Social means more vocal according to PWC
Professional Services firm, PricewaterhouseCoopers (PwC) notes that consumers everywhere are becoming more digitally empowered and, as a result of social platforms, they are also becoming more vocal.
PwC conducted interviews with 1,258 people in 60 countries during the last quarter of 2011. It found that in both the developed and emerging markets, consumers are more digitally savvy. As a result, consumers have more information and more choices than ever before thanks to the Internet and a proliferating array of personal devices.
“They’re also more vocal – and what they say carries more weight; sales can surge or slump in response to a campaign on Facebook or Twitter,” PwC said.
Research recently carried out by PwC also showed that the way people shop is changing. More than half of all Internet shoppers expect to spend more online in the future. “Their loyalties are also shifting; strong brands are becoming more important than the locations where the goods are for sale,” PwC found.
“CEOs know they have got to stay abreast of changing customer expectations by enhancing their digital commerce offerings, integrating the channels they use and investing in powerful analytics programmes to understand their consumers better. Only by doing that can they fend off the competition”, said John Wilkinson, PwC Retail & Consumer Leader in South Africa.
Wilkinson said that globalisation and digitisation are creating new opportunities, but they’re also creating new risks – risks that can turn from local problems into macro-disruptions.
He cited the sovereign debt crisis in the Eurozone as one such example. It’s played a large part in depressing customer demand in the developed economies, as CEOs in the sector are acutely aware: 40% of retail CEOs, and 50% of consumer goods CEOs, say it’s directly affected their companies.
PwC found that most CEOs are making their businesses more efficient as a form of response, with 77% of retail CEOs and 76% of consumer goods CEOs already implementing a cost-cutting initiative in the past year – and nearly as many plan to do so again in the next 12 months.
But they’re not just cutting costs, added PwC; this desire for more efficiency extends to the innovation process as well, the financial services group said.
Its research found that three-quarters of consumer goods CEOs intend to change their R&D and innovation facilities, and a quarter of them have ‘major’ alterations in mind. More than two-thirds are focusing on developing new products and services, as distinct from new business models. Retail CEOs are less interested in changing their companies’ R&D.
“Because of increased competition, it is important for companies to differentiate themselves by way of innovation, not just through products, but also by providing better customer service.” Wilkinson pointed to US multi-national technology company, Apple, as a good example of how it’s not just about selling, but about providing a ‘novel shopping experience’ for consumers.
Entering a new market by acquiring a local competitor provides immediate access to local facilities and distribution networks. It’s a strategy favoured by the world’s leading retailers. Wilkinson says this has been demonstrated in South Africa by Walmart’s R16.5 billion acquisition of a 51% stake in Massmart.
“The Walmart transaction has definitely helped to create a significant amount of interest in the Africa continent as an emerging market for retail and consumer companies, and it is inevitable that other foreign retailers will follow,” Wilkinson concluded.
Related articles
How SA mobile firms compare on social networks
Loading ...