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Now What? Review Of The Consumer Goods Forum Global Summit 2021

By Steve Wynne-Jones
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  • While it had to adopt a virtual setting for the first time this year, the Consumer Goods Forum Global Summit, which took place this week, has lost none of its impetus in seeking to drive positive change. ESM editor Stephen Wynne-Jones picks out some highlights from the four days.

    The Consumer Goods Forum Global Summit is traditionally a benchmark-setting event for the retail and consumer goods sectors – an opportunity for the top executives in the industry to meet, share insight, and showcase their efforts in driving positive change.

    The coronavirus crisis put paid to last year's event, meaning that this year's Summit, held virtually, was the first since 2019's Vancouver meetup, and was always going to be shaped by how successfully the world's biggest companies navigated the pandemic and, more importantly, what comes next.

    The Consumer Goods Forum (CGF) has itself undergone significant change in the past year or so, establishing eight Coalitions of Action around key pressure points for the industry (Forest Positive, Plastic Waste, Food Waste, Collaboration for Healthier Lives, Product Data, Human Rights – Working to End Forced Labour, Sustainable Supply Chain Initiative: SSCI and Global Food Safety Initiative: GFSI), which will enable it to tackle more directly the issues that matter most to consumers and society. This year's Summit was also the first to be helmed by managing director Wai-Chan Chan, who was appointed last year.

    In his opening address, Wai-Chan noted that the past year has seen plenty of lows, but also "incredible highs", in terms of how business has responded to the crisis. From a macro perspective, he observed, many countries are close to "breaking through the end of this cycle", meaning the theme of this year's event was a pertinent one – 'Now What?'

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    ESM was a media partner for this year's Summit, which welcomed 650 attendees to its virtual platform, with a total of 42 countries represented.

    Day One – Lessons From COVID-19

    The past, present and future of the pandemic was always likely to shape proceedings, and the first day of the Summit got underway with a three-way presentation featuring McKinsey & Company's Sven Smit, Thibault Mongon of Johnson & Johnson and IGA's John Ross, on the multifaceted impact that the crisis has had on how we live our lives.

    As Smit observed, the past year has seen all things digital accelerate to a level we could only have imagined – "many things happened in five days that we expected to happen in ten years," he said. Health and wellbeing also took on a new level of importance for consumers, leading to a "realisation that if somebody is not safe then nobody is safe," as Mongon put it.

    Retailers and brand owners have a role to play in this new environment, in terms of how they influence consumer sentiment – in a world driven by fear and instability, it's important for brands to build confidence in consumers. “It may turn out that we’re not in the logistics business, or the retail business, or the services business," Ross said. “We may actually be in the confidence business."

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    The coronavirus' impact on consumer trends was analysed in a discussion between Konstantinos Apostolatos of Boston Consulting Group, Francois Faelli of Bain & Company and Solitaire Townsend of Futerra. As they discussed, while there is a degree of optimism out there, the post-COVID consumer of the future is likely going to place more demands on brand owners, and adopt a more 'activist' mentality in their dealings with the industry.

    Commenting on the emerging Generation Z cohort, Townsend observed, "The consumer is not stupid. She's your daughter. She's incredibly informed."

    The first day also saw insightful discussions with a number of retail chief executives. Rodney McMullen, CEO of Kroger spoke about the changing dynamics of retail over the past year, and the need to replicate the in-store experience online. "Every day you will continue to learn how can you do it better," he noted. Elsewhere, Magnit's Jan Dunning provided the picture from Russia, where the COVID crisis has "enabled a change of culture" at the business, helping to accelerate transformation.

    Also appearing, Tim Steiner, CEO of Ocado, suggested that the surge to online in recent months is an indication of how the retail landscape is "going to change beyond all recognition" in the coming years, with more new online delivery firms "in the past 12 months than we have in the past 20 years". However, he noted that most of these are positioned in the ultra-fast delivery space, which isn't necessarily going to suit all shoppers.

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    One of the more novel takeaways from the first day of the Summit was from Malina Ngai of AS Watson, who in a panel discussion with Spar International's Tobias Wasmuht and David Taylor of P&G, spoke about how the business has appointed "chief smile officers" and established a "global smile index" on social media; an innovative way in which the business has maintained engagement with shoppers while also promoting positive mental health.

    Day Two - Building Resilience

    After Day One laid the groundwork, Day Two of the Summit continued to explore the proactive measures being taken by retailers and consumer goods firms to tap into changed consumer need states.

    A panel discussion between Mark Schneider, Nestlé, Brian McNamara, GSK, and Frans Muller, Ahold Delhaize, entitled Building Resilience in Tough Times, saw all participants agreeing that health and wellness was going to be a key influencer on shopper behaviour, with GSK's McNamara observing that " at a time when misinformation is around, brands can step in and be that trusted source for people."

    Nestlé's Schneider echoed that sentiment, suggesting that brands have a role to play as "sources of health and protection, but also knowledge."

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    Asia has long been a barometer for future retail trends, and following an informative Future of Retail in Asia panel in the morning session ("Asia is a crucible for innovation," as Melanie Sanders, Bain & Co put it), Daniel Zhang, CEO of Alibaba took part in an afternoon discussion on Trends and Learnings from China in the Post-Pandemic World.

    The new Forum co-chair encouraged delegates to "think of the value you can provide to customers" as the pandemic subsides. "Give people a real reason to go back to stores in terms of experience and services," he added.

    Day two also saw a discussion with Laxman Narasimhan, chief executive of Reckitt, who suggested that the pandemic "has shown that we are in effect trapeze artists – it has forced us to make more difficult jumps and twists every day." And he added, not everyone has the benefit of a safety net.

    Elsewhere, Coca-Cola's James Quincey spoke of how the business has navigated seismic shocks in the past, and will likely do so again in the future, after the current malaise dissipates. "Our approach has been to build in resilience to our operations," he said. "We have built a supply chain that has more resilience to those kind of shocks, and has the flexibility to change."

    Day two finished up with a discussion with Walmart International CEO Judith McKenna, who noted that while "nobody gave us a playbook on how to deal with the pandemic", the crisis has encouraged people to step up to the plate. "There's a generation of leaders coming through that have just had a crash course in leadership over the past year," she explained.

    Day Three - Belief In Brands

    Food insecurity, the embrace of omnichannel and 'building belief in brands' were among the topics on the table for Day Three of the Summit, which commenced with an overview of how China's Wumart Group is embracing digitalisation as it seeks to "transform traditional retailers into digital players", as its CEO Dr Zhang Wenzhong put it. Along similar lines, Falguni Nayar, founder and CEO of Nykaa, an India-based omnichannel beauty business, was on hand to discuss how the business had moved from 'online to omnichannel'.

    One of the standout presentations of the Summit saw Hubert Joly, the former chairman and chief executive of Best Buy, offer his prognosis of why motivation is so important within the industry, and why humility is one of the best attributes an industry leader can have. Businesses "need to develop an employee value proposition as strong as their customer value proposition," he explained.

    The challenge of dealing with forced labour within the retail and consumer goods industry was addressed by former Danone chief executive Emmanuel Faber, who is also co-chair of the Forum's Human Rights – Working to End Forced Labour coalition.

    Forced labour continues to be a "taboo" subject for many businesses, he explained, and the coalition enables business leaders to be transparent and share their observations in a private context – in turn putting in place positive actions. "The more we are transparent about it, the speedier we will be able to act," he explained.

    Another highlight of Day Three saw BBC Storyworks host a discussion panel on Building Belief In Brands, in which Consumer Goods Forum managing director Wai-Chan Chan outlined the challenges brands face when tackling social issues, whether it be sustainability, social justice, racial issues or other topics.

    "In the western world it's very difficult to stay silent," he explained. "But you can't just jump on the bandwagon, you need to be authentic."

    Day Four - Looking To The Future

    Over the past number of years, the Consumer Goods Forum has doubled down on its efforts to deliver results-oriented positive change – and far from being a talking shop, the annual Summit should act as a catalyst for instigating industry-wide initiatives. With this in mind, the final day of the 2021 Summit examined some of the areas in which the Forum is seeking to make a difference.

    Ahead of the UN Climate Change Conference (COP26) in Glasgow later this year, Unilever CEO Alan Jope was among those to contribute to a lively discussion on how firms can 'Join The Race To Zero' when it comes to carbon emissions – in other words turning urgency of action into energy.

    As Jope put it, his role is to "recruit, encourage, inspire and even shame" Forum members to step up to the plate and deliver substantial change. "We really are at a tipping point, we need short-term as well as long-term targets," he said, adding that the move to a net-zero economy "must happen – it is an existential threat to our species".

    The issue of deforestation is another area in which the Forum has made great strides recently – establishing a Forest Positive Coalition of Action last year – but again, words go only so far, and Forum members need to take meaningful action. As coalition co-chair and Carrefour general secretary Laurent Valee noted, "multi-stakeholder collaboration" is the only way to achieve effective results in this area. Or, as Pascal Canafin, Member of the European Parliament's Renew Europe Group, observed, "If you want to drive systemic change, you need to address numerous challenges and obstacles at the same time."

    The 2021 Summit ended with a changing of the guard, as Daniel Zhang, chairman and CEO of Alibaba Group, and James Quincey, chairman and CEO of The Coca-Cola Company were formally announced as the new CGF co-chairs for a two-year period, replacing outgoing co-chairs Özgür Tort, CEO of Migros Ticaret, and Emmanuel Faber, former chairman and CEO of Danone.

    Where Tort and Faber successfully navigated the Forum through the COVID crisis – while also helping to establish the Coalitions of Action structure – Zhang and Quincey will seek to push this forward, empowering businesses to deliver actionable change both in their organisations and the wider world. "We need to make sure that in two years time we have moved the needle for the betterment of the industry and the betterment of society," as Quincey put it.

    Or, as Forum managing director Wai-Chan Chan put it in his closing address, we need to "do more, do better, do faster" – wise words as businesses return to post-coronavirus stability.

    © 2021 European Supermarket Magazine. Article by Stephen Wynne-Jones. For more A-Brands news, click here. Click subscribe to sign up to ESM: European Supermarket Magazine.

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