“The Empty Basket” – The Challenges with FMCG Digital and E-commerce Leadership Hiring

Over the last decade there has been a fundamental shift online for many traditional industries such as: Music (Spotify), Transport (Uber), Retail (Alibaba, Amazon) Travel (Airbnb) and Media/Entertainment (Netflix) redefining themselves in the new digital era and realigning to modern day consumer demands and behaviours.

Now it is a transformative phase in the Fast Moving Consumer Goods (FMCG) industry, as the FMCG E-commerce trends taking shape in 2018/19 will influence the entire market for years to come. These trends have already altered the consumer’s path to purchase and opened the market for numerous new entrants.

Currently, challenger brands are better able to compete with (and win) vs big household names, as they’re agile, forward thinking and capable of connecting with the continually emergent market of online-focused consumers.

FMCG brands significantly invest in brand recognition, but as consumer loyalty swings and indeed becomes more fickle, recognition alone is no longer as paramount as it once was. Instead, consumers are seeking alternatives to popular brands, big name brand recognition is becoming less of a deciding factor in purchasing. Authenticity, provenance, environmental and social purpose all becoming more consequential in the consumers buying decision making process.

Findings: The Current FMCG Digital and E-commerce Leadership Landscape

It would appear that the challenges in the (FMCG) industry, are in part linked to the digital understanding and capability of the leadership. Those that genuinely have the ability and experience to drive change have often already been enticed away to digitally greener pastures! It is with this in the mind that Hoggett Bowers commissioned an internal study which has tracked and analysed 400 Digital and E-commerce leaders (Director – SVP/CDO) across 22 of the world’s largest and best known FMCG organisations. (This was done at a global, regional and large end-market /cluster level)

The results are thought provoking and have indicated, that whilst there is significant investment in the Digital and E-commerce ecosystems, this it appears has not been translated into leadership talent acquisition (Please see graphs below for sector hiring breakdowns). Whilst all of the above is true and applicable to the majority of global markets, the need to disrupt the status quo in terms of Digital and E-commerce leadership hiring and talent development appears to have fallen behind the curve and pace of change.

The majority (c 55%) of senior management across Digital and E-commerce come from within the same company and a further 21% of external hires come from within the same sector (FMCG). Only the remaining 24% of external recruits come from other industries, which in some cases have been far earlier adopters of commercial Digital/E-commerce business models. Typically talent has originated from the management consultancies and global technology giants.

Where Do People Move From?

Most Notable Out-of-Sector Companies Talent Moved From:

Additionally some 60% of leaders have been in tenure for less than 3 years and 85% of total sample under 5 years, this again highlights that many of the FMCG majors have been late acquirers and developer of Digital leaders.

Average Tenure in the Role

Breaking from Convention

As executive search specialists in the FMCG space we are often asked to find leaders with “like for like” experience, with the key deliverables around creating change and challenging the existing state of affairs! We often advise, however, that in order to find that “transformational hire” they need to be more flexible in their recruitment criteria and to consider cross-fertilization from across industry sectors. This is often met with resistance due to “cultural fit” or lack of “sector expertise”! Maybe it is time for as much change in companies’ E-commerce and Digital leader’s talent acquisition strategy as it is for them to adapt and change in the digital world?

This therefore poses the question “without innovating and becoming more flexible when searching for the new breed of FMCG Digital and E-commerce leaders, can the FMCG majors adapt, compete and disrupt in the digital landscape quickly enough to prevent further loss of market share?”

[Surely] In order to move forward in the digital world these businesses need to be risk seeking and look to hire deeply experienced, innovative and agile leaders from other sectors who have “grown up” online? So the conundrum for FMCG majors, is how to continue to re-invent and re-position its EVP to become attractive and connected to truly forward thinking digital leaders from other sectors.

For further insights and individual breakdowns by geography of the 22 companies analysed or to discuss FMCG leadership hiring and talent trends please contact:

Mark Tomlinson General Manager Global FMCG @ Hoggett Bowers Executive Search
Mark.tomlinson@hoggett-bowers.com