Friday, January 30, 2015

67% of CPG Companies Recognize Digital Potential; Only 16% Using Effectively

According to a new study, CPG Sales Leaders Go Multichannel,conducted by Forrester Consulting on behalf of Accenture, based on the responses from heads of sales and account directors, consumer packaged goods (CPG) companies can realize significant gains in cross-channel growth through digital collaboration with retailers and distributors.
But, although CPG executives are committed to increasing their use of digital technology to improve internal integration across marketing, sales, service, supply chain and research and development, many believe a number of real and perceived barriers, from emerging market restrictions and lagging customer analytics, may slow the process.
67% cited moderate or significant potential for digital technologies to amplify sales through traditional channels by improving the allocation of marketing spend to drive mutually beneficial retail relationships and execution to improve sell-through. 


 Additionally, 75% of all account directors surveyed expect improved collaboration with retailers and distributors through digital transformation to drive the availability of their products and make the best use of shelf space and trade promotion funds.
CPG heads of sales cited several additional potential benefits, including:
  • Reducing the cost of servicing customers   50%,
  • Increasing the chances of consumers trading up   46%,
  • Boosting sales through targeted email with personalized content and offers   57%
  • Consumer care services   51%
Koen Van Bockstaele, managing director, Consumer Goods and Services, Accenture, says  “… the vast number of opportunities being created by digital technologies continues to have a profound effect on CPG sales and trade marketing… to achieve their growth targets, CPG brands need to deliver and market a consistent, personalized consumer experience… to reach target consumers…”
The study shows that digital technology has the potential to help consumer brands pool actionable insights to increase consumer loyalty, share of wallet and the lifetime value of their products. But 70% of CPG heads of sales believe this potential may not be realized because of a lack of consistent, shared consumer data. 60% of these same respondents find it too difficult to deliver relevant and personalized content to engage consumers effectively through digital channels.
66% of CPG companies can identify online the stores that normally stock their merchandise, and 50% can confirm current availability by store using digital channels, according to sales leaders. However, just 16% of companies currently use digital technologies to maintain the in-store and online relationship with the consumer to drive repeat purchases in the store. Only 38% of all survey respondents say their companies use digital channels to drive planogram compliance, and just 30% say their companies use digital channels to drive perfect order and perfect delivery programs with retail partners.
Van Bockstaele goes on to say, “… most CPG companies acknowledge… the primary value of analytics revolves around obtaining a better view of the shopper… (but) they continue to struggle with the quality and consistency of the data available… ”
The executives surveyed believe store infrastructure will evolve too slowly to adequately reach an expected one billion new middle-class consumers in emerging markets. They identified cost (54%), development of suitable product offerings (54%), and fulfillment (51%) as the three main challenges.
For more information about the Accenture study, please visit here.
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