Membership Brief Temporarily Unlocked. Staying ahead of emerging trends is paramount. By harnessing the power of data and insights, we can anticipate 10 key beliefs that are more likely to materialize (than not) in the retail, service, and technology spaces, guiding businesses in their strategic decision-making and adaptation to the evolving market dynamics.
Belief No. 1: Grocery becomes the biggest eCommerce category by 2025
Likelihood: 70%
Historically, three categories led the US eCommerce market: apparel and accessories, computer and consumer electronics, and furniture and home furnishings. But in recent years, growth has been fueled by essential goods, including food and beverage items, personal care products, and household supplies. This shift will take grocery to the top of the four major eCommerce categories by the end of 2025.
The shift towards grocery-based eCommerce is not merely a reactionary trend but a reflection of broader societal changes. (2PM)
Grocery is the largest retail category, and while most sales occur offline, the steady uptick of online sales will bring billions of dollars into the eCommerce market in the coming years.
Belief No. 2: Dollar General builds a renowned retail media network by 2025
Likelihood: 50%
The digital version of retail media’s expansion into physical spaces is inevitable across all classes of stores. Dollar General’s partnership with Neptune Retail Solutions exemplifies this trend and proves that even budget stores can have effective advertising models. Particular to Dollar General, Neptune has agreed to offer omnichannel tools to drive sales in their 19,000-plus stores.
Neptune’s suite of in-store media solutions, including signage and digital incentives, enhances brand visibility and influences consumer behavior. As economic uncertainties persist, companies like Dollar General stand to benefit most from such initiatives. Neptune’s data-driven approach and Dollar General’s extensive reach position them as leaders in retail media, fostering profitable sales growth and solidifying their dominance in the evolving retail landscape.
Belief No. 3: McDonald’s China will be bigger than McDonald’s America by 2026
Likelihood: 60%
McDonald’s is positioning to make China its largest market by 2026, driven by a strategic expansion plan amidst the country’s economic challenges. With an ambition to open approximately 1,000 new outlets by the end of 2024 and a goal of reaching 10,000 stores by 2028, McDonald’s is tapping into the growing demand for affordable dining options.
This expansion is particularly focused on lower-tier cities, which represent a significant portion of the country’s 1.4 billion population. The economic downturn in China has increased the appeal of inexpensive meals, making McDonald’s offerings more attractive. Moreover, the company’s aggressive expansion contrasts with the cautious approach of other international brands towards the Chinese market, despite the competition from local fast-food chains like Yum China Holdings. By capitalizing on the economic conditions that favor budget-friendly dining and targeting underserved areas, McDonald’s is poised to outpace competitors and satisfy the increasing consumer demand, ensuring its dominance in the Chinese fast-food industry by 2026.
Belief No. 4: The DTC beef industry crashes in 2025
Likelihood: 40%
The industry is facing a looming crisis set to culminate in a crash by 2025, triggering an exodus among some players and consolidation among many. America’s cattle inventory has plummeted to its lowest level since the 1970s, now standing at 28.2 million, a 2% decrease from the previous year. Factors such as persistent drought, high input costs, and inflation are squeezing both consumers and farmers.
The beef industry’s economic landscape adds another layer of complexity to the notion of regenerative beef. Inflation in the beef sector, as noted by Haden Comstock of NCBA, has led to a decrease in beef availability per capita in America. (2PM)
While demand for beef remains robust, the escalating costs of production are unsustainable. The persistent drought in key beef-producing states like Texas, Nebraska, and Kansas has driven up feed prices, further straining the industry. As prices soar and margins shrink, many DTC beef operations will struggle to survive, leading to an industry-wide reckoning marked by exits and consolidations.
Belief No. 5: Tesla’s chief competitor will be BMW by 2025
Likelihood: 70%
By 2025, Tesla’s chief competitor is poised to be BMW, not other EV manufacturers. BMW’s strategic approach, blending electric and traditional vehicles on the same assembly line, has defied skeptics and propelled the company to prominence in the luxury EV market.
Last year, BMW sold 376,000 electric vehicles, a remarkable 75% increase, securing its second position, trailing only Tesla. The German automaker’s savvy strategy of integrating electric models within the designs of traditional vehicles has resonated with consumers, driving significant sales growth. BMW’s impending launch of a new line of battery-powered cars, boasting advanced features like improved energy storage and innovative digital displays, positions the company as a formidable contender against Tesla.
Belief No. 6: Nike will have to fend off Lululemon
Likelihood: 60%
Lululemon is on track to become Nike’s primary competitor by 2026, focusing on innovation and strategic acquisitions to broaden its appeal, particularly among men. A significant step in this direction would be Lululemon acquiring Ministry of Supply, a company at the forefront of sustainable and technical fabric innovations. It’s my belief that this would help Lululemon gain credibility and operational traction in its sustainability pursuits.
Researchers at the Massachusetts Institute of Technology’s (MIT) Self-Assembly Lab have developed technology that allows a garment to be altered or customized by heat administered by a robot. (Sourcing Journal)
The collaboration between Ministry of Supply and MIT to develop a sustainable, customizable 4D knit dress underscores the potential for groundbreaking advancements in athletic and leisure wear. This technology, which allows for personalized sizing and styling transformations without the waste of traditional fashion production, aligns perfectly with Lululemon’s commitment to sustainability and innovation. By embracing such cutting-edge fabric technologies, Lululemon can significantly enhance its product offerings, making the brand more appealing to a broader demographic, including men who value functionality and sustainability. This strategic direction will not only bolster Lululemon’s market position against Nike but also redefine consumer expectations in the athletic apparel industry. On the flip side, with headlines like these, Nike may begin looking for partnerships like Ministry of Supply.
Belief No. 7: Higher education returns to a path of exclusivity by 2026
Likelihood: 40%
The landscape of higher education is poised for significant transformation as a wave of college closures and mergers accelerates, fundamentally altering the accessibility and perception of a college education. With at least 30 colleges closing in 2023 alone, and predictions of a stark decrease in enrollment due to declining birth rates and changing educational preferences, the traditional college model faces existential threats.
This trend is not merely a reaction to the pandemic’s immediate impact but a reflection of deeper, systemic challenges in higher education, including financial sustainability and the ability to adapt to changing demographics. As colleges are forced to consolidate or reinvent themselves, the notion of college education will become less commoditized, potentially leading to higher value for high education (this, especially with the return of standardized testing). This shift could herald a new era of higher learning, where quality, adaptability, and innovation take precedence over traditional models and metrics of success, ultimately redefining the value and purpose of attending college.
Belief No. 8: India will be America’s third most-important retail marketplace
Likelihood: 60%
India’s trajectory to become the third-largest retail market by 2026 is underpinned by a convergence of factors that promise to reshape its consumer landscape significantly.
The country is undergoing a consumer industry revolution, with projections to hit a staggering $1.41 trillion by 2026, propelled by an influx of over 900 million internet users thanks to affordable data and burgeoning eCommerce access. This digital democratization is altering buying behaviors, with a pronounced shift towards online shopping. Furthermore, India’s young demographic and expanding middle class, concentrated in urban areas, are key drivers of this growth, representing a potent force of consumer demand and increased spending.
Now shift focus to India, a country of 1.425 billion and a middle class that ranges from 66 million to 432 million citizens depending on how you measure it. With a rich and diverse economic history, we witness a parallel narrative of arbitrage opportunities, this time in the realm of eCommerce. (2PM)
The government’s focus on streamlining tax structures and introducing reforms like the Pradhan Mantri MUDRA Yojana supports small-scale retailers and stimulates the market. Additionally, policy initiatives aimed at bolstering rural consumption, regulatory adjustments favoring the gig economy, and incentives for global investments in retail further cement India’s position on the global stage. Together, these elements weave a narrative of transformative growth, setting the stage for India to emerge as the third largest powerhouse in the global retail trade.
Belief No. 9: The Great Firewall of China comes crashing down
Likelihood: 60%
By 2026, the digital fortress that China has meticulously built around its cyberspace, known as the Great Firewall, is anticipated to exhibit significant vulnerabilities, unable to fully prevent the burgeoning tide of citizens seeking unrestricted internet access and engaging with American sources. The dramatic surge in VPN usage within China, despite the outright ban and rigorous censorship, signifies a growing demand for unfiltered information and global digital engagement among its population.
This burgeoning desire for internet freedom, coupled with the ingenuity of tech-savvy demographics in circumventing state-imposed restrictions, foreshadows a pivotal shift in China’s internet landscape. As Chinese netizens increasingly bypass the Great Firewall, this trend is poised to catalyze a positive ripple effect on the U.S. tech sector. American tech firms, known for their pioneering innovations and expansive digital platforms, stand to gain as unrestricted access broadens their user base and market reach within China, heralding a new era of global digital interaction and economic synergy between the two superpowers.
Belief No. 10: The asset management firm / longevity club hybrid emerges by 2026
Likelihood: 30-35%
A strategic pivot from traditional client engagement methods, pioneering wealth advisory and asset management firms are set to redefine the high-net-worth (HNW) client experiences by introducing longevity services as an exclusive, private club within their establishments.
Rather than your traditional commercial office, imagine an asset management firm that owns or leases out of a repurposed palatial estate. The vast majority is converted office space but a section of the indoor and outdoor properties are devoted to modern tools like cryo chambers, red light therapy, hyperbaric chambers, on-site nurses for products like IV drips and vitamin shots. And not to mention, powerful saunas and PEMF machines. The catch? It’s only for clients of the firm, their families, and a select few guests (who become prospects for the firm over the long run).
This innovative approach is designed to deepen relationships with investors by providing them with bespoke access to offerings that are offered elsewhere but in less accommodating environments.
By leveraging new technologies, aimed at extending and improving life, these firms aim to offer a more intimate, value-added service that communicates to their clients that the goal is preparation for a long life – whether retired or not. This not only distinguishes these firms from competitors but also aligns the innovative ones with the evolving preferences of both mass affluent and younger investors seeking unique services. As wealth managers expand their offerings with strategies like this and beyond conventional investment vehicles by focusing on: client wellness, liquidity solutions, and secondary market trading, they are poised to capture a greater share of investor wallets.
This transition towards hosting exclusive longevity services, rather than spending on traditional client acquisition events or traditional advertising, marks a sophisticated shift in strategy, aiming to cultivate deeper, more meaningful client relationships and solidify their position in a competitive market.
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Data-driven insights play a pivotal role in shaping strategic decisions and adaptation to evolving consumer preferences. By embracing beliefs, and those like them, enterprises can position themselves for success in the dynamic and competitive landscape of the next year and beyond.
By Web Smith | Editor: Hilary Milnes with art direction by Christina Williams