The consumer sector continues to be a dynamic and rapidly changing area both for businesses and their customers.
The consumer sector continues to be a dynamic and rapidly changing area both for businesses and their customers. Businesses are intensely focused today on identifying and responding to the evolving needs, demands and preferences of customers in the digital age. This includes exploring and developing new ways to connect and interact with consumers, as well as deciding where to invest on innovation that will drive future success in retaining current customers and attracting new ones as the competition grows.
A huge amount of convergence is currently taking place across the consumer markets sector and this trend is expected to continue. The major global players are certainly examining their product portfolios and considering how to expand their offerings beyond pure consumer products. For example, significant convergence is ongoing as consumer businesses are thinking more holistically and looking to extend their offerings and services into new areas such as nutrition, well-being and so on.
From a technology perspective, consumer businesses will remain sharply focused on digital technology to differentiate themselves in the evolving marketplace, whether that means using today’s digital technology, tools and channels to better communicate with customers, to improve overall service and satisfaction and to enhance distribution methods.
For major players operating large global brands, the key challenges will include how best to thoroughly identify, respond to and satisfy the needs of local consumers. M&A strategies can help global businesses fill gaps at the local level through the acquisition of smaller, fast-growing local brands and businesses.
Some market observers are predicting ‘an avalanche’ of M&A activity in the consumer markets sector. There is no doubt that among many consumer businesses, M&A activity today is almost replacing the need for an innovation or R&D department and the complex, costly process of establishing a new brand in a new market. M&A to acquire brands and businesses at the local level is viewed as a faster, more-efficient approach to evolving and growing the business and we can expect more organizations to pursue this strategy amid changing markets.