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2017 Consumer & Retail Top of Mind Survey

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Top of mind topics and trends according to 500+ consumer and retail executives from some of the world’s largest brands.

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2017 Consumer & Retail Top of Mind Survey

  1. 1. Thinklike astart-upHow to grow in a disruptive market 2017 Global Consumer Executive Top of Mind Survey
  2. 2. 2© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Thinklike astart-up Consumer and retail companies are facing three revolutions: In this perfect storm of market disruption, how are the most successful companies achieving growth? geographic demographic technological How to grow in a disruptive market
  3. 3. 3© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Willy Kruh Global Chair, Consumer & Retail KPMG International Thinklike astart-upHow to grow in a disruptive market There is a real opportunity for those who dare to lead the pace of innovation. Companies that evolve, innovate and truly understand their Millennial employees and customers will likely succeed.
  4. 4. 4© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Peter Freedman Managing Director The Consumer Goods Forum Thinklike astart-upHow to grow in a disruptive market In a market where heritage is no longer as important as relevance… you need to be able to innovate at least as fast as your competitor.
  5. 5. 5© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. 3out of 10 Thinklike astart-upHow to grow in a disruptive market In a recent survey of 500+ senior consumer and retail executives, said their companies would grow by 6 percent or more this year. What are these companies doing differently
  6. 6. 6© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Thinklike astart-upHow to grow in a disruptive market Are investing more in new technology Are more customer centric Are more focused on data and personalization Have more integrated supply chains Generate a higher percentage of their sales online 1 2 3 4 5 High growth companies:
  7. 7. 7© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Arecustomersreallyatthe centerofyourbusiness? Customer centricity
  8. 8. 8© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Customer centricity More customer- centric companies Current annual growth projection Steady or negative growth 6%+ growth 1–5% growth Customer centricity and revenue growth are closely linked Less customer- centric companies 59% 31% 26% 32% 16% 36% Source: 2017 TOM Survey, KPMG International and CGF
  9. 9. 9© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Customer centricity High-growth companies (6%+) Percentage of executives who say these factors are critical for success Higher-growth companies are more likely to say customer trust and loyalty and customer experience are factors critical to success Low-growth companies (<6%) Customer loyalty Customer experience 52% 33% 47% 30% Source: 2017 TOM Survey, KPMG International and CGF
  10. 10. 10© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Customer centricity More customer- centric companies Retail sales made online High online sales (61%+) Low online sales (0-30%) Medium online sales (31-60%) Customer-centric companies earn a higher percentage of their revenues online Less customer- centric companies 31% 49% 48% 35% 19% 9% Source: 2017 TOM Survey, KPMG International and CGF
  11. 11. 11© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Customer centricity Providing a compelling customer experience Companies with “good” or “excellent” capabilities Higher growth companies are better at engaging customers and providing a compelling experience Using social media for promotion and engagement Monitoring customer engagement Personal engagement with end-customers 0% 10% 20% 30% 40% 50% 60% 70% 80% Steady/declining growth 1% – 5% growth 6%+ growth Source: 2017 TOM Survey, KPMG International and CGF
  12. 12. 12© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Customer centricity Julio Hernandez Global Head of Customer KPMG International Many…still fall into the trap of focusing on what they can sell to the customer - not what the customer wants to buy from them.
  13. 13. 13© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Customer centricity Key takeaways Put customers at the center of your business Test the customer experience and get it right Invest in social listening and engage with your customers Be channel agnostic and create partnerships
  14. 14. 14© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Changing consumer Doyouunderstand yourcustomers?
  15. 15. 15© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Changing consumer Top market disruptors Expectation for immediate service Declining customer loyalty Preference to shop online Demand for personalization 38% Declining consumer loyalty to brands is expected to be the most disruptive behavior trend 33% 30% 29% Source: 2017 TOM Survey, KPMG International and CGF
  16. 16. 16© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Changing consumer Good How do you rate your personalization and customization capability? of companies say creating a more personalized customer experience is a top strategy but 39 percent lack the capabilities Poor Excellent Fair 21% 9% 40% 30% 34% Source: 2017 TOM Survey, KPMG International and CGF
  17. 17. 17© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Changing consumer of high-growth companies are successfully using data analytics to predict consumer behavior and preferences 69%
  18. 18. 18© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Changing consumer Mike Coupe CEO Sainsbury’s I always start from the premise that I have no idea how consumers are going to behave, so it’s our job to build a model that can adapt quickly to their changing needs.
  19. 19. 19© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Changing consumer Key takeaways Adapt to the new consumer Personalize customer experiences Understand what your brand stands for Crunch your customer data
  20. 20. 20© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Supply chain Isyoursupplychain readytodeliver?
  21. 21. 21© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Supply chain What is your company’s top supply chain priority? Forecasting trends Distribution speed and efficiency Quality control Manufacturing speed and efficiency 36% 31% 31% 31% Improving distribution speed and efficiency is the top supply chain priority for 36% of companies Source: 2017 TOM Survey, KPMG International and CGF
  22. 22. 22© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Supply chain Companies with fully integrated supply chains of high-growth companies have fully integrated their supply chains 43% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% Steady/declining growth 1% – 5% growth 6%+ growth Source: 2017 TOM Survey, KPMG International and CGF
  23. 23. 23© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Supply chain High-growth companies Percentage of respondents who ‘strongly agree’ their company offers the following: Same day delivery Easy product returns Stock visibility High-growth companies are more likely to offer stock visibility, easy product returns and same day delivery Low-growth companies 40% 26% 48% 26% 32% 19% Source: 2017 TOM Survey, KPMG International and CGF
  24. 24. 24© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Supply chain Erich L. Gampenrieder Global Head of Operations Advisory and Global Center of Excellence KPMG International With the analytics available today, it is not that difficult to model supply chains…to explore complex problems, and calculate what is really optimal.
  25. 25. 25© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Supply chain Key takeaways Create a supply chain that meets tomorrow’s needs Understand new business models and how they are relevant to yours Innovate to be more demand driven Use technology to turn your supply chain into a driver of growth Integrate your supply chain functions across the enterprise
  26. 26. 26© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Automation Canautomationgrow yourbusiness?
  27. 27. 27© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Automation 4out of 10companies believe Artificial Intelligence (AI) can be used to improve customer service
  28. 28. 28© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Automation Investment in robotics Robotics - cognitive Robotics - basic Robotics - enhanced 32% 32% Plan to invest within 2 yearsCurrently use of companies will use basic robotics for repetitive tasks by 2019 64% 30% 13% 32% 16% Source: 2017 TOM Survey, KPMG International and CGF
  29. 29. 29© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Automation What are you using or planning to use AI for? of companies using or planning to use AI are using it for customer service 41% Marketing personalization Customer service Demand forecasting Warehouse optimization and automation 41% 36% Smart shopping carts Product design 35% 38% 35% 35% Source: 2017 TOM Survey, KPMG International and CGF
  30. 30. 30© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Automation David Neely Managing Director, Technology and Process Enablement KPMG in the US The companies that have been most successful in leveraging these technologies at scale have viewed intelligent automation as an enterprise capability.
  31. 31. 31© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Automation Key takeaways Harness automation to drive growth Ask the right questions before you invest Focus on areas where AI will have the biggest impact on performance Don’t risk falling behind by waiting to invest
  32. 32. 32© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Disruption Candisruptionbecome anopportunity?
  33. 33. 33© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Disruption Top market disruptors include competition from new entrants, new business models and new technology
  34. 34. 34© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Disruption Changing consumer behavior is seen as the top cause of volatility by over 50% of companies Expect a slight increase Expected industry volatility over the next 2 years Expect no increase Expect a significant increase Expect a moderate increase 14%11% 28% 47% Source: 2017 TOM Survey, KPMG International and CGF
  35. 35. 35© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Disruption Companies that are larger and faster growing are more likely to say competition from new entrants will be the biggest disruptor
  36. 36. 36© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Disruption Michitaka Sawada CEO Kao Corporation I feel a very strong sense of urgency that we need, very quickly, to close the gap between the change that we are seeing outside and the reluctance to change inside.
  37. 37. 37© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Disruption Key takeaways Turn disruption into opportunity Embrace the revolutions reshaping consumer and retail Empower local markets to make decisions Know when to use risk to create ROI or when to hedge against it
  38. 38. 38© 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Thinklike astart-upHow to grow in a disruptive market Who was surveyed? 526 senior executives from the world's leading global consumer and retail brands, headquartered in 31 countries 92 percent of companies have over US$500 million in annual revenues 54 percent of respondents are at the Board or C-level, including 25 percent who are the CEO or president of their company
  39. 39. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. © 2017 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. kpmg.com/socialmedia For more information and to download the full report, visit: www.kpmg.com/CMsurvey To order complimentary print copies of the report please email consumer@kpmg.com

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