Demographic changes can present a host of opportunities for new ventures. And we're going to examine that as we begin our discussion on macroeconomic forces, and think about the impact that can have on you as the entrepreneur. When we talk about macroeconomics, we're talking about the vast number of influencing factors that go on within an economy. We'll discuss needs and wants of target audiences. We can also think about changing demographics and psychographics, as well as changes in technology, in society, in politics and regulations. So it's all six of these factors that we'll dig into as we explore macroeconomic change as part of the Opportunity Analysis Canvas. Our definition of demographics are simply the characteristics of the population. That provides insights to where opportunities exist within markets. It also gives us insights on how to develop appropriate business and marketing strategies to target those customers. And when we look a firms that are out there, we can learn a little bit about their demographics. Here, this report looked at Pinterest, one of the more common online platforms. Within the Pinterest audience and user base, the annual household income is over $100,000, 50% of its users have children, 68% are female, the age demographic is broad, with the bulk of them being between 18 and 54, but the highest concentration is between 25 and 34, with a secondary concentration between 35 and 44. So these are the types of data that companies want to be smart on as they're determining where opportunity may rest or, in time, who is their audience? And how can they better serve the market to that target audience? There are many demographic change is going on within the US. Things like an aging population, increasing ethnic diversity, a society challenged by obesity, are all things that are opportunities for entrepreneurs. There may be opportunities in developing assisted living centers. There may be opportunities in foreign language, radio, and media. There may be opportunities in weight control and other apps, as we've seen the rise of in recent years, on fitness and health related apps. And common questions for entrepreneurs that are directly based on demographics are things like the purchasing power and residences, means of transportation, age, family status, leisure activities. Other elements get layered into this as well, are things like income and gender and education. All things that are important to know and understand as you are either looking for opportunities or trying to understand the audiences that you're trying to serve. There are many different resources that are available as well. Here are a number of databases that we access to within the university, and that you have access to as well. In this case, with American FactFinder, and the State and County Quick Facts, they are US centric. But what you also may find is very comparable resources in other regions of the world, that are in largely developed, by the government, and or other special interest groups, or associations, that give you insights into the market opportunities and into the demographics of the markets that you might be interested in serving. The types of data that you find when you look at this kind of research, is typically immense. So I started geographically, by looking at a local area to our university in Bethesda, Maryland, and I can look at population density. I can look at age, race, households, housing tenure, and a variety of different factors based on the sheer number of individuals that comprise that individual group, as well as the percentage distribution of those factors across these populations. And I can do this for the majority of major cities in the US, I can do this for every state, I can do it nationally, simply by picking my parameters when I'm looking in this case within the American Fact Finder site. I can dig a bit deeper and look at other data. I can look at elements of education and graduation rates at various levels and graduation rates within a certain ages and poverty levels and the median earnings at different levels of education so you can look at data individually or you can cross filter data where you can look by race, by population age, by degree, by income and look deeper and deeper into data as you're trying to, again, identify opportunities or understand your target audiences. I can also look at employment within the area, and I can go in and I can see what industries are individuals employed within both ensure number as well as percentage distribution. I can look at the median earnings per industry. And see who makes what, based on the category of employment that they're within. So, a wealth of data is out there. Government data, this is a bit different. The Center for American Progress, and this is one of many different centers in the US that research such data. And I can pull demographics from these kinds of research as well. In this case, this was a piece of work that was done that look at workplace wage gap, health educational attainment, political leadership, and other factors based on their reporting, their finding of representation of women in the US at 50.8%, approximately half, and at 36% of that group are women of color. They also look at poverty and see a wide distribution, that between 10% and 26% of those women are living in poverty. And they've diversified it based on ethnicity as well. They've looked at education, they've looked at income, they have looked at health insurance and a variety of other factors, which again, at this stage gives simple insight into understanding the space and understanding the market and understanding demographics within that. But we as entrepreneurs can look beyond that and see where there's opportunity, where there's opportunity to do training, where there's opportunity to do workforce development, where there's opportunity to do education or other factors, that may play a role in trying improving the state of some of these areas. And so, in that way again as we look at demographics it's not purely to look at it for general knowledge. In our context, we want to look at it to think about where we can see opportunities. Where we can bring new factors to bear, or where we might help solve some of the problems that are being faced. We also want to think internationally as we're exploring opportunities. So we're going to take a brief insight from Africa's next boom, and we'll post the full video online for you. >> Africa is booming, the capital income since the year 2000 have doubled, and this boom is impacting on everyone, life expectancy has increased by one year every three years, for the last decade. That means if an African child is born today, rather than three days ago, they will get an extra day of life at the end of their lifespan. It's that quick. And HIV infection rates are down 27%. 600,000 less people a year are getting HIV in Sub-Saharan Africa. The battle against malaria has been won. Deaths from malaria down 27% according to the latest World Bank data. And malaria nets actually are playing a role in that. This shouldn't surprise us. Because actually everybody grows. If you go back to imperial Rome in the year one AD, there was admittedly about 1800 years where there wasn't an awful lot of growth. But then the people that the Romans would have called Scottish barbarians, my ancestors, were actually part of the Industrial Revolution and the 19th century growth began to accelerate and you saw that get quicker and quicker and it's been impacting everyone. It doesn't matter if this is the jungles of Singapore or the tundra of Northern Finland. Everybody gets involved, it's just a matter of when the inevitable happens. Among the reasons I think it's happening right now, is the quality of the leadership across Africa. I think most of us will agree that in the 1990's the greatest politician in the world was Africa. But I'm meeting brilliant people across the continent the entire time. And they're doing the reforms which have transformed the economic situation for their countries. And the West is engaging with them. The West has given debt forgiveness programs which have halved Sub-Saharan debt from about 70% of GDP down to about 40%. At the same time our debt level has gone up to 120 and we are all feeling slightly miserable as a result. >> So what we see here is that opportunity certainly isn't limited to the US, And opportunity for entrepreneurs might lie in places that not everyone necessarily sees the opportunity. And that's part of having great entrepreneurial insight. It's seeing what's not yet there. And so, in summary, we want to understand demographics and that it provides us insights into where opportunities exist and even more importantly, where they may exist in the future. It also gives us insights in how to develop appropriate business and marketing strategies to target the customers that we want to focus on. By examining these demographic trends, ideally, it gives us insights into evolving needs and wants where we can anticipate where we can play a role as entrepreneurs, and we can forecast market opportunities in the future.
