Coke CEO muhtar kent

 

In a Thursday BBC column, The Coca-Cola Company (NYSE:KO) chief executive and chairman Muhar Kent listed five consumer mega trends that he believes are changing the world. The viewpoint comes from a recent Consumer Goods Forum report called, the “Future Value Chain.”

Kent stresses the importance of these trends for the future of retail and consumer goods.

Take a look.

Mass urbanisation

Today, more than half the world’s population lives in cities, with the number expected to grow to 70 percent by 2050. Look for this shift to challenge the supply chain and logistics for consumer goods and retail industries.

While modernizing infrastructures, businesses will need to improve collaboration and work with cities.

Aging Population

By 2047, look for those over 60-years-old to outnumber people under 15-years-old. Some industries will find new opportunities with these older consumers and their disposable incomes.

Look for more focused marketing and home delivery.

Emerging Middle Class

In the next 10 years, the economy will shift to a growing middle close of one billion people.

By 2030, more than 90 percent of the world’s middle class will reside in emerging markets thanks to China and India leading the change. This will present new opportunities for manufacturers and retailers but new resource and cost challenges will come for some commodities.

Consumers are driving the bus

By next year, more than two billion mobile users globally will have made a transaction from their handsets. Fast forward to 2020 and a third of consumer transactions will be made online.

New ways to connect with consumers for digital shopping will take place and retailers and FMCG firms will need sophisticated real-time insights.

Keys to making this happen will be finding ways to communicate with online consumers and using digital consumer data in a good manner. Companies will need more transparency and collaboration with shoppers.

Sustainability is Key

By 2030, the world’s population will be 8.3 billion, increasing food and energy demands by 50 percent with fresh waters needs of 30 percent. How can this be met? Sustainability.

At Coca-Cola, they’re reducing their eco-footprint and reliance on fossil fuels with its PlantBottle. They are trying to develop a commercially-scalable, bottle-quality plastic made from 100 percent of plants.

And they’re trying to protect resources, beginning with water.

But how can this be accomplished, asks Business Insider? They cite Kent’s quote, “Over the next decade, success or failure for consumer goods companies and retailers will be measured by the speed and thoroughness with which we’re able to adapt to change at all levels – global, national, local and personal.”

Maybe another question is what would Warren Buffet, CEO of Berkshire Hathaway Inc. (NYSE:BRK.A) (BRK.B) do? In his portfolio of stocks, his largest holding comes in with Coca-Cola at 21.60 percent while he was a 8.73 percent stake in the company.

Note: I do not own any shares of Coca-Cola.