I wanted to share some of the key retail themes from the Australian Food & Grocery Council’s annual conference held on 23rd and 24th of May. This annual event was attended by over 400 delegates from across retail & FMCG industries.
Customer centricity – back to the future
Sure, some might say it’s returning to the basics of retailing and product positioning, however Nikki Baird, VP Retail Innovation, Aptos shared that “technology is accelerating product and experience demand cycles to weeks and even days, and it can take months and years to react.” Customers have high and ever-changing expectations, can be influenced by ever growing touch points along the purchase journey, and these undercurrents are creating behaviors like never before seen.
— AFGC (@AusFoodGrocery) May 23, 2018
Speakers and delegates shared key strategies
The conference covered the usual suspects around how businesses today must address the rapidly evolving market place. They must:
• Fully embrace customer omnichannel shopping and enhance shopping experiences across all channels
• Personalized marketing and localize product ranges
• Get closer to customers by enriching brands that connect in creative, authentic & engaging ways
• Achieve a balance between global scale and local, niche markets
There were a few key enablers that I noticed being consistently mentioned: Having strong customer-purchase and life-stage metrics; the ability to track customer journey metrics and Net Promoter Scores; embracing technology such as artificial intelligence or blockchain; and robust capabilities for longer-term planning and supplier collaboration
What percentage of your promotions are effective in achieving your objective? – Both Woolworths and Coles leadership mentioned how high promotions levels are a priority and shift in their go-to-market plan around more everyday low prices. Promotional effectiveness is an ongoing problem within the industry, with, on average, 40% of units sold on promotion (2017) in Australia being exceeded globally by only New Zealand at 59%, according to Nielsen. Retailers & CPGs are seeking guidance on how to optimize mass promotions and improve collaboration, as they struggle with the reality that, on average, 30-40% of promotions are ineffective, but if optimized, can return 2 – 4X effectiveness.
Are you ready for the workplace of the future? – Mark McCrindle, Social Analyst and Principal of McCrindle shared his perspective on the impact that age shift, further ethnic diversity, and population explosion will have on Australia. Consumers and employee workforces have and will continue to change, forcing CPGs and retailers to rethink their employee recruitment/engagement, adjust product positioning, and adopt new behaviors and technology.
By 2025, Generations Y & Z together will make up 64% of the workforce which will have significant implications for the traditional workplace environment. To better connect, Mark suggested companies will need to adopt digital and social mediums for communications. These groups want to be heard, so we must be responsive to their needs by seeking to understand them, first, through listening. In addition, we must offer collaborative and empowered education programs, vs. traditional classroom engagements, as Y and Zs are visual learners.
Is your brand meaningful, and is your marketing engagement effective? – Vanessa Matthijssen, Strategy Partner & National Consumer Products Lead with Monitor Deloitte Australia, explored the options for FMCG companies to establish meaningful consumer relationships and face the challenges that the digital world of commerce will bring. Vanessa’s presentation stated “After years of relative stability in our grocery shopping habits and retail landscape, the fundamentals of what, where and how we buy are being redefined. The digital influence on today’s shopper journey is profound – digital is shaping buying decisions and creating new paths to purchase.”