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Consumer goods manufacturers and retailers must address two mega-trends -- the digital world and the ongoing fight for global resources -- to safeguard their future and drive change across the industry, according to a new report published by The Consumer Goods Forum (CGF) and Capgemini.
“Future Value Chain 2022: Industry Initiatives Address Challenges of the Digital World and the Fight for Resources,” is the latest installment to be issued in the Future Value Chain series.
“Digitization is changing consumers’ lives and shopping behavior," noted Thomas Storck, merchandising and multi channel retailing officer at Galeria Kaufhof, a subsidiary of Metro Group, and co-chair of The Consumer Goods Forum’s Emerging Trends Steering Committee. "At the same time, global demand for resources like food, water and energy is rising rapidly with the potential for demand to outstrip supply in the next decade. The industry must work together to develop concrete milestones to respond to these mega-trends and build an action plan to move these from theory to reality.”
The Future Value Chain program has been established over the past seven years with a focus on extensive industry research and analysis. More than 200 executives from some of the leading consumer goods and retail organizations worked together as part of the program to focus on how, through a set of collaborative initiatives, the industry can continue to bring benefits to consumers. This effort was triggered by the significant changes taking place in society, consumer behavior, the environment and technology.
The collaborative exercise with the consumer goods and retail executives led to the selection of three initiatives that address the Digital World and Fight for Resources mega-trends and highlight the need for swift action:
- Consumer Engagement Protocol: This initiative is designed to address the changes being witnessed in consumer behavior. The potential power of user-generated and social media technology platforms to disrupt established institutions and the associated brand equity is undeniable. However, there are opportunities to connect directly with consumers as shoppers look for improved transparency in digital channels. At the same time, there is an inherent need to mitigate risks from privacy invasion. Increasingly, companies recognize the requirement to be proactive vs. being regulated in this area, but currently there is no voluntary global commitment concerning this in the consumer goods and retail industry. The project is focused on establishing guidelines for digital engagement with consumers.
- Next-Generation Product Identification: Today, in a world of rapidly expanding online commerce solutions, barcodes are unable to provide companies and consumers with the rich digital product information they seek. Consumer barcodes do not uniquely identify product or package variations that carry the same product identifier, meaning minor product variations cannot be accurately disclosed. This initiative focuses on connecting the dots to improve supply chain transparency, efficiency and traceability. The goal is to provide the industry and the consumer with accurate product information by using new technology capabilities for product identification to replace the current barcode.
- Sustainable Packaging Coalition: This potential initiative is designed to establish a coalition of companies to work together on non-competitive topics to improve the sustainability of packaging across the different value chain stages. The focus of potential activities will be around the three R’s of packaging and packaging components: redefine, reduce and reuse.
The Consumer Goods Forum (CGF) is a global, parity-based industry network that brings together the CEOs and senior management of more than 400 retailers, manufacturers, service providers and other stakeholders across 70 countries.