Introduction: What Can We Learn From European Business Trends?
Many of the popular business trends in 2023 have been inspired by Europe’s key players. Boasting a high gross domestic product (GDP), European giants like Germany, France, Italy, and Spain have an overwhelming market share of the EU’s €4.3 billion global trade.
Discovering what business trends the European market has made fashionable is vital for any entrepreneurs looking to establish their business within this space. In this guide, we’ll explore Europe’s major economies’ influence on business trends this year.
Who are the European giants?
Since the 1980s, Germany has been the largest economy in the EU. Accounting for over 29% of the EU’s GDP, Germany has a highly-skilled labour force that trailblazers in the automotive, engineering, and technology markets.
France is also a key player in the EU, bringing to the table a diverse economy of traditional industries like agriculture with modern sectors like aerospace and luxury goods. France’s contribution to the EU’s GDP was USD 2.6 trillion in 2022, and the country boasts a lucrative export market.
Italy and Spain are also key players within the European market. Both countries have highly resilient economies and have successfully navigated economic crises’ like the 2008 Global Financial Crash. Both countries have proven to be highly adaptable, with strong manufacturing and service sectors.
Although no longer a part of the EU, the United Kingdom is still a major player in the geographic region. Accounting for 16% of Europe’s overall GDP in 2016, the country continues to prosper in the digital and finance sectors.
How Europe has pioneered business trends in 2023:
Impacting how companies operate and respond within a market, business trends have been highly influential in an organisation’s success in recent years. In a competitive market, businesses have to respond to changes in consumer preferences, technological advancements, global economic conditions, and changes in rules and regulations.
Some of the biggest business trends in 2023 have been spearheaded by the European market. Let’s investigate.
Eco-friendliness and sustainability:
The EU has placed an increased focus on sustainability and reducing carbon footprints in the past five years. The formation of the European Scientific Advisory Board on Climate Change to achieve carbon neutrality by 2050 has changed the way many businesses operate. The EU financially incentivises businesses to reduce CO2 emissions by issuing ‘carbon permits,’ reducing the number of permits available each year.
Sustainability awareness has been on the rise for European consumers, with 54% of Italian and 51% of Dutch consumers stating sustainability is a key factor in influencing whether they purchase from a brand. This is significantly higher than any other major global market.
Digitalisation and innovation:
European giants have been at the forefront of digitalisation and innovation. Investing heavily into technology, the European market utilises advanced technology like the Internet of Things, artificial intelligence, machine learning, and blockchain technology. London, Berlin, Paris, and Stockholm are all major tech hubs and are home to the headquarters of some of the largest digital products providers.
Diversity in the workforce:
Promoting inclusivity and diversity within the workforce is a priority for the European giants. The European Commission aims to promote diversity for women, LGBTIQ persons, and people with disabilities. As of 2023, the number of women in senior management level or member countries was up to over 45%.
Prioritising a work-life balance:
The EU has a law called the ‘Work-Life Directive’ which facilitates the balancing of paid work and private life for employees within the EU. EU workers are guaranteed four weeks of paid leave at a minimum each year, and can only work a maximum of 48 hours in 7 days.
Businesses are encouraged to offer work-life balance benefits to attract and retain talent, and we are seeing an increased trend in the number of workplaces offering flexible working hours, remote work opportunities, and other perks.
Social responsibility:
A key business trend in today’s competitive landscape is to promote social responsibility. Encompassing a diverse range of practices, businesses are encouraged to promote societal well-being through greater sustainability, providing fair wages, supporting philanthropic causes, and promoting inclusivity in the workplace.
Companies are encouraged to disclose non-financial risks of operations, and we are seeing a trend towards greater transparency and investing in green technologies across the European economic area.
Embracing Artificial Intelligence:
Artificial intelligence (AI) and machine learning have changed the way businesses operate, and we expect to see the trend towards using AI continue throughout 2023. France and Germany are leading the European artificial intelligence race, popularising the technology across various industries such as healthcare, finance, and manufacturing.
AI-powered automation is expected to increase business efficiency and productivity while reducing human error. As a result, businesses that embrace AI will have a competitive advantage in the market.
In Summary:
Europe’s key players have a considerable role in business trends. Leading the way in sustainability, diversity, digitalisation, and work-life balance, Europe’s businesses are expected to continue to prioritise these areas in the coming years. Europe’s businesses are hyper-aware of changing consumer preferences, rules and regulations, global economic conditions, and technology advancements, and are adaptable to the ever-evolving landscape.