For decades, innovative companies with disruptive ideas have achieved stunning stockmarket success by challenging tradition-bound industries that were unwilling or unable to adapt.
In the 1980s, pharmaceutical firms boosted research budgets to battle the planet's most deadly diseases. The digital revolution in the 1990s saw companies like Microsoft and Intel design software and hardware that powered the personal computer revolution. In the 2000s, upstarts like Google and Amazon.com transformed the way people search for information and shop.
The pace of innovation in the 2010s is robust. Think about it. Not long ago, who could have fathomed the ability to control a home security system from your mobile phone or ride in a car without a human behind the wheel?
This is the NEXT - or New Exceptional Technologies - economy. Companies taking a leading role in this radical new world are developing the latest disruptive products and services that consumers want - whenever and wherever they need them. They are also the potential market leaders - the new growth companies delivering significant gains in a slow-growth world.
To identify these companies, it helps to examine six major NEXT economy themes:
Until Apple launched the iPhone in 2007, mobile phones primarily offered users a convenient way to make calls away from home. Since then, consumers have used their phones to download movies, build song libraries, hail car rides, and connect with friends. Today, there are approximately 5 billion mobile phone users, accounting for 66% global penetration. In the US, adults average almost six hours a day on digital media, over half that time on a mobile device.
Large, young populations with rising disposable incomes, particularly in emerging markets, are creating significant demand for premium products. This demographic shops primarily online and is largely reached through social media. Companies generating consumer excitement and developing e-commerce platforms with superior distribution will benefit most.
One company capitalising on the global consumer and on-demand themes is MercadoLibre, the leading e-commerce platform in Latin America with 267 million users in 2018. Based in Argentina, MercadoLibre also operates the region's largest online payment network, a credit line, and a real estate listing business. Through these interconnected businesses, the company has developed diverse revenue streams and strong customer loyalty.
A key strategy for enhancing the customer experience is collecting and analysing digital user data. 90% of the world's data was generated in the past two years, but only 0.5% of it has been analysed. This disconnect has created opportunities for companies to interpret and store this data, adapt business models, and quickly deliver customer solutions. Cloud leaders like Amazon.com and Microsoft are providing efficient access to high computing power.