New York, NY—Retailers and consumer goods companies could unlock $2.95 trillion in value for the industry as well as consumers over the next decade. This can be accomplished by accelerating digital purchase technologies, according to a new report by Accenture Strategy.
The research firm believes that investments in digitally driven business models will give consumers greater choice around how they purchase goods and services. Consequently, this would enable companies to deliver profitable, differentiated experiences.
Accenture Strategy’s Painting the Digital Future of Retail and Consumer Goods Companies report is based on analysis for the World Economic Forum. The report quantified the impact of the digital transformation on consumer industries over the next decade. It identified the current consumer appetite for new purchasing experiences. It also honed in on the business models that have the highest potential to unlock value.
The company asserts that four business models in particular will shape the future of digital commerce: 1. Shaping Economy, where consumers prefer to rent items rather than buy. 2. Personalization Economy, whereby consumers sign up for a “surprise me” subscription of specially curated products. 3. Replenishment Economy, where smart sensors detect when a product is running low and automatically reorder. 4. Services Economy, with consumers outsourcing services, such as laundry.
“The next decade will be a golden age for consumers, with technological innovation creating a variety of shopping experiences that will give consumers the simplicity, convenience or excitement they crave,” said Chris Donnelly, senior managing director, global retail lead, Accenture Strategy.
“Out of the $2.95 trillion in value the report identified, consumers have the most to gain—just over $2 trillion—through cost and time savings. The success of retailers and consumer goods companies to unlock value will be dependent on their ability to gain a deep understanding of consumers, embrace disruptive technologies and adopt innovative business models.”
Consumer Want New Purchasing Technologies & Experiences
Accenture found that 37% of U.S. consumers would allow companies to collect personal data via intelligent devices in return for a better experience or financial reward. Another 37% would subscribe to a service that constantly looks for the best pricing deals on their behalf, and actively recommends which company to switch to.
Furthermore, more than a quarter of U.S. consumers would use sensor-based digital services that preemptively address their needs without human intervention. Another 24% would subscribe to brands that analyze their shopping history to select products especially for them—and order them automatically.
“The retail and consumer goods industries will change more in the next 10 years than they have over the past 40,” added Oliver Wright, managing director, global consumer goods lead, Accenture Strategy. “As expectations around cost, choice, convenience and experience continue to increase, consumers will challenge the industry to evolve and innovate, which will drive huge growth in digital commerce.”
To reach the next frontier of digital commerce, Wright believes retailers and consumer goods companies should explore transformative business models. U.S. consumers are already welcoming these models.
Transformative Business Models
• Minimize impact on local communities: With an increasing number of retail stores downsizing or closing due to the rise of digital commerce, local communities need to respond. They need to establish economic development strategies to repurpose physical space as hubs for experiences, leisure and lifestyle activities.
• Reskill the workforce: Emerging technologies will drive a range of efficiencies that will change the nature of the industry’s workforce. Business leaders and policymakers must focus on accelerating reskilling people, creating partnerships with educational institutions.
• Ensure sustainability: Meeting consumer demand for rapid delivery needs to be achieved in parallel to minimizing the environmental impact. Shifting to electric vehicles and exploring load sharing can help while enhancing delivery efficiency. Furthermore, innovation in packaging design and supporting recycling infrastructure is also critical.
“To thrive in the next decade, organizations must aggressively pursue innovation and be willing to disrupt themselves. The winners will be those organizations that prioritize adopting a partnership mindset to offer customers new value. They will innovatively meet consumer demand for new services. They will also implement advanced data sciences to derive deeper customer insight to enable better decision-making,” said Donnelly.
Accenture is a global professional services company. It provides a range of services and solutions in strategy, consulting, digital, technology and operations. Accenture works at the intersection of business and technology to help clients improve their performance. The company has more than 401,000 people serving clients in more than 120 countries. accenture.com