EMERGENT RESEARCH is focused on better understanding the small business sector of the US and global economy.
Authors
The authors are Steve King and Carolyn Ockels. Steve and Carolyn are partners at Emergent Research and Senior Fellows at the Society for New Communications Research. Carolyn is leading the coworking study and Steve is a member of the project team.
Emergent Research works with corporate, government and non-profit clients. When we reference organizations that have provided us funding in the last year we will note it.
If we mention a product or service that we received for free or other considerations, we will note it.
As the Barlow chart below shows (click to enlarge), there's a big difference in the use of mobile banking applications.
64% of Gen X and Millennial SMB owners (those younger than 57) regularly use mobile apps for their banking transactions. Only 41% of Baby Boomer SMB owners (those aged 57 +) use them.
The article also points out that the average age of a small business owner is 62.
But it's worth repeating because younger tech startup owners tend to get much attention. This leads people to believe the average small business owner is younger than they are.
Barlow, a leading provider of market research and consulting services to financial institutions, defines small businesses as those with between $100,000 and $10 million in revenue. This means a strong majority of these firms have employees.
Quibi is a startup entertainment company that has raised $1.4 billion in venture funding to build a new content streaming service designed exclusively for mobile devices.
Founded by Hollywood titan Jeffrey Katzenberg and led by CEO Meg Whitman, a Silicon Valley titan, the company has additional star power because of who they've signed up to provide content.
"Quibi has attracted big-name talent to help kick off its first year, including Academy Award winners Steven Spielberg, Peter Farrelly and Guillermo del Toro; directors like Antoine Fuqua, Lena Waithe, Sam Raimi and Catherine Hardwicke; and stars like Stephan James, Chrissy Tiegen, Laurence Fishburne, Dave Franco, Bill Murray, Emily Mortimer and Kevin Hart, to name a few."
Quibi, which is short for “quick bites” is going to offer short-form videos of 4 to 10 minutes on everything from movies and TV shows in the form of short chapters to daily news and sports reports.
"Lighthouses,” the service’s premium videos, will cost about $100,000-per-minute to produce, on par with some of the most expensive shows on TV.
The question, of course, is whether or not people want and will pay for high quality, short-form video entertainment on their phone (Quibi is planning on charging $4.99 to $7.99 per month for access to their content).
“Everything they’re being offered today is centered around the TV. This is about your in-between time,” he told Fortune. “It’s quick bites, on the go and in between. It’s a very, very different viewing habit that we know our anticipated customers already have.… There is an unbelievable amount of content being consumed today on phones on the go. It’s just not of this quality.”
The shift to mobile computing devices is one of the most powerful technology trends of the past decade.
Whether Quibi is successful or not, it's an excellent example of the continuing impact this shift is having.
"The changes remote work has introduced have happened so gradually you may not have noticed. But its growing popularity is remaking how we work, the tools we use to work, how we communicate at work, and even the hours we work ... What was once a rarity among a select set of workers is quickly becoming a defining feature of the future of work."
The pros and cons of remote work are well known, but the article chart below nicely summarizes them. The underlying data comes from a remote worker study done by the social media marketing firm Buffer.
The big pro is, of course, flexibility.
We cover the importance of flexibility a lot (if you do a Google search on "flexibility "Small Business Labs"" you will find 3400 citations).
But it still needs reinforcing - it's a key driver of both the shift to remote work and the rise of independent work.
We also certainly agree remote and distributed work is a defining feature of the future of work.
And to better understand this trend, we closely follow two remote work edge groups - digital nomads and fully remote organizations.
Fully remote organizations are also on the leading edge of remote work because, well, all of their employees are remote.
While reading the Recode article we were struck that remote work is a great example of Amara's Law, which is:
We tend to overestimate the effect of a technology in the short run and underestimate the effect in the long run.
Back during the first Internet boom in the 1990s one of the most common forecasts was that very soon everyone would work remotely. This, obviously, didn't happen.
According to data from the 2019 MBO Partners State of Independence study, 83% of full-time independent workers report working remotely at least some of the time, and 31% report working remotely full-time.
As the study chart below shows (click to enlarge), this is substantially higher than what traditional full-time job holders report.
That full-time independent workers are more likely to work remotely than full-time traditional job holders is no surprise.
But that almost 1 in 3 three work remotely full-time is a bit surprising and illustrates the growing nomadic nature of work.
This is in large part being driven by improvements in the technology that support remote work.
Online video and chat services make it easy to connect and communicate with customers and partners, online content creation tools and cloud storage enable work to be done and delivered from remote locations, and online marketplaces provide remote access to new customers.
Another driver is the growing acceptance by hiring organizations that remote workers can be highly valuable and productive contributors.
A 3rd driver is, of course, more people want to work remotely.
... according to new SAP Concur travel and expense data gathered between January 2017 and December 2017 ... “bleisure” trips increased by 20% from 2016 to 2017. And during this time, more than 2.2 million bleisure trips were taken by business travelers around the globe, making up 10% of total business trips.
Back in 2015 bleisure travel was considered something that millennials mostly did.
But the SAP Concur data shows these days all ages are taking advantage of bleisure travel opportunities. Again from their post:
On average, millennials make up the largest share of bleisure travelers in the world, accounting for 38% of all bleisure trips in the Americas region in 2017, however Generation X (31%) and baby boomers (31%) are not far behind!
In case you're wondering where people go on their bleisure trips: "In the Americas the top destinations are NYC, Chicago, and Los Angeles; in EMEA, Tel Aviv, London, and Paris; and in APAC, Tokyo, Singapore, and Shanghai."
These locations are not surprising. They're all major business hubs that also attract a lot of leisure travelers.
Also not surprising is Airbnb is a growing supplier of bleisure travel accommodations.
According to Conur's data, 70% of expensed trips using Airbnb lodging include a Saturday night stay, compared to just 10% of trips with hotel bookings.
One of the most famous bleisure travelers is Marco Polo, so the the trend is not new. But it seems to be becoming much more popular.
MBO Partners last week released Digital Nomadism: A Rising Trend, a research brief on digital nomads. We worked with MBO Partners on this study.
Digital Nomads are wanderers who have a location-independent lifestyle that allows them to travel and work anywhere they can plug into the Internet.
Some are short-term nomads who only travel and work for short periods of time. Others do it for many years. And while globe trotting digital nomads get the most media attention, many never cross a border, choosing instead to live and work while exploring a single country.
The three key study findings from our perspective are:
1. About 4.8 million Americans currently describe themselves as being digital nomads. While only about 2%-3% of U.S. adults, this is still a large number of people.
2. About 17 million Americans who aren't currently digital nomads say they will become one over the next 2-3 years. Also, 42 million say they might become one over the next 2-3 years.
The research brief points out that most of these people are unlikely to become digital nomads. Instead, they will likely continue to be "armchair digital nomads" following the exploits of digital nomads instead of becoming one themselves.
But these numbers clearly illustrate how popular the digital nomad trend has become. As the Forbes article on the study - Digital Nomadism Goes Mainstream - points out, digital nomadism has become a spectator sport followed by millions.
3. The demographics of digital nomads are broader and more diverse than most think. While they skew male and younger, 31% are female and as the chart below shows, 54% are 39 or older.
We closely follow the digital nomad trend for several reasons.
First, digital nomads are basically mobile workers on steroids. Because of this, they provide insights on the future of distributed work.
They've also chosen a non-traditional career path with a focus on work/life balance and integration. These themes ripple through our broader research on independent workers.
And most of them are independent workers, which, of course, is one of the main areas we study.
We will continue to track and report on this topic. See the report for more details.
It includes an excellent video that is the most professionally done of any VanLife video we've seen and is well worth watching.
For those not familiar with with the VanLife trend, it refers to the growing number of mostly millennials who have traded in their homes and apartments for life on the road in vans.
Key quote from the article on the featured VanLife couple:
The couple is among other digitally savvy nomads, who have customized Volkswagen Syncros and other vans to live and work on the road rent-free. Some have parlayed their nomadic life into social media fame under the hashtag#vanlife. But Jess and Jorge aren't modern hippies abandoning capitalism. Between their Instagram posts, YouTube videos, blogging and photography, Jess and Jorge are hustling hard from inside their roughly 80-square-foot van.
It's become a bit of a craze and there are millions of #VanLife posts on Instagram, Pinterest, Facbook and Twitter.
These posts tend to show pictures of young, adventurous, photogenic millennials - often with adorable dogs - enjoying the great outdoors in beautiful places.
For example, the picture below is from the blog of the #VanLife Hearnes family and shows them having fun while touring Utah with their dogs.
What these pictures don’t tend to show are the downsides of VanLife.
These include limited access to bathrooms and showers, breakdowns, bad weather, work problems and the wide variety of challenges associated with living in a very small space.
The LinkedIn article and video are somewhat unusual in that they cover both the pluses and minuses of VanLife.
VanLife is part of the broader digital nomad trend. Digital nomads are folks with a location-independent work and lifestyle that allows them to roam the earth working and living anywhere that has a good Internet connection.
We’ve long followed the digital nomad trend. The reason is these people are mobile workers on steroids and they provide insights on the future of mobile and distributed work.
We’re just starting a project that includes more research on VanLifers and digital nomads. We’ll report our finding in the coming months.
In 2016, there were 291 million unique wireless subscribers in North America, representing 80% of the region's population.
There are now more mobile subscriptions in the U.S. than people.
We often point out that every time we make a mobile computing forecast we think it's too high. And so far every time we've made a mobile computing forecast, it's turned out to be too low.
We don't forecast smartphone data usage. Just as good. No way we would have forecast data usage to grow so quickly.
U.S. companies have long moved work overseas to save money. But a long emerging trend of moving work to lower cost areas of the U.S. instead of overseas appears to be gaining steam.
Although lower cost U.S. cities are more expensive than outsourcing overseas, rising salaries and costs overseas is making outsourcing there less of a bargain.
Meanwhile, locating in the U.S. has a number of advantages.
Having work done in the U.S. greatly reduces issues and problems associated with navigating time zones, cultures and languages that are common with international outsourcing.
The nature of software development and product design has also changed in ways that make domestic outsourcing more attractive. Key quote from NY Times article:
... companies in every industry need mobile apps and appealing websites, which can be made smarter with data and constantly updated. That software is best created by small, nimble teams, working closely with businesses and customers — not shipped to programmers half a world away.
Regular readers know one of our favorite trends is the paradox of place.
The paradox is even though the Internet and connective technologies has made working remotely easier than ever, people and companies are increasingly clustering together in fewer, more valuable locations.
But despite the paradox, there are a growing number of signals indicating that companies - and workers - are becoming more distributed.
Also driving this shift is cities like San Francisco and New York have become so expensive, it's simply become hard for companies and their employees to locate there,
The advantages of these remote locations include lower salary costs, higher standards of living for employees, greater ability to retain employees, less competition and consequently higher retention.
A number of domestic outsourcing firms have sprung up to tap into this trend. The New York Times article covers the Midwest-based Nexient, whose tagline is "100% U.S. based software partner".
Technology is, of course, the other driver of this shift. Next-generation chat, video calling, and project management software make it easier to coordinate work with and manage remote teams.
But paradox of place continues to be, well, paradoxical.
In person, face-to-face, co-location is the most effective form of communication, especially when you are faced with brainstorming and solving complex issues. Software development is often complex. And, the more that companies rely on technology to be a differentiator, the more complex it becomes.
So the trends indicate there will be both more distributed work and more co-located work. We believe both will continue to happen, at least for the next 5-10 years.
But we also think in the long run distributed work will become more common as technology reduces the problems associated with distance.
The short video below (less than 1 minute) give a quick overview of the Midwest's Silicon Prairie.
No matter how much we cover mobile computing, it seems in many ways we continue to underestimate its impact.
Recode's Big Smartphones Ate the Tablet Market big phones are defined as those with screens "between 5 inches and 6 inches in diagonal (an iPhone 7 Plus measures 5.5 inches diagonally)."
They report that in India and China almost 2/3rds of all smartphones are big. And while only In the U.S. only 33% of smartphones are big, they are rapidly gaining share.
The net result, as the Recode chart below shows, is tablet sales have slowed and are projected to decline about 1% per year over the next 5 years. Meanwhile, smartphone sales are forecast to continue to grow at about 7% per year.
This makes perfectly sense. Why buy a tablet if your phone is also effectively a tablet.
The interesting 2nd order impact of this shift is related to online video.
Americans spent about 7.5 billion minutes watching Netflix on their phones in June of 2017, according to data from media measurement company ComScore, up 73 percent since 2014.
As we reported last year, it's a mobile world and will continue to become even more so.
