The COVID-19 pandemic has raged on for a year and continues to create significant business challenges.
At the beginning of the crisis, many industry trends accelerated as consumers and businesses rapidly adapted their behaviours to meet health and safety requirements. Consumers, many of whom had already embraced e-commerce, jumped onto the internet in even greater numbers, buying more groceries and other goods online.
In the first six months of the COVID-19 crisis, it was also clear that a pre-pandemic movement towards more socially and environmentally conscious buying quickly gained steam. People increasingly considered not just their own health and well-being but that of society and the world at large.
Now, many months after consumers have settled into these and other behaviours, we are seeing the future of consumer markets more clearly. What are the trends shaping tomorrow, and what actions can you take to overcome uncertainty, meet challenges and capitalise on opportunities?
The store of the future will be omnichannel and experience-rich. It will fuse the physical and digital worlds. The store as we know it will continue to evolve. An ongoing migration towards all things digital and the influence of modern retail giants such as Amazon in the US and Alibaba in China will continue to force innovation in physical and digital retail spaces. Even strides made by companies in other sectors, such as Uber's pioneering ease-of-payment model, have ramifications for the store experience. They instil in customers an expectation for digital solutions in all aspects of their consumption.
Socially conscious consumerism will continue to grow as consumers seek brands that they trust and that align with their values. Consumers keep resetting, and raising, their expectations for the brands they choose to embrace globally and in Ireland. They're seeking purpose-driven brands that mirror their values and beliefs. They want companies to demonstrate their social consciousness in practical, tangible ways. The pandemic has broadened consumers' world of concerns. We expect socially conscious consumerism to continue to grow, presenting an opportunity for you to reinforce or clarify your brand proposition and its relevance.
The supply chain of the future will operate with near autonomy, making 'smart' decisions to self-regulate. Supply chains are under pressure as consumer behaviours. Expectations change dramatically and trends such as omnichannel shopping and multiple fulfilment points make it harder to predict and shape demand. Other factors are also affecting supply chains, including the pandemic, extreme weather, Brexit and global trade tensions.
Even after the pandemic and related crises end, complex issues will continue to challenge supply chains. Against this backdrop of uncertainty, end-to-end visibility will be the number one requirement for effective supply chain management. You'll have to have a clear understanding of the location and status of inventory and the movement of stock, and an accurate view of customer demand. You'll also need to ensure that your supply chain is responsive and flexible.
Consumer demand for healthier products, along with expectations for greater transparency and sustainability in the food value chain, is set to increase.
Many of the trends shaping the future of consumer markets, generally, will have a pronounced effect on the future of food. Even before the pandemic, consumers were demanding healthier and more sustainable wellness and food products, restricting certain food groups and taking supplements. Our March 2021 consumer research reveals that half of global respondents said they are including more plant-based foods in their diet in an effort to eat more sustainably. We expect this trend to accelerate and intensify.
Pressure from regulators and boardrooms to focus on ESG will intensify.
It's not just consumers who are increasingly prioritising ESG. C-suite executives, shareholders and governments are also making it clear that ESG initiatives are not negotiable or simply 'nice to haves'. And you, like leaders in other industries, will have to learn how to reinvigorate your value creation strategy in response. You'll need to acknowledge that value creation now relies on resilience and your company's contribution to the well-being of society as much as it does on financial productivity.
This was underscored in a recent statement on the purpose of today's corporations issued by the Business Roundtable, a group of prominent US CEOs. The group affirmed that corporations have a broader commitment — not just to shareholders but to an extended circle of stakeholders, including employees, customers, suppliers and the communities where they do business.
Governments are also leading the way on environmental issues. The recent decision by the new US administration to rejoin the Paris Agreement should also reignite a global focus on climate change.
The store of the future will be omnichannel and experience-rich, and will fuse the physical and digital worlds.
Retailers need to take account of and plan for key disruptors:
Brands need to focus on socially conscious consumerism that will continue to grow as people seek brands that they trust and that align with their values.
Industry leaders need to stay focused on:
The supply chain of the future will operate with near autonomy, making 'smart' decisions to self-regulate.
Supply chain leaders need to understand how the changing landscape will impact them where:
Consumer demand for healthier products, along with expectations for greater transparency and sustainability in the food value chain, will increase.
Is your business ready to win in this new world where:
Pressure from regulators and boardrooms to focus on ESG will continue to intensify the pressure on consumer goods businesses.
Key actions include:
The consumer markets industry was experiencing large-scale disruption well before the COVID-19 pandemic. Several macro trends had already gained traction, but the pandemic intensified and accelerated these trends. Such pivotal events, despite their lingering uncertainties and aftershocks, can serve as clarifying moments that present new opportunities. Now's the time to move forward with bold, decisive actions, even as the sands keep shifting. We are ready to help you as you face the future. Contact us today.