Responses to Change: Economy

Responses to Change: Economy

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Leading brands and retailers are already innovating to strategically respond to the 5 drivers of change in the economy, like category spending shifts, middle class erosion and more, which will not only determine the future of retail, but their leadership in that future. 

 

DRIVERS OF CHANGE

WHAT ECONOMIC DRIVERS WILL IMPACT YOUR SHOPPERS, AND HOW?

  • CATEGORY SPENDING SHIFTS: Consumer loyalty will favor retailers continuously managing store areas and shelf space to anticipate and reflect new trends and spending priorities.
  • MIDDLE CLASS EROSION: As aging and job market disruption put pressure on middle class incomes, consumer confidence will be fragile, with shoppers showing heightened price sensitivity. 
  • CITY CENTER EVOLUTION: Rising property costs in city centers will hit consumer purchasing power, driving demand for affordable-quality replenishment shopping options in central and residential area locations.
  • RISE OF NEW GROWTH HUBS: The search for better economic opportunities is pushing consumers migrate to urban growth hubs in emerging markets, driving income growth and aspirations. 
  • ADDRESSABLE POPULATION GROWTH: Growth of digitally addressable populations in emerging markets, and mainly in Asia, will broaden the consumer base for CPGs.
     

 

IN-MARKET LEADERSHIP CASE STUDIES

SO HOW ARE BRANDS RESPONDING TO DIFFERENT CHANGES IN THE ECONOMY?

Category Spending Shifts

As spending shifts to trend categories reflecting societal trends, Nestlé has acquired Persona, which sells nutritional supplements personalized to consumers lifestyles and needs.

Rise of New Growth Hubs

Benefiting from its tailoring of chocolates and cookies to local consumer tastes in emerging markets such as China and India, Mondelēz has raised its 2019 sales forecast.

City Center Evolution

As retailers continue to re-think floor space optimization, with non-food ranges moving online, Barilla is experimenting with an in-store restaurant at Carrefour Italy.

 

IN-MARKET LEADERSHIP CASE STUDIES

SO HOW ARE RETAILERS RESPONDING TO DIFFERENT CHANGES IN THE ECONOMY?

Category Spending Shifts

Reflecting the shift of retail spending to experience, Casino's urban banner Monoprix has launched in-store foodservice departments in collaboration with Belgian restaurant chain Foodmaker.

City Center Evolution

As retailers continue to repurpose floor space to optimize their cost base, Carrefour in Brazil will set up 15 dark stores within hypermarkets to enable ultra-fast deliveries to urban ecommerce shoppers.

Addressable Population Growth

Targeting India’s rapidly-growing digitally addressable population, Walmart-owned ecommerce player Flipkart has onboarded 27,000 independent kirana stores across 700 Indian cities as partners.

Middle Class Erosion

As middle class erosion heightens price sensitivity, premium Amazon-owned Whole Foods has cut prices by ~2.5% on from last year, looking to shed its expensive image and expand its base to the middle class.

Rise of New Growth Hubs

Exploring the nascent yet growing online opportunities in Africa and having launched a cross-border ecommerce platform in April this 2019, DHL has expanded its operations to 34 African countries.

Addressable Population Growth

To tap into the United States’ unbanked addressable population, Amazon US has launched Amazon Cash, reaching out to engage the 25.2% of the US population that do not use banking services.

 

KNOWLEDGE TO WIN

NOW WHAT WILL IT TAKE FOR YOUR BUSINESS TO WIN?

 

POWER OF PARTNERSHIP

WE'RE HERE TO GUIDE YOU WITH THE KNOWLEDGE TO WIN.

DIGITAL COMMERCE, DECODED.

<DEFINE/> Plan your retail strategy with market intelligence and forecasting

<DEMYSTIFY/> Optimize your digital shelf execution to drive margin and sales growth online

<DELIVER/> Monitor online performance and results in sales and market share

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