Rapid pace of change
The Consumer Goods Forum Global Summit opened in Vancouver this week, setting out to explore how to satisfy new consumer needs and what will be required to achieve this. Ian Cook, Executive Chairman, Colgate-Palmolive, and CGF co-chair, opened the event, outlining how the industry is being challenged by the rapid pace of change. He called out the impact of new technologies, how consumers are making their choices and the increasing influence of geopolitics as disruptive influences. Key themes throughout the day included the importance of building trust with consumers, investing in digital skills and developing new business models.
Investing in skills to counter the “age of anger”
With a view beyond the retail sector, Bill Morneau, Canada’s Minister of Finance, outlined the growing frustration and concern among consumers despite the progress that’s been made over the last 50 years. Lower poverty levels, increased life expectancy and better access to electricity, education and clean water have not created prosperity for all, eroding trust in key institutions. While conditions are advantageous for those that are working for the right company, living in the right part of the country and have the right skills, many are falling further behind. Morneau outlined how the Canadian Government has prioritised investment in skills development and science and established global trade deals to ensure a more optimistic and prosperous future for all Canadians.
Building a future-ready retail workforce
Investing in skills and building a future-ready workforce has also been a priority for Canada’s leading food retailer, Loblaw. It has been a leader in growing its digital business over the last few years, with over 1,000 people currently in digital roles. The company’s president, Sarah Davis, outlined plans to accelerate its progress in this area by investing $250m over the next five years, enabling its associates to gain the necessary skills to compete in the future. Loblaw also highlighted the importance of trust. Along with value and quality, consumers are looking for retailers to deliver on trustworthiness, with the retailer’s private label brand, President’s Choice, recently being voted one of the most trusted consumer brands in Canada.
Building on this, Tina Lee, CEO, T&T Supermarkets, highlighted the importance to connect to the Canadian customer in an authentic way. T&T aims to serve the “chopstick culture,” building appeal with first and second generation East Asian consumers and the Asian cuisine enthusiast.
Business as usual is not an option
Looking beyond the current timeframe, Max Koeune, President and CEO, McCain, pointed to the challenges associated with feeding a growing population. Over the next 30 years, this is forecast to cause major implications for land use, greenhouse gases and water stress, stating that “business as usual is not an option.” Outlining the need to shift towards a more sustainable agricultural approach, he pointed to the need to reduce food waste, a key priority for The Consumer Goods Forum. With a third of all food produced currently wasted, Koeune highlighted that 28% of agricultural land is used for producing waste. McCain has taken a collaborative approach to tackle this, including collaborating across the supply chain with Belgium-based retailer Colruyt to produce a range of soups from surplus fresh vegetables.
Diversity underpins innovation
Bringing a view from beyond the consumer goods sector, Arnold Donald, President & CEO, Carnival Corporation, suggested that while diversity in industry can be a challenge, it is critical for business success. Businesses thrive through innovation but requires people with different perspectives to organise around common objectives and develop new ideas.
Data improvements require CEO leadership
Closing the session, Peter Freedman, Managing Director, The Consumer Goods Forum, outlined the organisation’s progress on its Data Leapfrog project. The growing importance of data and analytics in the sector prompted the CGF to launch a new initiative two years ago to tackle the fundamental problems of poor data quality and the fragmented approach that is being undertaken. Led by David Taylor, CEO, Procter & Gamble and Olaf Koch, CEO, METRO AG, the project has made progress, but it has proven to be tougher than anticipated. Working towards all products having a unique identification that can be verified in real time by any trading partner is complex and will absolutely need to be on the CEO agenda if further progress is to be made.
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