FMCG 2027: Four shifts I think leadership teams should be thinking about now
Updated: Aug 28
We're approaching the point in the year where FMCG businesses start shaping their priorities, budgets and organisational plans for 2027.
The backdrop remains complicated.
Growth is harder won, consumers are more discerning, retailers remain demanding and leadership teams are under continued pressure to improve productivity without compromising the ability to grow.
From the conversations we're having across the market, there are four areas I think will become increasingly important.
1. The battle for value is becoming more sophisticated
The cost-of-living crisis accelerated behaviours that were already developing - private label growth, uninhibited shopping, increased promotional sensitivity and much greater scrutiny of what constitutes value.
But I don't think the conclusion is simply that consumers want cheaper products.
Consumers are becoming more forensic about where they are prepared to pay a premium.
Brands therefore need a much clearer reason to exist.
Superior product? Convenience? Health? Provenance? Experience? Genuine innovation?
The middle ground becomes increasingly uncomfortable when a consumer can trade down to an increasingly sophisticated own-label proposition or consciously trade up for something they perceive as materially better.
For leadership teams, that has implications far beyond pricing. It affects portfolio strategy, innovation, pack architecture, promotional investment and ultimately where capital gets allocated.
2. Health is moving from consumer trend to category disruption
Health and wellness has occupied FMCG strategy decks for years.
What feels different now is the convergence of several behaviours: protein, gut health, functional nutrition, lower sugar, ingredient scrutiny, moderation and increasingly GLP-1 usage.
The latter is particularly interesting.
UK research is already showing material behavioural differences amongst GLP-1 users, including reduced spending on snacks and confectionery and increased spending on fresh and higher-protein foods.
The important question isn't whether every consumer adopts these behaviours.
It's what happens when a sufficiently large group does.
Changes in appetite and consumption occasions ultimately change category economics.
That potentially affects portion sizes, pack formats, innovation pipelines, channel strategy and the definition of permissible indulgence.
I suspect we're only at the beginning of understanding what that means for FMCG.
3. Growth and efficiency are no longer separate conversations
For several years businesses could respond to growth ambitions by adding resource.
That environment has changed.
The conversations we're increasingly having are about how organisations create more commercial output without simply adding more commercial headcount.
And we're seeing that reflected in hiring.
There is noticeably more interest in Commercial Operations, Revenue Growth Management, Category, CRM, Data and other functions sitting around the traditional Sales and Marketing engine. That's significant.
These roles aren't necessarily there to create another layer of management. At their best, they're there to remove friction from the organisation - improving forecasting, decision-making, customer execution, systems, data visibility and ultimately the productivity of expensive commercial teams.
I think organisational design becomes a much bigger competitive advantage in 2027.
The best businesses won't necessarily have the largest teams.
They'll have the clearest accountability and the least organisational friction.
4. Efficiency creates a talent problem nobody has completely solved
There's another side to that productivity agenda.
AI and automation are increasingly capable of absorbing tasks historically performed by more junior employees: initial analysis, administration, reporting, research and content production.
Commercially, it's completely understandable why businesses are looking at it.
But from an executive search perspective, I think there's a longer-term question that deserves more attention.
What happens to the leadership pipeline if we systematically remove the work through which people traditionally learned?
Today's Sales Directors, Marketing Directors and GMs didn't arrive at that level fully formed.
They spent years building foundational capability, understanding customers, analysing data, sitting in meetings, making mistakes and gradually being given greater responsibility.
If organisations significantly reduce entry-level populations, they need to become much more deliberate about how they create tomorrow's functional leaders.
Otherwise, we could spend the next five years celebrating productivity gains and the following five wondering why the market has a shortage of experienced leadership talent.
There is a common thread running through all four.
2027 feels less about growth at any cost and more about productive growth.
Where should we invest?
Where can we simplify?
Which consumers are genuinely prepared to pay?
Which capabilities create competitive advantage?
And which capabilities do we still need to develop internally rather than automate away?
FMCG remains an incredibly resilient sector, but I think the businesses that outperform over the next few years will be those that make the best choices about where they deploy capital, technology and people - rather than simply having more of each.
Interested to hear what others across the sector are seeing as 2027 planning starts to take shape.
Comments