused consumers to enjoy stores in which can provide memorable and emotive experiences which can translate seamlessly from online to offline. Therefore, when it comes to brick and mortar stores, emphasis should be focused on the in-store experience, rather than product offering.

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ISSUE 01/2017 PLACE YOUR CATEGORY HERE

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FUTURE THINKING TRAVEL AND TOURISM

TRAVEL* &TOURISM

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"97% of millienals admit to posting on social media whilst travelling" The introduction of technology into the travel industry has revolutionized the way consumers book and experience travel. A report by Mintel (2017) stated that 54% of consumers feel that they do not need to talk to a travel expert when booking a holiday anymore. Three years on, and the digital landscape has introduced a whole new variety of travel apps which has enabled consumers to create personalised experiences at the simple tap of a button. 90% of travellers appreciate when a travel service company strives to customize their experience based on their preferences. (About. americanexpress.com, 2015) Expedia recently launched their ‘Discover Your Aloha’ site which provides personalised holiday recommendations using facial recognition software - without the long trip to the travel agents.

Whilst sites like this may appear interesting to consumers, 87% are now looking to Facebook as their main source of travel inspiration. (Price, 2017) Constant sharing of travel destinations on social media allows consumers to gain knowledge into what it may be like to travel to a particular destination from their peers. In fact, 97% of millennials admitted to posting on social media whilst travelling (Price, 2017) which represents the concept that social media itself now

acts as a personal travel guide to consumers. However, Munar and Jacobsen (2014) found that motivations of posting travel destinations online are usually for articulations of sociability and emotional support, rather than providing their peers with travel information. The report focuses on one set of particular holidaymakers in one location, therefore attitudes may change dependant on location and consumers. Nevertheless, it does reflect the concept of individuals sharing travel destinations online as a form of identity.

Another report also explores how many individuals manipulate travel images before they are uploaded online, which further supports the concept of travel selfies acting as a form of self-representation. (Lyu, 2016) The concept also links back to a point within chapter 1 which demonstrates the act of online media not being portrayed in it’s truest form, which could potentially lead to issues of mental health. The diagram in [Fig 6] displays the self-objectivation theory of Fredrickson et al. (1998) which displays how monitoring of appearance can lead to psychological consequences.

This represents how social media is influencing decisions and self-perceptions in multiple sectors.

FUTURE THINKING: DIGITAL CONNECTIVITY SOPHIE OTTEWELL

Furthermore, manipulation of travel images for online could also have the potential to provide consumers with heightened positive expectations of travel destinations, which could result in disappointment upon arrival.

As a result of the power of social media within travel, travel agents are now looking for new ways to update and innovate their services in order to win back consumers. Travel companies such as Virgin have recently introduced VR technology headsets into their stores, which allows consumers to experience destinations before they travel. ”Brands need to be ready to respond to consumers seeing the virtual world become as compelling as the real one.” (Lazarus, 2017) Not only does this revolutionize travel for consumers, but it also solves the issue of consumers being displayed manipulated images of travel destinations on social media. This poses a concept of whether the introduction of virtual reality to the travel sector could potentially revolutionize the way consumers travel altogether. The ability to travel to a destination without ever leaving your home town could have the potential to become a new form of travel for consumers who aren’t in favour of heading overseas.

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"The confluence of social media and VR combined with the ability to communicate body language in digital space will seperate intimacy from proximity."

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FUTURE THINKING FUTURE THINKING

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Future Thinking Due to the fast-paced nature of technology, it can be expected that a variety of advancements are just around the corner. Throughout the report, it is evident that social media has had a robust impact not only as an industry itself but also on a variety of different sectors. “The confluence of social media and VR, combined with the ability to communicate body language in digital space, will separate intimacy from proximity.” (Future Labs Presentation, 2017) One argument within the social media section of the report spoke about the concept of social media causing individuals to become antisocial. Future innovations could potentially either work to bridge the gap between social interaction and social media or hinder the divide even further, causing us to become more antisocial than ever before and live within realms of unreality.

ing constantly connected. (Turk, 2017) explores how Generation Alpha will have increased access to existing and emerging technologies and will become accustomed to interacting with digital content in new ways, which will potentially create highly skilled and specialised mindsets. As an emerging consumer type who can only be predicted via trends, current research cannot be taken literally. However, the report displays how technology will potentially have a positive effect on the minds of millennial children, providing them with the tools to lead easier and more streamlined lives – rather than a life hindered by ‘anti-social’ technology.

Whilst the millennial generation has been impacted tremendously by the creation of connectivity, the future lies on the generation who have grown up knowing anything other than be-

FUTURE * THINKING

What lies ahead?

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Future Research Throughout exploring digital connectivity and its effect on society and three key industries, a few crucial factors have flowed through the research findings which have sparked potential ideas for future research. The first being the presence of social media not only as an industry in its own right but also how it intertwines and drives many key industries of society today. One potential research area would be the recognition that consumers and influencers get from the constant sharing on social media, and how this helps them build their overall identity online. Furthermore, how does this online identity feed into and influence their real-life persona?

Another interesting research area would be the effect that social media and technology has on experiences. When consumers constantly share on social media, who are they really sharing for and to what end? Are consumers potentially missing out on key life moments to share them on social media? And are we living in the moment, or within a social media post?

Finally, one last interesting research point would be into the concept of consumers becoming tired of the complex world of technology and social media. When will too much social be classed as oversharing? Will there be a day where we don’t want to share anymore? And how does this influence our general life experiences? Will the complex digital world help us to appreciate the simple things in life more, or disregard them?

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Will there come a day where we don't want to share anymore?

RESEARCH

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