The current landscape
A few years ago, consumer products companies with established and popular brands could increase their market share while expanding into new markets. However, this method of sustained growth is no longer fruitful. Let’s explore what changed.
Digitally aware consumers
Consumers today have the access to make informed choices. With a multitude of choices from where they want to buy, delivery options, and better deals, physical stores need to keep up.
Consumers today are socially conscious — they demand supply chain transparency and expect an omni-channel presence with swift resolutions. A consumer product company is only as strong as their ecosystems.
Leveraging big data and analytics helps redefine expectations for what a consumer products company can deliver. “Born digital” companies are building innovative products and business models based on real-time data and actionable insights and gaining increasing market shares.
The changing dynamics
With various options from product to channel to delivery – consumers expect to be provided with choices tailored to their specific needs. These demands can only be met if consumer products companies understand and engage with consumers on a personalized level. Additionally, there is an increasing fluctuation in basic costs – from raw materials, to labor, to shipping, and beyond.
Limitation in physical display
- High-volume items offer limited choices
- Consistency and scalability need to be maintained through mass brand building and innovation
- Cottage-industries and local brands have limited access leading to under-performance
- Innovative business models offer new opportunities for revenue and growth
- Higher cost and inventory complexity due to the omnipresence of SKUs
- With mass merchants, e-commerce websites, and discounters each marketing their products, consumers end up conflicted about their choice
Paradox of choice
- e-commerce has eliminated limitations of shelf space
- Small, niche, local brands get “long-tail” opportunity
- Faced with unlimited choices, consumer confusion and frustration increases
- Making it a value-based proposition throughout the consumer journey
- Customers receive simple, flexible, and personalized services
- Deliver a customer-centric experience
Despite there being high pressure, the opportunities are also unprecedented. With an increasing number of local brands coming up, established companies are taking steps to maintain an edge. Whether that means acquisition or bringing out smaller companies with greater autonomy, they are working to stay relevant tomorrow.
How is intelligence an enabler?
itelligence, an SAP Platinum Partner, helps implement intelligent, intuitive technologies increase revenue, improve performance, and provide a better, smoother CX. The following technologies are crucial in helping consumer products companies become more streamlined:
Artificial Intelligence and Machine Learning
Artificial intelligence (AI) and machine learning are integrating into the fabric of our lives and becoming indispensable. ML algorithms today are capable of automating tasks that earlier took a high degree of human proficiency. Technological advances in ML algorithms are making possible high accuracy in natural-language understanding and in image and speech recognition.
With Alexa and Google Assistant becoming increasingly popular, conversational user interfaces are becoming the support of choice for customer interaction. Ranging from simple customer service to more complex processes. This could be leveraged within the consumer products industry for invoice matching, claims matching, and virtual self-service.
Managing Experiences through Data Platforms
Reducing turnaround time to analyze and respond in real-time to changing demands is the biggest competitive differentiator. Disruptors today are combining operational performance data from their business systems with the various verticals of rich experience coming from system end-users and consumers.
This helps in retention, improved productivity and smoother consumer interactions, through the capture of qualitative data, at scale, wherever consumers engage. However, doing this efficiently requires identifying trends, insights, and experience improvement hot spots. This means automating deep statistical analysis and AI-powered language processing to enable the above.
Creating a secure chain of unalterable transactional data is transforming the digital economy. Based on a vast majority, the blockchain system, is revolutionizing fundamental aspects of the consumer products industry. For instance, food traceability, ethical sourcing, and end-to-end supply chain transparency is becoming more common and simple.
With a value-based consumer products business, blockchain helps ensure that there is transparency and trust at every step of the chain.
The Next Generation of Robotic Process Automation (RPA) – Intelligent RPA
From manufacturing to warehousing to packing and shipping, RP tools are beginning to be a crucial component in various stages of the consumer products supply chain. Intelligent RPA is the natural next step in their evolution, with bots capable of making intelligent, intuitive decisions and a higher degree of autonomy than before rather than mimicking manual transactions.
A future where a digital assistant is capable of reading an order and going ahead with the required work-flow to deliver the order is not too far.
Tony Stark’s ‘Jarvis’ is no longer too futuristic. Alexa and Google Assistant are proof of an incredible advancement in how our interaction with business systems and the world in general has evolved.
With conversation requiring no learning and only a need to communicate, voice and chat interaction is the most simple and natural way for humans to interact with machines. This novel method of human-machine interaction simplifies complex and powerful business solutions. Instead of going through a maze of clicks and swipes, a task can be completed with simple requests.
Informed decisions are enabled by actionable, real-time data. Integrating advanced analytics capabilities into applications enables delivering in accordance to changing customer expectations. Better customer outcomes are made possible through proactive, embedded predictive analytics. This simulates the impact of business decisions and helps achieve better customer experiences.
Innovative new business models can also be made possible through analytics. For instance, it is possible for a business to determine where a consumer’s need is emerging for any given number or variety of products. This is based on comprehensive segmentation analysis. Augmented by AI/ML, analytics can now be integrated into voice chat and chatbots providing instant access anywhere through a conversational UI.
The final word
With the advancement and adoption of the Internet of Things, advanced robotics, analytics, and Big Data, the consumer products industry has been transformed over the last decade. Delivering higher efficiency and better growth requires adopting emerging technologies with predictive consumer-growth capabilities. Innovative solutions like SAP S/4HANA based on speed, agility, and scalability are required for digital disruption and delivering growth.