& the Future of Brands

& THE FUTURE OF BRANDS FIVE HUMAN ASPIRATIONS 1 Foreword Like never before, brands are navigating How might we create an era of constant change. brands of enduring value From data breaches and market volatility that are relevant to a new to information overload and lightspeed generation and resilient digital evolution, uncertainty abounds. for a new world? In virtually every industry and category, incumbents are being challenged by upstarts as the marketplace moves We believe an important part of the faster than ever before. answer lies in the rise of Aspirationals— more than one-third of the global Brand leaders are at the center of these public—who unite a love of shopping, dynamics, balancing the complexities of social status and sustainability values brand reputation, consumer trust, radical to shape new cultural norms and transparency, hyper-customization and, rewrite the rules of marketing. of course, business sales and growth. In this report, “Five Human Aspirations So, in this age of uncertainty, how and the Future of Brands,” we detail might we leverage these dynamics for a fundamental shift in the marketplace competitive advantage? How might towards authenticity, wellbeing, we deliver more value for consumers, sustainability and social purpose. And employees, shareholders and society? we reveal how the deepest hopes, needs and aspirations of a rising generation of consumers will define our future. By understanding the Aspirationals— who they are, what they care about and why they matter—brand leaders will be inspired to think more creatively, design more holistically and act more purposefully for a world where we can thrive in change together. FIVE HUMAN ASPIRATIONS 2 Table of Contents 4 INTRODUCTION: The Rise of the Aspirational Consumer 5-12 PART ONE: Aspirationals Segmentation 13-16 PART TWO: Beliefs and Behaviors 17-20 PART THREE: A Closer Look at Key Issues 21-51 PART FOUR: Five Aspirations That Hold the Future for Brands 52-53 TAKEAWAYS: Key Learnings for Brand Leaders FIVE HUMAN ASPIRATIONS 3 The Rise of the Aspirational Consumer We marketers can be obsessed with Indeed, building on five years of generational trends. How many meetings global insight from more than 21,000 have you had lately on what Millennials respondents across 21 international think of your brand? Or what Generation Z markets, BBMG and our partners at means for your digital strategy? GlobeScan have revealed the Aspirational generation who combine a love of style, And yet, while important, we may be social status and sustainability values to asking the wrong questions. Or, at least shift cultural norms and rewrite the rules seeking insights and revelations in the of marketing. wrong place. This Aspirational generation isn’t defined The truth is that generations are defined by age, but rather the desire for their by more than birthdays. Our generational actions to meet their needs, have a identity is formed by the common human positive impact on others and connect experiences that shape the very idea of them with an ideal or community that’s who we are and the understanding of bigger than themselves. Representing our place in the world around us. 40 percent of the global adult population, Aspirationals are connecting the right In the emerging 21st century, thing to do with the cool thing to do, a generation—shaped by 9/11, creating new possibilities for brands, perpetual wars, economic crises business and the society we share. and environmental threats—is experiencing an equal and opposite reaction toward generosity, creativity, collaboration and caring. FIVE HUMAN ASPIRATIONS 4 PART ONE: Aspirationals Segmentation Aspirationals are represented across every age, culture, geography and income. Globally, they are most likely to be Millennials, and are the largest presence in emerging markets. Almost half are parents with children under 18. FIVE HUMAN ASPIRATIONS 5 ASPIRATIONALS SEGMENTATION Global Consumer Segmentation The Aspirational segmentation explores the intersection of consumer needs, desires and shopping behaviors with 40% social and environmental beliefs, values Aspirationals and priorities. The segmentation reveals a spectrum including highly committed Advocates (22% of consumers globally in 2016), style- and social status- 29% seeking Aspirationals (40%), price- and performance-minded Practicals (29%) Practicals and the less engaged Indifferents (9%). MATERIALISM More than any other segment, Aspirationals are defined by their love of shopping, desire for responsible consumption and their trust in brands 22% to act in the best interest of society. And, Advocates as the largest consumer segment globally, 9% Aspirationals matter because they are the Indifferents first to unite materialism, sustainability values and cultural influence, making them an essential audience to build markets, influence cultural norms and shape behavior change at scale. SOCIAL & ENVIRONMENTAL VALUES FIVE HUMAN ASPIRATIONS 6 ASPIRATIONALS SEGMENTATION Aspirationals: By the Numbers Aspirationals represent 40% of the AVERAGE AGE: AVERAGE EDUCATION: Global Public and are most likely to 39 High School be Millennials, skewing younger in developing markets. PEOPLE: China 52% Nigeria 58% 47% PARENTS 48% 52% (with children under 18 years old) MALE FEMALE India 53% GENERATIONS: 38% 33% MILLENNIALS GENERATION X S. Africa 52% 20% 9% BABY BOOMERS SENIORS FIVE HUMAN ASPIRATIONS 7 ASPIRATIONALS SEGMENTATION Advocates have been the traditional focus of sustainable consumerism because of their willingness to pay more for socially and environmentally responsible solutions. MOST LIKELY: WHY THEY MATTER: Generation X Though relatively small in size, Advocates do their homework and have the potential to disproportionately influence others 22% by taking action on issues and causes GLOBAL they care about. PUBLIC BARRIERS: They don’t like shopping and they don’t 90% see brands as a solution. They don’t RESPONSIBLE trust global companies. CONSUMERS OPPORTUNITIES: Brands should honor the Advocates by 28% authentically addressing their concerns STYLE and being rigorous in any social or FOCUSED environmental claims. FIVE HUMAN ASPIRATIONS 8 THE ASPIRATIONALS SEGMENTATION Practicals are laggards in purchasing more sustainable products; while they’re not opposed to sustainability they see it as a bonus after price and performance. MOST LIKELY: WHY THEY MATTER: Millennials Practicals’ impact comes from the likelihood that they are tipping-point consumers when trends hit scale. 29% GLOBAL BARRIERS: PUBLIC They are discouraged by high prices, and they aren’t likely to take the time to look for sustainable products. 44% RESPONSIBLE OPPORTUNITIES: CONSUMERS Practicals are more likely than others to trust consumer reviews, ratings and proven performance. 53% STYLE FOCUSED FIVE HUMAN ASPIRATIONS 9 THE ASPIRATIONALS SEGMENTATION Indifferents are the least likely to engage in the sustainable economy. MOST LIKELY: WHY THEY MATTER: Generation X Indifferents are unlikely to make proactive choices for more sustainable goods, so brands will drive health and sustainability 9% for these purchasers by embedding GLOBAL positive impacts in how products are made. PUBLIC BARRIERS: They are least likely to feel a sense of responsibility to society with their 46% purchases. They don’t place a high priority RESPONSIBLE on products with social or environmental CONSUMERS benefits. They are the least likely of any segment to try new things. 7% OPPORTUNITIES: STYLE FOCUSED Indifferents will ultimately follow the marketplace. FIVE HUMAN ASPIRATIONS 10 ASPIRATIONALS SEGMENTATION Global Presence 21 COUNTRIES N=21,000 40%–60% RUSSIA ASPIRATIONALS UK CANADA NIGERIA 58% INDIA 53% GERMANY S. AFRICA 52% CHINA 52% TURKEY INDONESIA 51% CHINA GHANA 49% USA PERU 49% KENYA 44% SPAIN PAKISTAN CANADA 42% BRAZIL 42% MEXICO GREECE UK 41% RUSSIA 41% GREECE 40% INDIA GHANA KENYA BRAZIL PERU NIGERIA 14%–39% INDONESIA ASPIRATIONALS CHILE 39% SPAIN 37% ARGENTINA USA 36% CHILE SOUTH PAKISTAN 33% AFRICA TURKEY 24% ARGENTINA 23% MEXICO 22% GERMANY 14% FIVE HUMAN ASPIRATIONS 11 ASPIRATIONALS SEGMENTATION Global Presence Aspirationals have a broad global presence, UK 41% with particular strength China 52% in emerging markets Aspirationals in the United Kingdom where they make up span generations with the largest half of the population or USA 36% population representing Generation X Aspirationals in China are most likely (30%), followed by Millennials (26%). to be Millennials (44%). Of all social more, including Nigeria issues, they believe corruption (75%) Aspirationals in the United States are British Aspirationals’ trust in global (58%), India (53%), China and the gap between the rich and the most likely to be Generation X (32%), companies to act in the best interest (52%), South Africa (52%), poor (72%) are the most serious social and more than one-third (34%) are of society is among the lowest (43%) issues. Indonesia (51%), Ghana parents with children under age 18. of all respondents. More than four in five (82%) believe (49%) and Peru (49%). that climate change is a serious Similarly, Aspirationals problem, compared to 72 percent of are a significant presence the American population overall. in developed markets, representing more than one-third of consumers in markets like Canada (42%), Russia (41%), the United Kingdom (41%), Greece (40%), Spain (37%) and the USA (36%). Aspirationals in emerging Brazil 42% India 53% markets tend to be Millennials, while in Forty-three percent of Aspirationals Forty-one percent of Aspirationals in

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