Marketers will have to be more creative, shoppers will shop even more locally, empty shelves are here to stay and the impact of AI is also increasing in FMCG. These are the trends of 2024 according to Consumer Panel Services GfK’s Davy Van Raemdonck.
Making choices
“Last year I predicted that 2023 would be the year of making choices. In a number of areas, that has indeed proved to be the case. Among other things, we saw that shoppers made clear choices, be it forced by an inflationary context or not. Those choices led to continued pressure on volumes in the Belgian FMCG market. In addition to the pressure on volumes, there was also downtrading: shoppers looked for cheaper alternatives, leading the market share of private brands to continue to grow.
With the sector’s strong emphasis on price and promotion, this trend will undoubtedly continue in 2024. For this reason, marketers will have to take a different and more creative course in 2024, in my view. If they want to reclaim the upper hand for the A-brands, they will have to evolve away from price and promotional actions, and bet on innovation and creative communication.”
Responding to existing trends
“A number of trends will remain important and will continue to evolve: think of the importance of local products. The energy crisis and the war in Ukraine have clearly exposed Europe’s dependency. Also, the recent war in Gaza may again cause scarcity of some raw materials or higher logistical costs.
Shoppers are becoming more and more aware of this and this will cause them to take the local aspect in their buying behaviour into account even more. The broader theme of sustainability will also play an even more important role in 2024. Year after year, the group that is consciously dealing with this and putting its money where its mouth is will grow. Marketers will have to use these developments even more than before to get their message to consumers.
Empty shelves and franchising
“Despite the pressure on volumes, even today we still see a deliberate choice for empty shelves, due to the recurring conflict situations between retailers and manufacturers around price negotiations. Besides the short-term impact of this choice, the strategic long-term choice in terms of the business model within retail has been one of the themes over the past year. Indeed, the clear choice to further develop the franchise model has not gone unnoticed.”
AI impact
“When we talk about the near future, Artificial Intelligence has so far remained (too much) under the radar – specifically its implementation and integration. As far as I can estimate, adoption of AI’s capabilities within FMCG has remained very limited. However, I expect many more companies to start experimenting with it this year, and they will discover the opportunities it offers. This will have an effect on many fronts, such as marketing, sales, logistics, product development or HR.
However, what will undoubtedly remain at least as high on the agenda is the ethical discussion about how deep AI can and should start to find its way into the business world. The recent events around OpenAI have once again underlined this. So I am very curious to see what this will mean for this new year.”
