Predicting the future is the golden ticket to success! One talent to perhaps get you closer to becoming a fortune teller is Trendspotting – identifying trends as they happen with measurable data. It’s one thing to have talent, it’s another thing to have theory. This article attempts to tackle the theory behind Trendspotting.
We all want to get in front of something just as it’s about to happen. People have stories of purchasing stock before it “went big” like Google and Microsoft. Originally, I was going to write this article about something even bigger – Chinese business. It occurred to me that Chinese business is a perfect example of a Trend. Rather than writing about a specific trend, I’d rather “go big”!
I define a Trend as a measurable event that can be sampled over a time range. For example, business bankruptcies month over month – bankruptcies would be the event, month over month filings would be the sample, and data from the past six months would be the range. Often people look at events when trendspotting. Here are some examples:
• Annual number of children born in Brazil between 1997 and 2007.
• Annual total employed in China from 2005 to 2007.
• Monthly number of new business licenses filed in Russia between 2000 and 2008.
• Monthly revenue from mobile phone companies in India between 2005 and 2009.
The power of data to support your trendspotting is critical. Intuitive observations can often be brought to form with staticstics and data. Most good trendspotting starts with intuition, but you’ll need impartial data to back it up. One thing to be aware of, not all observations you see are trends. Be prepared to accept your observation was an outlier and more rare than you thought. Some examples of impartial data sources to support your intuition:
The Central Intelligence Agency World Factbook – Yeah, I know what you’re saying. CIA?! How are they impartial? Turns out the US Government hires the best and brightest people to research and assemble factual data about every country in the world. If you want to learn about a far away place, the Factbook is a wonderful place to start.
The United States Census Bureau – I recall assembling data for a client to demonstrate the size of a market in the United States. Up until factual data was presented, his colleagues would use data like, “huge” and “massive” – not “45.5 million households”.
Google Scholar – Opinions from learned professionals have been indexed and made available to the general public. Often a trend has data and research that you can quickly obtain.
National Bureau Of Statistics in China – The Chinese Government publishes data much like the USA. Chinese population, for example, is still growing (1/2 of 1%), but the Tiger is still roaring.
Organisation for Economic Co-operation and Development (OECD) OECD – The data available here can help you pinpoint samples and ranges to support your events.
Benefits of Trendspotting
I’ve been very lucky with identifying trends only from my intuition. I learned the theory behind Trendspotting while getting my MBA at UCLA. Let me save you the tuition. You can use trendspotting in:
• Daily Business – You’re in charge of performing while on the job. You know the events you’re seeking to grow/shrink/etc. – identify measures to start sampling. Once you sample the events – measure it and identify a trend.
• Career Development – Thinking of a career change? What are events occurring in growing frequency where your talents are needed?
• Investing – This has been the big payoff for me. I invested in Brazil, Russia, India and China long before my friends. These countries are growing in personal income and productivity. Those are leading indicators to energy consumption.
• Education – What fields will be relevant over time? What events require professional expertise to make the events successful?
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