LONDON — Dealing with disruptions within the consumer landscape are a constant concern for food and beverage companies, according to “Pursuit of harmony in turmoil: working together to make a difference,” a new report from the EY Global Consumer practice in conjunction with The Consumer Goods Forum.
The EY Future Consumer Index surveyed more than 20,000 consumers across 27 countries about the changing landscape. Many of these consumers had cost and price on their minds, with 74% anxious about rising living costs, 56% worried about affording household necessities, 54% expecting rising living costs to continue increasing in the next six months and 64% expressing worries about the US economy.
According to the report, these worries are about more than just increasing prices. Some customers are concerned about sustainability and living with less during the pandemic, which in turn is making them question the need to own more. Other consumers “may want to do more things, but they might not want to own more things,” the report said, which is driving up interest in experiences, services, renting, repairing and peer-to-peer selling.
The EY Global Consumer practice also identified 200 drivers of change that may influence the consumer landscape over the next decade. Blockchain technologies lead to “greater scrutiny of brands;” new digital products and experiences help consumers form certain choices as well as how brands engage them; and shifting health perceptions have moved consumer focus to mental well-being, preventative measures and social determinants.
Another concern is the polarizing behaviors surrounding social, political and economic statuses, the report noted.
“The divisions in society, growing inequality, political environments which push people apart instead of bringing people together is a terrible development,” said Frans Muller, president and chief executive officer of Koninklijke Ahold Delhaize NV.
Mr. Muller was one of the 17 leaders of the CGF member companies interviewed as part of the report.
“A lot of things can be solved with technology and collaboration, but spirit, mentality, listening to each other and living together in a society will create opportunities for everybody,” Mr. Muller said.
According to the EY Future Consumer Index, these polarizing behaviors (plus consumers becoming more aware of how they spend their time and money) are part of this disruption. Consumers also are moving their aspirations from ownership and brand loyalty to “expressing purpose.”
The report cited statistics about “how the disrupted consumer is changing,” which include 70% of consumers expecting companies and organizations to drive positive social and environmental outcomes, 63% reappraising how they spend time on “things they value most” and 28% switching from name brands to private label.
Even with a drastically changing consumer landscape, companies still are adjusting their plans according to every major change, the report said.
“We’re building the company in the context of what’s happening in real time, I would say it’s been very fluid, but of course it’s been influenced by what was happening and what we think the world is going to look like going forward,” said Steve Cahillane, chairman and CEO of Kellogg Co.
Companies must also adapt to the new behaviors and regulations that derive from changing perceptions in health and wellness.
“We’re working very hard to fully understand how the consumer can evolve to a place where our products can be part of a healthy diet, in moderation, and how we educate the consumer to get there,” said Dirk Van de Put, chairman and CEO of Mondelez International, Inc.