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Digital Top Priority For 54% Of Consumer Goods Firms

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Digital Top Priority For 54% Of Consumer Goods Firms

The Consumer Goods Forum and KPMG International today released the findings of their annual Global Top of Mind Survey. The survey polled nearly 500 C-suite and senior executives from food, drinks and consumer goods manufacturers and retailers in 32 countries. It reveals how important the digital revolution will be over the next 12 months to consumer goods and retail companies - impacting everything from business growth and supply chain management to food safety, sustainability, and data security and privacy.

 

 A Shift Towards Digital

  

More than any previous year, the focus of executive attention has shifted from economic uncertainty to data, technology and the supply chain. As the consumer demand for digital experiences and ecommerce grows, retailers and manufacturers are looking at how they can meet these needs and operate in this new era of disruptive technology.

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54 per cent of respondents cited digital strategy for mobile/digital platforms as top of mind for their business over the next 12 months; 32 per cent of respondents however currently see themselves as having weak or no capabilities in these areas. Peter Freedman, managing director of The Consumer Goods Forum, commented, “This year’s research clearly shows how important digital strategy is to the modern consumer goods industry, as new technologies and new entrants to the market disrupt traditional consumption."

56 per cent of consumer goods and retail business leaders cited data analytics as being important to their firm’s strategy, making it the highest-ranked strategic area in the survey. Willy Kruh, global chair, consumer markets KPMG International, said, “The survey results reveal that improving capabilities in the area of data analytics is the number one strategic priority for executives in the consumer space in 2014. At a time when 90 per cent of the data currently available has been generated in the last two years, the volume is overwhelming."

47 per cent of the respondents cited data security as being very or critically important to their business, and 29 per cent said it will be one of their biggest challenges over the next 12 months. Data analytics were also cited as one of the three biggest business challenges over the next 12 months by 21 per cent of respondents. Kruh added, "While data analytics may be at the top of the corporate agenda, the challenge that should really be keeping companies awake at night is data security. Although 47 per cent of the respondents cited data security as being very or critically important, this is not enough. Companies are still a long way from where they need to be in terms of protecting their client and proprietary information from security breaches. Hackers will always be one step ahead, and companies need to ensure they are not overconfident in their ability to protect themselves.”

Top of the Charts – The Supply Chain

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The supply chain was rated by consumer goods and retail executives as the number one challenge for their companies - and is also the most likely to receive increased investment this year.

In the survey, 38 per cent of executives cited supply chain management as their main challenge and 42 per cent placed supply chain management at the top of their list for increased investment over the next 12 months. This was followed by international expansion (32 per cent), data analytics (28 per cent) and digital strategy (28 per cent). 45 per cent of executives said speed and agility is their top priority for improving the supply chain.

Sustainability and Health Driving Decisions

A significant number of consumer goods and retail leaders also indicated the importance of corporate social responsibility in their plans for the next 12 months through transparency and environmental considerations.

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44 per cent of business leaders cited traceability and transparency around end-to-end value chains as a top goal for their company just ahead of reducing waste and emissions (42 per cent) and sustainable sourcing (41 per cent). While food retailers and manufacturers listed health and wellness (47 per cent) and securing food safety (46 per cent) as their top goals for the next 12 months.

52 per cent of respondents reported that they have a strong or good capability to meet their sustainability agenda. Reputation and brand (41 per cent), consumer demand (34 per cent) and competition (28 per cent) were cited as three main drivers behind sustainability. 56 per cent of respondents said health and wellness and/or CSR and sustainability priorities are very important to their business.

Freedman also added, "Getting this [digital] strategy right and acquiring new digital skills will allow businesses to reach out to consumers in new ways, drive growth and enhance other important elements of their businesses; not least when it comes to ensuring a transparent and collaborative end-to-end value chain. The Consumer Goods Forum is already helping members get to grips with these important challenges through our programme of major projects, events and best practice communities”.

© 2014 European Supermarket Magazine by Nicole Gernon

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