AI is here today with 16.7 percent CPG manufacturers surveyed reported they are actively working on incorporating AI capabilities. However, 33.3 percent of those surveyed responded that AI is still two to three years out. POI’s research has found this response contrary to the broader market of AI availability. Europe was an early adopter of AI planning and optimization capabilities, and as a result, and many European solutions are now available in the U.S.
75.7 percent of companies surveyed continue to have data challenges with foundational data (such as POS, daily, shopper). Retailers and manufacturers must make data acquisition and sharing a top priority in 2019 and beyond. Retailers, manufacturers, and vendors will need to stretch beyond traditional data and better understand what services the consumer desires and start co-locating these “benefits” within the store.
69.9 percent of respondents agree that their companies are struggling to have retailer aligned promotions executed at store level. When retailer aligned promotions are not executed as planned at store level, both teams fail to gain the expected results. Although retail execution of aligned promotions is up 20.1 percent over last year, improvements in aligned promotions needs to be accelerated.
91 percent of respondents surveyed said there is a substantial lack of linkage between digital and traditional promotions. Integration of consumer and loyalty shopper data is helping to see who the target consumer is and cater store layouts, offers, promotions, to them based on these preferences. Companies need to ensure they are on a journey to ‘full integration,’ which will benefit the manufacturer and what the manufacturer can share with their retail partners.
The lack of connectivity between trade promotion systems and retail execution systems is severely impacting execution and revenue gains by millions of dollars. Execution is everything, and the inability to pass promotion tactic changes to the field and monitor in-flight activity is costing manufacturers and retailers’ money.
Manufacturer concerns about the ability to drive profitable business with Amazon continues to increase dramatically year-over-year. The ecommerce journey is best not done alone. The POI recommends that manufacturers network to understand and replicate what is working and also how to overcome obstacles with their peer-set.
Source: (Kantar Consulting March 4, 2019)
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