Going Digital = Growth for CG Companies

Digital transformation is connecting billions of people worldwide, empowering consumers and enabling consumer packaged goods (CPG) companies to manage the enterprise more effectively and efficiently to drive growth, according to “Thriving in a Connected World”, the Grocery Manufacturers Association (GMA) and PwC US 2011 Food, Beverage, and Consumer Products financial performance report.

Now in its 15th year, the report includes analyses based on public information from 148 companies in the food, beverage and consumer products sector. According to the report, major opportunities for CPG companies are being created with digital technologies.
 

"CPG companies of all sizes harnessed digital technologies in the past few years to become more productive and efficient," said GMA President and CEO Pamela G. Bailey. "This study shows how food, beverage and consumer products manufacturers are leveraging innovation to optimize service to consumers and trading partners."
 

For example, business mobility has been shown to boost productivity in sales, supply chains, distribution centers and stores, as well as to contribute to individual productivity. To determine the best use of mobile devices across the workforce, the report suggests that workforce productivity should be viewed through three lenses: mobility on the floor where workers use their digital devices for instant information; in the field where mobile employees can make decisions on the spot with their devices; and in flight where sales representatives, who historically travelled to each location to analyze performance, now use mobile technology to monitor activity, thereby increasing productivity.

The report notes that as devices and wireless data networks grow, rich multimedia capabilities will continue to be added to business work flows and businesses will continue to capitalize on the opportunities mobile devices create within the workforce.
 

"Today's consumers are more empowered with greater control of their shopping choices with the growing array of digital technologies like smart phones, tablets and social media. And they aren't shy about posting their feelings online about products, where they literally are handing over reams of potential insights that can create a tremendous opportunity for CPG companies that can find the patterns in the noise," said Susan McPartlin, PwC's Retail and Consumer Industry Leader. "Just a few years ago, digital information meant one thing to senior executives – risk. However, companies are no longer just thinking 'defense,' they are using the digital data to advance their competitive position, help improve all aspects of operations and get smarter about international expansion plans."
 

To this point, the report notes that currently, CPG companies lack detailed insights about consumers in China and other emerging markets. Many of the norms taken for granted in developed markets — point-of-sale SKU numbers, predictable pricing models, even accurate information about how to reach a store or when it will be open — cannot be assumed in emerging markets. According to the survey, connecting with consumers on their own digital terms will allow companies to learn how these markets work.
 

Additional key findings from “Thriving in a Connected World” include:

For an electronic copy of “Thriving in a Connected World”, visit: www.pwc.com/us/retailandconsumer or www.gmaonline.org.