Online shopping is pervasive - 49% of U.S. consumers shop for consumer packaged goods products online.
Age and affluence are no longer inhibitors to online shopping – 61% of Millennials, 55% of Generation X, 41% of Boomers and 39% of Greatest Generation have recently purchased a CPG product online.
Many food manufacturers and retailers are admittedly not prepared to meet the needs of digitally engaged food shoppers. Based on extensive research and interviews with grocery industry executives, we've found that the classic transformation categories - people, process and technology - provide a roadmap for successful digital transformation. Within these areas, there are six distinct imperatives driving costs that trade partners must overcome if they want to succeed in omnichannel.
The rush to maximize online channels drove many manufacturers and retailers to build completely separate digital teams that often lack cohesion with the traditional brick and mortar teams. Integrating teams into a singular omnichannel structure can reduce redundancy and ensure a cohesive strategy. Securing the right talent to lead integration efforts is also critical.
Only 7% of retailers surveyed believe they have the skill sets to succeed in digital compared to 22% of manufacturers.
Multiple, misaligned forecasts add cost and increase operational inefficiencies. Food manufacturers and retailers who forecast collaboratively can improve overall inventory management while increasing sales.
Delivering the right product to the right customer at the right time and cost requires a balance between demand planning, response and execution.
Data inaccuracy is not a new issue, yet it’s still a significant cost contributor for which the industry has not agreed on a solution. Both food manufacturers and retailers must accelerate the solution for this industry-wide issue.
When the price and product description is identical across channels—in-store, online and between collaborating partners.
Many food retailers and manufacturers are creating their own views of the shopper and in most cases these views aren’t integrated. This fragmentation limits the potential for real growth, particularly in digital which introduces an entirely new dimension of real-time shopper intelligence. In surveying retailers and manufacturers, each believed collaborative, integrated shopper data can radically improve return on investment.
Food retailers and manufacturers are failing to adequately share shopper data, segmentations and other consumer insights, leading to missed opportunities to work collaboratively to grow sales.
Disconnected shelf capabilities add significant cost to the system for both food retailers and manufacturers. Completeness and consistency across in-store and digital shelves are table stakes for cutting costs and creating a clear omnichannel assortment strategy that keeps digital shoppers coming back.
Product information, imagery, seamless views of the shelf, and transparent pricing are all critical to building a better, more cost-effective digital shelf and they are only achieved with food manufacturer and retailer collaboration.
Digital environments exacerbate waste in food manufacturer’s and retailer’s current marketing spend by introducing an almost infinite amount of consumer touch points. Traditional trade promotion strategies follow product flow. Trade promotion strategies built for our omnichannel future must follow the shopper flow. To do this effectively, manufacturers and retailers will need strong, collaborative shopper engagement strategies.
As much as 72% of digital promotions are not delivering needed return on investment. Much like in brick and mortar environments, collaboratively identifying and pursuing only the campaigns with the greatest ROI potential will be vital.
Download Digital Food Shopper: Managing Your Collaboration Model to learn how you can leverage the accelerators and overcome the inhibitors to omnichannel success.BONUS: Download Finding the Profitable Path to Your Digitally Engaged Grocery Shoppers Executive Workbook 2018 to determine if you are ready for this digital adoption pace.
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