4 Major BI Challenges For The FMCG Industry And How To Overcome Them Hemanth Kumar November 2, 2017

4 Major BI Challenges For The FMCG Industry And How To Overcome Them

4 Major BI Challenges For The FMCG Industry And How To Overcome Them

Traditionally the FMCG industry is an extremely competitive business.

The diverse, broad and hard-to-predict influencing factors in sales, marketing and supply chain make it an ever-changing field.

In this environment of constant change, FMCG executives not only have to strategize for the present but also plan for the future.

Since the consumer base is huge and distributed across various geographical locations, the competition from local players also impacts business.

Also, with the advent of digital media and increase in delivery channels, tapping the most spot-on growth opportunities has become more complicated in an already complex system.

To sum it up in a few lines, the success of an FMCG company heavily relies on two crucial aspects – speed and accuracy.

Whether it is to run the right sales promotions or choosing the best marketing campaign or picking the most cost-effective supply chain, the overall success depends on

  • The accuracy of decisions in each scenario.
  • How fast every decision is taken

Needless to say the accuracy in decisions comes with the data available with each executive.

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However when it comes it to accessing required information, FMCG companies typically face these 4 major challenges:

Dependence On A standalone BI Tool/Application

Half knowledge is more dangerous than ignorance.

Most FMCG firms depend on a analytics or a BI tool for obtaining insights and decision making. While the data obtained is still useful, the data acquired doesn’t give a 360 degree view of each scenario.

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For example, using the tool you might easily notice that there is a drop in soft drinks’ sales in London.

However you may not conveniently spot the exact reason and problem source for this drop.

You again need to check numerous related hierarchy reports/spreadsheets (product, sales, region etc.) to find the cause.

In an industry where there are multitudinous influencing factors and time is a crunch factor, the usage of such a singular tool leads to an inaccurate and time-consuming decision making.

Read more: 5 Tips For Developing An Effective BI Strategy

Customizable Reports

The one thing an FMCG executive can’t survive without – Reports.

This is quite obvious and understandable. Customarily for FMCG users, reports were the go-to visual formats for accessing data.

However in most FMCG firms, report generation is a job of MIS or developer teams.

Whenever executives need new reports or updation of existing reports, they have to constantly hover around these teams.

This tedious procedure wastes time and decreases the work productivity of both groups.

Insights From Limited Data Sources

Typically FMCG companies use internal market research data, organizational historical data or/and syndicated data from vendors like Nielsen, IRI, SPINS etc.

These types of data are important. We won’t deny that.

But in an industry which possesses multifarious consumer touch points, the sole dependence on syndicated data providers results in limited insights.

There will be an additional need to combine the internal sales,market research and finance data with syndicated data to get the right insights.

Also, combining this data with external data sources like Social feeds from Twitter, facebook , weather forecasts, events related data make these insights far richer to study cause and effect.

Lack Of Forecasting And Evaluation Intelligence

As mentioned earlier, FMCG executives not only have to strategize for today but also plan for tomorrow.

They need to continuously factor in various market scenarios and forecast growth for the future.

An effective BI system should not just provide insight but also help users in evaluating understanding the consequences of every decision.


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For instance, if the CMO decides to increase the marketing budget by 30% in London, the BI system should be able to analyze and forecast the effect on sales in that particular region.


If the brand manager wants to cut costs on dogs (as in the BCG matrix) and explore new market/product segments, the BI system should be able to detect and recommend  growth opportunities.


How will external factors like weather or events in the city going to impact sales –  If it is going to be colder than usual temperatures, certain products will be sold more and If there is a football event there will be an increase in demand for certain beverages and snacks.

However, these elements are missing in several FMCG BI systems today and most executives still depend on intuition-based strategies

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How to overcome them? – 360° Intelligent BI system

The uncommon data requirements of the FMCG industry, demand a tailor BI system which should possess the following characteristics:

1. The BI system should be a self-service one, meaning – users should be able to quickly generate customized reports without depending on the MIS team every time.

Read more: Power BI & The Shift to Self-Service Business Intelligence

2. An efficient FMCG BI system should be powered with advanced analytics features (preferably predictive analytics) which not only just presents insights but also

  • ROI per dollar spent
  • ROI of shelf life
  • Losses due to OTIF and MSL non-compliance
  • Dogs, Cows, Stars and Question marks
  • Any uncommon sales, marketing or supply chain anomalies
  • Marketing and sales promotional campaigns and channels
  • Custom plan for cost optimization based on the BCG matrix
  • Measures to reduce OTIF losses
  • MSL value for region , sku , channel and store
  • Future sales
  • OTIF loss because of non compliance of MSL
  • Growth opportunities in different regions, market and product segments etc.

While these are just a few scenarios, there are a ton of others where an intelligent BI can help. Get in touch with our Business Intelligence experts to discuss your BI strategy.

3. Since there are many influencing factors and innumerable consumer touch points in the FMCG industry, wide varieties of data need to be feeded in the BI system.

These can include big data from syndicated data providers, internal market research, weather forecasting, social streams, POS, historical campaigns etc.

4. While obtaining accurate data is itself a struggle in a traditional BI system, getting it in the right format is another tussle. FMCG executives should have the flexibility to access data in preferred and advanced visual formats.

These formats can be customizable dashboards, graphs, pie-charts etc.

Questions an effective BI system should answer for FMCG executives

Since the success of any FMCG company largely depends on the efficiency of marketing, sales and supply chain teams, an effective BI system should answer these important questions.

MarketingSalesSupply Chain

1. Am I getting the correct ROI for the marketing spend.

2.Am I spending at the right time and place.

3. Am I missing any opportunity which can yield me good results.

4. Is there a new segment that I can target.

5. Can I optimize the spend on each brand based on the BCG Matrix

6. Are my Marketing efforts helping competition and by how much.

1. How can I forecast my sales better.

2. How can I increase sales by improving operational efficiencies.

3.What kind of Promotional activities give me optimal results and where .

4.What is my lost opportunity of sales .

5. Is my shelf space expenditure giving me the right ROI

6. What is the right product mix for that store

  1. How can I analyze the number of trucks required, truck load efficiency etc.
  2. How can I easily identify which items went out of stock and when.
  3. How can I ensure that products are always available on-shelf
  4. How to plan product transportation based on weather and environmental factors
  5. How to invest in the right channels and optimize costs

Last but not the least – adoption of BI

This is an important one.

Even though FMCG companies today are investing heavily in various BI tools, these tools usually have a low adoption rate.

In addition to the reasons mentioned above, another primary reason for poor adoption is the non-availability of data at fingertips.

Executives need to open the BI system and go through numerous reports for accessing the smallest pieces of data.

Sales team on the field need to have information at their fingertips instead of going through various reports to make decisions.

In such a complicated scenario, an AI powered chatbot might come up as an ideal solution.

The conversational interface of a chatbot enable it to take relevant data from the existing BI system and present it as answers to users’ queries.

Powered with Machine Learning and Natural Language Processing, these chatbots can present information in both text and rich media formats.

The best thing? These bots can be integrated in the organizational messaging platforms like Skype For Business,  Slack etc. and users don’t even need to switch reports and visit the BI system again.

This convenient data accession provided by chatbots allows FMCG executives to always take quick and data-backed decisions.


To wrap it up, speed and accuracy of decision-making are extremely critical for the success of any FMCG business.

The table below demonstrates how an effective BI system can achieve these two key components.

Accuracy of data
  • Big data from multifarious consumer touch points
  • Advanced analytics features (preferably predictive analytics)
  • Advanced visualization components
  • Self-service option for quicker and customized report generation
  • AI chatbots for providing data at fingertips

Know how FMCG companies like Reckitt Benckiser, Britvic, Unilever etc., are leveraging our intelligent BI systems to multi-fold their revenue growth.

If you’d like to learn more about this topic, please feel free to get in touch with one of our experts for a personalized consultation.