Four Game-Changing Consumer Trends

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Pierre Cléroux, Vice President, Research and Chief Economist, BDC
Fall 2013

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Four Game-Changing Consumer Trends

  1. 1. Four Game-Changing Consumer Trends
  2. 2. The world is changing more than ever before
  3. 3. Impact on Consumer Behaviour ■ Rapidly changing technology - More changes will happen in the next 5 years than have occurred during the last 15 years
  4. 4. Impact on Consumer Behaviour ■ Aging population - In 10 years, more than 8 million Canadians will be over 65 – twice as many as today
  5. 5. Impact on Consumer Behaviour ■ 2007-2008 recession - The worst recession since the Great Depression had a profound and lasting effect on the Canadian consumer
  6. 6. These economic forces are not only changing our business environment, but are also reshaping consumer behaviours.
  7. 7. So, what are the next gamechanging consumer trends?
  8. 8. Consumer Behaviour in Canada 1. The Internet and the empowered consumer 2. The health “mania” 3. The “Made in Canada” advantage 4. Customization is King
  9. 9. 1. The Internet and the Empowered Consumer
  10. 10. The Internet and the Empowered Consumer B2C
  11. 11. Online: 84% of Canadians are connected to the Internet, owning 2.6 Internet-capable devices on average
  12. 12. The path of a purchase has not changed, but the channels consumers use are different.
  13. 13. Path of a Purchase 1 Awareness Building awareness 2 Intent Consideration 3 Decision Pre-purchase activities Purchase 47% of Canadian consumers conduct a broad online search prior to purchase
  14. 14. Path of a Purchase 1 Awareness Building awareness 2 Intent Consideration 3 Decision Pre-purchase activities Purchase 42% consult customer review sites before buying
  15. 15. What are the Most Trusted Sources of Opinion for Consumers? 92% 70% 47% 47% 46% 42% 41% Source: Nielsen “Global Trust in Advertising” report 2012.
  16. 16. Path of a Purchase 1 Awareness Building awareness 2 Intent Consideration 3 Decision Pre-purchase activities Purchase 42% search online to find the best place to buy
  17. 17. Path of a Purchase 1 Awareness 41% Building awareness 2 Intent Consideration 3 Decision Pre-purchase activities Purchase 41% of Canadians buy products or services online
  18. 18. Path of a Purchase 1 Awareness Building awareness 2 Intent Consideration 3 Decision Pre-purchase activities Purchase 57% of the decision to buy a product is made online
  19. 19. You need an online presence! Even if you don’t sell online. Canadians make their buying decisions online.
  20. 20. “High-Web SMEs have experienced revenue growth that was up to 22% higher than low-Web SMEs.” Source: BCG survey of 15,000 SMEs in countries
  21. 21. The Internet and the Empowered Consumer B2B
  22. 22. Online ranks as top source when looking for a new supplier % 100 90 80 70 60 50 40 30 20 10 0 Go-to sources Internet search engines Company websites Business network Employees or business partners Magazines Most influencial sources Trade shows Friends and family
  23. 23. 57% of the purchase decision making process has been completed prior to contacting a sales representative
  24. 24. “A simple Web presence is no longer sufficient for businesses; they need to adopt and develop a multi-channel approach.”
  25. 25. The Opportunity The Strategies ■ The Canadian online retail presence is underdeveloped ■ Build and develop an online presence ■ Carefully manage online reviews ■ Understand your market and offer flexible acquisition options (online/offline)
  26. 26. 2. The Health “Mania”
  27. 27. 50% of Canadians consider the health impact of a product as an important factor during the purchase decision process.
  28. 28. 31% of Canadians are willing to pay a premium for healthy products.
  29. 29. Impact on Consumer Behaviour Health awareness is changing how Canadians: ■ eat ■ practice sports ■ spend their leisure time ■ purchase products for their family
  30. 30. Healthy Foods As Canadians get older, they’re looking for products that will help them stay healthy
  31. 31. Wellness Services Canadians are focused on caring for themselves; as result, there has been an increase in demand for health and wellness services
  32. 32. Health Monitoring Device This health trend combined with the technology revolution leads to new market opportunities
  33. 33. Low Toxicity Products Canadians are concerned about the effect that a variety of products have on their health
  34. 34. The Opportunity ■ Canadians spend an average $935 per year on health and wellness The Strategies ■ Provide new solutions to meet the public’s desire for a healthier lifestyle ■ Adapt your products and services to heathconscious consumers ■ Promote health benefits of your products and services
  35. 35. 3. The “Made in Canada Advantage”
  36. 36. Nearly One Out of Three Consumers Are Willing to Pay a Premium on Ethically Made Products Social Responsibility
  37. 37. The Opportunity The Strategies ■ SMEs can differentiate themselves from multinationals ■ Source locally as much as possible ■ The “Made in Canada” should be an option ■ Communicate and promote the local characteristics of your products
  38. 38. 4. Customization is King
  39. 39. An increasing number of Canadians are looking for custom-made products, tailored to their specific needs. They also want to be more engaged in product creation.
  40. 40. Two ways to address this demand Customization Expand product lines + Mass customization
  41. 41. Mercier Wood Flooring ■ Expansion of product line ■ 13 wood species, 74 rich colors, and beautiful ecofriendly finishes; Mercier wood floors offers 3000 different possibilities
  42. 42. mymuesli ■ Mass customization ■ Production of cereals adapted to your specific needs: you can create and order a unique muesli directly online ■ Matches your demand (tastes, allergies, etc.)
  43. 43. “Mass customization has created new business models that enable SMEs to better compete with multinational companies.”
  44. 44. The Opportunity The Strategies ■ SMEs’ flexibility gives them a certain advantage over larger corporations in using mass customization ■ Involve consumers in product creation ■ Reorganise the business model around mass customization ■ Expand product line-up with simple personalization options
  45. 45. Conclusion ■ Engage customers in a closer dialogue ■ Understand the factors that are reshaping the way consumers perceive value ■ Emphasize the local value of your products
  46. 46. Take the time to develop strategies with your team. Ask yourselves: how can you make these trends work to your advantage?
  47. 47. Thank you Follow us: BDC BDC_News BDC Entrepreneur bdc.ca

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