Expect Big Investments In Productivity, Sustainability, And New Regulations

In 2022, Europeans can expect less volatility than in 2021 (not a high bar to clear!), but it won’t be smooth sailing. Brexit’s impact will become clear as COVID recedes, and regulators will draft new rules to protect Europeans as they work from home. And the combination of consumer demand and EU regulation will drive more European companies to invest in substantial sustainability efforts rather than trying to skate by on greenwashing. Here are some of Forrester’s predictions for European business, customer experience, marketing, and technology leaders in 2022:

  • The percentage of European consumers who regularly purchase from brands that match their values — already high, at 47% — will grow by 15%. According to Forrester Analytics data, 69% of European adults wish that more companies were transparent about their business practices, and that figure is 87% for the most empowered consumers — they increasingly expect brands to use their platforms to contribute positively to society. In the same survey, 47% of Europeans say they regularly purchase from brands that align with their personal values, including 62% in the Netherlands, 57% in Spain, and 55% in Italy. In 2022, we expect a 15% increase in those averages, driving brands to take further action.
  • European businesses will invest between €2.4 and €3.3 billion in automation to boost productivity — including in lower-wage sectors. Forrester calculated that in 2020, European companies invested a total of €1.88 billion in employee productivity automation tools such as digital process automation (DPA), digital decisioning platforms, workforce optimization, conversational intelligence, robotic process automation (RPA), and AI-based text analytics. We estimate that growth in 2022 will be at about 33% for RPA and 13% for DPA. Further, in 2022, European companies will invest in automation to boost productivity in traditionally low-wage sectors such as retail and hospitality. European retailers like ASOS, Sephora, and ZARA already complement labour with automation for personalisation and predictive purposes.
  • Politicians will have to give up their dreams of a sovereign European cloud, but GAIA-X’s transparency and data usage standards will conquer the world. The US-based cloud hyperscalers met European customers’ requirements by clearly describing their existing capabilities, partnering more with local companies, and delivering a few new features. Thus, GAIA-X never stood a chance as Europe’s sovereign cloud, but it has pushed providers to be more explicit about how they protect customer data, to the benefit of all. GAIA-X has also kick-started standards for transparency and data usage and raised the profile of initiatives like the International Data Spaces Association (IDSA), which is developing mechanisms to govern the sharing (or selling) of data. These initiatives, plus projects like Catena-X in the automotive supply chain, offer a model that the world will replicate — but they’ll do it using existing cloud infrastructure.

To understand all of the major dynamics that will impact European businesses next year, download Forrester’s complimentary Predictions guide or visit our Predictions 2022 hub.