Five trends sweeping through the consumer sector

Digitalisation and rapidly changing customer expectations are transforming the consumer goods sector. If firms are to survive the persistently turbulent retail environment, they must tailor their outfits to the quickly shifting demands of their consumer base.

New research by CIL Management Consultants has identified five major trends that are reshaping the face of the consumer sector. According to a survey of over 35,000 consumers in a variety of sectors, the trends are: increasingly transient brand loyalty, the value consumers place on convenience, the ever-growing importance of peer reviews, older adults becoming more tech-savvy, and the growing appetite to align purchasing decisions with brands that support their core values.

Liam McGuinness, Head of Consumer, Retail and Leisure at CIL Management Consultants, commented, “Our research shows that it is the consumer that is in the driving seat when it comes to the evolution of brands and products. They are much more liberated, confident and empowered.  They are prepared to make the most of the choice available to them. This makes it challenging for businesses, but those which are listening and responding to consumers and are prepared to invest and evolve their proposition will succeed. Those that stand still will not.”

Transient brand loyalty

Top companies holding onto customers through brand loyalty alone are facing an uphill challenge. Digital disruption has resulted in changes to consumer behaviour, which is forcing a range of marketing strategists to reconsider their old, possibly out-dated strategies. Modern customers wield an increasingly impressive array of digital tools and online databases, and are now able to quickly and conveniently compare prices, check availability and read product reviews. To that end, some 57% of holidaymakers always compare operators, according to CIL.

Further illustrating how today’s consumers are much more adventurous and willing to break away from the big brands to experience something new and more authentic, the research revealed that 83% of delivery aggregator users such as Deliveroo and Uber Eats engage with such services because of the range of options available to them. At the same time, a third of spirits drinkers are actively seeking new brands – as reflected by the gin distillery boom currently seen in the UK.

Convenience is king

On the other hand, some things never change. According to CIL, convenience remains a key factor in consumer purchasing behaviours, particularly when it comes to impulse and repeat purchases, often trumping price. For example, the research found that when picking up a quick lunch time snack, six out of ten consumers plump for the most convenient option at the time, while 94% of gym goers feel location is the most important factor when choosing their facility. As a result, finding the right spot can be the critical factor in determining success for retail, hospitality and leisure success.

So important is convenience to the experience of consumers, CIL even found that when it comes to impulse and repeat buys, speed and convenience even trump price. Twenty-eight percent labelled it as a key factor above all others.

Endorsements driving purchase

Another key trend in the consumer sector is the fact that peer and expert recommendations are having an increasingly large impact on trial and purchase. Relating partially to the trend of transient brand loyalty, the readily accessible user generated reviews many products have online can make or break them, while expert opinions hold even more sway, as they are easier to access than in the print age. Illustrating this, CIL pointed to online review platforms such as TripAdvisor, which have become so influential in recent years.

At the same time, this challenge has also opened the door to a major opportunity for many brands. By getting the backing of social media personalities, brands can pay for their own faux-user-generated endorsements, via platforms like Instagram. Brand advocates on social media are being used to build awareness. At the same time, traditional analogue approaches are also proving vital, with recommendations at point-of-purchase proving important. For example, 52% of drinkers seek recommendations from bar staff, making knowledgeable, trained and customer-friendly employees a key part of the drinking and selling experience.

Narrowing tech gen gap

Initially the internet was thought of as a young person’s game – but having now been in use for decades, many people who were middle-aged in its early years are now approaching retirement age. Forty-one percent of over-75s subsequently have a social media profile, and this is only going to rise. As a result, a fully inclusive online presence is essential for future success. CIL’s research shows that 62% of the over-65s now book their holidays online, demonstrating the huge potential of such a strategy.

This is also linked to the on-going retail battle with the move away from in-store spend, but not necessarily the death of the high street. Instead, a repurposing is taking place. According to CIL, the most successful are using their store estate in new ways rather than as simply space to sell products.  Like-for-like brick-and-mortar-sales are perhaps less important; instead, stores are recognised as a valuable resource for fulfilment, or as a way of building brand recognition and improving engagement with the consumer.

Tribal alignment

To an extent, consumers do still feel the need to express a connection to favoured brands, and are happy to express a preference for companies, groups or values. For example, 57% of consumers would buy own-branded clothing from their fitness provider. However, this is a far cry from the blinkered brand worship of the 1990s, as seen with lovers of Nike, for example.

Instead, consumers are more likely to tie the colours of a brand to their mast if it helps them display a certain commitment or purpose – something that the once infamous sweatshop-produced goods of Nike would struggle to compete with in the modern day (though the the firm's Kaepernick ad strategy has been a profitable bid for 'purpose'). Consumers are clearly making a conscious choice about displaying brand association, and this conscious consumer also affects other areas. Whether it’s healthy snacks, mindfulness apps or activity-based holidays and trips, CIL’s report suggests customers are more careful than ever about this factor.