A report published this week by The Consumer Goods Forum (CGF) together with consulting firm Capgemini, calls for the implementation critical initiatives to safeguard the future and drive change for the consumer goods industry. The two megatrends identified are the challenge of today’s digital world and the ongoing fight for resources.
“Future Value Chain 2022: Industry Initiatives Address Challenges of the Digital World and the Fight for Resources,” is the latest installment in a seven-year program designed to address significant changes taking place in society, consumer behavior, the environment and technology.
“We identified the two key megatrends of ‘Digital World’ and ‘Fight for Resources’ as likely to have the greatest impact on the consumer goods and retail industry in the coming five to 20 years,” says Thomas Storck, member of the management board, Galeria Kaufhof, Metro Group, and co-chair of The Consumer Goods Forum’s Emerging Trends Steering Committee. Digitization is changing consumers’ lives and shopping behavior. At the same time, global demand for resources like food, water and energy is rising rapidly with the potential for demand to outstrip supply in the next decade. The industry must work together to develop concrete milestones to respond to these megatrends and build an action plan to move these from theory to reality.”
Peter Florenz, corporate vice president, Henkel AG & Co., and co-chair of The Consumer Goods Forum’s Emerging Trends Steering Committee, said, “This is an exciting time to be a consumer – they are in control. The next 10 years will mark a radical change in how products are sourced and purchased.”
The collaborative exercise with the consumer goods and retail executives led to the selection of three initiatives that address the Digital World and Fight for Resources megatrends and highlight the need for swift action:
Consumer Engagement Protocol: This initiative is designed to address the changes being witnessed in consumer behavior. The potential power of user-generated and social media technology platforms to disrupt established institutions and the associated brand equity is undeniable. However, there are opportunities to connect directly with consumers as shoppers look for improved transparency in digital channels. At the same time, there is an inherent need to mitigate risks from privacy invasion. Increasingly, companies recognize the requirement to be proactive vs. being regulated in this area, but currently there is no voluntary global commitment concerning this in the consumer goods and retail industry. The project is focused on establishing guidelines for digital engagement with consumers.
Next-Generation Product Identification: Today, in a world of rapidly expanding online commerce solutions, barcodes are unable to provide companies and consumers with the rich digital product information they seek. Consumer barcodes do not uniquely identify product or package variations that carry the same product identifier, meaning minor product variations cannot be accurately disclosed. This initiative focuses on connecting the dots to improve supply chain transparency, efficiency and traceability. The goal is to provide the industry and the consumer with accurate product information by using new technology capabilities for product identification to replace the current barcode.
Sustainable Packaging Coalition: This potential initiative is designed to establish a coalition of companies to work together on non-competitive topics to improve the sustainability of packaging across the different value chain stages. The focus of potential activities will be around the three R’s of packaging and packaging components: Redefine, Reduce and Reuse.