During such extended periods of economic uncertainty, we will be seeing that 'creative destruction' taking place; old businesses going bust - old business models ceasing to function - and new ones emerging.
And what will emerge?
|The Old||The New|
|Owning a car||Renting/sharing a car|
|Software in a box||Software from the cloud|
|Buying electricity from a big company||Generating your own electricity, selling the surplus|
|Bookshelves full of books||Flash drives full of e-books|
|Buying things||Experiencing things|
|Buying things||Making things - a 3D printer in every house|
|Food as a fuel to keep you going||Food as an authentic experience|
|Globally-known brands||Locally-produced and cherished brands|
Old things will not necessarily disappear. They will simply lose their erstwhile dominance. Television did not kill radio or cinema, it diminished their importance. The internet will not kill television or books, it will diminish their importance.
But what really drives the economy? The notion of 'show off or die'. When I see a person sitting alone behind the wheel of a large SUV in slow-moving urban traffic, I can see one insecure person who still believes it necessary to demonstrate their wealth in this rather primitive and grotesquely wasteful way.
Car ownership statistics from the UK, US and Germany show that many young professional people have got the message that owning a car is as fashionable as being daubed with woad.
If you really must drive your own car - this is the future. Coming into production this year, the Volkswagen XL1 is the shape of things to come.
The other week, Moni told me a current hipster joke: "My favourite frequency is 25,000 hertz. I bet you haven't heard it." The true hipster, at the avant-garde of society, will wear brands no one has heard of, see bands no one has heard of (Eric Shoves Them In His Pockets, anyone?), go to clubs no one has heard of, drink unpasteurised beer from a micro-brewery in Przasnysz.
When the developed world emerges from economic crisis in a few years time, it will emerge without many of its familiar brands. The UK has lost such high street chains as HMV, Barratts, Habitat, Jessops, Clinton Cards and Comet (to name but five of 23 that have collapsed since the beginning of last year).
While Google is set to keep its primacy for the foreseeable future, I'm wondering who will be the Google of new technologies that are as undreamed of as computers and mobile phones were just 30 years ago? Which of the following brands will make it huge globally in the next decade? Spotify? ZipCar? MakerBot?
It's worth reading this article from the Economist's Management Thinking website about collaborative consumption - sharing is the new ownership. Excerpt here:
Makes eminent sense. Cut out the clutter in your room, in your garage, loft - in your life. As someone recently wrote in Gazeta Wyborcza - 'what's the sense of spending your life doing a job you don't enjoy to buy things you don't need to impress people you don't like?' So if 'showing off or die' will not be the next driver of economic growth what will?
The so-called emerging world is still forging ahead powered by the old model of consumption - if you haven't experienced having a big car sitting in the drive of your four-bedroomed house, it will drive you to work harder and longer until you do.
The future engines of growth for the developed world will be different. No longer conspicuous consumption, 'keeping up with the Joneses', stuffing the landfill sites of the nation with trash bought on credit. Certainly healthcare will eat up ever more of rich countries' GDP as their populations age. The dream of living a long healthy life into an advanced old age is a very real economic driver. Seventy as the new fifty? An alluring prospect that billions will buy into.
People will always be conceited and snobbish, but in the rich world they will seek ever more sophisticated and subtle ways of showing it. Think of a new way of satisfying that need and you can become very rich indeed. If richness is what drives you...
More about the new Sharing Economy here and here (from the Economist).