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Market Trends Portal

Market Trends

Informa operates within the Knowledge & Information Economy and serves customers who operate in a range of industry sectors.

Read on for examples of the specialist industry markets in which Informa operates, written from experts within the Group, and the trends that create opportunities for our customers and demand for information services products.

  • Pharma
  • TMT
  • Health & Nutrition
  • Aviation
  • Specialism

Pharma: Competition and Innovation


  • It is a time of change, and both challenge and opportunity, for major Western pharmaceutical companies. Competition and innovation are emerging from China, and many non-traditional players, revolutionary cell and gene therapies are starting to gain approval, and the industry is exploring the potential of artificial intelligence and data analytics.

    The world is wrestling with the increasing costs of keeping people well, and companies face the commercial challenge of ensuring research and development efforts provide sustainable returns on investment.

    Strategies to keep healthcare budgets under control include demanding that pharma companies demonstrate how their medicines deliver value, renegotiating existing prices downward and boosting the uptake of less expensive alternatives such as generics and biosimilars.

    At the same time, more Chinese capital is being put to work in Western businesses, and the influence of innovative home grown companies with global ambitions is on the rise. The number of reviewers for new drug approvals in China is now 600 from just 60 a few years ago, with plans to have 1,600 within a year. China’s Food and Drug Administration has ambitions to be as significant as its US, European and Japanese counterparts.

    While the pharma industry is global, companies have to maintain intelligence on what is happening locally to ensure optimal market access and tailor their approaches by country and indication. This is particularly acute in the fast-growing biosimilars space, which has seen growing influence from companies based in India, South Korea and China.

    Currently, the best selling drugs are monoclonal antibody-based biologics – Humira, the top selling drug, posts sales of more than $18bn – but many are about to go off patent, opening the door to less expensive biosimilar alternatives. Some leading pharma companies are putting in place defensive strategies to protect their franchises, while others see opportunities to build out their own offerings, and indeed the pharmaceutical industry has many reasons to be optimistic.

    In 2017 there was an upswing in regulatory approvals, particularly for innovative new medicines and revolutionary cell and gene therapies, which some believe signals the dawn of a new pharmaceutical age. The US Food and Drug Administration approved 46 new molecular entities, while the European Medicines Agency gave the green light to 28 new products containing 29 new active substances. Regulators are taking a more pragmatic view around approvals to get help to patients as quickly as possible.

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    With the new tax proposals in the US, and estimates that the largest 10 US pharma companies may be sitting on as much as $160bn, a surge in merger and acquisition activity is expected for 2018. Indeed, in January alone, Sanofi and Celgene announced deals worth nearly $28bn.

    Beyond marquee acquisitions, an upswing in bolt-on acquisitions and product in-licensing is likely to boost pharma pipelines. Many of these assets reside in emerging small to medium-sized biopharmaceutical companies, who often have less than a handful of assets in their pipeline and are reliant on capital market support. In 2017, the global biotech industry secured more than $70bn from the capital markets. Companies will need access to databases identifying the most promising emerging companies and unpartnered assets while stepping up their own biopartnering capabilities.

    Pharma is also beginning to wrestle with the potential of artificial intelligence to handle the terabytes of data associated with human healthcare globally. This may mean pharma companies look beyond their usual partners to develop relationships with businesses familiar with handling such data sets. With data likely to be a key differentiator in future healthcare provision, do not be surprised to see an increasing presence of IOT giants such as Google, Microsoft and Amazon in the sector in the coming years.

     

    Mike Ward Head of Pharma Content, Business Intelligence

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TMT: Telecoms at the tipping point


  • The future of telecoms and TV is fast emerging, with TV reaching a long-awaited tipping point and the rapid adoption of mobile broadband leading to innovation in services. Technology, Media and Telecoms (TMT) companies in the US and around the world are closely watching, responding to consumer trends and targeting their investments accordingly.

    Few trends will be bigger in 2018 and the coming years than the transformation of TV and video by the delivery of services “over the top” of the Internet. Netflix, Amazon Video, YouTube and other online-only services will account for 18% of total paid and ad-supported TV and video revenues next year and 60% of growth. In the world’s most advanced TV and video market, the US, these over the top services will take an astonishing 89% of revenue growth.

    Understandably, telecoms and media companies worldwide are watching the US closely. A meaningful number of households in the country are cutting the cord by cancelling their pay TV contracts, tired of paying for bundles including hundreds of TV channels they never watch. Ovum data shows that pay TV subscription numbers began to decline from a high of 100.8 million at the end of 2013 and will fall to 95.8 million by 2022. The creation of new households uninterested in subscribing in the first place, known as cord-nevers, means pay TV’s penetration of households will fall nearly 10 percentage points to 71.9% in 2022.

    A growing number of consumers will opt to use lower-priced, online-only services instead. We forecast the number of subscriptions to online video services in the US will rise to 213.1 million in 2022, more than double the total for pay TV, split between 130.4 million Netflix-like subscription-based video-on-demand-only services, and 82.7 million subscriptionbased linear online video services such as AT&T’s DirecTV Now, Amazon Channels and YouTube TV.

    The rise of over the top video will impact one of the strategies for growing broadband and TV subscription numbers and revenues: the multi-play bundle. Traditional dual-play bundles of fixed broadband and fixed telephony will see the greatest decline in numbers.

    But US operators are innovating with bundling in other ways, looking to hitch their next-generation video services to rapid adoption of mobile broadband. Uptake of quad-play offerings that include mobile will continue to grow, and mobile broadband subscriptions in the US are due to exceed 555 million in 2022 – including 104 million to 5G services.

     

  • In other markets, outcomes will be different. Why? It is easier to say what is singular about the US than to generalise about the rest of the world. At over 90% penetration of TV households, the US pay TV market has been saturated for a very long time. Operators have focused on increasing subscription fees to grow revenue, which has led average triple-play prices to reach as high as $145 per month.

    Globally, subscriptions to fixed-broadband bundles that do not include pay TV will begin to decline from 2017, while those that do will grow strongly over the forecast period. But outlooks differ greatly by market.

    Looking at the 10 largest countries by number of households at the end of 2021 – China, India, the US, Brazil, Indonesia, Russia, Japan, Nigeria, Germany and Mexico – fixed broadband will dominate in some, and pay TV in others.

    Varying take-up of subscription online video reveals just how much of an outlier the US will be, with more subscriptions than homes as services proliferate and some households sign up to two or more.

    One factor will remain constant: mobile broadband will be adopted widely, presenting new opportunities and challenges to TV the world over. 

    Consumer & Electronic Services, Ovum
    Rob Gallagher Research Director,

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Pharma: Health & nutrition: Clean choices


  • In the US, consumers are increasingly paying attention to what they put in and on their bodies. They are reading product labels, scrutinising chemical-sounding or perceived unnatural ingredients, and seeking out healthier, less processed offerings that their grandparents would recognise.

    Consumers are also increasingly demanding greater transparency in the foods and packaged goods products they purchase: what is in the products they buy, where the ingredients came from and how they were made. Shoppers, particularly millennials, want to know the stories behind products and use those stories to determine how much they trust a brand and how much they will pay for it. According to New Hope 2017 consumer research, 65% of millennials would pay more for responsibly produced food compared with 25% of baby boomers.

    As US consumers put more dollars towards healthy, clean and sustainable nutrition, their expectations are putting pressure on traditional food and beverage consumer packaged goods companies. But as the big food companies struggle in the age of the new consumer, other companies are finding market opportunity.

    Growing at 6-10% each year over the last decade, US consumer sales of natural, organic and functional foods and beverages are far outpacing total US food industry sales, which grew less than 1% in 2016 according to Nutrition Business Journal (NBJ). Although still small in comparison to the total industry, natural, organic and functional food and beverages are forecast to reach $196 billion by 2020.

    Other consumer packaged goods product categories are also being impacted by the new consumer. The US dietary supplement market grew 6% to $41bn in 2016, as consumers continued to increasingly spend their dollars on natural nutrition and wellness products. Combined sales of natural and organic personal care, household and pet products increased nearly 7% to $18.6bn in 2016.

    The entire US natural and organic products industry, which includes foods and beverages, dietary supplements and personal care, household and pet products, surpassed the $200 billion mark in 2017 and has more than doubled in size since 2007, when industry sales were less than $100bn.

    By 2020, NBJ is forecasting nearly $300bn in annual consumer sales, impressive for a business sector that was once considered a fad and supported only by yoga moms and tree-hugging hippies.

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    Shifting market dynamics, coupled with the increased and new kinds of investment dollars available to emerging brands, is motivating a growing number of companies to launch each year with product innovations that provide healthier, cleaner options; greater product transparency; and mission-driven business models that address societal and planetary problems like global warming, food security/access, nutritional poverty and more.

    At our own Natural Products Expo West and East, more than 1,000 new finished product brands launch each year.

    The food choices prioritised in Dubai look different to those in Dallas, and yet these same macro forces rocking the food and beverage landscape in the US are causing ripples elsewhere throughout the globe, as evidenced by worldwide growth of everything from organic food to dietary supplements.

    In the last 10 years in the supplements market, for instance, China’s share of the market has grown faster than any other country, up to 14.3% of the world’s industry in 2016 from 9.6% in 2006. The Chinese market has gained the attention of many supplements companies as consumers are increasingly spending on health products and e-commerce continues to grow exponentially in the country.

    And in vitamins and minerals, the strongest growth is coming from Eastern Europe and Russia, with increasing health concerns, rising obesity rates and disposable income spurring sales of supplements for overall health.

    Carlotta Mast Senior Vice President, Content & Insights, New Hope Network

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Aviation: From defense spend to space start ups


  • The global aerospace and defence industry enters 2018 with the wind at its back. In commercial aviation, the large jetliner market continues to grow, fuelled by new demand for air travel and more efficient aircraft. In the Western defence industry, government spending is rising again, while the space market is being transformed by entrepreneurial start-ups.

    The large commercial jetliner market dominated by Airbus and Boeing is heading into an unprecedented 15th year of growth. History would suggest the market is overdue a downturn, but there are few signs of weakness. Global economic growth, rising numbers of middle-class travellers in emerging markets and low interest rates are underpinning strong demand for new airplanes.

    Boeing delivered a record 763 aircraft in 2017 and took orders for another 912. The two airframers’ massive backlogs would take seven to nine years to deliver at current production rates and both companies are bolstering output. China’s Comac is emerging as a third player but is not expected to pose a significant challenge to either company for some time.

    In addition to new sales, the Aviation Week Intelligence Network (AWIN) forecasts the maintenance, repair and overhaul (MRO) market for commercial aircraft will generate $88.3bn in demand in 2018, with another $8.3bn for business aircraft and $6.5bn for civil helicopters. But the civil MRO market is experiencing some churn as large aerospace contractors, most notably Boeing, aim to grab a larger share of those lucrative revenues.

    The air cargo market grew 9% in 2017, according to the International Air Transport Association, with e-commerce underpinning new demand. Further growth is expected in 2018. Two pockets of the aviation market that continue to struggle are business jets, which is still climbing out of a brutal downturn that began in 2008, and civil rotorcraft, which was hit hard by a slump in demand from oil and gas companies.

    Longer term, the nascent market for urban air transport bears watching. Uber is aiming to begin experimental flights in Dubai and Dallas in 2020, which could lead to commercial operations by 2025. Multiple urban air taxi concepts are in development.

    After several years of decline, Defense Department funding in the US, by far the world’s biggest spender, is growing again. The Trump administration has requested $686bn for the Pentagon in fiscal 2019, a nearly 18% increase since the budget bottomed out in fiscal 2015. Missile defence programmes should see hefty increases as Washington seeks to counter strategic threats from a nuclear-armed North Korea, with additional money going to modernise forces and aircraft used during conflicts in the Middle East and Afghanistan.

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    The Pentagon is also under pressure to reach for more advanced technologies such as efficient engines that can power combat aircraft and hypersonic missiles, as well as upgrades to artificial intelligence, automation and big-data analysis, which appear to be lagging behind investments in China.

    European defence budgets have risen as NATO prepares to counter an increasingly aggressive Russia, and alliance members come under pressure to meet a commitment to spend at least 2% of GDP on defence. But political turmoil and the UK’s impending exit from the EU have created uncertainties. Germany and France are strengthening their defence ties and have declared an ambition to jointly build a European answer to the F-35 fighter jet, while a decline in the value of the British pound has hit the UK since it invests heavily in US-made equipment, most notably the F-35. Nothing will do more to transform the military aircraft market than the F-35, which AWIN projects will see nearly $73bn worth of deliveries in the next five years.

    Space is an industry characterised by disruption, with companies such as SpaceX and Blue Origin progressing toward their goal of radically reducing the cost of access to orbit. Investors pumped $2.8bn into 43 US space start-ups in 2016, many of them communications satellite ventures, according to the consultancy Bryce Space and Technology. New commercial space start-ups are also popping up in China and Japan.

    Joe Anselmo Editor in Chief, Aviation Week

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Specialism and the rise of the expert


  • In the last few years, a sense of distrust has seeped into the global zeitgeist. Due to the proliferation of fake news spread through websites and social media, as well as the failures of the establishment to adequately respond during times of crisis, people are wary of government, corporations and the media, unsure if they have honest intentions or if they are motivated by a desire to promote self-interests.

    However, futurists who track global trends believe this mistrust has also given rise to a countermovement. While people are still sceptical of the perceived establishment, they are eager to embrace and bring attention to the good work of individuals with whom they directly relate. In this environment, there is potential for experts to cultivate even greater influence within their industries by complementing their vertical-specific expertise with deeper audience engagement, particularly through online and social media channels.

    Recent data from the Edelman Trust Barometer, an annual global survey of trust and perceptions of credibility, points to the validity of this approach. Their 2017 study found most participants considered peers to be just as trustworthy as those categorised as experts. However, in 2018, technical and academic experts once again landed in the top spots, as they had in previous years. These two groups were deemed most trustworthy of all those tracked in the 2018 edition, with 63% and 61% respectively believing technical and academic experts were very or extremely credible, while trust in peers decreased to 54%.

    Why? One theory is that the global political and policy instability of 2017 made people more trusting in only those with access, deep knowledge and understanding of specific subjects, giving experts a leg up. Even though peers saw declines in their trust ranking, they were still the third most trustworthy group out of a field of 11, staying influential partly due to the power of human connection.

    But it is clearly not about blindly believing and following anyone who is friendly or claims to be an expert. Expertise is often in the eye of the beholder, after an evaluation of a person’s qualifications, demonstrated knowledge, and public perception of their integrity and credibility. Where authors and experts can demonstrate they have a genuine intention to inform and help the reader as a fellow member of the community – be that a local, or personal interest, or professional vertical community – they are more likely to be believed and trusted.

  • Technology has a major role to play in building connections with audiences and communities, and is now essential to deepening trust with an audience.

    In addition to the fact that social media is increasingly where people find news and information (a Reuters Institute 2017 Digital News Report found that 33% of those between 18 and 24 listed social media as their main source of news), it has also made it possible for savvy influencers to take parasocial relationships – a one-way relationship with someone you do not know in real life – to the next level by using online interaction with fans and followers to supplement real life interactions.

    There is a good chance that for each of us, technology has aided in creating or preserving a relationship that would have otherwise been difficult to grow or maintain. Having met someone at a networking event, an exhibition, a party or someone’s house, you connect online afterwards, and follow and interact with them, often over the course of years. Indeed, some researchers believe that online and offline relationships are often indistinguishable and offline relationships are not somehow more real than online ones.

    So what matters? Trends and data show that audiences and communities are looking for experts, first and foremost: people who are credible, creating and providing original content and unique insights and intelligence, and connected to their world (and more often than not, actual people and individuals, and sometimes brands, rather than institutions). They expect that engagement to be online as well as offline and to use multiple formats – video, audio, images, long reports and short form content.

    Connecting with audiences in these ways is essential to the growth and future of many information services products, and particularly intelligence-based services. Without these, brands may one day find their readers have abandoned them and gone elsewhere.

    Informa’s response to these trends, and the initiatives underway to cultivate communities, are covered elsewhere in this report. This includes the ongoing focus on being specialist in chosen, international vertical markets and investing in our data, intelligence and connection credentials. It includes broadening in-person formats at exhibitions and conferences to year-round interactions and community building online. It includes supporting the authors we publish so that they can also extend their position as experts in their communities.

    Richard Stanton Chief Digital and Innovation Officer, Business Intelligence

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