BATTELLE PREDICTS FUTURE CONSUMER VALUE ZONES: THE CONVERGENCE OF VALUE, THE MARKET, AND TECHNOLOGY
December 6, 2005

BATTELLE PREDICTS FUTURE CONSUMER VALUE ZONES: THE CONVERGENCE OF VALUE, THE MARKET, AND TECHNOLOGY

Columbus, Ohio--Do you know what you will buy in the stores five or ten years from now? Probably not.

Virtual reams of data are parsed, pored over, and extrapolated by market researchers in order to predict what you will buy.

In this inexact and subjective science, yours is the unknown, unarticulated customer voice of the future. But, if there is one time-tested certainty in the mind of a consumer it's knowing you will want the best value.

"Benefits are to consumers what profit is to corporations-it's the margin of advantage. And like corporations seeking better profits, consumers are always seeking better value," said Steve Millett, Futurist and Thought Leader at Battelle.

Battelle has created a way to anticipate consumer value by identifying Future Consumer Value Zones. These emerging value zones are areas where changes converge to create particularly rich opportunities for consumer value. They will occur when new technologies and products meet marketplace trends and changing consumer behavior to create exceptional value for consumers.

Battelle has identified three such zones that will have resonance for American consumers through the year 2015.

  • Sustainable wellness
  • Infotainment
  • Personalized power.

Sustainable wellness is more than health care. It involves sickness prevention as well as disease cures. Today the health care industry equals more than 15 percent of the entire Gross Domestic Product of the U.S. The health fitness and maintenance market increases further the total spent on medical and pharmaceutical care to more than $2 trillion per year.

The value zone for sustainable wellness will continue for at least another 20 years as the U.S. population ages. Scientific research affirms people's beliefs that if they eat right, exercise, and avoid risky behavior they can extend their good health as well as their lives. This is of great value to everyone and drives consumer behavior. Continued breakthroughs in DNA research and the development of high-tech medical equipment will provide further value to all ages wishing to live longer and healthier lives.

Already plastic surgery is more commonplace as a way to preserve youth and the appearance of wellness. Elective-and somewhat controversial-diagnostic body scans are using technology to search the body for potential problems like heart blockages and cancer so they can be prevented or treated before they are beyond control. In the future, we likely will see a new generation of home medical diagnostic products that are as simple to use as weight scales.

Other sustainable wellness breakthroughs in the next 20 years could include genetically engineered organs for transplants, skin replacements, micro-surgery, highly targeted treatments for cancer, vaccinations for a broad spectrum of diseases, and nutritional regimens tailored for individual requirements.

Infotainment is the value zone created by the convergence of information technologies (including computers and the Internet) with telecommunications (wireless cell phones and land lines) and digital entertainment. We already are seeing a new generation of digital and flat screen TVs. In time, we will be able to access the Internet and databases from around the world through our TVs and computer programs, as well as entertainment programs, through real time consumer demand.

The TV will not be our only cyber portal. Just as we saw the spread of telephones through the house, we will see many computers in various sizes to meet our needs.

We already are seeing the convergence of telecommunications and the Internet in the new generations of cell phones. In addition, we will see the spread of video conferencing to the home, so that grandparents can see and talk with their grandchildren anywhere in the world.

The convergence and convenience of entertainment, information, and education in hardware will also occur in content. Information access leads to education access, as we are now seeing the first wave of Internet courses. This trend will accelerate in the future. Meanwhile, as people see more high-tech entertainment, they will expect more animation of factual information. The present generation of video games will evolve into the next generation of modeling, simulation, and forecasting for serious research. The U.S. Armed Forces already are beginning to use video-game-like training systems with a new generation of soldiers who are comfortable learning with this medium.

The market size for infotainment today may already be as high as $900 billion in the U.S. alone. Over the next 20 years, this market could double or even triple. Its growth will depend upon the value zone where new technologies come down in cost while consumers become better educated. Consumers will demand quality, convenience, speed, accuracy, and affordable prices. Older consumers, who are becoming increasingly comfortable with technology as it becomes a more integral part of daily life, will appreciate value just as much as youngsters.

The third consumer zone is personalized energy. We have just begun the transition from large-scale streams of energy to individualized, packaged energy. The driver for this change is the consumer need to have reliable and mobile power for the electronics of wellness and infotainment. In addition are the larger national issues of energy availability for continued economic growth.

"Americans use an enormous amount of energy, and we expect the benefits of reliability, safety, and use on demand. As easy as flipping a switch," Millett said. "But the challenge facing the market, and one it is trying hard to overcome, is in meeting this consumer expectation in the areas of mobile power for wellness and infotainment."

The current market in the U.S. for energy is roughly $600 billion and rising rapidly. This market could easily double if not triple over the next 20 years.

We see on the horizon new possibilities for energy storage and fuel cells. Fuel cells offer a new approach that converts hydrogen into electricity for consumers of computers, electronics, health devices, and homes across a range of power. Fuel cells will be used for transportation, first as auxiliary power for electronics and then as supplemental drive power. In addition to reducing dependence on foreign supplies of oil, fuel cells will be more environmentally friendly than gasoline engines.

Advances in DNA engineering of plants will lead to new generations of plants, not necessarily food crops, designed for conversion to fuels. This will lead to new bio-fuels, including methanol as a source of hydrogen for fuel cells. Bio-fuels could also be used with gasoline to provide an extended energy source with fewer pollutants. Advances in materials may lead to the further commercialization of solar power.

"Future consumer value zones are not easy to calculate and certainly are not static-consumers change, marketplace conditions change and technologies change," Millett said. "But, improved consumer value through better benefits and lower relative prices goes to the heart of competitive advantage in our market system where consumers have choices."

Battelle is a global leader in science and technology. Headquartered in Columbus, Ohio, it develops and commercializes technology and manages laboratories for customers. Battelle, with the national labs it manages or co-manages, oversees 19,000 staff members and conducts $3.3 billion in annual research and development. Battelle innovations include the development of the office copier machine (Xerox), pioneering work on compact disc technology, medical technology advancements, and fiber optic technologies.

For more information, visit www.battelle.org or contact National Media Relations Manager Katy Delaney at (410) 306-8638, delaneyk@battelle.org or Media Relations Manager Mark Berry at (614) 424-5544, berrym@battelle.org.