Fasten your seat belts: Volatility will continue to be the name of the game in Europe in 2020. US-EU and US-China trade disputes will roil global markets, cybersecurity threat actors will target Europe’s intellectual property (IP), and Brexit-related uncertainty will continue to dampen the economic prospects for the whole European region, however (and whenever!) the UK leaves the European Union.
But with volatility comes opportunity, as we lay out here in three of our most important predictions for Europe in 2020:
- European consumers will reward brands that live their values and punish those that don’t. The result? At least one European firm will lose more than 1% of revenue when it fails to live by its values. Forrester expects Unilever CEO Alan Jope to deliver on his pledge to sell off brands that don’t fit the firm’s societal contribution goals in 2020. And other European consumer packaged goods (CPG) firms will follow suit. But CMOs beware: Forrester also expects values-based consumers will punish your firm for making claims that your products can’t support, so audit your processes first.
- Europe will lay claim to the title of “regulatory superpower,” bringing big moves in competition, privacy, and financial services rule-making and enforcement. EU Competition Commissioner Margrethe Vestager will pursue aggressive anti-trust enforcement and drive the digital single market forward. Forrester also anticipates both a steady drumbeat of General Data Protection Regulation (GDPR) enforcement actions and an avalanche of consumer privacy class actions in 2020; further, the EU will finally adopt the new ePrivacy Regulation. EU regulators will also aim to remedy some of the shortcomings of the second Payment Services Directive (PSD2) and open banking 1.0.
- Digital China will accelerate investment in Europe, and both the EU and member states will regulate acquisitions in key areas. WeChat Pay increased its European merchant total by 350% in the past year, and we expect similar growth in 2020. European states will keep debating Huawei’s role in their 5G rollouts, and further acquisitions of European brands by state-backed Chinese firms (such as Haier’s purchase of Italy’s Candy to gain more traction in the industrial internet-of-things market with its COSMOPlat platform) will continue to raise European regulatory eyebrows. Thus, we also expect both the European Commission and individual member states like France and Germany to impose new rules for screening proposed acquisitions of firms in critical sectors such as AI, telecoms, robotics, and industry 4.0.
(Clarissa Skinner contributed to this blog post.)