2024 was another unsettling year for UK plc. It was a year of alarming geopolitical conflict, extreme weather, high inflation, rising unemployment and industrial action – not to mention a general election.
It was the year of the Crowdstrike outage and the Post Office Horizon inquiry. It also saw the failures of several major UK brands, including Homebase, Ted Baker and The Body Shop.
In this business environment marked by uncertainty, leaders may struggle to muster the energy and optimism required to greet a new year. But with careful planning and an understanding of the trends coming down the line, savvy decision-makers can find ways to win in 2025.
Prove value to gain customer confidence
According to Pip Hulbert, UK CEO of VML, a global brand agency, British firms will face many of the same challenges they’ve been grappling with in 2024. “It will continue to be a tough economy,” she says bluntly.
Tight budgets and flagging confidence means leaders will be more cautious in their decision-making, she adds. Purchasing decisions, for instance, are taking longer. Hulbert explains that VML’s business clients are “looking for more assurance around the commercial impact of the work they do with us. They need those proof points.”
Things haven’t calmed down at all since we’ve come out of Covid
Dan Howell, managing director UK&I at Kimberly-Clark, a consumer goods manufacturer, says it’s the same story with consumers, who have been “under a huge amount of financial pressure. They are becoming increasingly demanding of brands to truly deliver value.”
In 2025, leaders will need to focus on understanding consumer anxieties and offer services and solutions that can deliver demonstrable return on investment.
Understand a new generation of buyers
For Irina Novoselsky, CEO of Hootsuite, a social media management platform, the biggest trend for next year is a generational challenge. “Over 70% of all business buyers are now either gen Z or millennials,” she notes. Having spent several months meeting with 500 gen Z-ers to better understand their decision-making, Novoselsky believes “companies are woefully unprepared for what that [change] is going to mean.”
Current selling models won’t work with this demographic, she explains. More than 50% of gen-Z buyers say they make purchasing decisions long before speaking with a salesperson.
“This generation grew up with a phone in their pocket, but they don’t want to use it to talk. They don’t want cold calls,” Novoselsky says. Gen Z-ers prefer to use new channels, such as social media, to do their own research before making a purchase.
Howell has noticed this trend too. Kimberly-Clark, which owns popular brands including Andrex, Huggies and Kleenex, has been keeping tabs on social commerce.
“Over the past decade, social media has become more of a marketing platform,” says Howell. “But now, particularly with the introduction of TikTok Shop, social platforms are very big sales channels.”
Howell believes it will be essential to master social commerce in 2025. “It seems counterintuitive, but customers trust what they see on these platforms, because it’s not generic advertising – it’s real people demonstrating products.”
Make AI work for your business
While consumers may value that authenticity – the realness – the biggest trend for 2025 is something more artificial.
“AI is here to stay,” says Novoselsky. In spite of ethical qualms, doubts over its reliability and worries that the AI bubble may soon burst, the technology has completely changed the way business is done. “The conversation now is about how you lean into it,” she says.
For Hulbert, embracing AI is about streamlining processes. “We should be using our people for more strategic, creative tasks and leveraging AI for those low-touch requirements,” she says.
And, while AI use cases differ across industries, any organisation could benefit from AI’s ability to analyse data quickly. For instance, the technology can find patterns in organisational data to help understand employee engagement, fine-tune internal processes and sharpen forecasting models.
AI is here to stay. It’s completely changed how we do business.
Kimberly-Clark uses AI to process data from big retailers that stock their products and build consumer groups the organisation can target with advertising. “The ability to process data in real time and act on it is so important,” says Howell. “AI is a fantastic tool for doing that and getting analytics out quickly.”
For Novoselsky, the business benefit of AI is clear. “It’s going to support every single role. In 2025, leaders need to think about how to use it as a multiplier for employees’ productivity and efficiency.”
But, implementing AI effectively comes with several challenges. For Hulbert, the focus is on ensuring staff are comfortable using AI tools. Investing in training therefore will be essential in the new year. “What works best is doing it in bite-sized chunks and building people up gradually,” she says.
Hulbert and Novoselsky both believe that nurturing a growth mindset in the organisation is a central piece of the AI puzzle. “We are all starting at kindergarten level with AI,” Novoselsky says. “This is an opportunity for everyone to start at the same place – which almost never happens – so you’re looking for people who are happy to learn and comfortable with getting things wrong.”
Protect your organisation from burnout
Of course, finding the enthusiasm to embrace new technology may be harder in 2025. Several years of uncertainty and disruption have left a mark on the workforce, and “things haven’t calmed down at all since we’ve come out of Covid,” according to Howell.
“People are operating in burnout territory,” he adds. Macroeconomic challenges, mass layoffs and ceaseless technological developments, among other factors, have left employees exhausted. To get the best from them, executives may need to consider unorthodox approaches.
“What we’re talking about now is how to intentionally operate at a level of effort below our maximum capacity,” says Howell. It’s a move from “maximum effort” to “optimal effort”, he explains. In practice, this could mean simple measures, such as finishing meetings 15 minutes earlier, or complex ones, like challenging an organisational culture of perfectionism.
“Your ability to solve problems quicker than the competition is how you’re going to win and you can’t do that if you’re not being creative,” says Howell. “If you’re operating at your edge all of the time, you lose creativity.”
With no sign of challenges abating in the year ahead, savvy leaders would do well to consider whether taking their foot off the gas is one possible way to protect their workforce and unlock crucial innovation.
