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Digitization, Transparency, and ESG: Consumer Trends in 2021

In 2021, consumer behavior is driven by several demands: transparency, sustainability, and digitization. Companies need to catch the wave of digitization by making supply chains transparent and building trust with the consumer.
Consumer Trends in 2021
Consumer Trends in 2021
New technologies lead retail to changes and innovation
New technologies lead retail to changes and innovation
Consumers now favor natural and sustainable products
Consumers now favor natural and sustainable products
Technology is the new language of business interaction
Technology is the new language of business interaction
The global economy is experiencing significant changes. To catch on, PwC conducted a new study in March 2021. Several recent studies, including the survey by PwC, provide a picture of changes and developing trends that can be viewed in three main directions.
Digitization of retail
One of the main trends of 2021 was the ability of a business to change quickly. New technologies continue to radically transform retail in both online and traditional formats, contributing to drastic changes and innovation.

A patchwork of companies with complex and opaque connections within supply chains have ceased to meet the needs of the market. Now the sales channel must be clear and traceable.

Retailers should create a consumer experience that makes purchases as easy as possible by simplifying payment procedures, integration the different methods of shopping available to consumers, convenient technologies, and contactless delivery. 42% of PwC respondents named fast delivery among the top signs of a reliable online store. In an ever-changing market, new technologies for logistics companies go far beyond simple automation solutions and optimization. The most forward-thinking companies are improving their logistics orders by using combinations of robots, artificial intelligence solutions, IoT devices, and more to create a highly optimized supply chain capable of meeting the changing needs of contemporary consumers.
More transparency requirements
PwC estimates that more than half of consumers (56%) of consumers consider the transparency and traceability of the supply chain to be an important factor for their purchases. The demand for transparency and speed of realization of the order requires companies to abandon the old models of logistics and storage. The supply chain needs to become more automated and intelligent and should include technology solutions and AI for adaptability and transparency.

Transparency means real-time access to data streams about orders, warehouses, delivery processes, and effective supply chain management. All the data is the basis for analytics, forecasting, and service improvements. With these dataflows, AI will identify and connect supply and demand, including analysis of search queries and social media discussions. AI recognizes the relevance and feedback for a brand, a particular product, or service. Therefore, personalized advertising will become relevant information on required products.

To win the hearts of consumers, companies now do not need mass offers, calls, and mailings. It is time to build a trustworthy relationship: analyze the clients' actions and offer what they need here and now.

Digital transparency will enable the company to adjust and change the offer in time in accordance with the consumer's request. It can be both a reorientation to local sources of raw materials and a turn to a «healthier» business. PwC experts foresee consumer demand for healthy products and their transparency and stability requirements in the value chain to increase.
New technologies lead retail to changes and innovation
New technologies lead retail to changes and innovation
Consumers now favor natural and sustainable products
Consumers now favor natural and sustainable products
Technology is the new language of business interaction
Technology is the new language of business interaction
The growing demand for ESG
Customers and employees choose companies who demonstrate their values and social responsibility. According to a study by Edelman, which follows this trend in its global brand trust survey, 71% of respondents in 2020 said that if they think profit is more important to a brand than people, they will lose trust in it forever.

Accenture notes that in last year, trends related to inequality and intolerance have exacerbated in society. People still find themselves in a vulnerable position due to their gender, age, physical aspect, or social status. Therefore, people especially need empathy and compassion.

In 2020, some industries have lost strong players, but this has not diminished the competition. During the crisis, people began to buy more meaningfully, which means they spend less.

Consumers will look for brands that are focused on achieving non-financial goals, including in the areas of ecology, social responsibility, and corporate governance (ESG). Customers and employees want brands and employers to be proactive in addressing issues that matter to them. The overwhelming majority of Edelman survey participants (80%) admitted that they expect brands to "solve society's problems." Сontemporary consumers believe that companies should support environmental change and increasingly favor more natural and sustainable products. According to Harvard Business Review, the trend towards environmentally friendly purchases is strengthening and will continue to grow.

Companies have to recognize that value creation now depends on adaptability and contributing to community wellbeing, not just financial performance. Large businesses are accountable not only to its shareholders but also to a wider range of stakeholders, including employees, buyers, suppliers, and the communities in which it operates.

Gartner predicts that a circular economy will replace a linear economy by 2029. This means that buying and selling will finally be replaced by rent or sharing - that is, the sharing economy. The sharing economy a logical consequence of the corporate transition to sustainable development. The next stage of sharing economy is the rental of IT and cloud digital products. By using SaaS, companies save resources for purchasing, maintaining, and updating individual software and the entire cloud infrastructure.

The last year gave impetus to many changes: from the development of e-commerce, the exponential development of logistics companies organizing delivery to everyone who stayed at home, to the formation of new consumer habits. All this will spur the market in 2021 - companies will offer services and products in new ways, using different points of contact with the customer. Technology now is the new language of interaction and trust in business.
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