IBM - ConsumerIBM has released a study on global consumer trends which ‘reveals’ that the importance of brand purpose surpasses cost and convenience for today’s shoppers. This has implications not only for brand owners and consumers but also for blockchain-based recording of sustainability and provenance.

Transparency constitutes proof that an organization and its offerings are what the company claims to be – a way to earn consumers’ trust. Brands can leverage data and integrate blockchain technologies as brand differentiators that effectively provide transparency and traceability – which will also boost profits as the study shows that shoppers willingly pay more if a retailer can demonstrate provenance,” said Luq Niazi, Global Managing Director, IBM Consumer Industries.

Luq Niazi, Global Managing Director, IBM Consumer Industries.
Luq Niazi, Global Managing Director, IBM Consumer Industries.

The IBM Institute for Business research

The research, developed in partnership with the National Retail Federation (NRF) in the US, polled nearly 19,000 consumers from:

  • 28 countries
  • across all demographics and generations, from Gen Z to Baby Boomers (ages 18-73).

The objective was to:

  • understand how individual purchasing decisions are evolving
  • help today’s consumer-facing companies navigate the related trade and commerce complexities.


According to the IBM research:

  • one-third of all consumers today will stop buying their preferred products – if they lose trust in a brand
  • one-third of consumers have already stopped, in 2019, purchasing previous longtime, favorite brands.

In effect, consumers are prioritising choices which are sustainable, transparent and aligned with those consumer core values. They are willing, for brands that “get it right”, to:

  • pay more
  • even change buying habits.

At the same time, buying behaviour has changed. Consumers shop whenever and wherever the mood strikes them – often while doing something else. “Whereas impulse buying was once the norm, impulse shopping is the current norm.” 70% of consumers shop in “micro-moments” – or shop while simultaneously performing daily tasks.

Brand proliferation and the implications

With brands proliferating and products being available to shoppers anywhere at any time, corporate values now outweigh product costs and convenience. Consumers of all ages and incomes are paying premiums for products aligned with their personal beliefs. According to the IBM research, on average of ‘purpose-driven shoppers’:

  • 70% pay an added premium of 35% more per upfront cost for sustainable purchases, such as recycled or eco-friendly goods
  • 57% are willing to change their purchasing habits to help reduce negative environmental impacts
  • 79% state it is important for brands to provide guaranteed authenticity, like certifications, when they’re purchasing goods
  • within this latter group, 71% will pay a premium – up to 37% more – to companies which provide transparency and traceability.
Mark Mathews, Vice President, Research Development & Industry Analysis, NRF.
Mark Mathews, Vice President, Research Development & Industry Analysis, NRF.

Shoppers today show an increased willingness to pay premiums for products that align with their values. The study’s findings show that today’s retailers need to be proactive in evaluating and understanding what drives current and future core buyers while still boosting margins for their business,” said Mark Mathews, Vice President, Research Development & Industry Analysis, NRF.

IBM’s recommendations to businesses

If cost is no longer the preeminent deciding factor for the buyer, IBM is recommending the following three approaches for retailers wishing to maintain, even regain, market share:

  • earn consumers’ confidence through transparency and traceability: with “micro-moments” on the rise, companies must go beyond simply offering convenient or quicker services to gain customers’ trust – consumer brands now need to differentiate themselves by offering convenient, quicker access to detailed information such as how the products are manufactured, quality of ingredients, if it is sustainable or ethically sourced, and under what conditions
  • measure sustainability through economic impact: reducing environmental impact goes beyond recyclable packaging or reducing carbon footprints; purpose-driven brands must also help build a sustainable, circular economy for future generations and they must integrate sustainability as well as measure this end-to-end and across the entire supply chain for CPG manufacturers
  • deliver value through flexibility, not more products: as digital interactions continue to influence the way consumers shop, retailers need to innovate in store and offer consistent brand experiences across all channels; the challenge for many retailers is how rapidly to deploy and integrate new capabilities with existing store technology environments and so deliver on consumer expectations.

In addition, IBM draws attention to its open developer ecosystem to provide retailers with targeted innovation and experimentation. Through IBM Sterling’s expanded partnerships – with Salesforce, Sapient and Project 44 – IBM seeks to:

  • solve complex supply chain challenges
  • produce seamless customer engagement
  • enable visibility into the entire retail journey – from order creation through the delivery and shipment lifecycle.

Enterprise Times: what does this mean

According to the IBM research, the modern-day marketplace reveals a new generation of customers. These possess higher expectations and present challenges that retailers must face in 2020. The findings also illustrate shifts in consumer buying behaviour, shifts which require changes to how retailers and consumer packaged goods brands build brand affinity.

As one example, IBM references Terra Delyssa, a Tunisian olive oil producer. Terra Delyssa is incorporating traceability into its data and products – via blockchain technology and IBM Food Trust. The intention is that consumers will be able to trace olive oil from the retailer back to the orchard where the olives grew – using a QR code or lot number.


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