Retail and consumer markets are not facing a temporary downturn. They are undergoing structural recalibration. Across Europe, three shifts stand out.
First, innovation intensity has declined. Recent market data shows fewer new product launches and lower revenue contribution from innovation across major European brands. While total FMCG value grew by 3.4% in 2024–2025, sales from new innovations actually declined by 4.5% as companies pivoted from “breakthrough” launches to incremental line extensions1,2. At the same time, private label continues to gain structural share to a record 42% across the EU, signalling that retailer brands are no longer just “budget” alternatives but structural competitors for the value equation3. For branded manufacturers, this raises the bar: Premium positioning now requires demonstrable differentiation and commercial discipline, not just brand heritage.
Second, restructuring is no longer episodic, it has become a continuous operational requirement. A significant share of European retailers and consumer companies have implemented or announced organisational simplification and cost programs over the last 12–18 months. Most notably Unilever, which recently initiated a productivity program to deliver €800 million in savings through “delayering” and the spin-off of non-core business units4. Layer reduction and overhead scrutiny are no longer just cost-cutting exercises; they are becoming standard responses to persistent margin pressure.
Third, pricing and mix management have moved decisively up the executive agenda. Revenue Growth Management is no longer a marketing tool; it is a board-level capability. Commercial excellence in pricing architecture, trade spend governance and portfolio mix is increasingly central to performance5,6.
Taken together, these developments redefine what leadership must deliver. In Consumer & Retail, we are putting a high focus on the ability to execute and to deliver result. If you will, simplify & deliver is the term of the hour.
The MU Leadership Navigator 2026 studies clearly demonstrate that a leader’s proven performance in relevant contexts is the most reliable indicator of future success. To make informed leadership decisions, it is essential to understand your specific context. In the coming years, senior leaders have indicated that 50% of their leadership capability needs will be context-specific, further highlighting the importance of knowing your context.
For Consumer & Retail companies, profitability now takes precedence over expansion narratives. Fewer innovation bets, tighter portfolio control and disciplined pricing governance define the environment.
Leadership excellence in this context is operational and commercial:
High performance is contextual. A leader successful in growth acceleration may struggle in a margin recovery cycle. Boards that explicitly define their current economic reality make more accurate leadership decisions.
When markets recalibrate structurally, leadership becomes less about style and more about delivery.
In structurally pressured markets, ambiguity is expensive, with many firms facing similar challenges. However, it is important to recognise that responses to these challenges need to be tailored to the specific circumstances of each firm.
Leadership criteria must therefore be expressed in business outcomes:
Evidence from this report indicates that leadership predictions are most accurate when a relevant track record holds significant weight in the evaluation process. This finding reflects the predictive value of demonstrated success in comparable contexts, consistently showing that predictive accuracy increases when a relevant track record is prioritised. In execution-intensive industries such as retail and FMCG, proven delivery under comparable economic pressure is a stronger indicator of future success than abstract capability models. Potential and adaptability matter, but only on top of demonstrated commercial execution.
Retail and consumer industries operate with short feedback loops. Strategy translates into P&L impact within quarters, not years. In such environments, leadership selection cannot begin with abstract capability models. It must begin with evidence.
Boards and executive teams should therefore ask a simple but demanding question: Who has already delivered results in situations comparable to the one we face today?
Effective leader selection should therefore begin with disciplined filtering:
Only once this evidence is established should broader leadership characteristics be assessed. Curiosity, adaptability and strategic thinking matter. But their predictive value increases significantly when they are anchored in demonstrated performance under comparable conditions.
Leadership excellence is therefore not primarily defined by who someone is in theory. It is defined by what they have delivered when trade-offs were real and performance was exposed.
Retail and consumer markets are becoming more measurable, not less. Leadership decisions must follow the same discipline.
1 Nielsen IQ. (2026, January 28). Innovation under pressure, How Western Europe can reignite consumer relevance in 2026. Retrieved March 10, 2026 from https://nielseniq.com/global/en/insights/analysis/2026/innovation-under-pressure/
2 Hübner, M. (2026, January 9). Brands are increasingly losing the courage to innovate. Lebensmittel Zeitung. (https://www.lebensmittelzeitung. net/industrie/nachrichten/analyse-marken-verlieren-immer-mehr-innovationskraft-188683)
3 Roy, A. (2025, December 16). CPG Private Label value share climbs to 42% across EU6 – rising to 44% in supermarkets, reports Circana. Circana. (https://www.circana.com/post/cpg-private-label-value-share-climbs-to-42-across-eu6-rising-to-44-in-supermarkets-reportscirc)
4 Unilever. (2024, March 19). Unilever to accelerate Growth Action Plan through separation of Ice Cream and launch of productivity programme. (https://www.unilever.com/news/press-and-media/press-releases/2024/unilever-to-accelerate-growth-action-plan-through-separation-of-ice-cream-and-launch-of-productivity-programme/)
5 McKinsey & Company. (2025, January 22). Leading European consumer goods with commercial excellence. (https://www.mckinsey.com/industries/consumer-packaged-goods/our-insights/leading-european-consumer-goods-with-commercial-excellence)
6 Cruz, C. Javor, C. Kwon, S. & Mologni, F. Beyond the Tail: How a Strategic Approach to Simplification Fuels Growth. Bain & Company. Retrieved March 13, 2026, from https://www.bain.com/how-we-help/beyond-the-tail-how-a-strategic-approach-to-simplification-fuels-growth/