Tap changing consumer behavior to grow

Businesses that capitalize on consumer behavior change are better positioned to outperform economic growth

Global businesses that capitalize on major changes in consumer behavior can generate significant growth over the next few years, says a new report from Accenture.

The report concludes that companies able to capitalize on these changes with speed and agility could capture a portion of the trillions of dollars in growth that businesses globally are likely to see over the next few years as the result of changing consumer behaviors. Accenture estimates that just 20 sectors most associated with these changes are set to enjoy growth of $2.4 trillion by 2016.

Many companies expect to outgrow their national economic environments over the next few years, said Mark Spelman, a managing director at Accenture. To be able to achieve their expectations, companies should look not just to new markets, but also to how consumer behavior is changing and then put in place the capabilities necessary to capitalize on those changes.

Among the key changes in consumer behavior the report identified:

Consumers are increasingly connectedoften online, interacting with companies and other consumers to research and purchase products, share advice, and praise or criticize a business. Nearly three-quarters (73%) of the consumers surveyed said they use the Internet to research or purchase products or services more than they did three years ago. Consumers are also increasingly using social media as a tool in the purchasing process.

Consumers are increasingly demandingseeking products and services customized to meet their specific needs. Approximately two-thirds of consumers surveyed said that it is important to be able to buy what they want when they want it (68%) and to be able to customize the product or service to be exactly what they want (63%).

Consumers are increasingly conscientiousseeking sustainable goods and services, they are focused on where and how their products are made and on doing business with companies that make a positive social and/or environmental impact. Half (51%) of consumers surveyed said they consider the environmental impact of the product or manufacturer before purchasing a product more often than they did three years ago.

Accenture also found that while nearly three-quarters (73%) of business executives said that consumer behavior has changed markedly in the last three years, a similar proportion (74%) said they do not fully understand the consumer changes that are under wayand even more (80%) said they believe that their companies are not taking full advantage of the opportunities these changes present. Making recommendations on how companies can achieve growth and outperform competitors by effectively addressing changing consumer behavior, taking their lead from growth leaders in their industries, the report urged businesses to:

Invest in advanced analytics toolsand the relevant workforce skillsto assess these changes and interpret consumer data. Armed with such data, companies will be better equipped to enhance the consumer experience with more-tailored customer service. For instance, the analytics program of a leading media-rental company enables it to recommend movie and TV titles based on an individual consumers preferences and rental history.

Have the strategic mindset to recognize and adapt to disruptive consumer change and competitive threats. A global car-rental company replicated the business model of new players offering hourly rentals. By meeting disruption head-on, the company has been able to use its scale and scope to reduce the threat of new competition while improving customer service.

Put in place flexible organizational models that enable the company to be more agile and act quickly. This might entail acquisitions, divestments or partnerships to complement existing capabilities. For instance, a US-based grocer understood at an early stage consumers growing emphasis on healthy living and carried out numerous mergers and acquisitions to become a global leader in natural foods.

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