2024: The same but more?

If I were to make bets on what the year ahead will have in store for consumer companies, it would be all too easy to say that things will be much the same as in 2023, but more so. We’ve seen geopolitical uncertainty; this year we’ll see more. We’ve seen Generative AI go mainstream; this year could see it scale new heights. We’ve seen increased global temperatures; this year the mercury will rise higher still. ??

Back in 2018, I embarked on a program called FutureConsumer.Now, which sought to reimagine the future of the consumer industry. Six years later, I'm still seeing many of the trends we identified being played out in the market, from auto-replenished shopping to DNA tailored nutrition. Most of the trends that will define the future, whether in the coming year or the coming decade, already exist; in fact, many are well-established or beginning to scale. This means that, when it comes to looking out a year ahead, many of the things we’ve been tracking this year, and over the past decade, are likely to continue to gain momentum. The same but more!

However, there are always new things to consider, and many things that we saw emerge or develop in 2023 could be far more influential in 2024. For consumer products companies and retailers, there is a lot that they will need to anticipate and respond to in the coming year. Here are three things that are likely to move up the corporate agenda:

Efforts to build supply chain resilience will intensify: The new year ushered in a fresh supply chain crisis in the form of escalating attacks that are disrupting shipping routes through the Red Sea and Suez Canal. In response, we are seeing shipping companies reroute their vessels around South Africa, adding nine days and thousands of nautical miles to voyages that will likely increase costs and time to market.

The additional time added to these voyages will impact consumer products and retailer stock planning. The uncertainty caused will make it difficult to guarantee enough supply to deliver on the volume expectations of planned promotional activity in the short term. More broadly, supply chain disruption will have a compounding effect on other disruption, making it even more challenging for consumer companies to meet their targets on price, growth and profit.

Retailers and brands looking for long-term solutions have been working to diversify their supplier base, build alternative shipping routes and source goods and materials from closer to home. These efforts are likely to double down to help reduce costs, protect from geostrategic risk and hedge against the inflationary impact that shortages could have on already stretched household finances.

Quantum will start to unlock rewards, and risk: All eyes have been on Gen AI as the technology to watch in 2023, and this is unlikely to change in 2024 as use cases continue to grow and scale. But in the background, quantum computing has been progressing at pace and leaders will increasingly be looking at how they can bring it into their business processes, especially as its ability to rapidly improve the speed and utility of AI models becomes more apparent.

Although mainstream applications of quantum could be a decade or more away, processing power for qubits (the basic unit of quantum information) has seen exponential growth from 100-qubit-per-processor in 2021 to over 1,000-qubit-per-processor in 2023. This is not only alerting businesses to the quantum opportunity, but to the challenges it can bring in the wrong hands.

The ability of quantum computing to break existing cryptographic security measures is driving companies to put in place plans for “post-quantum cryptography,” measures that will protect systems and data from quantum-powered hacking. These will form a pragmatic backdrop to the development of any new quantum- powered tools that can speed up business processes or drive faster customer data analysis.

GLP-1 will push snacking up the agenda: The rapid emergence of an established diabetes treatment, GLP-1s (Glucagon-like Peptide 1), being used to treat obesity and suppress appetites, may be well timed in a world where experts are forecasting that one billion people globally will be living with obesity by 2030.

GLP-1 drugs can help people drop pounds quickly by moderating cravings and reducing calorie consumption. This has driven a wave of interest, especially in the US. Although high prices and the potential side effects of GLP-1 brands mean it is unlikely to have more than a marginal impact on overall consumption, those margins may be telling as moderating food consumption impacts volume growth for food companies and foodservice operators.

For food companies on tight margins looking to recover volume growth in the wake of high input costs, this could be a problematic equation to solve. However, every cloud has a silver lining and GLP-1 will support the underlying trend toward higher-margin snacking products and smaller servings. Although this year will not see a GLP-1 revolution, it is likely that it will, in part, drive product reformulations and accelerate the push towards healthier snacking and smaller portion sizes in the market.

Whatever comes to pass in 2024, the longer-term outlook remains sobering for the business landscape. The World Economic Forum’s Global Risks Report for 2024 has pointed to a deterioration in the outlook for the coming decade with extreme weather, AI-generated misinformation and political polarization identified as the main global risks for the coming year. Over 60 national elections are due to take place in 2024 which will affect almost half the world’s population. These in themselves will collectively add further geopolitical volatility. For any leaders looking at how business disruption may evolve in 2024, the answer is likely to be the same, but more!