We review the issue of consumer trust, the key theme which was discussed during the first day of the annual Consumer Goods Forum Global Summit in New York.
Highly trusted brands can drive growth and value creation
With the conference theme set as ‘trust as a foundation for growth’, conference presentations from both outside and inside the industry explored the importance of the issue. Drawing on examples from his own company, Procter & Gamble’s Chairman, President and CEO, AG Lafley, stated that we should not be surprised that food and consumer brands are highly trusted due to the scope of their reach, frequency of purchase and frequency of use. Over time, the company’s highly trusted brands had driven growth and value creation, emphasising the importance of staying incredibly close to the shopper and consumer in order to ensure their needs are being fully met.
”SKUs for news” could impact trust
However, he also questioned whether or not the industry is building or eroding trust by changing products too often, too fast. Procter & Gamble has been streamlining its product portfolio and setting a higher bar in terms of meeting consumer needs. Reducing the SKU offering within a category often makes it easier for shoppers to make a purchase decision in-store, improving conversion rates and sales.
Building appeal with the ‘latte’ generation
In the final session of the day, Indra Nooyi, PepsiCo’s Chairman and CEO, questioned why consumers, and particularly millennials, are shifting their buying patterns towards smaller companies. She stated that to build trust with this group of customers, dubbed the ‘latte generation’, companies have to develop products which are local, authentic, traceable, transparent and ethical. She also highlighted how quickly it is possible for companies to lose consumer trust, which has often been built up over a number of years, through a local crisis being amplified quickly and globally through social media. To protect against this, she stated that it is important for companies to have a rapid response strategy in place.
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