Consumer packaged goods companies and grocers are focused on growth more than ever, but they must move beyond traditional localized use of big data and analytics to gain the insight required to drive top- and bottom-line growth.
That’s according to a new report by the Grocery Manufacturers Association and Deloitte Consulting.
“The research will assist CPG companies in understanding the broad set of capabilities and competencies required to improve their analytical IQ, with big data making that need even more urgent,” says Marcus Shingles, principal, Deloitte Consulting LLP.
“The emphasis is on the need to think beyond data tools and techniques and focus on analytical talent models, decision processes and cultural shifts. With the ‘new normal’ of rapid-pace technological and digital innovation, CPG companies will depend now more than ever on big data analytics to compete and grow,” he says.
The conclusions and recommendations of the report include:
- Build the foundation. During the past decade, a majority of CPG firms have not been able to move beyond localized analytics and are challenged to exploit their “small data” (structured data from internal sources) much less the vast volume of unstructured data that make up big data.
- CPG success now depends on data analytics acumen. “Until now, a CPG company’s competitive advantage did not depend on having strong analytical maturity; however, the industry’s preconceived notion of change is about to be disrupted by the exponential pace of innovation,” the report notes. “Navigating this landscape will require companies to harness data and efficiently convert it to insights.”
- Put it in context. “Whether small or big data, the goal is to consistently make better decisions to improve an organization’s planning and execution toward achieving top- and bottom-line growth objectives,” according to the report.
- Innovative Culture. Companies must instill a culture of experimentation – trial and error – to obtain the analytical maturity needed to succeed in today’s competitive landscape.
As the food, beverage and CPG sectors compete to stand out and garner sales in an increasingly competitive landscape, they also must grapple with a new normal – brick and mortar stores following the data analysis trend pioneered by online retailers like Amazon.
Increasingly, each customer expects to have a special experience when shopping in a store. And to meet these evolving tastes, retailers are interested in increasing sales by capturing and using shopper information to create brick and mortar environments that seem tailored to each individual, notes The Architect’s Newspaper.
“The future of retail is really about applying the best of what we’ve learned in web and mobile and social applications over the last five or ten years and bringing it to the physical space,” says Colin O’Donnell, partner and COO at technology design consulting firm Control Group.
For example, British supermarket Tesco has rolled out virtual stores in South Korea where shoppers can scan images of items for purchase with their smartphones.
“If physical retailers can see that a shopper is visiting a second time, they can adapt digital displays to show new items as that shopper passes by,” the article notes. “If RFID chips identify clothing that a shopper is trying on, a digital display in the dressing room can allow the customer to request a different size or color. And if customers repeatedly pick up, then discard, an item, the manufacturer can rethink its design in the next production run.”
Consumers have been sharing information online for the past 10 years, O’Donnell notes.
“If I can control that and expose that information to people I want to have access to it, it fundamentally changes the way people interact,” he says. “There’s less of a barrier between you and the next person, and as a society you actually start to change as an organism.”
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