Competition in the consumer packaged goods (CPG) industry is fierce. Whether you are a CPG distributor, wholesaler or retailer, you are likely working to improve efficiencies, reduce costs from your supply chain and manage margins to squeeze as much profit as you can from every transaction. Make it easier to understand the shifting behaviour of customers with data analytics and KPIs.
A recent McKinsey & Company survey of North American consumer-packaged-goods companies found 69 percent of the executives working in consumer goods believed that the COVID-19 crisis would have a lasting impact on their customers’ needs in the next five years. But fewer than 30 percent of all executives felt that their companies were well equipped to address such changes.
In other words, companies are struggling to find net new growth. One way that can help is to use data and analytics to improve operational efficiency, eliminate dead stock to monitoring customer behaviour and managing product assortment.
McKinsey sees growth as a three step process: first, predicting levels and areas of growth in consumer consumption and spending; then, transforming growth levers in response; and, finally, sustaining growth with operating-model changes. Consumer behavior and engagement with products, brands, and channels have changed so much that innovation must now be top of mind for CPG leaders.
Price sensitivity is key in the wake of COVID-19. What consumers value is shifting, with younger consumers seeking brands they see as sustainable, different, and authentic. Many age groups are prioritizing conscious eating and living, preferring purpose-driven brands that help them meet personal goals like reducing meat consumption. Small brands are rushing in to deliver on these brand values. e-Commerce has experienced meteoric growth and discounters are continuing their steady rise, especially in developing markets.
So, how does data analytics help move a company forward? For any business, data can be visualized using three aspects,:
- Where are we now: What is working through covid and beyond, who are the most profitable customers and products did people desire. What innovations worked and what channels were preferred?
- Where are we going: Set desired KPIs around new strategy, product lines and delivery channels
- How can we reach there: Keep monitoring KPIs weekly and determine ongoing change to drive margin growth
In this eBook, we will focus on the top KPIs consumer goods businesses need to know and measure; the importance of finding the right business intelligence tool to help aggregate, slice-and-dice, and analyze your data; and how this data can benefit you in multiple areas and activities within your business, from launching new products, and tracking product sales, to identifying trends and margin analysis.