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CPG Industry gets a makeover for better consumer experience

All thanks to technology, today retail industry has surely witnessed a transformation. Indian consumer packaged goods industry is no exception. Let's know how has the CPG industry changed over time.

Tags: Consumer Packaged Goods Industry, CPG Industry, Artificial intelligence, chatbots, smartphone, Alexa, Google Home, eMarketer, Indian retail industry, Indian retailer, Amazon, Consumer trends, GoodNes, Save Water By Colgate, Pedigree, Feed the Good, Virtual re

BY Guest author  |  Mar 09, 2018  |  comments ( 0 )  | 
Consumer Packaged Goods Industry

The Consumer Packaged Goods industry is undergoing massive transformation, thanks to the emerging digital technologies impacting companies across verticals and most importantly the new-age consumers who enthusiastically incorporate multiple shopping approaches in their everyday lives. As a result, CPG brands have started to adopt new models rooted in digital capabilities to develop newer ways to target different platforms and channels to reach out to their consumers at the right place, at the right moment.

More power to consumers
Artificial intelligence powered platforms such as chatbots, smartphone assistants like Siri and voice enabled devices like Alexa, Google Home as well as internet of things powered devices, and wearables are giving more power in the hand of consumers to redefine their shopping experience. These technologies are influencing much of the customers’ purchase decisions at a very early stage of their shopping journey, with them probably closing on the brand before actually visiting the retail store or going to the ecommerce website.

For instance, when you ask Alexa, which is the best gluten-free soup available in the neighborhood, Alexa suggestions might be based on what others have bought or might even recommend Amazon Prime high-margin products. These platforms eliminate the need to visit a store as consumers can voice order. This adds to the challenges brands face as it diminishes the opportunity for brands to interact and influence consumers in-store. These platforms integrate with the past shopping behavior of the customers, they promise personalized shopping experience and convenience, giving more reasons to believe these devices to grow in popularity in near future. This is further supported by a research done by Google that predicts 30% of all searches will be done through voice technology by, 2019. According to eMarketer, penetration of voice activated assistance device will increase as much as five times in the next three years.

Brands need to evolve to these changing needs and expectations of the consumers' brought by AI powered interfaces. These platforms can actually create more value for the customers and brands should leverage voice-enablement yet another layer for branding, just like social, mobile or any other digital channel. Tide, for example, has added a ‘skill’ on Alexa, giving consumers detailed instructions on how to remove stains. After reading the directions out loud, Alexa sends the instructions in a text message with a link to buy laundry detergent on Nestlé also rolled out a ‘GoodNes’ skill, which pairs voice-cooking instructions with an online guide. Colgate has ‘Save Water By Colgate’ skill where user can get interactive facts and tips to help you save water and stop waste.

Today’s consumers have a very short attention span. These consumers value real, personalized and transparent communication and want extra level of convenience, real-time feedback and entertainment in their busy lives. Visually engaging content in the form of video content and images is increasingly catching a lot of attention. Hence, the channels, type of content and strategy that worked for consumers a few years back might not be effective today. This calls for crafting a marketing strategy that fits the values and expectations of these consumers. For example, Pedigree recently adopted Facebook’s masks feature to help shelter dogs find homes in their mobile campaign, part of the Mars-owned pet-food brand’s ‘Feed the Good’ initiative. The experience is both, functional as well as fun – a perfect way to attract today’s digital audience.

How can CPG brands hit the right strategy and what’s the future?

Reaching Customers Directly: In the CPG industry, sales still happen mostly in-store, with retailers largely controlling shoppers’ in-moment decisions. Because of this, most CPG companies miss the opportunity to interact with their customers directly and influence their purchase decision. However, emerging technologies including AI powered smart vending machines, devices integrated with diagnostic capabilities and voice technology are enabling brands to engage with their target customers in a truly immersive manner. These smart devices help enhance customer experience by providing personalization, convenience and value to customers. They can also help the brand develop a closer emotional connection with the consumer, by providing customization and real time feedback.

Coca-Cola has been working on a smart digital vending machine powered by artificial intelligence and connected to cloud. Through this machine, the company will be able to control remotely the price and promotions at a specific location. It will also allow the brand to send personalized messages and provide a chat platform.

In fact, earlier this year Colgate launched its first app-enabled electronic tooth brush called the Colgate Smart Electronic Toothbrush E1 with Artificial Intelligence. Available exclusively on and in some Apple retail locations, Colgate's new product provides a few pieces of real-time feedback to help users improve their brushing routine.

Driving growth through data: Data is at the center of everything today. Growth of companies in the CPG industry is set to be driven by data based intelligence. Some of the big brands are already investing in collection of data and generating insight to drive growth. Big data investment is the topmost priority to inform new innovations and to deliver highly targeted customized marketing messages. Machine learning and AI are being leveraged to come up with powerful product recommendation engines. Brands are also directly collaborating with retailers for their shopper databases to better understand omni channel trends.

Going forward, consumers will continue to redefine the CPG industry with even greater power and choices in their hands. More brands have started to realize the importance and need to get closer to consumers; the industry is witnessing increased adoption of emerging tech and overall transformation of businesses fueled by digital technologies. Expected increased investment in key consumer technologies, some of them which are likely to see more traction this year include Artificial intelligence, Augmented reality and Virtual Reality and Conversational Platforms like Amazon Alexa, Apple's Siri, and Google Assistant.

This article has been authored by Priya Srivastava, Manager, SapientRazorfish


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