The Social Science Of Data – Rethinking Marketing

Good afternoon, everyone. I'm a demographer. What that means is that all I do every day, all day long, is look at big fat datasets and try to make sense of them. Try to understand how the world works and then the role very much is to look forward to understand data, trying to understand how customers shift, how customer personas shift, and what changes when one generation enters a new stage of the lifecycle. Because then all of a sudden this particular market gets colored, gets shaped by a whole new set of values. And as a demographer, I'm legally required to start every presentation for you with a big fat population chart. And it's a super simple graphic. We have babies on the left hand side of the chart, hundred year old folks on the right hand side of the chart. Just over 26 million people. And this is the population that you're servicing at the moment. The big bulge in the 30s that you're seeing there, that is the millennial generation. That is the by far the biggest generation in this country. But who the hell cares about the status quo? That is the most boring thing to actually think about. It is much more exciting to understand what the future looks like. And the good news is that on a population level, in a national sense, forecasting is so easy in Australia because we have such a clear understanding of how many babies you will be making this year. And we also know how many of you won't be making it until next year. So that's super simple to forecast. Plus as a nation, we dictate the migration intake. We literally set the number and then once the cap is reached, we say no more. So also forecasting migration is super easy. We know that migrants are almost exclusively 18 to 39 years of age. So we constantly, year by year, throwing more people into those two decades of the 20s and 30s. We're constantly growing them. So let's understand what the future looks like. First observation, top right hand corner. A decade from now, Australia will have grown by 3.5 million, maybe even 4 million people. That is a lot of growth. A rising tide lifts all boats. These are more people to sell your stuff to. This is good news to begin with. But quite quickly, glancing at this chart, you'll realize that this population growth isn't evenly distributed across the whole age spectrum. You see that 0 to 14 there is essentially stagnation, more or less. We will not be seeing more young people in ten years time than we do today. There is, of course, big growth in the young adult market. The 15 to 25 year old segment, the sex, drugs, and rock-and-roll phase of the life cycle. So if you're selling these things, you'll have a great decade ahead. But you want to remember that most of this growth in the 15 to 25 market that is driven by overseas migration. And then all of a sudden, you want to remember that we shift migration and we really shifted it over the last couple of decades. In the 50s and 60s, migrants came from the Mediterranean, Greeks, Italians. They dominated the migration intake. By now we very much shifted towards Asian source nation, the Indian, the Chinese markets are now providing population growth here. There's no ethnic discrimination or target in those numbers. We simply take whoever is willing to pay for an arm and a leg for an education in Australia. We are willing to take whoever has the right skills that we put on this kid's migration list. Plus, the reason why we don't take any young Italians or Greek any more is because they don't exist. There are literally no young Greeks or Italians anymore. But that's just an aside. The biggest, the single biggest year of age that will grow the most over the next ten years. These are here. 43 year olds. And isn't that wonderful news? This is a beautiful statistical alignment. These single year rates that we were seeing most growth in is also the time of your life. We are spending the most money. There's no time in your life where you will be spending more money than at 43. Makes sense, doesn't it? You had a couple of promotions, so your income tends to be nice and high. At 43, you already have 1.7, actually more like 1.6 kids these days. They are very hungry. They eat a lot of Weet-Bix. They need a cricket bat, school uniforms. The costs don't end. Plus, you have a big fat mortgage at 43. Every single penny that you earn goes straight out the door back into the economy. It's really annoying for the 43 year olds, but it is great news for us as a country because we just happened to go through the post-pandemic economic recovery just in time for the biggest generation millennials to step into the highest spending phase of the life cycle. We didn't do anything to deserve it. Let's call it demographic dumb luck, but we will take it. So that's good news. The bad news is also hiding in this chart. We are aging like crazy. This doesn't come as a surprise to you. You read this a million times. Everything south of 60 sees massive growth. As a marketing cohort, that is great people to be doing business with. Baby boomers, people that will in ten years time be in their 70s largely. Forget about poor retirees. Retirees now are rich. Baby boomers hold 60% of the cash savings in this country. They are all acid rich. They all own their own homes. A marvelous core to be doing business with. But I want you to get a bit nervous about this cohort. 85 and older. In the next 12 years, so just a tiny bit more than we show on this chart. In 12 years time, we will have doubled the population 85 plus. And that is important because 85, yet again is a very statistically significant year. It is the so-called 'median age of death'. That means half of you, it's that half. We split the table in the middle. You won't make it to 85. Terribly sorry. The remaining half. Congratulations. Half of you guys, though, that is the front half of the room. You will require assistance with activities of daily life. You will need care. It is, of course, expensive to grow old as a nation. But it is also outrageously labor intensive. And that's the big fat challenge that we will be seeing over the next ten years, it's a skills shortage. We doubled the 85 year olds from 5000 to 1 million with double the demand of carers that we need. That's ludicrous. That's very, very difficult. But also this whole annoying skills shortage. Who have you tried to hire somebody in the last 2 or 3 years. That wasn't as much fun as it was 10 years ago, 15 years ago? I think a bit more annoying. You had smaller talent pools. You had to throw more money at talent. That wasn't great fun. Yes, the pandemic impacted that because early on in the pandemic, the federal government made it very clear that no financial assistance was going to be handed out to international students, to temporary visa holders. So they backed off that put a hole in the workforce. Well, but now the pandemic is over and we don't need to worry about this. Well, to be honest, things are not going to get better ever. To be quite frank, because the skills shortage very much is baked into the demographic pie. We have the big fat baby boomer generation over the next ten years, completely leave the world of work. Big generation out. That's okay. Boomers worked for many years, they're allowed to retire. Also, retirement is not a new phenomenon. People retired in the past. But previously when you had a cohort of people to retire, you had an equally sized, actually a larger court enter the world of work at this end of the spectrum. This time it's big cohort out, small cohort in because lots and lots of those people in their 20s, they will not stay here. They will not work here. They will leave the country again. So there's an imbalance. But as if this imbalance wasn't bad enough, millennials, people in their 30s and 40s, essentially, they procrastinated for an awful long time with making babies, but they're now finally making babies. That means they have another 12-13 years worth of baby making left in the tank as a generation. That means they at least temporarily leave the world of work. The skills shortage is going to get worse. So you need to prepare for this. This is the big challenge. You have massive opportunities of growth. The Australian business model is going to continue to operate just well, just fine. We create so much wealth because mining, that's of course the main thing that we do, mining, agriculture, tourism and international education. That's all we do on the international stage to make money. All of those things will blow up over the next 10-20 years. A marvelous country to be doing business in. You just need to do it without any workers. So that means, first and foremost, retention is the name of the game. Treat your existing staff nicely. That's a bit obvious. Do that. Also, you want to think about systems. Smart systems, AI, software, automation, wherever you can. Can you make your existing worker bees more productive? Can you operate? Can you scale up your business without the need for much more labor? Because it will become ever harder to find staff. And also, don't be afraid of AI. By now we are operating forever onwards essentially in a regime where we run out of workers rather than running out of jobs. If you are 40 plus, you're definitely were raised in the mindset – "You are so lucky when you have a job. You better hold on to this job. It's a privilege to have a job." Don't. Let that kind of thinking go. Young people these days, people in their 20s that enter the world of work, they will have their whole career in an environment of a skill shortage. So that means they can demand higher wages and we see wage inflation. That again, means better not rely on wages all that much, just make sure that software, wherever it's possible, it is actually your friend. It is society's friend. It's not the enemy. There is a major shift happening or has been happening here for a long time in the Australian consumer market. In order to talk about these shifting market realities in Australia, I want to take you back to my favorite day of the year. Only comes around, comes around every five years actually, and that is of course, Census Day. So if if you remember this most magical of nights, you were you were kindly asked to put your job into the census form and you filled it out, marked it done and our friends at the ABS, they took your answer for whatever it was and they put it into one of 1300 categories. That's the number of jobs that officially exist in this country. And every single one of those jobs has a number from 1 to 5 attached to it. That's the so-called skill level that indicates how much formal training is required for you to do this job. Skill level one, jobs that require a university level education. Doctors, engineers, midwives. Skill level three jobs are the backbone of the Australian middle class. Your TAFE-level degrees, your tradees, your manufacturing workers. Skill level four jobs are technically called low skill jobs. You need some sort of formal qualification, maybe a driver's license to be a truckie. And skill level five jobs are so-called unskilled jobs. No formal training required or what you need to know for the job you will be taught on the job. The single best indicator in this country for your future income is your level of education. Nothing comes close. The more highly educated you are, the more money you make. And yes, I know you all know of a plumber, don't you? A plumber who takes home 300,000 bucks. It's good on him but remember that he's cheating and it is a he to begin with because 99.9% of plumbers are men. But his duty boss is not a plumber. He's a small business. He employs two apprentices and another plumber. That's how he gets to his three hundred thousand bucks. Just needed to get the plumber question out of the way. That always comes up. So this is the Australian workforce. In the 1980s. 23% of all jobs in the 1980s require a university level degree. These were then, of course, held by boomers, baby boomers. They got free university education, they got a good income, a university degree, guaranteed a beautiful, successful career. The backbone of the Australian middle class was still strong at 20% and lets bunch together skill level 4 and 5 jobs for now into a single category. 48%. Why am I bunching skill level four and five jobs together? Simply because there is no way in hell that from now on, ever onwards, in the predictable future a skill level 4 or 5 worker will be able to afford a house in the capital city in Australia. It's out of the question. So that's why ideally we'd like to see the number of skill level four and five workers decline. We want to kill off as a society as many skill level four and five jobs as humanly possible. And it's okay, we kill off the jobs, not the workers. That's perfectly ethical. So let's understand how the Australian workforce transitioned, transformed itself over the last 40 years or so. Are we well and truly transitioned into a knowledge economy? Well over a third of jobs require now a university level education. Also, those people take home really nice high incomes. That is quite a positive development. If you look at 29 year olds, half of them have a university degree. So it becomes the norm, very much the norm to have a uni degree. The backbone of the Australian middle class; however, skill level three jobs that is eroding away. Only 13% of jobs now fall into this middle category. Yes, very optimistic. Very glad to see that we think we shrunk the number of skill levels four and five jobs. Only 40% of jobs fall into this category. It's also really good if you are the treasurer. That's exactly what you want to see because skill level four and five workers, they will not put enough money into the superannuation throughout the whole career to pay for their own retirement. So we need to subsidize skill level four and five workers through the pension scheme. So we're very glad to see that number minimized. But you also realize that if you in front of your inner eye, if you picture the Australian workforce to look like a bell curve where yes, rich people exist, poor people exist but more than anything, we all live middle class lives. We have middle class incomes, we have very egalitarian society where everybody is roughly the same. Well, then you're stuck in the 60s. That's when the world of work looked like that. By now, the Australian workforce much more looks like a letter U. Actually a bit more like a letter J. Where we have more people at the top end, a relatively sizable chunk at the bottom end, and the middle class is absolutely eroding away. That doesn't exist. But so what does that mean for you as marketers to operate in this U-shaped economy rather than in the bell curve economy? Well, I think I can answer this by stepping into your local supermarket, into the cereal aisle of your local Coles or Woolies. And we will have a look at our benchmark skill level three breakfast item. And that would be a bunch of Weet-Bix. Wouldn't it? That you pick $0.42 per 100 gram. That is our skill level three breakfast benchmark. How did your local supermarket react to in Australia, where more and more customers have to carefully watch every single dollar that they're spending? Well, a whole new product category emerged, didn't it? It is the the home brand, the Aldi, the black and gold end of the market, the Wheat Biscuit end of the market. And these products come at a steep discount, 50% discount. And what's the premise of this whole category? We offer you the same utility, a wheat breakfast at a lower price. Same utility, lower price. Also, you put your business hat on. The margins are tiny. You need to operate at scale to survive at the home brand end of the market. But what happened at the Paris end of your local supermarket? Well, Weet-Bix protein happened and makes you strong. Weet-Bix Organic happens that saves the planet and Weet-Bix Kids happened. I'm sure it's good for something as well. But these products come at an absolutely steep cost, three times the price. And what's the premise of this category? Well, that's pretty obvious as well. We offer you a better breakfast at a much higher price. And also, you realize that the margins are truly delicious at this end of the Weet-Bix spectrum. And that also means that as any business, the single dumbest thing you can do is to blindly target the center of the market and think that one size fits all. She'll be right. She won't be right. The center of the market is the single most dangerous spot. Just think about the housing market, for example. You hear stupid numbers thrown around like the median house price of Melbourne and Sydney. You read these numbers left, right, and center. That's an interesting number in a bell curve environment. In a U-shape environment, the top end of the market will forever look down upon a $900,000 house in Melbourne. That is a house they wouldn't be seen in. The bottom end of the market, they can't fathom how they could possibly afford a $900,000 house. So this whole sent off the market thing becomes outrageously difficult and dangerous. If you take one thing away from today, don't blindly target the center of the market. Pick and choose which end of the spectrum we want to be operating. Businesses can easily operate at both ends of the spectrum depending on your product and services, but you then have different different sales channels, different products on offer for both ends. That is a more healthy approach to business than the center. In our consulting work, it is shocking how often we run into businesses that wonder why their fair share of the pie has been shrinking and shrinking, why their business has been going down. It is just quite often it's those Weet-Bix type companies that that suffer the most. You might have gotten a sense over the last couple of years that it has gotten harder and harder to create a five star customer experience to really satisfy customers. You might say things like it feels like modern day customers are more entitled or harder to please than ever before. And in order to understand why that might be the case, let's travel back in time and place. Well to a simpler time, to the 1990s. To a simpler place, we travel to the UK to a small English village near the Scottish border. A boring little town. Not much is happening, but it is just large enough for McDonald's to open up. So Macca's opens. The villagers happily stand in line to queue for their their Big Macs, their milkshakes, their Happy Meals, and they happily munch away on their fast food. Life is well in our little town. But what happened to the local post office a single month after McDonald's opened? Well, the post office was absolutely flooded. Inundated with complaints. Your service is terrible. I can't believe I have to wait in line for so long. It's just unacceptable. So what happened here? Well, those villagers, they got accustomed by shopping at McDonald's to the idea of quickness, to the idea of fast moving queues. And then those evil, evil villagers, they took their expectations from McDonald's and they transferred it to the post office to a completely unrelated entity. That means the post office wasn't compared against its performance last month. It wasn't compared against the performance of the post office in the next village down the road. No, it was compared against McDonald's. Why am I telling you this? You aren't running post offices. I don't think. I'm telling you this because your customers, every single one of them is using these sexiest, the sleekest apps that mankind ever created on a daily basis and it is changing the sets of expectations that they bring to the consumer landscape. Spotify. Any song that you ever listen to is instantly available. That is what you demand now. Uber, they offer a seamless transaction. The car magically arrives. You slide in, the car magically delivers you to your destination. You slide out. Seamless. These days, God forbid, if you find yourself in a taxi and you have to tap your credit card at the end, you go, "Oh, these are eight seconds I'll never get back." Your expectations are outrageous and so are the expectations of every single person that you're doing business with. It is harder than ever to create this five star experience, this wow effect, this positive story that people want to share with their friends and family. And I don't really have a big solution for this other than you guys having to constantly keep upping your game. You constantly need to invest into better systems. You need to make sure that the consumer experience is nice and easy. It's flowing, it's comfortable, it's convenient that your websites look as sexy, as sleek as the websites of the biggest, best players out there in the planet. This is a constant game of keeping up with the Joneses because you're dealing with a very, very demanding bunch of people. So now let's understand before we jump to the Q&A part, let's understand the Australian consumer landscape from a generational perspective. We'll walk through them generation by generation. We're starting with the pre boomer cohort, which we throw everyone born before the end of the Second World War into a single generation. That's because they're already making up only a small share of the Australian population, 6% in ten years time they only make up 2%. That's because they well and truly reach the dying stage of the life cycle. And to be honest, as marketers, you won't be missing them much as they leave the stage of life because of a terrible generation to be doing business with. They only purchase the stuff that they really needed. Boo, that wasn't much fun. It was always more fun to deal with the next generation down the track, to deal with the baby boomers. People born in the 18 years following the end of the Second World War. But I must say baby boomers are still quite often miscategorized as a purely materialistic generation. You want to remember who raised those baby boomers. These were parents that saw the First World War and saw the Second World War. And for good measure, in the middle, we threw in the Great Depression. So no wonder, is it, that their kids, the baby boomers, measured their success in life against a bit of a materialistic yardstick, isn't it? And granted, boomers headed well as they grew up. Economic tailwinds all the way through the 20 odd percent of them who went to university did get free university education. That was very beneficial. But also, baby boomers revolutionized every single stage of the life cycle that they ever lived through. They were the first generation for women to enter the workforce at scale. So under the baby boomers went from one household income to one and a half household incomes. That really turbocharged the spending capacity in this country. We all of a sudden, even the poorest families could afford labor saving devices, fridges, vacuum cleaners. But most importantly, Australians could afford cars. And so what that means is we completely changed the whole geographical set-up of Australia before the baby boomers came along. We still lived in relatively densely populated, clustered small cities, so to speak. But then you own a car. You drive out until you can afford a quarter acre block. You put on a brick veneer, a house. If you're Greek, you throw a couple of columns in the front door. And life as well. The next family has to drive five meters further, the next somebody ten meters further and so forth. And so we really spread out. So these increadibly pancake flat city structures that we have in Australia, these are result of baby boomers. And in ten years time though, baby boomers will have completely left the world of work. In ten years time, even the youngest baby boomer is of retirement age. Granted, they will still sit on your company boards, they will still have talkback radio shows, but more than anything, their social and political influence is well and truly on the way out. That means in ten years time, the last bunch of people that actually care about hierarchies is gone. So that means if your organization still looks like a hierarchical beast, you will find it incredibly hard to retain staff because absolutely everyone in this organizational structure will hate the structure. You'll still operate in an environment of a skills shortage where people can just leave. So you do need to adjust your organizational structure. I know that's just as hard as changing the engine of a running car, but it needs to be done. You need to flatten hierarchies right now so that you can retain staff that you become a bit more more agile. Not an easy task to be doing. But I would argue it's absolutely crucial. When you market to baby boomers, you can actually be rather value driven, you can even be moralistic, narrative driven. That works well with this generation. It's a generation that thinks very highly of themselves. They think of themselves as a very righteous generation. They also also think they're very capable because they had economic tailwinds, they reached great economic success. They are also an outrageously rich generation. And then the next ten years, they are a marketer's dream, because most of them would not do a hard retirement. Gold Watch on Friday, golf course from Saturday onwards. That's not how baby boomers retire. They slide into retirement. They scale back their working hours. They take longer holidays in the middle of the year. They still stay connected to work in some function or another. That means it is the only cohort in the whole life cycle that is rich, both in time and money. All other cohorts miss at least one of the two. So this is a dream come true. And because of the pandemic right now, baby boomers still feel cheated out of two good years of their retirement, of their golden years. So they even feel a sense of urgency to part with their money. Plus, they benefited from high interest rates because they own 60% of the cash savings in this country and they are all asset rich. So they are the jackpot client for absolutely most businesses. The next generation down the track is very, very different from the baby boomers. These are the small oops, tiny, forgotten Gen-X. Gen-X are people born in the 60s and 70s. They always feel forgotten. They feel missed out, left out. And that's because they were. They are tiny generation sandwiched between two big ones. So we just tend to skip them. Or at least that's what we've done in the past. That is a mistake that we must not make in the 2020s. To the Gen Xers here in the room, this is your decade. There is a level of seniority built into leadership positions in this country. You become Prime minister at 54. You become CEO at 52. This is you. There is very precious few of you guys and gals going around. That means you have a higher chance than any previous generation to grab one of those leadership positions. That means even though it's a small generation, Gen X that is, they will amplify their values because they set the policy direction, they set the strategic direction of this country. So quick recap before we talk about those values. Gen X, we push. Quick recap why Gen X is such a tiny generation? Well, when you were meant to be born, contraceptive pill gets introduced so that that keeps a lid on things. Then early 70s, halfway through when you were meant to be born and no fault divorce gets introduced in this country. That means no unhappy siblings get added to your families. Plus, the 70s were a decade of unusually low migration intake. So forever the underdog. But Gen X grew up as the first bunch of kids that saw both their parents work. So this is why they were called the latch-key generation, because they came home to an empty house and they were the only generation really at scale that grew up unsupervised. Because their parents growing up, they essentially told them just come back home when the streetlights go on or don't, we don't really care. And so they became a very, very pragmatic, autonomous and very, very capable and pragmatic generation to be doing business with. Actually so when you talk to those folks, don't use the language that you use with millennials or baby boomers where you can be flowery, moralistic, narrative driven. Doesn't work with Gen-X. This is a bunch of people that research every feature of leafblower they purchase to death. So the name of the game is facts featured data. That kind of stuff works really well with Gen X. You then see quickly emerged the narrative of, "Oh, I better not use the exact same narrative for all customer cohorts because this fact future data stuff might be seen as boring, as meaningless by boomers and even millennials to a degree but it works really well with Gen X," whereas you better not bore Gen X with moralistic gobbledygook. They are pretty allergic to that. So that's Gen X. The two things that Gen X will push like crazy over the coming decade. And they're already doing this because guess what? Gen X already took over the political leadership in this country. Every single state premier is a Gen Xer for a little while New South Wales even had a millennial in Dominic Perrottet as a premier. I never counted him as a millennial because it didn't have those millennial vibes, so to speak. But more than anything, it is Gen X running the show and X, their values. They saw their moms work full time. It's the first bunch of people that think it's normal for women to be part of the workforce, so they will continue to push anything that smells like gender equality left, right and center. You cannot get away under Gen X leadership, especially considering they're running a workforce that is 75% millennial Gen Z when you discriminate between men and women, that doesn't work. By the end of this decade, the gender pay gap will be completely 100% closed. There's no argument about this. Legal astrix, we're talking about the gender pay gap, not the gender income gap. The gender income gap is because we're not paying industries dominated by women any money. That's childcare, for example. And had I only told the story the other way around, I would have ended on a high. But I screwed that up. But so expect much, much progress in anything in terms of gender relations. Also Gen X and I'm not all that optimistic about this issue, Gen X really pushes work-life balance because they saw that parents work themselves to death and so they figured, "Hey, there must be a better way than just working ourselves to death." Gen X men are the only cohort in the whole country that are less likely to be an entrepreneur to run their own business than we would statistically expected to be. That makes sense to me because the one thing that you don't get when you run your own business is time with your family. So Gen X men weren't willing to do this at scale. So that's Gen X. Small generation, very dramatic, but absolutely calling the shots over the next ten years. The next generation down the track, that is probably the majority of the room if I had to take a bet, born 82 to 99. These are, of course, the very scary millennials. And millennials are also called Gen-Y because they always ask why? Terrible joke. And this is a generation that is obsessed with meaning, with purpose in their life. And why is that? Well, millennials grew up in the households of baby boomers. The boomers are their parents. That means growing up, they had it all materialistically speaking. They grew up in materialistic wealth, and their parents also never pushed them to anything. They never pushed them, channeled them into certain careers. They said stuff like, "I don't care what career you pursue, I just want you to be happy." Who grew up like this? Most of you, I venture a guess. And that led to a bit of a decision fatigue, a bit of a tyranny of choice that millennials experienced when it was time to choose a career after finishing high school. And so what do millennials do? Well, first, they procrastinate to take a gap year. But after this, you need to make a decision on what your career path should be. And what do millennials do when they can't decide? Well, they go on YouTube and they type in career advice and they'll be bombarded with the same narrative every single time. I was one stuck in a 9 to 5 working for the man, hamster wheel of work, hated every second of it but then one day I looked deep inside my soul and I discovered my true meaning, my true purpose in life. And then I created a startup. Sure, it was hard at first, but I doggedly persisted. Eventually I succeeded. And now I jump out of bed in the morning and I run to the office because I'm so excited to go to work. And if I can do it, so can you. So this is every single TED Talk that I've ever listened to, by the way. But this narrative, we are bombarding our young workers with this narrative and it is leading to two developments. The first thing is rather wonderful. It leads to more young people having a go at creating a startup, at reinventing the way we work, trying to run their own business. That's wonderful. It even leads to the big players taking their social corporate responsibility issues a bit more seriously. That is also nice. But more than anything, this is leading to what I call work image issues. Work Image issues are the office equivalent to body image issues where we're looking at these sexy models and bodybuilders on Instagram, and then we look at ourselves and we go, could be better. We literally have millions of young people in Australia on antidepressants. The census asked for the first time in '21. Do you have a medically diagnosed, medically not self-diagnosed, medically diagnosed, chronic health condition? And you got to pick your favorite health condition. And 23% of women in their early 20s said they have a medically diagnosed chronic mental health condition. That is bonkers. That is absolutely ludicrous. And I would say this has very much to do with a search for meaning in their life. Where the hell does the meaning of life come from for the young generation? It certainly doesn't come from God. That's what their grandparents used. That doesn't work anymore. Generation of atheists. So that's out of the question. Well, their parents were also atheists. They didn't have this problem. They didn't have this problem because they started families in their early 20s. So it was very easy for them to just fill a couple of teenage years, couple of university years with sex, drugs, and rock-and-roll and then move into meaning phase. They stuffed this meaning shaped hole with, well, drugs. That's not an option. Nowadays, young people actually use much fewer drugs. Not that I'm promoting this as a solution here. But what young people do is they start their families in their mid to late 30s so they can't possibly get meaning in their lives from them. So what did young people do? Well they started to be called the experience generation, a generation that apparently forgoes materialistic desires in order to experience the world. Gap years. travel, yoga, festivals and the Instagram generation and Instagrams, they experience this. That's what you Instagram. You don't Instagram your belongings. You show who you are. You show that you have meaning in your life through showcasing your experiences. This is what this generation tries to do. Also, they quite obviously look for meaning at the place that they hang out for for eight, nine, ten hours per day. That's work. It is a pretty logical narrative. Plus, they get bombarded with the idea that work has to be meaningful. But how likely do you think it is that we can perfectly match our 14 million jobs in Australia with 40 million individual passions and desires? Yes, there will be an overlap. Good on you if you fall into this overlap category. But for most jobs it is probably a bit much to be asked to also shoulder the burden of providing meaning in a person's life. Do I have a solution for this? Absolutely not. I just want you to be aware of this big problem that your biggest consumer cohort, the absolute vast majority of your staff, what they carry around with them. So if you can add a bit of meaning to their lives, you're doing and I wanted you to say you're doing God's work, that's not the case for the atheist generation. So that's not working. But are you doing good work. That's what you're doing. Push that narrative. That works really, really well and you cannot afford to misunderstand millennials simply because they are such a big chunk of the population. They're making up over 40% of your workforce soon. That is by far the most important bunch of people that you're working with and that you're selling stuff to. The next generation down the track, these are the Gen-Zs born in the 18 years of the new millennium, the first 18 years of the new millennium. They're the kids of Gen X, which in turn makes them more generation as well. And they are a super exciting generation to be doing business with and to have as workers simply because they are the only generation in the whole country that never, ever looks up at the iPhone and goes, "Oh, I can't believe I lived without that." Because they never did. Growing up, they always had access to smartphones and it really changed the way they think. This is a generation that grew up with global news, the fierce global news stories left, right and center. This is a generation that always had access to the whole information that mankind ever created. And that changed the way they think. They think in bigger systems, in more global connected systems. They think global warming first, local bike paths second. Tell those Gen Zs how your small thing fits into that big thing. That works really well when you deal with those people. Also, this is the most highly politicized generation in quite a while. The Greta Thunberg genaration, so to speak. So they have this bizarre mixture of being a pragmatic generation, kids of Gen Xers and being a bit of a self-righteous political movement. So they differ quite a bit from previous generations. But since all the major problems in this country, in this world that I'm seeing are systemic in nature, I'm quite excited to have a couple of systemic thinkers coming our way. No pressure Gen-Zs but that is what you need to carry that burden. You see how this goes? Gen X and Y and Z? We run out of letters in the alphabet. We have to switch to our Greek friends, Gen Alpha. And I'm not making any workforce or shopping predictions about babies just yet. That'd be presumptuous, if not illegal. But so for better or worse, this is the Australian consumer and workforce landscape that you're working with over the coming ten years. WF, by the way, stands for workforce. That's who we are servicing. It's an exciting shift because every time a new generation moves into a new stage of the lifecycle, they infuse this stage of the life cycle with their own values. But it also means that you constantly need to change how to talk to retirees because a retired baby boomer, will very much not think of them as a retired baby boomer. They will not think of themselves as retired. You need to be very carefully navigating how you speak to this code. There is very much self reliant, independent thinking. Talk to those values. Millennials. They don't think of themselves as boring, suburban moms and dads, but that's exactly what they are now, and that's what they will becoming more and more. So they will Google all the boring stuff home ownership, washing machines, SUVs. Yes. They'll Google plug in hybrid SUV or whatever. But it's all so predictable what's coming. But they're doing this with their own tint, with their own sugar coating, their generation of sugar coating on top. And every generation always wants the same thing. They want to be able to tell a positive story about themselves to themselves. But those stories that people tell to themselves that tend to differ a bit from one generation to the next. So I hope I still got a sense of optimism across here. Overall, there is growth. This is not a given across developed countries in the world. Plenty of those, I'm from Germany, that is a basket case of an economy over the next ten years. So there will be plenty of countries where the economic trajectory goes downwards. It's all the way up for us. So that is quite, quite optimistic. I would say there are plenty of opportunities here for you. The polarized workforce, that was the Weet-Bix spectrum that was to be hollowing out of the Australian workforce. Please forget everything else I said, just remember, don't blindly target the center of the market. That's the one thing I beg you, I implore you not to do. That is the best way of driving a business against the wall. Very clearly position yourself along the Weet-Bix spectrum and you will have a marvelous decade. The problem, of course, is that you will have absolutely no staff to do this kind of work because the skills shortage is here to stay. So you need to be very, very smart in terms of attracting staff. You need to retain your staff, be really nice to everyone, always be nice anyways, but be particularly nice to your staff. I'm very happy to take a couple of questions. Before we take the questions, I am, as a demographer, obviously on every single social media channel. For the few baby boomers, if any are in the room, I'm writing a column in The Australian, for the young'uns I'm on TikTok, and for you business minded lot I'm on LinkedIn. That's the big QR code. Thank you very much and I'm happy to answer any type of question. Thank you. Simon That was amazing. Thank you very much. I actually now have a little bit of a craving for a McDonald's burger, so thank you for that. We actually have a couple of roaming mics around. I saw a lot of people taking lots of notes, so I'm keen to hear. Hands up, we can get them back to you very, very quickly. So you said you didn't want to make any predictions about Gen Alpha, but do you secretly have any predictions for that? Well, I do, of course, But so with Gen Alpha, what you want to remember is that who are their parents? They are the kids of the Millennials. And so what do millennials do when they raise their kids? So millennials as parents are a bit unique because they will probably be, on average, the first generation that will be doing financially less well than their parents. At the same time, they feel the desire to replicate all the positive aspects of their own childhood for their very own kids now. So that is that's a bit hard. Now, you grew up in a bigger house than you could possibly afford. So how do you how do you replicate this? How do you replicate all the childcare services that you did that you went through? So we do need to think that then they also revert back to parental techniques that their parents used because you kind of sort of copy your parents with a bit of a skew there. But expect this again, to be a much more highly educated generation.You'll have more single kids now without siblings because we just don't have as many kids anymore. Just at 11:30 today, if you're taking notes, we released new birth rate data for Australia. We now have super low birth rate of 1.63 births per per woman. So I needed to update my joke of 1.7 kids per woman, actually. So we're slowing this down. At the same time, we have record high numbers of births just because we now have the big bunch of millennials making babies. So if you talk to a midwife at a maternity ward, she would look a bit confused when you say that we have this record low birth. And she's like, "No, no, I've never been busier." And that's that's true. But so we then need to think about Gen Alpha. Where do we get the Gen Alphas from? If we want to grow our population base and we obviously import them from overseas. And the more the lower the birth rate, the more people we import from overseas. If we want to keep the ratio between workers and retired people, somewhat even, that brings a couple of challenges with it. That means where the hell do we get our housing from? So the housing shortage will be with you for the next ten years. But back to Gen Alpha, I'm kind of optimistic about housing for Gen Alpha because the generational wealth from their baby boomer grandparents that will largely skip the millennials. The millennials will inherit money at around 65, thereabouts, and then they won't blow it all in 20-30 years, and then their own kids get a massive inheritance. So Gen Alpha should get a juicy, juicy sugar hit at some stage, but not until they're 50s to be honest. That's just a bit ahead of myself, probably. Thank you. There's a question over here. How do we reconcile the fact that we've got an aging population, which obviously require more health care, aged care, etc., and not enough young people who are coming through, exactly what you said. So there's fewer people. Our working population is going to be shrinking in proportion to an aging population, which means that the only way to pay for that then will be high taxes as well. But yet we also need greater consumption to be able to drive the economy forward. Yeah. So sounds like the next 20 or so years we're going to be hit on a number of fronts there. So what are your predictions? Well there are quite a few predictions to be made. The first one is that global capital changes. So global capital over the last 30 years was rather happy to be invested into risky stuff. That's because the baby boomer cohort that created all this wealth that held all this wealth, think about what your financial advisor would tell you in your 20s, 30s, 40s. You can risk it all. The money would come back eventually. That is not the case now that the money is old and conservative. Now the big wealth, the big chunk of wealth wants to be invested in to boring stuff. It wants to be invested into real estate, infrastructure bonds. Yawn, yawn, yawn. So that is not very conducive to innovation. So that's a risk speaking. At the same time, we now need innovation because we need to automate our economy in order just to make sure that we look after all those old people and we talk about automation and aged care. We're not talking about robots flipping old people or anything like this. We're talking about every single part of the workforce becoming a bit more productive so that we free up man hours to be thrown at the workforce. So in two years time, would you go to the MCG for the grand final, there's no chance in hell that a human will check your tickets. There will be a digital technical solution for this at half time. It will not be a huge human pouring your beer. And robots can already do this much better than humans. So that's what we will be doing. That's what we will be seeing. And then again, a bit of these man hours can then be thrown at the at the aged care market. The aged care workers, though, will probably mostly be imported from the Philippines, from Thailand and so forth at low cost. So that means we somehow need to house a bucket load of low income workers and we need to house them close to where the old people are because Australians tell you stuff like, yes, some Australians downsize, but the downsizing narrative is much exaggerated in this country. Overall, people will tell you stuff like, I want to be carried out of my family house, which of course is the ultimate downsizing into the box. But more than anything, they want to stay put. So we need to co-locate carers and so you see that there's always a housing angle to all of those things and that leads to policy shifts. And couple of those big policy shifts that we will be seeing as we move away from taxing consumption and income to taxing wealth. This will be done. This will be an ugly battle. There'll be lots of people crying foul play. We're now seeing people complain about super balances, over $3 billion being taxed still at 35%, still at a discounted rate. But people have stopped whining about this. This would be much harder in ten years time. There's no way we'll have stamp duty. We will have gone back. We will have a land tax. We need to tax wealth and then distribute it more equitably. The same thing with all the new wealth that we will create. The next 20 years, you have no idea how much cash we will create through mining. We need to capture this wealth. We need to distribute it. That's the way we have a fighting chance here. I know I sound a bit Trotsky here, maybe, but that's the kind of that's the kind of predictable shifts we're seeing now in the last three-four months, how the national narrative around housing completely shifted. Its supply supply supply. It's more about taxing land rather than taxing housing transactions. That will come. A couple of predictable challenges and they will be big manage them all along. Ultimately, I'm still optimistic. I have just heard a bit doom and gloom as I spoke here. Not sure if this answered your question, but at least I spoke for two minutes. All I heard there was more tax. So maybe that's a great place to end. Everyone, can you please put your hands together for Simon for his very invaluable insight? Thank you very much, Simon.