The Fast Moving Consumer Goods (FMCG) sector is the fourth largest sector in India. It is growing at a compound annual growth rate (CAGR) of almost 28%.
Automation & Robotics
“90% of all predictable & physical processes in the manufacturing industry can be replaced by automation for the benefit of producers & consumers.” - McKinsey & Company
Automation, digitisation and advanced analytics are changing the business landscape. “Autonomous Mobile Robots” are freely navigating material handling equipment which is equivalent to a driverless Google car transferring material without requiring an operator. These robots have a suite of the sensors that enables them to perceive the external environment, helping them to navigate around fixed obstructions and moving obstacles to perform designated tasks collaboratively with human workers. FMCG businesses can achieve an optimal model for manufacturing success by combining human skills with robotic ability and autonomy as it facilitates:
- Reduction in production bottlenecks
- Reduction in delays caused by human errors
- Helps individuals in higher value addition
- Helps individuals to focus on higher priority tasks
“Artificial Intelligence in FMCG will increase productivity by 40% and profitability by 38% by 2035.” - Accenture
Traditional to Digital
The 2020 COVID pandemic has highlighted the limitations of traditional ways of doing business. It has resulted in the abrupt shift to digital retail. Social distancing has accelerated the adoption of e-commerce and consumers will continue to embrace digital platforms for a variety of needs in the years to come. This is apparent because even after lockdown restrictions were lifted, digital engagement has continued to remain high, with 80% of consumers reporting safe, easy and convenient experiences in Direct to Consumer (DTC) channels.
“Buy Online Pickup In Store” i.e. BOPIS is another emerging trend among consumers. The primary reason behind this change is safety along with the ability to browse through the entire assortment more efficiently, at the convenience and comfort of their home. Brands, who fulfils the single serve needs, at home consumption and evolved shopping missions; are going to dictate the new pipeline priorities. Brands should get a hang of the consumer base and price / value considerations that can potentially drive the overall net present value.
Technology doesn't just enhance the market reach for a brand but it also helps get better understanding of the consumer base, better consumer segmentation, brings down the cost of order capturing, boosts sales efficiency with the help of AI and dramatically reduces the time to reach the market.
Augmented Reality and Virtual Reality
51% of the global consumers are willing to try the new reality i.e. AR & VR to assess products & services. Consumers are still hesitant to go out to stores. The onus is upon brands and retailers to offer them alternative entertainment & shopping experiences. Businesses that can leverage AR / VR may hold the answer to immersive augmented reality experience that will transform engagement and shopping in the near future.
Leading Trends
Multichannel to Omnichannel Transition
In multichannel marketing, the brand is at the center of the strategy, with one static message that’s communicated to each channel. In omnichannel marketing, the customer is at the center of the strategy, with channels adapting around the customer’s behaviour. Providing virtual trial rooms and video based sales calling kind of integration between offline and online retail is likely to grow further. Businesses are exploring integration strategies to enrich the customer value proposition. The focus is now creating a unified shopping experience for customers across different marketing and sales channels.
Direct to Consumer Strategy
A direct-to-consumer (DTC) approach is about building one-on-one consumer relationships by leveraging technology to deliver deep consumer insight. This can lead to relevant, personalised products, services, experience products, services, experiences, communication and offers and can efficiently drive increased consumer acquisition, conversion, retention and advocacy.
Why DTC Strategy ?
- Competitive advantage over big as well as small brands
- Effective & efficient targeting, acquisition, conversion and retention
- Reduced cost & media agency dependency as you own data
- Restructured retail as it eliminates retailers margin
- Scale up operations by leveraging technology
