11 Big Ideas to Watch in 2011
1. Rethinking Retail 2. Paranoia, Inc.3. The Return of Hiring4. Cash, Credit, or iPhone?5. Resuscitating Electric Cars6. An IPO Comeback7. The Battle for Your Living Room8. Bespoke Everything9. A Facebook Backlash?10. Adding Bottom Lines11. More Uncertainty
Online retailers have always competed by offering convenience and low prices, but they've lately began to master the art of getting people to buy things they don't yet know they want. These new start-ups—like Gilt Group, LivingSocial, and Groupon—send locally targeted e-mails (hello, Shreveport, Louisiana!), give huge discounts (50 percent off is the norm), and make customers pull the trigger quickly, sometimes within a matter of minutes. It's about making shopping feel too good to be true. And if Groupon's latest sale offer is any indication, it's a highly lucrative—if a bit saturated—field.
Radical transparency is so last decade. Privacy and security are the new concerns swimming in the zeitgeist. Blame it on brouhahas over airport body scanners, WikiLeaks, and customer tracking by Web companies. Look for more upstarts like LifeLock, which offers identity theft protection, and Reputation Defender, which offers a service to remove one's personal information from websites, to be capitalizing on newfound fears about privacy. And Big Brother, beware.
Yes, hiring. Ever heard of it? American companies shed millions of jobs during the recession. As the economy has recovered they've made up for the shortfall by getting more out of their workers—productivity grew by 3.5 percent in 2009. But productivity is slowing down, which means companies will have to start hiring again. What does it mean? You'll have to work harder (and pay more) to attract talented, motivated people.
The cash register is still ubiquitous, but it has new high-tech cousins. Twitter inventor Jack Dorsey's next start-up, Square, uses a cheap plastic attachment that turns an iPhone into a sophisticated point-of-sale system that can be used by any business, large or incidental. A host of other new companies are offering novel ways to pay, chiefly using smartphones: self-checkout apps, credit card chips embedded in phones, and a new offering from PayPal that allows money to be transferred by bumping two phones together. Fist bump! (Gently.)
After a decade of fits and starts, the electric car business is revving up. Tesla Motors, Elon Musk's electric car start-up, is now public and is poised to being manufacturing its next-generation electric sedan. It could help build momentum for other electric car start-ups that have products in the pipeline, such as Fisker and Coda. Meanwhile, the hotly anticipated 2011 Chevy Volt, sold by a resurgent GM, will create opportunities for a new generation of automotive suppliers.
Public offerings were quite comatose during the recession—and the venture capital industry, which depends on public offerings to keep funding start-ups, was loudly wailing about its future. But IPOs appear to be on their way back, thanks to Tesla, whose stock price has skyrocketed over the past few months. Kayak and Skype have already announced their intentions to go public and there are a host of other companies—LinkedIn, Zynga, and Groupon—rumored to go that route in the near future.
In September, Steve Jobs introduced his company's Apple TV, a little box that lives on top of your television and streams movies, as "one more hobby." But competition for your home-entertainment is getting serious. Google and start-ups like Boxee, Hulu, and Roku are jostling for space on your television screen with stand-alone gadgets and modified televisions and DVD players. All these new electronics will create a market for apps—tiny software programs sold online—that could eventually rival the billion-dollar smartphone app market. Our question: Who's going to build the living room version of Angry Birds?
Customization has been popular for years, led by pioneers like Threadless and Ponoko. Now, taking into account consumers' desire for quality over quantity, it's moving into industries that were hitherto unthinkable. Local Motors has designed an open source car, and New York City-based Adafruit sells electronics that are designed and built by users. Even the luxury brands are catering to whims of the hoi polloi: In September Chanel gave New York City shoppers a chance to customize the colors of ballet flats.
Facebook survived the Hollywood takedown of 2010, and Mark Zuckerberg emerged as Time's Person of the Year. Is it too good to be true? Might Facebook be primed to stumble—or at least stub a toe—sometime soon? Its size and ubiquity have drawn scrutiny and criticism from users worried about its blasé attitude toward privacy, from governments eager to regulate the way it manages user data, and from entrepreneurs who charge that its new payment system is too greedy. Will a backlash make a dent in the power of this social network? Eh, probably not.
It's become fashionable for investors and entrepreneurs to talk about double-bottom-line businesses—that is, businesses that make money and do some good in the world. That sounds impressive—but not as impressive as the triple bottom line, an increasingly popular bit of marketing jargon for socially responsible businesses. (The three bottom lines are generally profits, people, and the planet). Lately there's been talk of adding yet a fourth bottom line that would capture a business's cultural impact. We wouldn't be surprised if 2011 is the year of the first self-proclaimed quintuple-bottom-line business. Hey, it worked for the razor blade industry.
Predictions are always meant to be taken with a healthy heaping of salt, but we are pretty sure that 2011 will be a year of certain uncertainty, as a volatile economy and an acrimonious political climate make it difficult to plan for the future. Will more European economies need bailing out? Will President Obama's health care reform be modified or repealed? Is another stimulus plan in the works? Entrepreneurs will have to plan for the best, the worst, and everything in between. Well, you've always been doing that, right? —Max Chafkin