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Next in consumer markets 2024
Tech-powered business models for a new era of growth
After combating the ever-widening ripple effect of pandemic-related volatility over the past few years, consumer-facing companies are poised to tackle growth in 2024. Consumer demand is continuing its upward trajectory while supply chains are regaining equilibrium.
Consumer markets (CM) companies remain focused on diversified portfolios via transformative acquisitions while balancing the right capabilities for both near-term and foundational improvements.
Despite the persistence of swirling external forces, CM leaders are optimistic about taking control of the year ahead, animated by the prospect of business model reinvention fueled by artificial intelligence (AI) and generative AI (GenAI).
Taking their cue from consumers who are embracing emerging technology for speed and convenience, they are prioritizing digital transformation to build trust, nurture loyalty, boost innovation and ignite growth.
Pivotal trends in 2024 will fall into these categories:
- Power business model reinvention with digital strategy
- Sustain growth with cost transformation
- Bolster customer loyalty with tech-enabled experiences
- Fortify core capabilities with a balanced deals portfolio
- Build stakeholder trust with robust business-risk and tax planning
- Upskill talent for the digital age
Power business model reinvention with digital strategy
As emerging tech efficiencies continue to drive productivity and pique consumer interest, almost 60% of CM leaders will invest in emerging technologies as a strategic priority during the course of 2024. A sizeable majority (73%) expects to use GenAI to support new business models.
In response to consumer interest for the most convenient combination of physical and digital options, digital innovation centers can help fast-track new products, experiences and services while digitized supply chains can deliver them.
To meet the ever-more-demanding expectations of tech-savvy consumers — many of whom already use emerging tech options to research, compare and buy products and services — companies are updating legacy systems with the right combination of tech investment and people power.
Are you ready for business model reinvention?
Transformation leader:
Work closely with your CMO, Chief Customer Officer and CEO to build a customer-centric model focused on sustainable outcomes. Elevate and connect your two most crucial stakeholders: customers and employees.
COO/Chief Supply Chain Officer:
Digitize your supply chains to offer the omnichannel options that consumers seek, the robust combination of physical and digital channels for each shopping trip — from initial research to final purchase.
Sustain growth with cost transformation
Prepare for business model reinvention by reevaluating core capabilities. To manage end-to-end costs more strategically, take the long view. Promote radical clarity that can lead to innovative simplification, digital value creation and external business alliances for non-core functions.
Boosting supply chain resilience can help manage costs, as can shedding underperforming assets to free up capital for reinvestment in high-growth segments. Meanwhile, digital transformation can deliver both near-term operating efficiencies and long-term top-line growth.
Making the difficult cost-transformation decisions sooner rather than later can help you reach your most valuable customers with the products those customers want — in the channels they prefer. The outcome? Improved margins from both higher revenues and lower costs.
Bolster customer loyalty with tech-enabled experiences
Across the customer life cycle, emerging tech has sparked new opportunities to personalize and enhance customer experiences. Some of these experiences occur at external touchpoints such as search engines and marketplaces. Regardless, they all serve to build your brand.
Ultimately, consumers define a brand by the entirety of the experience it provides, both physical and digital. And they have proven time and again that brand loyalty influences purchasing decisions.
Even more noteworthy, consumers more likely to use emerging tech are more loyal than most. And many who don’t already use emerging tech told us they’re open to finding out more. Take advantage of the possibilities offered by AI and GenAI to connect with consumers at a personal level, further solidifying their loyalty.
Turbocharge customer experience
CMO:
Deploy advanced technologies to deliver the immersive experiences and personalized convenience that differentiate your brand while forging deeper connections with customers; AI and GenAI offer a wealth of possibilities.
CIO:
To drive business growth, define for leadership teams the outcomes that tech can deliver — such as enhanced customer experiences that ultimately cement long-term customer loyalty. Then, implement the technologies that achieve those outcomes.
Fortify core capabilities with a balanced deals portfolio
Despite higher interest rates underlying an uneven deals market, CM companies remain committed to deals that add value and support growth. Seek out capabilities that fill portfolio gaps with strategic acquisitions in innovation and technology.
Access to technology continues to play an important transactional objective, with many acquirers viewing their target’s technology capabilities as an opportunity to accelerate their own digital transformation.
Continue assessing products (within your own portfolio) — or participation in certain categories — that don’t support your core capabilities. These slow-growing offerings that aren’t a natural fit are ripe for divestiture, which can allow you to focus on a leaner, more cohesive growth portfolio.
Build stakeholder trust with robust business-risk and tax planning
Prepare to address new dimensions in risk-related reporting and tax planning in 2024. The SEC’s cyber disclosure rule includes a specific requirement for timely disclosure of a cyber incident after its discovery and determination of material impact.
The SEC’s climate disclosure rules call for dramatic change in the nature and extent of disclosures US companies are required to make about the impact of climate change. The gathering and reporting of these incremental disclosures may also require significant changes to a registrant’s systems, processes and controls. Meanwhile, new standards require companies to be more transparent about how they will use AI and GenAI.
Separately, an unparalleled shift in how companies are taxed on international operations — which took effect Jan 1 — could impact larger multinationals. Navigate tax strategy and compliance requirements with a tech-enabled data-first approach to shore up stakeholder trust.
Go beyond compliance to deliver growth
Tax executive:
As the C-suite recognizes how early strategic planning with tax can support growth initiatives, tax is becoming a driver for sustainable enterprise growth — from evaluating new business ventures to restructuring supply chains to targeting digital transformation.
CISO:
Surmount cyber-risk challenges by joining forces with C-suite peers to embed tech-enabled cyber-resilience efforts enterprisewide. Doing so helps your company stay ahead of new regulatory requirements while also strengthening defenses against major risks.
Upskill talent for the digital age
A skilled, motivated workforce is essential for business model reinvention to succeed. Almost 85% of CM leaders told us internal challenges such as upskilling workers could impede their efforts if not properly addressed.
To address the challenge, almost 40% of CM leaders have already started upskilling their employees while 30% have a plan in place to do so. CM leaders recognize that differentiated customer experiences start with superior employee experiences that motivate talent.
An AI component is essential to upskilling: Nurture your workers’ interest in AI by empowering them to add value to the business while participating in planning and implementation. Support their career progression with upskilling initiatives to meet evolving market conditions.
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