Best Opportunities for Growth in the Consumer Goods Market
Today’s consumer goods market bustles with both well-known corporate players and nimble new brands attempting to carve out the next great industry competitive advantage. Relying on yesterday’s production, supply chain and sales practices simply won’t cut it.
Companies today must marry a wealth of consumer demographic data with larger cultural and social shifts to position their brands for relevance in the future. Investing in the right technology and tools will be critical to capturing, then leading, that CIG charge. Consumer goods companies must understand:
- What internal and external forces motivate its target consumer?
- What technological tools position it to reach the most relevant leads?
- What disruptions loom on the horizon, either social, political, economical or otherwise?
In answering these questions, we begin to weave the tapestry of the top consumer trends for this year. Understanding the emerging consumer goods industry trends discussed below empowers CIG brands like yours to invest in the right technology, tailor smarter brand messages, deliver preferential products and, ultimately, forge profitable connections with customers.
Driving Forces in This Year’s Consumer Goods Trends
Today’s state of the consumer goods market is fundamentally shaped by a core set of social, cultural, political and technological factors that affect the everyday lives of consumers.
These wider forces have created an inflection point for CIG brands. Once acknowledged, companies can pivot to creatively integrate or strategically disrupt these underlying forces, creating a brand narrative both aligned with yet positioned to stay ahead of the times.
1. Customer Centricity in the Digital Age
Immediate, omnipresent and personalized. These are the holy grail of what consumer brands aspire to obtain in today’s digital-first world.
Over one-third of the world’s population owns a smartphone. Mobile devices have come to be one of the most dominant forces in contemporary life, shaping how people communicate, answer questions, schedule their days, get directions and shop.
It’s no longer enough to simply optimize sales platforms and marketing collateral for mobile search. CIG brands must deliver the personalized, relevant content today’s consumers use their mobile phones to view. A company’s ability to deliver customer-centric, value-adding content to the average person via their most prized device will profoundly affect its ability to succeed in the increasingly mobile marketplace.
Bioindividuality recognizes that identifying and profiling the genetic singularities within every person is the foundation for a healthful life. This unique approach covers everything from one’s metabolism, body composition and sleeping habits to more interconnected systems like memory and digestion, lending personalized suggestions on how these biological parameters influence our tastes and habits.
The commercial embrace of bioindividuality represents the larger consumer demand for personalization. Today’s shoppers seek products with individual relevance and meaning rather than broad goods with generalized results. Brands in the health and wellness industry are particularly impacted by the bioindividuality trend, but its uses and influences extend to products far beyond protein bars and shampoo.
3. Sustainability, Global Consciousness
Almost half (48%) of American consumers say they consider their purchasing decision’s impact on the environment and intend to make positive changes. They’re putting their money where their mouths are, too. Sustainable fast-moving consumer goods (FMCG) sales today carry a compound average growth rate (CAGR) four times higher than conventional products and brands without any sustainability tenets. By 2021, the sustainability FMCG market is projected to reach $142-150 billion in sales, compounding by a minimum of 20% annually since its first growth spurt in 2014.
4. Internet of Things (IoT)
CIG brands must keep tabs on the next projected chapter of technological innovation, the burgeoning internet of things (IoT).
The IoT-infused commercial landscape offers retailers and producers a new foothold to examine interconnected consumer patterns and behaviors, then launch more compelling purchasing incentives. Mobile phones, wearables, voice assistants, household electronics and even connected appliances and cars provide new data for the consumer goods market to capitalize on.
5. The Omnichannel Experience
Omnichannel retailing has seen itself emerge as a major industry trend within the past five years. However, its importance continues to climb as everyday consumer technologies evolve. Consumer goods companies must find ways to engage with audiences cohesively and compellingly on multiple channels, utilizing joint targeted campaigns informed by synthesized consumer data.
Brands must find the appropriate balance between supporting mobile, voice and desktop shopping and in-store amenities, if relevant, for its business models. Industry data, in particular, continues to point toward transitioning and investing in the former (digital-first experiences) while creatively repurposing the latter (in-store) to create a contemporary shopping journey.
6. Digital Supply Chains
The consumer goods market sees supply-side forces impact its evolution, as well. Few supply-side variables have been as positively influential for CIG companies as implementing a horizontal digital supply chain directing in-house operations.
Digitally transformed supply chains harmonize cross-functional data, allowing organizations’ production, warehousing and distribution branches to work in tangent off the same data systems. In doing so, CIG companies:
- Improve inventory/warehousing practices
- Coordinate more cost-effective shipments
- Manage fluid vendors and partners
- Uncover inefficiencies or process burdens through ERP data mining
- Can better spot demand patterns and integrate advanced planning analytics and forecasting into everyday management
7. Institutional Transparency
Trust in traditional institutions is at a historic low, particularly among millennial and Gen-Z consumers. As a result, consumer goods brands must go the extra mile to prove their authenticity and commitment to ideals larger than profits.
Brands most successful at establishing this transparency and trust are those who master customer-centricity and omnichannel engagement with its target consumer profiles. These companies have invested in understanding the true preferences and desires of its base and have nurtured a one-on-one connection. They bring value to their customers’ lives, not just another sales transaction.
8. Voice Technology
Voice search is poised to be the next great chapter in commerce platforms for consumer goods companies. Industry research projects voice-assistance speakers and devices to grow from its 2.5 billion household devices today to over 8 million by 2023. This mounting prevalence presents a revolutionary new way to reach and engage with consumers directly. Over 80% of voice device owners already utilize voice commands to search for real-time information and answer questions. Brands that integrate voice search into their omnichannel presence or to trigger marketing content will be primed to leverage this growing technological wave.
9. Smart Packaging
Another supply-side force driving growth for CIG brands is the rise of smart packaging. Traditionally relegated to commercial food, beverages and pharmaceuticals, smart packaging principles and techniques are seeing applications in broader product scopes, often to cost-cutting advantage.
A smart-packaging strategy involves interconnected uses of tools like QR codes, near field communication (NFC) and RFID to extend the shelf life and organization of goods while in storage, as well as improve the transparency and expediency of the delivery process to the consumer. Overall, smart packaging principles aid in a customized, seemingly on-demand user experience while also improving a company’s life cycle management metrics.
Top Consumer Goods Trends for This Year
Inspired by an evolving cultural and technological backdrop that prioritizes personalization, immediacy, transparency and authenticity, today’s FMCG and CIG companies stand to benefit the most by incorporating any of the following consumer goods trends into their brands.
1. Going Green
Committing to a “greener” brand footprint is one of the best growth opportunities for consumer goods companies. Buyer interest in environmentally conscious, sustainable and green products has never been higher. Research from Nielsen additionally shows that in the retail market, products with clear brand messaging geared toward sustainable sourcing and social responsibility has seen the highest sales growth rates in the retail space — with more than 60% of households now prioritizing purchasing sustainable products.
Four of the main characteristics consumers look for in a green brand are:
- Production sustainability: A product and its components are sourced and fabricated using socially conscious, sustainable and environmentally aware processes and materials across the entire production chain.
- Processing claims: The words and descriptions used to advance a product’s green identity (e.g., “organic,”) are representative of accurate scientific, legal or medical terms.
- Product ingredients: Product ingredients are easily identifiable, familiar, safe and generally considered “clean” according to popular scientific and consumer sentiments.
- Product packaging: Materials used in the shipping, storage and housing of a good or product are recyclable, compostable, sourced sustainably and overall have a minimal carbon footprint.
2. “Silver” Products, Goods
The world’s population is aging. According to the United Nations, the total population of persons aged 65 or older will double in 20 years to exceed 1 billion, then double again by 2050. By 2030, the population of elderly persons is expected to outnumber children under the age of 10 across the globe.
Most tellingly, the aging population is not geomarket-specific. Its effects extend over established and developing consumer markets alike. Again, by 2030:
- One in five North Americans will be elderly
- One in four Europeans will be elderly
- Nearly one in five Chinese will be elderly
- One in eight Indians will be elderly
Aging populations significantly alter the landscape of consumer demographics. Products geared toward the aging or elderly will see significant opportunities for depth and expansion, particularly in Asian markets. Already, consumer goods brands like Dove and ConAgra have launched product lines targeting senior citizens.
Biohacking is the direct commercial result of bioindividuality, or the trend of consumers seeking products tailor-made to match their unique genetic makeup.
Already, biohacking has seen tremendous growth in the broader health and wellness industries. Consumers can order protein powders customized to their workout regiment, skincare products for their skin type and even potted household plants to “hack” mood and hormone regulation.
Yet biohacking’s ability to marry product personalization with daily functionality is only half the commercial opportunity. The popularity of biohacked consumer products reveals a deep consumer desire across demographics to live healthier, happier lifestyles based on verifiable, science-backed findings. Brands that can answer this need in their own product lines stand to leverage this powerful consumer trend.
4. Voice-Enabled Ordering
The increasing prevalence of voice-assistant devices will offer a decisive new frontier to reach and engage target consumers — in the convenience of their own homes.
Brands that optimize sales pages and content marketing collateral toward voice-based searches stand to achieve two benefits. First, they present a new level of convenience for users to find and interact with their brands, often with users doing so instinctually. Second, they stand to master a new form of SEO far before their competitors.
Voice-enabled ordering and shopping has already seen a series of successful pilot iterations, mostly in the form of voice-enabled apps. From pizza chains to grocery stores with voice-controlled digital shopping carts, voice activation stands to serve as the next significant chapter in mobile consumer technology.
5. Experiential Connections
Inspired in part by the emergence of pop-up shops, creative experiential partnerships offer CIGs a way to create memorable brand touchpoints with your customers, nurturing more authentic connections along the way.
These campaigns work best when they harness technology’s ability to blur digital and physical experiences. Brands will be pushed to think creatively about how to engage with customers online in ways that mirror organic interactions in stores. For example:
- Influencer and acquisition collaborations: Getting physical products off the webpage and into the hands of real industry leaders and influencers as well as into stores.
- User-generated content: Putting the power of the online review back in your control, plus offering another arm to practice customer-centricity.
- Co-creation across pages and platforms: Letting customers express their own product or brand ideas, preferences and tweaks, then creating content based on their feedback.
The irony is not lost that many of today’s most successful e-retail disruptors are moving to develop in-person brand experiences. Instead of hopping on the pop-up store bandwagon, CIG brands should strategize ways they can recreate a dynamic in-store experience across their omnichannel touchpoints, then use those non-salesy touchpoints to convert.
6. Sustainability and Transparency
Consumers today are more concerned about the reputations of the businesses they engage with than ever. Though they still value bargains, they’re less inclined to compartmentalize low prices and savings if it means supporting unethical businesses or production processes. In fact, 75% of consumers say they’ll switch to a brand that provides in-depth product information on the label and online, even paying more for that product.
CIG brands have several tools at their disposal to convey greater integrity and transparency. They can:
- Wield social media to narrate end-to-end sourcing, vendor, testing, production and packaging practices
- Use marketing and advertising to relay authentic brand values
- Cultivate brand partnerships with nonprofits and influencers dedicated to causes you care about
- Be transparent — literally — jumping on the transparent packaging trend with glass, clear bioplastic and clear biodegradable plastic packaging over petroleum-derived containers
7. On-Demand Home Delivery
On-demand, home-delivered products were first pioneered by CIG disruptors selling subscriptions for everything from razors to wine. Now, traditional consumer goods companies must take the best aspects of on-demand home delivery and integrate them into their supply chain infrastructure, beating competitors at their own game.
Doing so lets consumer goods companies tout both the personalization consumers crave and the benefits of a digitally directed supply chain. It also satisfies the customer’s need for instant gratification. With one click, they can order the goods they want, then get them in the time frame they need. This “last-mile delivery” convenience brings a brand-reputation boost prized by many CIG companies but delivered by few, and can be piloted using several strategies and services:
- Partnering with an established on-demand delivery provider (compared to traditionally large logistics companies)
- Incorporating your products onto existing on-demand delivery apps, with both B2B and B2C platforms available
- Creating your own courier delivery service in dedicated regions
While the costs of implementing on-demand home delivery options has historically turned CIGs away, the benefits may outweigh the risks. Those online transactions provide you access to large swaths of consumer data inaccessible through old retailers. Plus, CIG companies can even repurpose physical storefronts into micro-delivery warehouses serving local zones, breathing new life into expensive retail square footage while offering this popular delivery perk.
8. On-Demand Services
Like on-demand delivery, on-demand service is a promising new trend in the consumer goods marketplace. It allows brands to repurpose the goods it’s already known for into attractive, brand-intuitive service offerings and experiences, tailored to fit the lifestyles and preferences of its consumer base.
Take this industry example. Tide recently captured attention with its launch of Tide Cleaners, an on-demand laundry and dry cleaning service the brand initiated after intense consumer research into both millennial and elderly demographics. With the success of its test pilot programs, Tide announced its plans to make Tide Cleaners available in roughly 2,000 locations nationwide by the end of 2020.
9. Tiered Subscriptions
Subscription ecommerce has grown by more than 100% annually each year for the past five years. What’s more, over 15% of all online shoppers have signed up for a reoccurring subscription service, contributing to the growing $10 billion industry.
Consumer goods companies have yet another opportunity to incorporate the best of their top disruptor’s practices into their own models. With brand familiarity on their side, larger CIG companies are in a prime position to offer products via a subscription-like package delivered conveniently to the consumer’s door.
Tiered recurring subscriptions are particularly pertinent to brands whose products and goods are required regularly, such as household goods, food, beverage and confections, cosmetics, personal care and hygiene products and cleaning supplies.
10. Shopping Local
Tenets of the buy-local movement still reverberate with pockets of today’s consumers. At its heart, the movement aims to reinstate consumer agency and transparency into the entire production pipeline, as well as stimulate local markets and economies.
CIG brands large and small can adapt many of its core sentiments into their own business processes, and do so in a way that isn’t co-optive or superficial. They can:
- Create hyper-localized social media ads targeting specific regions
- Launch special regional products or services, ideated internally or crowdsourced from local consumers
- Find key regional partners to set up complementary brand offers
- Publish marketing collateral highlighting local vendors and partners
- Foster community involvement and brand sponsorships at the local level
11. Global Urbanization
More and more of the world’s population is concentrated in urban centers. With over one billion new people expected to enter those urbanized consumer market by 2025, CIGs must reevaluate their existing competitive market profiles to identify currently fruitful industry spaces as well as emerging ones.
But CIGs must also keep a pulse on the impending population and urbanization shifts favoring the East. Within the next decade, Asia will outpace the West as the top consumer market. The Asian market growth share — notably in China, Indonesia and India — is expected to make up over 80% of the world’s burgeoning new middle-class population with an extra disposable income of between $10 and $100 per day.
Asian markets and their bolstering middle class represent a peak opportunity for CIG players, particularly in the ecommerce and B2B spheres. CIG brands must look to adopt Asia-centered regional business models with localized coordination backed by equally localized consumer data analysis.
12. Moment-Specific Communications
Today’s shopper wants clear, direct and personalized information across their shopping journey. Those same shoppers leave traces of their true likes, interests and concerns all over their web searches. Together, that desires-based information is primed for brands to create “micro-moments,” or moment-specific communications triggered after a specific consumer action and designed to engage, surprise and delight.
Technology affords CIG companies more opportunities to nurture moment-specific communications than ever. Chatbots and messenger apps can work as real-time Q&A agents answering product or service questions during relevant searches. Properly timed suggestion for augmented or virtual reality experiences can cement your brand in the mind of a lead. Social media ads can display on home feeds after a consumer has researched relevant queries. The list goes on.
These intentional, helpful micro-moments allow CIG content to be more useful than ever, informing the customer decision journey without aggressive or repeated sales pitches.
Don’t Follow Industry Trends. Set Them.
Across two decades and dozens of research campaigns in 47+ countries, Proactive Worldwide has meticulously crafted its superior consumer goods market research and competitive intelligence methodology. It’s positioned us as one of the world’s leading CIG CI firms for a reason — and our customers as market trendsetters, not followers.
Browse our website to learn about our approach and areas of expertise, then contact us to see what insights we can deliver for you.