Consumption Two major trends are now affecting consumer markets, and companies need to break their identities to catch up.

Circular economy cannibalize, ie cut the traditional consumption and sales of new products, rather than next to or in addition to existing markets.

Business models based on used goods and recycling are growing up to 20 times faster than traditional business models. There are also plans for Finland the first shopping center based on a circular economy, for which a model similar to the Swedish one is being sought.

In addition, as many as 40 percent of consumers think when shopping for fashion whether the product can sometimes be resold.

These trends should be taken into account by companies trading in products or services for consumers if they want to be competitive in the future.

That’s what he says Susanna Takkunen, head of Accenture ‘s consumer goods technology business unit and recent PhD. In September, Takkunen defended his dissertation on the digitalisation of companies manufacturing consumer products and its impact on the consumer market in Aalto University’s DBA degree program.

“In the future, companies need to think about how durable a product is and how long its life cycle is, as it may be bought and sold several times along the way,” says Takkunen.

“Sustainable development requires open cooperation and information sharing with other players.”

Digitization is part of the trend towards more sustainable consumption. For example, it would be impossible to find out and clearly present a product’s journey from its starting point to the consumer’s hands without digital technologies, Takkunen says.

“Finding out about a product’s journey requires an ecosystem where information sharing is open.”

Transparency is a major change in companies’ traditional corporate culture based on secrets and patents.

“Sustainable development requires open cooperation and information sharing with other players. For information to be available, technology must be firmly at the heart of the company’s operations. ”

Examples of more open thinking can already be found. For example, the giant Unilever plans to share design and material information about the recyclable toothpaste tubes it has developed.

Susanna Takkunen, Head of Accenture’s Consumer Goods Business Unit.

Information sharing In addition, according to Takkunen, success in digitalisation also requires a different kind of rethinking. He calls this in his dissertation “breaking out of the identity trap”.

Traditionally, companies have built business models in a retail-centric way, as the stone-foot trade has been the place where products are sold.

Digitization changes the situation. E-commerce is changing the relationship between business and consumer, and therefore, instead of “one-size-fits-all” thinking, the individual needs of the consumer come to the fore.

Takkunen In his dissertation, he studied in depth eight companies, six of which were Finnish, one American and one French. The size of the companies ranged from small companies to international companies with a market value of many billions of euros. Companies are not named in the dissertation.

Companies that had succeeded in dismantling the retail focus and changing their direction to consumer-oriented also had a deep understanding of the importance of the digital revolution for their business and were able to take advantage of it, Takkunen argues.

“What was typical of these companies was that the change was driven by top management and the understanding of consumer focus passed through all levels of the organization,” says Takkunen.

In his dissertation, Takkunen did not comment on whether digital understanding was essential or profitable for the company. A few companies had come to the conclusion that digitalisation was not essential for them.

“Right now, it seems that traditional grocery companies are growing more slowly than smaller gamblers who have built their business models to suit the needs of the consumer.”

“The consumer himself feels that consumption alone is not the most important thing.”

Consumption and there is an obvious contradiction between sustainability. Overconsumption threatens the carrying capacity of the planet and the well-being of humans and animals.

The controversy comes to the fore especially this week as many companies offer their products at a discount in the wake of the U.S. Black Friday discount day.

According to Takkunen, the meaning of Black Friday is changing. In Finland, too, many brands either oppose the expiration date or give it new meanings.

“Companies may point out that prices have not changed or they emphasize that it is worth buying a quality product that lasts for 20 years,” says Takkunen.

Shopping due to shopping is declining, Takkunen says. The pandemic in particular made people more cautious. Impulse purchases have declined. According to Takkunen, the Americans do spend money, but they want to spend it on necessities, experiences and domestic tourism.

Supply chain problems and component shortages also lead to planning and preparedness.

“The grocery store shows that people plan their eating more carefully and further away,” says Takkunen.

“Before a new garment was bought, now a used garment is bought. The basic need remains the same. ”

People the willingness to participate in black friday is declining year by year, takkunen says.

According to Takkunen, last year only 22 percent of respondents to a U.S. survey said they were spending money on the day of the spike. It was 62 percent less than a year earlier.

In contrast, retailers believed that 42 percent of people spend more money than usual during Black Friday.

“The consumer himself feels that the consumption itself is not the most important thing, but the money is spent on something else that is better for society, the climate and humanity,” says Takkunen.

Although the coronary pandemic put the world economy at a standstill, consumption this autumn has been at an unprecedented level globally.

According to Takkunen, the peak in autumn consumption was the eruption of a dam during the pandemic. The curve is already leveling off.

Consumption continues, but it unfolds in new directions. Success in this market depends on how well a company is able to change its own operations and take over new channels and raw materials.

“Trends do not mean that the consumer will necessarily stop buying everything, but his needs will shift to different things,” says Takkunen.

“Before a new garment was bought, now a used garment is bought. The basic need remains the same. ”

#Consumption #major #trends #affecting #consumer #markets #companies #break #identities #catch

Next Post

Leave a Reply

Your email address will not be published. Required fields are marked *