Market Transparency a Challenge for Consumer Goods Sector
The consumer products sector is a wide-ranging industry that, despite its diversity, exhibits a number of similar trends. “Perhaps the biggest issue facing consumer packaged goods companies in the coming year is how to compete more effectively in an increasingly transparent market,” according to a Deloitte’s 2008 Industry Outlook: A Look Around the Corner.
Driven by a changes in technology and in consumer demand, the consumer is becoming increasingly savvy, Deloitte says. “Online product reviews, in particular, are building consumers’ knowledge arsenals and making a considerable impact on purchase decisions.”
Clearly, a “New and Improved” message will no longer carry the day.
In Asia, there is an extreme example of web-empowered consumers fundamentally altering the typical shopping dynamic: Various websites “[enable] potential customers to register their product interest …. The site accumulates this information from hundreds of people and leverages it to negotiate discount prices from retailers.”
Unfortunatley, Deloitte says, “The introduction of truly innovative, breakthrough products (as opposed to launching product line extensions) has lagged.”
The Deloitte report also looks at issues involved with sustainability and generating top-line growth. It concludes, “If companies can fundamentally address the issues of product transparency, top-line growth and sustainability in 2008, they could attain commercial success at a rate they haven’t seen in the last decade.”
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