What keeps consumer goods (CG) executives up at night? The industry realities of sky-high operating costs, looming price increases, and shoppers who want cheaper products. The biggest consumer goods industry trends of 2023 offer opportunities for brands to drive profitable growth, even in an uncertain economy, but only if they put the data they already have to work.
It’s not surprising that 68% of CG industry leaders say improving operating margins will be their biggest challenge in 2023. You can grow profits, even as tighter budgets force you to do more with less. How? By using the data you already have to stay ahead of the industry’s current shifts.
Get more bang for your trade promotion buck
Most promotions fail to break even. How can you boost your trade budget ROI?
Trend #1: Omni-channel shoppers expect omni-channel engagement
To stay competitive, it’s essential to achieve perfect retail execution. But with most consumers shopping online and in stores, brands need to engage consumers everywhere they discover and purchase products — a mission-critical task, considering 60% of shoppers say they’d rather buy from CG companies instead of retailers.
Here’s the catch: The traditional one-size-fits-all marketing strategies CG companies typically use to drive consumer demand won’t be enough to attract the attention of shoppers who expect personalized experiences online.
Here’s what you can do: Deliver the seamless engagement consumers expect — regardless of channel. To do this, unify your data sources to better connect with your customers and tap into clearer analytics. That helps you reach consumers in a personalized way and on the devices and channels they prefer.
Trend #2: Keeping up with consumers
What shoppers want has changed dramatically and frequently over the past several years, recent consumer goods industry trends show. Keeping up with their preferences is now the top priority, according to 93% of CG leaders.
It’s not easy to stay agile if you rely on stale data to make decisions. If your products and distribution can’t keep up with what retailers and consumers need today (and predict what they’ll want tomorrow), your competitors may gain an edge.
Here’s what you can do: Use real-time data to predict, track, and capitalize on important trends. For example, if you see consumers on social media wishing for product flavors you don’t make, you can develop new versions of their beloved grocery item and expand your product line, knowing there is a market for the additions.
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Right now, 85% of growth-seeking CG companies want to win over consumers that haven’t shopped their brand before. According to Deloitte, these companies plan to use trade promotions — alongside advertising and product innovation — to compete with private label products and attract the attention of new shoppers.
That sounds simple enough, but tighter margins mean you need to squeeze every drop of value from your trade promotion budget. Historically, maximizing return on investment of promotions has been difficult for CG companies because of poor transparency, legacy processes, and weak analytics.
Here’s what you can do: Optimize your promotions with tools that automate planning, tracking, and forecasting so you can quickly spot and scale your most profitable programs. Companies that do this well score big wins. Top-performing promotions return five times more than the least efficient, according to McKinsey.
Trend #4: Efficiency — everywhere and all at once
Current consumer goods industry trends show stubborn labor and supply chain challenges are making it harder for CG companies to get products in the hands of consumers. That’s leading more than nine in 10 companies to focus on supply chain improvements and operational excellence, with another 90% prioritizing productivity and efficiency.
Their main concern is that consumer demand, although predicted to cool, is still hot. CG companies need to keep goods flowing, even as they contend with delayed deliveries and empty desks.
Here’s what you can do: Integrate applications and automate processes across the supply chain. That will improve visibility, enable real-time communication with partners, and lessen the impact of unplanned costs, out-of-stocks, or delays.
What these consumer goods industry trends mean for you
What’s the bottom line for your brand? Dive deeper into your real-time data for insights that help you better respond to changing consumer preferences and wider macroeconomic challenges.
The companies that can manage this successfully won’t just win the hearts of consumers — they’ll establish themselves as a force to be reckoned with for years to come.
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