changing consumer behaviours in a post covid-19 world · customer experience. experience is...
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Document Classification: KPMG Confidential
© 2020 KPMG, a Hong Kong partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Hong Kong, China.
Changing Consumer Behaviours in a PostCovid-19 WorldTRConnect BriefingAnson BaileyHead of Consumer & Retail, ASPACKPMG China
5 May 2020
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Document Classification: KPMG Confidential
© 2020 KPMG, a Hong Kong partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Hong Kong, China.
The New Normal……Different Speeds
Berkshire Hathaway
disposes of USD50bn
airline stocks
Airlines +Airports
driving newtech +innovation -focus on Customer
AI / Data / 5G
85MDomestic tourist
trips in China..first 3 days of Golden week!(from May 1)
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Document Classification: KPMG Confidential
© 2020 KPMG, a Hong Kong partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Hong Kong, China.
Key Trends – from NRF 2020
People-CentricEmpowerment & Diversity
TrustBusiness reputation & purpose, sustainability
Customer ExperienceExperience is everything
Platforms & New business models
Commerce everywhere / anytime
Intelligent & Responsive Supply
Chain Available wherever,
whenever, however the customer wants.
Cooperation & Collaboration
Even competitors complement one another
Use and Not Just Retain Data
Responsibly & Ethically
Technological IntensityRetail needs to be “Tech”
to serve the “new customer”
Future of Retail
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Document Classification: KPMG Confidential
© 2020 KPMG, a Hong Kong partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Hong Kong, China.
Global case studiesThe 6 drivers of consumption will continue to shape consumer purchase decisions
—Value will remain an important driver in these times of economic uncertainty.
—Lack of an online proposition could be a hindrance.
Value
—Convenience will be a real winner for both online and in proximity shopping.
Convenience
—Experience will continue to be important but the nature of experience will need to evolve.
Experience
—A reduction of choice would reduce supply chain complexity and working capital exposurewhilst also addressing certain sustainability criteria.
Choice
—Ensuring the purpose of an organisation is in line with customers values and expectations will remain a pivotal factor.
Purpose
—Keeping consumers safe, both online and in physical stores will factor highly on shoppers agendas.
Privacy & Safety
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Document Classification: KPMG Confidential
© 2020 KPMG, a Hong Kong partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Hong Kong, China.
Current state of the marketThe pandemic is impacting the retail landscape in different ways
Pricing of consumer goods in Asia are holding steady
Increased demand for home and personal hygiene products – likely to sustain
Key retail trends in Asia
Increased demand for food products with longer shelf life
Accelerated the move towards a cashless society through contactless mobile payments
Demand for delivery has significantly increased; food delivery affected by hygiene concerns
Shift in consumer buying behavior as they may move more of their shopping to the ecommerce channel
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Document Classification: KPMG Confidential
© 2020 KPMG, a Hong Kong partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Hong Kong, China.
Cash flow managementSegments affected: Non-food retailers, F&B Restaurants
Last mile deliverySegments affected: Online retailers, Online marketplace
Business continuitySegments affected: Non-food retailers, F&B Restaurants
Changing consumer behaviorSegments affected: All retailers
Supply chain issuesSegments affected: All retail segments
Health, safety, wellness +hygiene standardsSegments affected: All retail segments
Current state of the marketIn the wake of the current situation, retail businesses are faced with several challenges
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Document Classification: KPMG Confidential
© 2020 KPMG, a Hong Kong partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Hong Kong, China.
Pleasing customers during a pandemic
Think ‘safe retailing’
Get closer to customers
Close that last mile
Improve digital channels
Deliver on your values
Source: Rene Vader, Global Head of Consumer & Retail https://www.linkedin.com/pulse/pleasing-customers-during-pandemic-rene-vader/?trackingId=lLPLA2VsTWCbAokhuj4c3g%3D%3D
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Document Classification: KPMG Confidential
© 2020 KPMG, a Hong Kong partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Hong Kong, China.
Chinese Consumers slowly returning……but it is a “new normal”
Ended lockdown but not travelling abroad
China GDP Q1* 6.8%
China Wholesale and Retail Q1*
17.8%
CNY Red Packetsyet to spend
SOCIAL RETAILING
LIVE STREAMING
*Source: National Bureau of Statistics of China
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Document Classification: KPMG Confidential
© 2020 KPMG, a Hong Kong partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Hong Kong, China.
Future Destinations in 2020
ChinaThe United States, which had been top of the list, has dropped out of the top ten entirely, following the outbreak!
1st
2nd
3rd
Thailand
Russia
Japan
US
International locations - Thailand was the destination Chinese travelers wanted to visit the most in 2020, followed by Russia and Japan
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Document Classification: KPMG Confidential
© 2020 KPMG, a Hong Kong partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Hong Kong, China.
Consumers are more
tech-savvythan before
Data analytics
is powering growth
Generation Z is driving change
Brands are striving towardstransparency
Smart cities are taking
shape
Digital Retail on the Rise
Source: KPMG Publication, Digital Retail on the Rise, 2019
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Document Classification: KPMG Confidential
© 2020 KPMG, a Hong Kong partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Hong Kong, China.
Cognitive expertadvisors
Quantum computing
Smart dust
Machine learning
Digital twin
Virtual assistants
Conversational user interfaces
Smart robots
Drones
Autonomous vehicles
Artificial General Intelligence
Augmented Data Discovery
Neuromorphic hardware
Blockchain
IoT platform
Software defined security
Edge computing
5G
Smartcity
Serverless PaaS
Augmented reality
Human augmentation
Volumetric displays
4D printing
Connected home
Nanotubeelectronics
Virtual reality
Brain Computer Interface
Cognitive computing
3D printing
Artificial intelligence
Impact
Transformational
High
Moderate
Digital platforms
Immersive experience
Emerging
Technology
Radar
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Document Classification: KPMG Confidential
© 2020 KPMG, a Hong Kong partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Hong Kong, China.
How can you compete in a
“Mobile First”
World?
765mMobile payment
Users in China
3.5bnSmartphoneusers in the
world
1.2bn/1bnAlipay / WeChat
users
400mInternet users
In ASEAN
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Document Classification: KPMG Confidential
© 2020 KPMG, a Hong Kong partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Hong Kong, China.
Platform Business Models
changing ownership of
assets vs access
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Document Classification: KPMG Confidential
© 2020 KPMG, a Hong Kong partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Hong Kong, China.
Online has Inflated Customers’ Expectations
UNLIMITEDSelection
INSTANTDelivery
TRANSPARENTPricing
EERILY ACCURATE
Personalization
FLEXIBLEPayments
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Document Classification: KPMG Confidential
© 2020 KPMG, a Hong Kong partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Hong Kong, China.
4 phases of response should be consideredGiven the way that consumers and markets are likely to develop it is important to consider a phased approach in your businesses…
New Reality(12-24 months)
Recovery(6-12 months)
Reaction (first 4-8 weeks)
Resilience(now)
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Document Classification: KPMG Confidential
© 2020 KPMG, a Hong Kong partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Hong Kong, China.
Investment in those new economy
companies continues to rise……
Rapid adoption ofdigital technologies
+social media+tribe marketing
Leap directly from cash to digitalpayments but needto find an answer to
cross-borderpayments
Data...data…datalow data costs
helping to supporton demand service
in ASPAC
Need for Regionale-fulfilment hubs+logistics infra!Major issue in
ASEAN
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Document Classification: KPMG Confidential
© 2020 KPMG, a Hong Kong partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Hong Kong, China.
You also need to ensure you have a
social goodagenda that
encompassespurpose
Emerging Technology like AI +Blockchain will
profoundly impact
supply chains
Data +Innovation
is critical to maintain long-term
competitiveness
Listen to your customers and follow them on their journey! They are demanding
more +moretransparency
from the brands they buy
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Document Classification: KPMG Confidential
© 2020 KPMG, a Hong Kong partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Hong Kong, China.
Consumers will still travel but in stages with
domestic travel leading the way! They will
still want expert guided choices, higher
engagement, personalization,
human touch, trusted relationships
+exceptional in-store
experiences!
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Document Classification: KPMG Confidential
© 2020 KPMG, a Hong Kong partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Hong Kong, China.
Download these reports
Anson BaileyPartner, Head of Consumer & Retail, ASPACHead of Technology, Media & Telecoms, Hong KongKPMG China
Tel: +852 2978 8969Email: [email protected]@kpmg.comwww.kpmg.com