Economist Research Reveals Direct-to-Consumer Trends

Going direct to consumer is top of mind with executives in the consumer goods (CG) industry today. But are companies really ready for this new wave of consumer interaction? Recently, the Economist Intelligence Unit (EIU) conducted research sponsored by Oracle, to better understand how CG companies are engaging directly with consumers today and in the future. The survey polled CG executives across the globe and conducted in-depth interviews with corporate leaders in the industry to explore direct-to-consumer initiatives.

 

On April 12, 2012, during a CGT web seminar, panelists reviewed the results of the research. Here is a recap of the event:

 

--Jon Copestake, chief consumer goods analyst, EIU, kicked off the web event by unveiling three key findings.

1. Pushing traditional media through new media channels is not enough to reach today's more plugged in, product-savvy consumer.

2. CG companies are experimenting with new ways to establish and enhance direct, two-way relationships with their target consumers across multiple channels to enhance brand loyalty and drive product sales.

3. Survey respondents and other CG executives see their nascent e-commerce efforts as complimentary to, not competing with, existing retail channels.

“Last year, there were only 24 percent of respondents who were concerned with directly selling their products to their consumers. In the coming year, this is going to increase hugely to 41 percent. This is quite a quick turnaround, and it seems like as these opportunities to engage directly with the market grow, consumer goods firms are going to be increasingly looking at new channels and new ways at which to do so,” explained Copestake.

 

--Pella Corporation was on hand next to share its experience on selling direct to consumers. Rick L. Hassman, director, Corporate Applications, shared Pella’s vision for marketing sophistication: “We have become much more in tune with our marketing efforts that we have out, to the point that now we can make better decisions.” Hassman also explained how fact-based marketing investment decisions help Pella to better understand its customer. “Capabilities allow us to optimize marketing spend and provide visibility of customer path/drivers,” he said.

 

--Bernard Goor, vice president for Oracle Consumer Goods and Process Industries, and Angelique Moon, director for Oracle Consumer Goods CRM Product Strategy, next offered their experiences from the viewpoint of a solutions provider. They explained how brands benefit more when consumers are happy. For example, they revealed that 94 percent of consumers will pay up to 25 percent more for a better customer experience. “When expectations are not met, brands get dumped,” said Moon, who went on to explain that 89 percent of consumers began purchasing from a competitor following a poor experience.

 

For more direct to consumer insights, listen to this web event in its entirety by clicking here.