Over the last decade, the traditional strengths of Consumer Packaged Goods (CPG) companies have been slowly eroded. Companies no longer need to own factories to produce goods, Amazon sells anyone’s products, the power of mass-marketing through traditional media is dwindling, talent favours startups, and innovation happens increasingly outside corporate R&D centres.
Digital native companies like Ocado and HelloFresh are disrupting the industry at incredible speed. Next to their inherent nature to think customer-first, they are also a step ahead organizationally, not hampered by siloed marketing and sales departments or complex global-local operating models. At the same time, digital aggregators like Amazon and Alibaba are rapidly gaining momentum by consolidating demand in fragmented markets and increasing transparency on performance and price. Further down the value chain, new formats like Rappi, Grab, and Getir are gaining ground by offering on-demand delivery services. Together these developments have led to a heated battle for the consumer, and in particular, the data that direct online contact with the consumer yields.
The consumer goods industry has learned that if you know your consumers, and can drive information from their behaviour into your decisions, you will win the market.
We have helped multiple global CPGs navigate digital disruption by re-inventing their organizational set-up, building new capabilities, and architecting the right technology landscapes. Such transformations do not always come naturally for multi-billion-dollar businesses spread across many product categories and regions. However in the new disrupted reality, they are key to survival.
Over the decade we have developed a model through which CPGs are able to step up their digital capabilities on three horizons: optimization, transformation, and disruption. These generate value on different timelines.
Making disruption work in the consumer goods industry isn’t an overnight process, nor is it a complete leap of faith. We guide global CEOs and CDOs through their digital journeys, from kickstarting proof-of-concepts in local markets and scaling them when successful, to supporting technology selection and building global structures, to launching stand-alone ecommerce ventures.
Working with CPGs has strengthened our conviction that knowing the customer, and in particular, using the data that comes with knowing your customer, is the key to competitive advantage. Only through this can companies accelerate learning and drive up satisfaction, sales and margin. CPGs that have the right operating model, and that are able to combine global scale with placing customer data at the heart of every decision, do well.
We supported Heineken in their global digital transformation. First we co-designed the overall approach and roadmap, and then we kickstarted initiatives on the ground in select front-running markets to prove what worked. This included monetisation of B2B routes-to-market and implementing data-led decision-making.
We crafted Colgate-Palmolive’s Europe-wide digital and ecommerce strategy and designed their digital operating model, enabling them to realize their digital growth ambitions. Through the joint strategic review and implementation, the ecommerce team successfully trained 10 local country teams and supported engagements with 30+ partner retailers and pure players.