Feb 22, 2018
NEW YORK, February 22, 2018 - Online commerce is continuing to cause disruption in the retail and consumer industries and are encroaching ever more on traditional ground, global management consultancy Oliver Wyman reveals in its sixth annual Retail and Consumer Journal.
From the major success of Amazon in food retail to omni-channel being the key to the future of retail - this year’s Journal takes a sweeping view of a world buffeted by change that is taking place at unprecedented pace. But even at such a rapid rate, for retail the end game lies a considerable time out in the future, and companies have time to adapt and succeed.
“For the last few years, e-commerce and omni-channel have been top of mind for the industry. This year we took a deeper dive at how retail and consumer companies are overcoming this disruption by applying clever and innovative ways to take on the challenge and be successful,” said James Bacos, partner and global retail practice leader, Oliver Wyman.
Highlights from the Retail and Consumer Journal include:
- China has experienced explosive online growth in recent years, and online penetrating matches or even exceeds the US in many retail sectors today. In many ways, the future of retail can be observed in China, in some of the new online propositions and formats which are being tested.
- The shift from physical to online retail has continued at pace in most markets and retail sectors. Online is most advanced in apparel and hard lines, yet we do not see the growth of online “flattening off” in these areas any time soon. Increasing penetration is driven by innovation on the supply side which continues to improve the online shopping experience and reduce barriers to adoption.
- Food retail has been more resistant to the online tsunami so far, with penetration rates in the most advanced markets, such as UK and France, still less than 10 percent. However, we see some signs that this is about to change: more flexible delivery, existing players innovating with improved propositions, and Amazon entering the food business.
- Consumer businesses are also looking to access new ‘value pools’ by moving into adjacent areas or services. For example, food manufacturers are developing more health-related products and functional foods.
“The digital age is changing the landscape of retail,” said Bacos, “and retailers questioning their current structure will find they are probably not fit for the future. Our journal explores the change retailers can implement to achieve technological leadership in their industry.”
About Oliver Wyman
Oliver Wyman is a global leader in management consulting. With offices in 50+ cities across nearly 30 countries, Oliver Wyman combines deep industry knowledge with specialized expertise in strategy, operations, risk management, and organization transformation. The firm has more than 4,700 professionals around the world who help clients optimize their business, improve their operations and risk profile, and accelerate their organizational performance to seize the most attractive opportunities. Oliver Wyman is a wholly owned subsidiary of Marsh & McLennan Companies [NYSE: MMC]. For more information, visit www.oliverwyman.com. Follow Oliver Wyman on Twitter @OliverWyman.