Aligning to the consumer: Retail in the next decade
Official report

Aligning to the consumer: Retail in the next decade

The World Economic Forum released a new report in January 2017 entitled “Shaping the Future of Retail for Consumer Industries" with insightful details and recommendations.

The new report by the World Economic Forum echoes previous findings: it expects the next decade to be the golden age of the consumer, with shoppers having more choices and control than ever before. Going forward, consumers are expected to be presented with a growing array of products and services, often personalized to their specific needs and wants. 

Overall, the retail experience is poised to become more inspirational, exciting, simple, and convenient based on the consumer’s ever-changing needs. What does this mean for businesses in retail and in consumer packaged goods? 

>> Read the full report by the World Economic Forum

This development, paired with transformative technological innovations, will continue to drive fundamental changes, increasingly blurring the boundaries of “retailer” and “manufacturer” as companies evolve to meet their customers’ needs. These forces will cause the retail and consumer packaged goods (CPG) landscape to change more in the next 10 years than it has in the past 40 years.

The report finds that the key drivers of success in the next 10 years will be centered on building a deep understanding of and connection to the empowered consumer, promptly incorporating disruptive technologies, embracing transformative business models in both the offline and online space, and establishing key capabilities. 

With this transformation, there will also be challenges to solve by pro-actively readying organizations for change and implementing the required technologies to address issues related to store closures, employment (job loss/re-skilling), and potential adverse environmental impacts.

The insight report focuses on digitally developed markets and represents a call to action to stakeholders across the private and public sectors. Retail and CPG incumbents need to address the accelerating opportunities and challenges to their current business strategies and operating models. It is also critical to work with policymakers, regulators, and in some cases even educators to formulate clear positions on the social implications and ensure positive outcomes.

The report lists the following key drivers of success:

  • Building a greater consumer understanding and a stronger consumer connection
  • Rapidly adopting game-changing technologies
  • Unlocking the power of transformative business models in physical and digital spaces
  • Redefining and building key future capabilities 

And it lists the following key challenges with recommendations and insights:

  • High cost and difficulty of implementing new technologies
  • Slow pace of cultural change
  • Limited public-private partnerships to address social implications directly 

Empowered by technology, the hyperconnected consumer is redefining value. The traditional measures of cost, choice, and convenience are still relevant, but now control and experience are also important. Globally, consumers have access to more than 1 billion different products offered by a wide range of traditional competitors and dynamic new entrants, all experimenting with new business models and methods of customer engagement.

As choices continue to increase, loyalty becomes more fragile, and the consumer becomes more empowered. Businesses will have no choice but to remain agile and constantly innovate and disrupt themselves by embracing new technologies to meet the high standards and expectations of consumers.