EY report highlights challenges in consumer products market and emphasizes investment in innovation

From Yahoo Finance: 2025-06-22 17:43:00

Consumer products market is struggling due to rising costs, economic uncertainty, and decreasing interest from even ultra-wealthy consumers. EY’s State of Consumer Products report emphasizes the need for investment and innovation to survive in a competitive market, with a focus on brand relevance and resilience. The industry faces challenges in meeting consumer expectations for value, innovation, and personalized marketing. Retailers are seeking valuable partnerships for growth, while investors are influencing business strategies and M&A decisions.

As consumer product companies seek to adapt to changing market dynamics, investors are increasingly looking for steady performance. Valuation gaps may hinder M&A recovery, but firms are reviewing their portfolios and growth strategies to capture new markets. Companies must prioritize a future-thinking model, incorporating advanced technology and innovation to shape consumer trends.

Competition for shelf space is intensifying, with retailers gaining leverage over consumer product firms through private labels and control of consumer data. Retailers are predicted to drive change, leading to a shift in relationships with consumer product companies. Collaboration, innovation, and real-time consumer insights are crucial for success in a rapidly evolving market.

Consumers are demanding better quality, value, and innovation from brands, driving a reset of expectations. Loyalty is now more fluid, with consumers willing to try new brands that meet their expectations. Consumer product companies must adapt and innovate to become the brand of choice for high-value consumer groups, shaping consumer behavior and rebuilding relevance in a changing world.

Read more: EY Report Urges Retail Firms to Reclaim Their Relevance