Consumer convenience in the FMCG industry
The lives of consumers are becoming more and more complex as a result of factors such as challenging work hours and faster passed lifestyles. Because of this, consumers are continuously looking for convenient solutions which will help them to make their hectic lives more simple. When it comes to FMCG, convenience is about more than just products, packaging and store formats, it is about every action that can help achieve efficiency for consumers. A report by Nielsen looks at how the needs of consumers globally are changing, focusing specifically on the factors which are driving the need for convenience in consumers.
Consumers globally are leading very busy lives and often work life balance is mentioned as one of their most pressing concerns. As a result, these consumers are demanding products and processes which will help them to overcome the everyday hurdles. Automated, easy to use, digitised options for most items is today’s requirement. This growing demand for convenience poses a range of opportunities for both manufacturers and retailers. In order for companies to continue being successful, they need to adapt and improve as consumer needs continue to evolve.
Nielsen (2018) states that there are a number of different factors which are influencing the global demand for convenience. By understanding these factors, FMCG companies can create better strategies in order to satisfy consumer demand. Neilson (2018) states that the six key drivers for convenience solutions are rapid urbanisation, smaller households, crowded transport, evolving gender roles, generational needs and uptake of technology.
Rapid Urbanisation – Consumers globally are moving to urban areas looking for better infrastructure and services and better employment opportunities. By 2025 58% of the global population will live in towns or cities. Most consumers already here, and the changing structure of urban living environments results in a faster paced life with more demands on the time of the consumer. Customers will have to look for new ways to streamline their lives, in order to better deal with urban lifestyle changes. Consumers want more efficiency and where they can will use advanced technology to help them make a decision.
Shrinking Households – Many consumers are downsizing their living areas as a result of high property prices, increasing population density and limited space for new housing. The average household size globally, ranged from 2 to 9 people and continues to decline as fertility rates continue to fall. A shift in consumer behaviour is occurring as a result of these trends. Now FMCG companies will need to put more emphasis on multi-usage products, space-saving packaging, single serve offerings and family sized meal options.
Crowded Transport- There are major barriers to the development of the transportation infrastructure in urban areas, such as high investment costs and limited land. This transport infrastructure is needed for their fast-growing populations. In the majority of cities consumers are spending more time commuting on public transport, globally consumers are spending on average 2 hours commuting every day. With more time being spent on commuting, consumers have less time at home to cook and clean and sometimes meals are consumed on the go. Consumer choices are changing to match their busy lives which creates opportunities for companies to consider more on the go meals, multi-tasking home products and commuter shopping opportunities.
Evolving Gender Roles – Almost 54% of working aged women take part in the labour force. This trend is taking place globally and across every socioeconomic group. As a result, the traditional role of women taking care of cooking, shopping etc has shifted to a shared role between couples. Companies as a result, need to comprehend how shopper roles are changing and create and implement new marketing strategies to suit consumer demand across all genders.
Generational Needs – There are regions such as the Middle East and Sub Saharan Africa where younger generations will stay the dominant age segment. For example, in 2025, 51% of the Sub-Saharan African population will be made up of consumers aged 19 or under. People are also living much longer now than they ever have and the proportion of consumers globally over the age of 50 is rising, particularly in more developed countries. In both Europe and North America, by 2025 approximately 40% of the population will be over the age of 50. The change in age demographics is also a driver of change in consumer behaviour. Spending ability and technology adoption varies significantly between generations, as do their convenience needs. For example, in markets where millennials are the dominant age segment, consumers will look for ready to eat meals, automated offerings and space saving packaging. However, in the markets with aging populations offerings like home delivery or easy to open packaging may be more popular. A deep understanding of a markets’ changing demographics is vital for FMCG companies to tailor their products to the needs of the different age segments.
Uptake of Technology – Both the scope and scale of technology have increased dramatically, driving a transformation in how consumers use digitisation in their lives. By 2020 global internet access will reach 52%, while the rise of smart homes and buildings and increasing smartphone penetration will increase consumer connectivity to services. Consumer’s will have more control to personalise, customise and get products wherever and whenever they need them. This means that both manufacturers and retailers will need to match these on the spot needs, using individual data to create solutions for their customers and in turn establish deeper relationships.
 Neilsen (2018) A Quest for Convenience