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2017 Consumer Products Trends Report

In our annual 2017 Consumer Products Trends Report, we discuss how consumer dynamics are requiring that companies redefine tried-and-true business processes, channels of distribution, and strategies for growth. With today’s consumers more educated, more connected, and more engaged than ever before, both consumer products manufacturers and retailers are being challenged by an increasingly unrelenting pace of change within the industry. While consumers are still difficult to predict, the key competencies required to realize competitive advantage in the consumer products industry change every year.

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In our 2017 Consumer Products Trends report, we focus on the changing face of the consumer, the evolution of growth, and the key competencies for a modern consumer products organization.

Changing Face of the Consumer

Today’s consumer, with increased access to information, has an expectation to attain what they want, when they want it and, where they want it, making the ability engage with and adapt to today’s consumers an absolute imperative for CP companies. To do this effectively, it is important to first understand the foundational shifts with today’s consumer.

  • Aging Population: Consumers over 60 years old make up 12% of the population, expected to reach 17% by 2030 and 22% by 2050.
  • Working Millennials: Millennials account for 24% of the U.S. population, having a pronounced impact on today’s consumer behaviors.
  • Coming of Age Consumers: Generation Z will almost double in the next 20 years to 40% of the U.S. consumer base.
  • Digital Consumer82% of shoppers consult their mobile device on purchases they’re about to make in a store.
  • Urbanization: Global city dweller population is rising at 65 million each year and they are more connected than ever.
  • Multicultural Consumer: Making up 38% of the U.S. population, multicultural buying power is growing at an exponential rate.

The Evolution of Growth

By definition, consumer staples are considered to be ‘non-cyclical,’ meaning they should always be in demand and less prone to the ebbs and flows of a changing economy and associated pricing pressures. Traditionally, this has led to steady and predictable year over year growth for the CP industry. However, the various ways with which our industry is growing is challenging the status quo. Barriers to entry are being broken down, channels of distribution are evolving, categories are expanding, and companies are partnering and divesting at an increasingly pronounced rate.

  • Diminishing Barriers to Entry: There was an $18 billion market share shift from large to small and mid-sized business in the last 12 months.
  • eCommerce: CP eCommerce sales rose 42% the past 2 years and are estimated to surpass $10 billion in 2016.
  • Health & Wellness: Over the last 12 months the Consumer Healthcare Market has grown by 7%.
  • Merger & Acquisition: Global merger & acquisition activity at an all-time high.

Key Competencies of a Modern Consumer Products Organization

Modern Consumer Products Company Competencies

Through the years, investments in leading processes and systems have allowed CP companies to make strides towards increased supply chain efficiencies, optimized marketing and sales spend, and overall operational excellence. With many of these foundational capabilities in place, taking into account the Changing Face of the Consumer, and The Evolution of Growth in our industry, the seven competencies outlined below pinpoint specific areas in which CP companies need to invest to ensure they remain relevant and competitive into the future.

  • Strategic Innovation: Create business value through the development and commercialization of new ideas in an increasingly competitive market environment.
  • Sales & Marketing Alignment: Commit to organizational revenue and profitability KPIs across brand, shopper, and trade marketing functions.
  • eCommerce and Digitalization: Reevaluate traditional sales, supply chain, and marketing processes to meet the continued rise and impact of eCommerce.
  • Integrated PlanningIntegrate across the business, planning horizons, supply and demand, and partners to satisfy demand and maximize profitability.
  • Revenue Growth Management: Develop sophisticated pricing, promotion, and assortment strategies with a focus on company and retail customer profitability.
  • Actionable and Focused Analytics: Leverage the growing volume of available data to drive strategic insights and activate them to drive tangible business value.
  • Quality and Regulatory: Navigate an increasingly regulated environment and develop the necessary processes and systems for FDA compliance.

To read the full Consumer Products Trends report, click through on the PDF below. If you found this information interesting, subscribe to our blog to receive the latest insights:

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Tags: Analytics, Consumer Products Trends, Data Analytics & Insights, Digital Engagement, eCommerce, Integrated Business Planning, New Product Commercialization, Strategy & Compliance, Strategic Innovation