The journey to becoming a data-driven consumer goods firm
- Posted on June 5, 2023
- Estimated reading time 6 minutes
There are two types of people: those who focus on the big picture and those who focus on the details. Neither is better or worse than the other, but more than likely you are closer to one of those two camps than the other.
Your consumer goods business uses data every day. From sell-through data to focus group and market research data, it’s driving your decision-making. But you know you could always take it further: you could obtain more data, better data, data that uncovers more insights that could boost margins, revenue or increase price-to-earnings ratios.
You already know the impact analytics and data can have on your business: consumer goods firms that scale data, analytics and AI can achieve a 32% increase in their price-to-earnings ratio and triple their return on investment compared to other companies stuck with siloed, inaccessible data.
However, the path to powerful analytics isn’t always straightforward. In fact, 80%
of global decision-makers struggle to make the most of data and insights and 74% of CPG executives say they are struggling to scale analytics and AI capabilities across their business.
This is keenly felt by larger, more established CPGs. They have a hard time reorganising their widely dispersed organisational elements to become more data-driven and customer-centric – all while battling, circumventing, and reinventing legacy tech.
No matter where you are with your data, AI and automation maturity journey, more can be done. Organisations today can no longer wait to get results from digital in 3 or 5 years (or even 1 year). Business value must be delivered in weeks.
How mature is your approach to data and analytics?
There are five key questions to ask:
- Do we regularly collect business data?
- Do we analyse that data?
- Do we make decisions based on that analysis?
- Do we use that data to predict future scenarios?
- Do we democratise data for effective use across the business?
If you answered yes to all of these, stop reading right now and make yourself a congratulatory coffee. Your consumer goods organisation is way ahead of the competition.
If you answered no to one or more (especially question 4), then welcome to the club – you’re not the only one recording and analysing data but not in quite the advanced ways you’d like.
The challenges for consumer goods firms
Business unit structure means data silos are unavoidable. Data is fragmented and difficult to make use of, which is a by-product of CPGs being too IT-centric (doing what can be done rather than what should be done).
Data projects fail to get support from the business or board level, so they fail more than they should. Stakeholder buy-in across the whole business is essential but hard to achieve. Communication of the benefits is a big part of the answer.
Data governance is an afterthought for many businesses, with data and network security rarely forming part of any data platform’s foundations. This is perhaps because data governance is a difficult-to-communicate concept (it helps keep data secure, private, accurate, available, and usable).
The consumer engagement story for established CPG brands is often one of fragmented experiences, a lack of 360-degree visibility and a struggle to meet changing consumer needs.
Data and analytics goals: What CPGs are looking for
The objective is a Unified Data Platform that offers a number of powerful benefits:
- One version of the truth with commonly agreed KPI definitions, data lineage and governance. The result is quality and consistency.
- Fast and timely data to support near-real-time reporting on performance and operations, providing our colleagues with the tools to manage forward rather than retrospectively.
- Automated operational and performance reporting removes the effort in manual report creation and enables more time to be spent on analysis and action.
- Enabling self-service analytics to give more capabilities back to business units, from the advanced insight teams to basic users to drive speed of thought interrogation of the data down transactional detail.
- Mobile and tablet access transforms how you access reports and business insights. Ease of access gives everyone in your organisation – from execs to store or manufacturing managers and omnichannel colleagues – visibility of reports, alerts and insights.
All of this together delivers joined-up data across all channels, offering a complete picture of your business with options to drill down into specific areas of data. It’s a 360-degree view of each customer, delivering personalised and meaningful experiences in every interaction through all channels, ultimately bringing actual revenue increases.
Complete tracking of goods from warehouse to the customer allows businesses to optimise orders and routes, plus accurate tracking for customer orders, which means more reliable aftercare services (and that means improved customer loyalty and NPS ratings).
Transforming the way you handle and use data
Building a data operating model (Unified Data platform) like this is a colossal piece of work, and it takes time. So why choose Avanade? First and foremost, we’re honest with you. We'll tell you if we’re not the right people for the job. There are many different operating models, such as centralised data lake, data fabric, data mesh, hub and spoke… the list goes on. The truth is there is no single right answer, as the best operating model depends on your organisation.
We will work with you to not only define your ‘north star’ vision but also to establish a clear roadmap. This roadmap will be carefully designed to align to your wider business strategy while also maximising the potential of your data and ability to deliver value.
It's beyond the scope of this blog post to give you all the answers and tell you which model to use. But talking to Avanade can help you on your journey to advanced data and analytics. We’ll help you navigate through various operating models and co-create the one that works for your organisation.
We bring a vast range of different vertical expertise together in one place. After all, good data and analytics depend on many different elements: managed services, infrastructure, data collection software, AI, IoT, and more besides.
Innovation – through analytics – as your engine for growth
Our continuous innovation methodology helps you face the future with confidence by embedding responsiveness and agility into your team, department or entire organisation. To move a concept, process, service, product or feature from a vague idea to a fully implemented solution, a methodical continuous innovation approach is essential. It’s our way of unlocking faster collaboration, experimentation, learning, and adaptation throughout your business.
We’re plugged into the right insights, bringing a resilient, tried-and-tested approach that at the same time has the flex to adapt to different organisations, work styles and market fluctuations. Adapting to change is critical, both for you and for us. We’re in for the long haul.