Retail & consumer

Retail & consumer

Muhtar Kent, Chairman and Chief Executive Officer, The Coca-Cola Company
Alison Watkins, CEO, GrainCorp
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Reaching global consumers – especially through technological innovation – is high on the agenda for both retail and consumer goods CEOs. That’s why these CEOs are not worried about the speed of technological change. On the contrary: they embrace it as a golden opportunity to find new customers.

Technology has the potential to transform retail and consumer businesses
80% of retail CEOs ranked “technological advances” as one of the global trends that will transform their businesses most over the next five years. 67% of consumer goods CEOs also ranked “technological advances” in their top three. On the other side of the coin, just 34% of consumer goods CEOs and 38% of retail CEOs see the speed of technological change as a concern, compared to 47% of CEOs overall. Even potential cyber threats don’t seem to be causing these CEOs to stay up nights: Just 35% of consumer goods CEOs and 41% of retail CEOs are concerned that cyber threats could be a threat to growth, compared to 48% of CEOs overall.

Why is this? Perhaps because technology has the power to put more products into the hands of consumers. Take online shopping. This year’s PwC Total Retail survey research shows that 41% of global shoppers bought products through tablets, compared to 28% in 2012 and 43% purchased products through smartphones, compared to 30% in 2012. That’s tech-savvy customers using technology to improve their buying experience.

Into Africa
Africa has some of the fastest growing economies in the world, and consumer goods CEOs in particular have taken notice. 18% of those planning a merger or acquisition, joint venture or strategic alliance are looking to Africa, while 12% of retail CEOs are, compared to 8% of the rest of the CEOs.

Reaching consumers is one thing – understanding their shopping habits is another
91% of retail CEOs said they were “concerned” about shifts in consumer behavior, with 28% saying they were “extremely concerned.” One potential shift: Are consumers shopping with fewer retailers? When we asked our Total Retail shoppers to tell us how many retailers in a given group they’d shopped with in the last 12 months, 15% of our global sample responded that they had shopped with just one, an increase of 7% from 2012. That same trend held in the "2 to 5" favorite retailer range, which increased to 43% from 35%.

Consumer goods CEOs and retail CEOs see the same economic policy threats
Retail and consumer CEOs tend to see economic threats the same way. They agree on their top four economic policy threats to growth: a growing tax burden, fiscal responses to debt and deficits, over-regulation and exchange rate volatility.

When it comes to business threats, high, volatile raw materials prices stand out as a top concern
High, volatile raw materials prices round out the top five concerns for both retail and consumer goods CEOs. Most believe that they’ll need to make some changes to the supply chain in response to transformative global trends. Retail and consumer goods CEOs are ahead of the curve – 32% of retailer and 34% of consumer goods companies already have a change programme underway or completed, compared to 24% of the overall sample. And more consumer goods CEOs believe their procurement and sourcing departments are well prepared to make the changes (45% vs 33% of CEOs overall and 40% of retail CEOs)

91%of retail CEOs are concerned about shifts in consumer behaviors.

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74%of consumer goods CEOs are concerned about high, volatile raw materials prices.

 

Retail and consumer CEOs rate technological advances highest as one of the global trends transforming their business.

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CEO interview quotes

"As faster economic growth shifts to places in Africa, across Asia, and Latin America, consumer goods companies have to adapt with the right products in the right stores at the right prices at the right time to meet the needs of new consumers."

Muhtar Kent
Chairman and Chief Executive Officer, The Coca-Cola Company

"E-commerce has a tremendous impact on us because it changes consumer behaviour and spending, which is a very important factor."

Chen Long
Chairman, China Resources Enterprise, Limited.

"[The planet] is going to have population growth of 2.5 billion to 2050, so that’s equivalent to adding a country the size of France every year. Something like 70% of that population growth is coming out of the Asian markets, Middle East, North Africa."

Alison Watkins
CEO, GrainCorp

"Information innovation poses challenges and yet provides opportunities as well...We are also working on big data to see how we can use it. Generally speaking, by collecting a lot of data about how customers cast their eyes in various directions in a store, big data can tell what customers are interested in."

Shigetaka Komori
Chairman and Chief Executive Officer, FUJIFILM Holdings Corporation

"It is a fact that consumer behaviour and spending patterns have changed. It is paramount for retailers to take heed of consumers’ changing behaviours and identify ways to meet their needs."

Chen Long
Chairman, China Resources Enterprise, Limited.

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