The Consumer-Packaged-Goods (CPG) industry has many challenges and obstacles woven around. From continuously varying consumer interests, market demands, and fluctuating graphs to growth in E-commerce platforms, leaving behind the traditional channels (for instance, the grocery market), the CPG companies are racing to adapt Analytical models like AI/ML models into their business strategies.
Advanced analytics has paved its way to help the companies achieve remarkable excellence in five major priorities in the CPG industry – Trade, Marketing, Pricing solutions, E-Commerce and Manufacturing, and Supply domains.
Trade Spend Optimization
The annual investment that the Consumer-Packaged-Goods (CPG) companies make for trade promotions is 20 percent of their revenues. The studies show that 59 percent of these companies are still stuck with losses.
Whereas, the winning companies have established a five-times greater revenue than the competitor companies. It is, so, evident that the right strategies and analysis of the trade investment effectiveness and the actual incremental value can increase the company’s success and maximize the revenues.
The advanced analytics are extensively helping out in finding the insights and the incremental data which are being used to measure the effectiveness of the entire trade investment.
Marketing Strategies
The marketing strategies of the CPG companies are generally found to be weak, full of flaws, and ineffective in the long run. How is this true? Well, in many cases, the companies encourage working for and promoting their products to the already built customer network, providing them with lucrative offers and other promotional schemes. These marketing strategies are extremely weak, as they are unable to attract new customers, and spurts the sales for a very short time, that is, are not long-term effective.
Leveraging analytics to build robust marketing strategies is among the major focus of the top-tier CPG companies, which helps them to reach more audiences and find an edge over other competitor companies.
Analytics can help realize consumer preferences by analyzing the insights from social media, shopper cards, user registrations, and many more. A clearer picture is depicted by analyzing the media channel insights and figuring out the brand objective impacts.
Pricing Solutions
Deciding the regular pricing is equally important as the promotional pricing of commodities. A major amount of trade expenses goes into sewing the gap between manufacturing cost and retailer demands.
Also, the promotional offer pricing boosts up short-term sales and profits, whereas wisely deciding the regular day-to-day pricing of CPGs maintains the regular profits and the impact lasts for a very long journey.
E-Commerce
Over the past few years, consumers have gradually shifted towards purchasing healthier products and so have deviated from traditional markets to E-commerce channels. The E-markets are booming and flourishing, and so the CPG companies need to target the E-commerce channels and work harder to built better marketing and promotional strategies to sell their products over these markets and target the online buyers along with the traditional ones.
The companies which opt for analytics strategy to analyze E-commerce data and insights to better perform at online markets are found to have achieved more than other GPG companies that focus on traditional channels only.
Optimizing Manufacturing and Supply Chain Strategies
Efficient planning and effectively strategizing the manufacturing and supply functional units are critically required to strengthen the entire business from the grassroots level. Having said so, how can this horizon remain untouched from the benefits of advanced analytics!
The CPG companies are inclining towards leveraging analytics in chalking out the short-term as well as long-term manufacturing and supply blueprints. Be it the exhaustion and re-filing of the raw materials or deciding transformational expenses and identifying the best-suited routes, every short-term objective is more profitably achieved with the implementation of analytics.
The impact of promotional offers which leads to the heavy market demand of goods puts several lofty challenges in front of the companies. To efficiently meet up with the surged demands, increased transportation requirements, and the hike in manufacturing goals, analytics hands over a better picture of the dos and don’ts to the companies which assists them to cover extra steps towards success.