Companies focus on engaging with customers and building trust in 2015
TORONTO, June 24, 2015 /CNW/ - After battling an eight-year global recession, the message coming from the consumer industry is that it is now time to focus on driving revenue growth. While expansion or top line growth is consistently a top three concern for consumer executives, according to a recent survey, it is now the number one priority. Findings from KPMG and The Consumer Goods Forum's 2015 Global Consumer Executive Top of Mind Survey reveal that expansion and driving revenue growth are more important than ever for the industry.
According to the survey, approximately 42 per cent of global executives consider expansion and growth to be their number one priority. In Canada, the numbers are even stronger, with 58 per cent indicating it is their main area of focus. While more than half of all respondents globally reported moderate growth of 3-10 per cent in 2014, an impressive 92 per cent reported the same level of growth in Canada. Executives recognize that top line growth is a challenge in a slower environment, but agree that sales growth is the key lever to improving their business profitability and it remains an area for increased investment.
Beyond growth, only winning consumer trust and an omni – channel customer focus (letting customers shop on their own terms) rate as top priorities. This suggests that the industry sees customer engagement as the pathway to growth.
The survey results provide insight into six levers that will exert the most influence on a company's ability to grow revenue.
Consumer Trust – Creating consumer trust emerged as the top priority following growth (13 per cent; Canada 17 per cent). Ninety-two per cent of Canadian respondents cited it as the top area for increased investment over the next one to two years versus 30 per cent globally. And, all Canadian respondents agree that building trust is one of its company's core values. Canadian executives recognize that growth cannot be achieved without credibility and the trust of its customers.
Omni-channel – Omni-channel is one of the top issues of importance (12 per cent; Canada 17 per cent), particularly for retailers. It is both a key area targeted for investment and a top challenge. To achieve growth, companies will need to provide a seamless experience for consumers and allow for the integration of emerging technologies such as smart watches or new payment methods.
Data security – Interestingly, data security was not identified as a top challenge for companies nor a target for increased investment; with over half of respondents believing their companies have "sufficient skills and technology to manage cyber security." The relatively low rating for data privacy and security as an area of importance and a threat exposes a potential blind spot for companies.
Corporate responsibility – While social and environmental responsibility is near the bottom of the list of issues overall for respondents, consumer trust is near the top. Many companies realize that successful corporate responsibility efforts can be an enabler of growth, by helping to build consumer trust. There is a growing awareness by companies that sustainable practices are both good for the community, and for the bottom line.
Consumer knowledge – The possibilities of data analytics have not yet been fully absorbed and integrated by most companies and traditional market research has not yet caught up with sampling in an age of digital devices, or with findings of behavioural economics. Overall, it appears that most consumer companies have a way to go in terms of truly understanding their customers.
Supply chain – Supply chain is important to many respondents but not of primary importance. However, many respondents named it as an area for increased investment and one in three plan to transform their supply chain and operations. This signals that businesses understand that if revenue growth occurs, the supply chain will be a key enabler and must remain efficient to allow the bottom line to grow with the top line.
"Consumer companies must recognize that in the race for top line growth, even the slightest hesitation will leave them falling behind. The winners that will achieve significant growth will be those who truly understand their customers' behaviours and how to best influence them."
- Willy Kruh, Global Chairman, Consumer Markets, KPMG
"In today's digital age, a company's reputation and trust can evaporate in a tweet and disrupt what a company has worked hard to establish. The consumer industry in Canada understands that without credibility and the trust of its customers, you will not be able to grow. Trust alone cannot sell a bad product; but a lack of trust can thwart the sale of a good one."
- Willy Kruh, Global Chairman, Consumer Markets, KPMG
About KPMG and The Consumer Goods Forum's 2015 Global Consumer Executive Top of Mind Survey
The survey was conducted online during March and April of 2015. A total of 539 executives from companies headquartered in 41 countries participated in the survey.
Three-quarters of the respondents are C-suite or above, one-third of which are CEOs or Board Directors. The companies they represent are primarily manufacturers (48 per cent), retailers (32 per cent) or distributors (20 per cent) in the food, drink and consumer goods sectors. Nearly 90 per cent have annual revenues over US$500 million, and 34 per cent have revenues exceeding US$5 billion.
KPMG LLP, an Audit, Tax and Advisory firm (kpmg.ca) and a Canadian limited liability partnership established under the laws of Ontario, is the Canadian member firm of KPMG International Cooperative ("KPMG International"). KPMG member firms around the world have 162,000 professionals, in 155 countries.
The independent member firms of the KPMG network are affiliated with KPMG International, a Swiss entity. Each KPMG firm is a legally distinct and separate entity, and describes itself as such.
SOURCE KPMG LLP
For further information: Julie Bellissimo, KPMG in Canada, 416.777.3988, [email protected]