The COVID-19 pandemic has accelerated the trends impacting the global consumer products and services sector. At-home consumption levels have reached all-time highs, the shift to e-commerce has accelerated and the “omni-channel experience” has become increasingly important. These trends are enabling new market entrants to gain market share at the expense of legacy competitors, and global players will need to adapt their strategic priorities accordingly, including by refocusing their supply chains and distribution models and re-thinking their marketing and innovation strategies.
The Company strongly believes that continuous consumer engagement while delivering quality products to customers should be the sector’s top strategic priority for the next few years. From a practical perspective, the restrictions forced by the COVID-19 pandemic, along with changing consumer preferences, have accelerated the rise of e-commerce as a critical distribution channel. Legacy players with exposure to traditional channels and outmoded retail footprints will continue to be challenged in this rapidly evolving environment, while innovative players with flexible business models and costs structures, who are able to adapt and evolve quickly, will re-shape the broader industry. Furthermore, the Company believes that certain other trends, including favourable demographic trends, transparency of ingredients/materials and responsible sourcing, and the emergence and expansion of specialty brands will continue to shape the sector and lead to potential investment opportunities.
Within the consumer products and services sector, the Company believes certain segments are well-positioned to benefit from the current economic environment and are aligned with its investing expertise. These include: (a) Luxury and Luxury Value Chain; (b) Lifestyle, (c) Physical Retail; (d) Online Retail; (e) Consumer Services and (f) Beauty and Personal Care.