9 Key Business Trends For 2021 and Beyond
This is an up-to-date list of important business trends in 2021. Along with companies, consumer behavior changes and tech innovations driving each trend.
Whether you’re a scrappy startup or part of a Fortune 500 company, these trends are worth keeping an eye on.
1. E-commerce shows steady post-pandemic growth
Searches for “ecommerce” are still growing as 2021 rolls on.
The pandemic completely changed the way people shop.
E-commerce was already on the rise before COVID hit.
But in March 2020, it took off at an astronomical rate.
Shopify reports that e-commerce experienced 10 year’s growth in just three months.
Searches for “Shopify” peaked at the height of the pandemic when e-commerce was the only option for many businesses.
In 2021, experts predict that 19.5% of global retail sales will come from online purchases.
By 2024, they estimate that online shopping will be responsible for nearly 22% of all retail purchases in the world.
Data shows that the number of e-commerce users grew substantially during 2020, too.
The increase was 9.5% year-over-year, and the number of users is expected to grow 10% in 2021, too.
Projections from eMarketer show that retail e-commerce will jump nearly 14% in 2021.
That’s a revision on a pre-pandemic estimate that suggested retail e-commerce would grow at just less than13%.
Most retail execs know the importance of e-commerce.
In a Deloitte survey, 88% of retail executives said digital acceleration is a priority.
Searches for “digital transformation” are up 614% since 2016.
Estimates show that $1 million dollars is spent online every minute.
Of course, much of that money is spent on Amazon.
The food and personal care industry saw the highest growth in the e-commerce space in 2020, according to data from DataReportal.
Globally, the e-commerce revenue in this category was up more than 40% and grocery stores’ online transactions in November 2020 were double the amount they were pre-pandemic, in January 2020.
eCommerce spending saw the largest increase in the food and personal care sector. Searches for “online groceries” peaked in mid-2020, but still remain elevated.
Within e-commerce, mobile sales specifically are making huge gains.
They were up 31.5% in 2020 and are expected to grow more than 28% this year, landing at $432 billion in 2022.
2. Businesses continue to utilize social media
Running a business without having a social media presence is almost unheard of in 2021.
Search growth for “social media marketing” over time.
The importance of social media in business’ marketing and e-commerce plans will likely continue to increase in the years to come.
As of 2019, 73% of marketers said that social media was either “somewhat effective” or “very effective” for their business.
Finaria reports that spending on social media ads will hit $105 billion in 2021—a 15% increase since 2020.
Over the last three years, spending on social media ads has jumped nearly 70%.
An increasing number of businesses are turning to social media influencers to market their products.
More than 90% of marketers report using the strategy and it’s working.
On average, the earned media value of working with influencers is $5.78 on every dollar spent.
Searches for “influencer marketing” have grown 569% in the last five years.
TikTok is one social platform that’s overlooked by most businesses.
But 2021 could be the year to change that.
It’s only been around since 2017, but TikTok already boasts 689 million monthly active users, most of whom are between the ages of 10 and 29.
In 2020, TikTok took in around $1 billion in revenue, much of that from selling ads on the platform.
In mid-2020, they launched a new tool for businesses running ads.
Searches for “TikTok ads”.
Facebook, Instagram, and Pinterest allow businesses to tag their products in posts.
Those tags take users directly to product information and the opportunity to make a purchase.
Experts say this social media commerce will have a big year in 2021.
Social shoppers are expected to spend $39 billion this year, an increase of 33%.
3. Big data gets bigger
Experts say big data will continue to get bigger through 2027.
We’re talking about the large volumes of data that businesses use to understand trends, preferences, and patterns.
The market is expected to double between 2020 and 2027.
The global market for big data continues to grow at an incredible rate. The total value is expected to be $103 billion by 2027.
Stats show that 52.5% of businesses are using big data analytics and 38% of businesses who aren’t using it plan to start in the future.
Searches for “business analytics” have been steadily climbing for the past 10 years.
The percentage of Fortune 1000 businesses investing big money in big data has risen 25% since 2018, according to a survey by NewVantage Partners.
According to one survey, businesses that use big data see a profit increase of 8% and a cost reduction of 10%.
Nearly every industry now uses big data.
E-commerce businesses use data to forecast trends and product demand. Banking institutions use data to increase profits.
In the oil industry, analyzing big data helps to ensure safety.
Netflix is one business that utilizes big data to drive profit.
Netflix uses big data to reduce churn and improve overall customer satisfaction.
The company estimates that big data algorithms help it save $1 billion every year in the form of customer retention.
In 2021, businesses are eager for fast, real-time big data processing and analytics.
This need is driving demand for edge computing.
Google search growth for “Edge Computing”.
Instead of sending the data to the cloud, this technology allows the data processing to take place closer to the data generation source.
There’s no doubt that the amount of data businesses collect from the IoT (Internet of Things) is rapidly expanding.
Experts say that IoT will generate 90 zettabytes of data by 2025.
The development of the 5G mobile network is driving enhanced data collection and analysis.
In simple terms, 5G has a significantly larger capacity for carrying data than 4G.
This means businesses will have more data from more diverse sources at faster speeds.
As interest has grown, searches for “5G” have increased more than 1,100% in the past five years.
4. Entrepreneurship is on the rise
Millions of people were laid-off or let go from their jobs entirely during the pandemic.
And the data shows that many of them became entrepreneurs.
Searches for “start a business” are up steadily over the last 5 years.
In 2020, there were 4.5 million new business applications. That’s up 24% over 2019.
There was a large jump in business applications in 2020.
The “likely employer applications” designate those businesses that are likely to take on paid employees.
Those have risen drastically, too.
The monthly average of these applications between July 2020 and March 2021 has been 32% higher than pre-pandemic levels.
This trend is sticking around, even as many in the United States begin to regain a sense of normalcy after the pandemic.
The May 2021 business applications report showed that business applications were still up substantially when compared to previous years and had increased nearly 9% month-over-month.
The warehouse and retail industries have shown the strongest growth in terms of new businesses.
Even those who haven’t formally started a new business yet may be interested in doing so in the coming years.
Pittsburgh’s Chatham University reported that even though their business counseling and training services went online last year, demand has increased by 50%.
The entrepreneurship surge has also been seen in a very unexpected segment of the population—kids.
During the pandemic, young students had more free time. And many teens reconsidered their interest in attending college.
In one survey, data showed that 62% of Gen Zers and 50% of millennials are planning to start a business.
Surveys have found that younger people are becoming more interested in entrepreneurship.
SaNiyah Henderson, a 15-year-old from Ohio, developed her business plan during the pandemic and opened a beauty store in October 2020.
She’s also formulating her own hair growth oil.
A college student started her own tie-dyed clothing company, Tied by Len, during the pandemic.
Now, she has more than 14k followers on TikTok.
Six-year-old Nicholas Bubeck started a business building toy airplanes. He donates his profits to a heart foundation.
5. Revamping human resources
In the early days of the pandemic, remote work became the norm for many businesses almost overnight.
An April 2020 survey showed that 17% of employees worked from home full-time before the pandemic and 44% were fully remote after the pandemic.
Searches for “remote work” are up 110% over five years ago, but they are leveling off now.
In 2021, watch for some contention between businesses and employees as work-from-home policies are finalized for the long term.
Data shows that 89% of employees want to be able to work remotely, at least part-time.
But, another study shows that 83% of CEOs want employees to return in person.
In many ways, the pandemic also intensified feelings employees had about their employers caring for their health and wellness.
For example, mental health has been an important topic of discussion in many companies.
In one survey, 92% of CEOs said their businesses had increased focus on mental health after the pandemic.
Salesforce.com is one company that’s created programs to give their employees the resources they need to care for themselves and their mental health.
They created the “B-Well Together” video series that features speakers and wellbeing experts.
Citigroup has taken steps to help employees set work-life boundaries.
In March of 2021, the company banned internal video calls on Fridays in an effort to give employees a break.
Another human resources trend that’s recently picked up steam is business agility.
Many companies see inefficiencies in traditional hiring models and 42% of small businesses can’t fill their job openings.
Companies are also looking for more advanced and specific skill sets to give them a competitive edge.
Research shows that job descriptions now list one-third more skills than they did in 2017.
This all points to an increase in hiring remote freelancers, an “on-demand” workforce.
A study run by Harvard Business School found that 40% of business leaders said accessing freelancers helped improve productivity and increase innovation.
They also found that 60% of respondents said it was “highly” or “somewhat” likely that their core workforce would shrink in the future.
Searches for “freelancing” are higher than ever and have shown a steady climb over the past five years.
6. Millennials Splurge for Nostalgia
Millennials in the U.S. have a combined annual spending power of about $2.5 trillion (and growing).
And Millennials recently surpassed Baby Boomers to become the largest generation in America.
By 2025, Millennials are expected to account for three-quarters of the global workforce.
All of this means the economy is entering a “youth boom”. Baby Boomers have been the primary consumers for decades, but that torch is about to pass to people who are 20+ years younger — skipping over the smaller Generation X.
This shift is rapidly changing consumption habits, especially in the U.S.
As a result, companies are shifting their strategies to appeal more to Millennials.
One way they’re doing so is via nostalgia.
One example is Pokémon.
Thanks to numerous games and merchandise, the ‘90s video game franchise has become the highest-grossing media franchise in history, with an estimated $100 billion in total global revenue.
Pokémon has brought in more revenue than any other media franchise worldwide.
Nintendo (which is a part owner of The Pokémon Company) might be the king of capitalizing on Millennials’ nostalgia.
The $67 billion market cap company launched a scaled-down version of their original NES console for a limited time in 2016. The system sold so well that they released it a second time in 2018 — when it sold out within hours once again.
Combined with the follow-up SNES Classic, the company reportedly sold over 10 million units of the rereleased consoles before the end of 2018, leading global monthly console unit sales for the first time since 1995.
And because Millennials are the first generation that grew up with widespread access to video games, they’re also the first generation of adults to play — and buy — video games as much as they do.
In the U.S., Millennials spend an average of $112 per month on games.
And they don’t just game alone: over 38% of American parents with children under 18 now play video games with their kids at least weekly.
Which is a perfect situation for Nintendo’s family-friendly games. In 2020 the company had its best August ever in terms of hardware sales, and 10 of the 20 best-selling games that month were Nintendo-only.
(So it’s no surprise to see new competition from tech giants in the forms of Apple Arcade, Amazon’s Luna, Google Play Pass and Google Stadia.)
Nostalgia is also helping convince Millennial parents what to feed their kids.
Millennials tend to be more health-conscious than their parents were, favoring natural ingredients.
Searches for Magic Spoon breakfast cereal over time.
And then there are the many revivals, reboots and remakes of movies and TV shows.
Case in point: Netflix’s Cobra Kai, which was one of the most popular series in the U.S. last year.
Other examples from Netflix include Chilling Adventures of Sabrina, The Baby-Sitters Club and Mystery Science Theater 3000: The Return.
Not to mention Disney’s recent remakes of Mulan, The Lion King, Aladdin, The Jungle Book, and others. Several of which made even more money after inflation than the original blockbusters.
New stories are also being told in an ‘80s or ‘90s style, or incorporating pop culture nods to those past decades. Like Stranger Things, Ready Player One and See You Yesterday.
The fashion industry has been massively influenced by Millennial nostalgia as well.
Sales of fanny packs reached an astounding $100 million between September 2016 and 2017. In the U.S., the accessory’s sales then quadrupled from 2017 to 2018. And astoundingly, they doubled again in 2019.
Google searches for “mom jeans” have been climbing steadily.
7. Companies Embrace Digital Process Automation
The global digital process automation market was valued at $1.4 billion in 2019 and is projected to reach $25.56 billion by 2027.
The global digital process automation market is set to grow significantly by 2027.
Digital process automation can help companies implement new offerings faster, scale up services efficiently, reduce errors, ensure consistency, help with regulatory compliance and provide novel solutions to customers.
43% of knowledge workers say they use automation software to help complete tasks faster.
The industry can be broken down into two main categories: “dumb” robotic process automation (sometimes simply called “robotic process automation” or RPA) and AI-powered “intelligent automation” (IA).
(Both are software-based: the “robotic” part refers to software robots.)
“Dumb” robotic process automation (RPA) does not learn and evolve on its own. It simply executes specific, predictable tasks.
But it does so much more cheaply than humans can, with an estimated cost reduction of 66% - 80% compared to regular employees.
Searches for “robotic process automation” have more than doubled since 2016.
For example, the University of Texas MD Anderson Cancer Center used HelpSystems Automate to automate 80 different tasks.
Tasks like alerting their IT team to system failures in real time, backing up critical applications, generating reports and more. This resulted in an ROI of 650% as well as better patient care.
Intelligent automation (IA) is useful for situations with more variation.
While more expensive than “dumb” RPA, IA uses machine learning to learn and adapt.
This type of automation excels with unstructured data, computer vision, natural language processing, predictive analytics, self-repair and tasks that require judgment.
Search volume for “intelligent automation” increased by 163% over the last 5 years.
90% of executives who are scaling up their intelligent automation say it creates higher-value work for their employees.
And because it’s more powerful, intelligent automation can allow for “hyperautomation”: the start-to-finish automation of entire business functions. (Hyperautomation was named by Gartner as the #1 strategic tech trend of 2020.)
As 2019, finance and accounting were the departments investing the most in IA technologies. Followed by global business services and compliance.
Estimated global spending on IA technologies by function, based on a survey of 590 business leaders.
But in practice, many players offer both intelligent automation and “dumb” RPA.
Like Microsoft’s Power Automate (formerly “Flow”) which includes thousands of prebuilt automation templates for simple workflows like sending automated emails when new files are added to SharePoint.
But it also includes a feature called “AI Builder” for more advanced functionality.
Search volume for “Power Automate” (the new name for Microsoft Flow).
(Microsoft also announced that it would be licensing OpenAI’s GPT-3 language model. But it isn’t clear whether that will be used with Power Automate.)
Or like Automation Anywhere, which bills itself as the world’s #1 intelligent automation platform. It features the “Discovery Bot”, which searches for opportunities to automate additional tasks — and automatically creates additional software bots to do so.
But the company also has a “bot store” with hundreds of ready-to-use simple workflow automations.
Automation Anywhere’s software bot store.
Other examples of digital process automation include:
Desktop automation software like Apple’s Automator for desktop workflows on Mac, Kissflow (with customers including Pepsi, Domino’s and Comcast), Pipefy (with customers like Kraft Heinz, Ogilvy and Vodacom) and Tray.io (with customers like Udemy, Typeform and AdRoll).
Searches for Pipefy over time.
8. The Legal Cannabis Industry Continues to Grow
Legal cannabis spending is expected to reach $42.7 billion per year globally by 2024.
That’s up from just $3.3 billion in 2014 and $14.9 billion in 2019.
The U.S. is leading the charge, with about 81% of total sales.
That’s largely because legal marijuana is available to more people in the U.S. than in any other country. (In most states, medical marijuana is legal but recreational use is not.)
Marijuana is fully legal in the black states, fully illegal in the gray states, and allowed medically and/or decriminalized in green states.
Avoiding the piecemeal approach, neighboring Canada made recreational marijuana legal for adults nationwide in October 2018. (It was the second country to ever officially do so, after Uruguay.)
Unlike in the U.S., Canada’s legalization at the national level allows Canadian cannabis growers to export the majority of their product.
As a result, there has been a significant uptick in demand for cannabis from growers like Canopy Growth ($7.79B market cap), Aphria ($1.36B market cap), Aurora Cannabis ($808M market cap) and Tilray ($735M market cap).
After all, Canada’s population is only about 38 million. So despite its quickly-growing domestic market, there’s a limit to how large it will become.
This means that most of the industry’s future growth lies elsewhere. In countries with larger populations — and as-yet nonexistent legal cannabis markets.
In Europe, for example, selling recreational marijuana is treated as essentially legal only in the Netherlands and Spain.
That leaves a population of about 682 million without retail access to cannabis in Europe alone.
In fact, only about 2.5% of the world’s 7.8 billion people can legally buy marijuana for recreational purposes.
According to some, that number may double in the next several years: more countries in Europe, Asia and elsewhere appear to be moving toward full legalization.
Many have already decriminalized it (requiring only a fine if caught), made it legal for medical purposes with a prescription, or allow CBD strains which contain little or no THC.
Because medicinal use is legal in more places than recreational use, about 71% of global sales were for medical purposes.
But for the same reason, more growth is expected in the recreational category. By 2027, recreational cannabis sales are expected to make up 62% of the total.
Aside from the recreational vs. medicinal split, there are two main cannabis product categories:
Those that include large quantities of THC (which gets you high) and those that contain more of the “relaxation” molecule CBD (and little to no THC).
CBD may be the lesser-known of the two, but it’s currently booming in the U.S. as it’s been legalized at the federal level.
CBD use by age group.
The top reasons for using CBD are relaxation (at 55% of users), stress/anxiety relief (at 50%) and improving sleep (45%).
No wonder CBD products are exploding in popularity.
For example, CBD flowers. Which people can cook with, smoke or vape without feeling any direct effects.
Search volume for “CBD flower” has grown quickly since CBD was legalized federally in the U.S. in 2018.
THC-based products come in pretty much all of the same forms as CBD products. But since they include THC, the effect is different (and they’re legal in fewer places).
Although influenced by the pandemic, cannabis delivery is also a growing trend.
9. Ad Markets Consolidate
Worldwide Google searches for the term “influencer marketing” have increased 1,314% in the past 5 years.
Searches for “influencer marketing” over time.
The reason is no mystery: for every dollar spent on influencer marketing, the earned media value created is $5.78.
Companies aren’t just relying on famous names, either. They’re also turning to influencers with small but targeted audiences.
But there’s one problem.
Dealing with individual influencers doesn’t scale.
Enter: influencer marketing platforms.
Influencer marketing platforms make it easy for companies and influencers to “meet” and make deals.
The influencer marketing platform industry is expected to increase from $4.6 billion in 2018 to $23.52 billion in 2025, for a CAGR of over 26%.
Growth of the influencer marketing software space from 2018-2025.
Influencer marketing platforms and related products include:
NeoReach, which was founded in San Francisco in 2013 and counts Airbnb, Amazon and Walmart among its customers.
Searches for Upfluence have increased 120% in 5 years.
Search interest in Cohley has been spikey but generally on the rise.
But influencer marketing platforms are just one part of a much larger meta trend: ad market consolidation.
Fractured advertising markets make it harder for companies to find marketing opportunities and buy placements at scale.
As a result, we’re seeing platforms, marketplaces and agencies emerge to make that process easier across different media.
In podcasting, for example.
Podcast advertising is growing rapidly, from an estimated $313.9B in 2017 to $708.1B in 2019 in the U.S. alone.
The US podcast market is steadily growing.
But there are over 1.5 million podcasts, most of which operate independently from each other.
And many more top podcasts are part of podcast networks, which also serve as ad aggregators.
Like audiochuck, iHeartRadio, Wondery and Headgum (which owns Gumball).
Not to mention all the podcasts and networks Spotify has acquired over the last 24 months.
In 2019, company spent about $400 million (total) on 3 podcast companies: podcast publishing platform Anchor and the networks Gimlet Media and Parcast.
But Spotify also makes it possible to buy ads on over a million other podcasts. As well as between songs. With the Spotify Advertising self-service platform, advertisers can reach the 170M+ people who listen to Spotify with ads turned on (meaning they don’t pay for a membership that removes the ads).
Spotify Advertising even has a free feature that turns advertisers’ text scripts into voice ads, removing a significant barrier to entry.
Affiliate marketing is another fractured market.
On the aggregation side, there have been affiliate marketing networks for ages. But the list of major players is still long.
Plus niche entrants like Rewardful — an affiliate network exclusively for SaaS businesses who bill with Stripe.
With so many affiliate networks, it’s common for companies to enroll with more than one.
To manage their affiliates who are spread across all those networks, businesses are turning to affiliate management programs like Affluent, Partnerize and Affise.
Searches for “affiliate management program” have increased 633% in 5 years.
On the flip side, affiliate marketers face similar challenges. Many sign up for multiple affiliate networks, which can be difficult to monitor and manage.
That’s where affiliate dashboards come in.
Search interest in affiliate dashboards has more than tripled in the last 5 years.
That concludes our list of super important business trends.
The business world (including marketing, sales, fulfillment and more) is quickly moving online.
Companies that stay on top of key trends (and innovate based on those trends) are poised to come out on top.