Throughout the chapters of history, the target market of the FMCG industry is huge and constantly expanding. In a recent research, it is even found that the global FMCG market will grow at a CAGR of around 4% by 2020.
With the continuous expansion, the complexity and diversity in the 5 P’s of marketing – Product, Price, People, Place and Promotion has also increased.
Needless to say, the consumer base of any large to mid-sized FMCG company is enormous and is spread across numerous locations (countries/states/cities).
In marketing speak we can say, the distribution networks are extensive.
Consumption patterns of customers also keep changing and new segments are being created at the same time.
Depending on the specific market and its needs, strategies for pricing, marketing/advertising and product modifications vary too.
Customarily, the traditional media i.e TV advertisements, print and banner ads was the popular go-to marketing channel for several FMCG marketing executives.
However, the rapid rise of digital media and online social networks has opened a whole lot of new marketing opportunities.
This diverse fragmentation of a gigantic market coupled with cut-throat competition and endless opportunities to communicate with end-consumers in both the traditional and digital worlds, has led to the following questions among the FMCG marketing executive circle:
- Am I spending at the right time and place?
- Am I missing any opportunity which can yield me good results?
- Is there a new segment that I can target?
- Am I getting the correct ROI for the marketing spend?
- Are my Marketing efforts helping competition and by how much?
- Can I optimize the spend on each brand based on the BCG Matrix?
As someone who helped improve the marketing ROI of Fortune 100 FMCG companies by over 3% for more than 10 years, we get these questions from several CMOs on a regular basis and we understand the pain-points and know how exactly to solve them.
Most Common Problems in FMCG Marketing & Their Secret Solutions
Problem #1 Identifying The Right and New Market Segments And Opportunities
FMCG companies mainly rely on syndicated market data providers like Nielsen, IRI, SPINS etc. for various market research purposes (which we will discuss as we go further)
Companies buy this data or subscribe to the reports by the providers. However these reports are provided for a few senior executives and for the rest, they tend to take the data and create reports based on Excel or some other BI tool.
These reports are used for:
- Recognizing the cash cows, dogs, stars and question marks in the BCG matrix
- Identifying segment wise performance of competitors and opportunities for new product launches.
- Analyzing the region wise product performances for identifying new potential markets and increase the reach of existing products.
The sole dependence on syndicated and internal market data.
Even though we acknowledge the importance of syndicated data, the sole dependence on it for identifying new market segments and other market research activities may result in lot of missed opportunities.
Also, these reports are time consuming to develop and don’t give pinpointed insights. Since executives need to go through multiple spread sheets, the work productivity also decreases.
The Secret Solution #1
Acuvate’s data science powered Business Intelligence solution combines syndicated data, internal data and big data from various social networks, search analytics data etc. and identifies new potential market segments. It can even detect the size of each opportunity.
This way, the right amount of planning and budgeting can be done for new product launches and marketing.
The solution also can…
- Forecast the growth of your existing segments and product base.
- Give you the performance of your question marks and forecast what the likely performance is going to be
- Alert you on any risks for your cash cows and stars based on market performance.
- Enable you to optimize the spend on each brand based on the BCG matrix.
Problem #2 Inaccurate Targeted Marketing/Advertising Strategies
Half-knowledge is worse than ignorance – Thomas B. Macaulay
FMCG CMOs usually spend a massive amount of money on marketing/advertising.
As noted earlier, the consumer base is enormous and is spread across numerous locations. There are also a ton of traditional and digital marketing channels to reach the end consumer.
All these factors put tremendous stress on CMOs who need to ensure that a marketing campaign actually convert into high-yielding sales in that region.
With the amount of available data and factors which need to be considered, they often find it hard to predict and run the right campaign at the right time and on the right channels.
In simpler terms, CMOs struggle with detecting the right opportunities that result in a high marketing ROI.
In fact in a research by McKinsey, it was found that even seasoned CPG executives within marketing and sales confess they don’t fully understand consumers’ digital behaviors or know the best ways to use digital channels and tools.
Again, in a rush, most FMCG marketing executives today rely on historical data from the organizational traditional business intelligence, syndicated market data and to an extent on intuitive hunches to design marketing/advertising strategies.
Executives can’t nail down which promotions yield the maximum bang for the buck. They cannot exactly spot which strategies convert into high-yielding sales.
The Secret Solution #2
Powered with Predictive Analytics, Acuvate’s BI services help marketing teams to
- Forecast and Recommend the right advertising campaigns, platforms, channels etc. at a particular time-period based on the influencing factors
- Detect the best campaigns and events which have generated maximum revenue in a specific region and product category.
- Detect which type of campaigns/strategies worked well for your competitors.
Problem #3 Poor Reporting System & Lack of structured data
In the fast-paced and ever-changing environment of FMCG industry, the ready availability of customized reports (both static and dynamic) for different hierarchy levels is extremely critical.
Today, the FMCG marketing teams depend on developers or a MIS team who consolidate all the data required and create reports for the Business teams to define strategy and take decisions.
This procedure requires a lot of time, money and effort due to manual consolidation and creation of reports. These reports also can’t be updated immediately and marketing teams again have to flock around the IT department for small changes
The delay in decision-making of marketing executives directly impacts the sales and supply-chain teams and thereby resulting in the decrease of effectiveness of the campaign and consequently the marketing ROI.
The Secret Solution #3
Acuvate’s self-service BI coupled with an AI powered report management system empowers marketing teams by
- Building customized data models and dashboards to provide a single window view for marketing and sales teams.
- Creating customized reports by converting unstructured data to structured one.
- Providing advanced self-service BI tools which can be used to create new reports or changing existing ones
- Increasing the work productivity of business users by eliminating the dependence on MIS teams and developers for creating new reports on existing data
- Using AI powered chatbots which can push reports or updates to the right personnel at the right time.
- Presenting information quickly in both text and rich media formats for faster decision making.
But, how adoptable are these new technological solutions?
We understand that the adoption of these new technologies looks like a huge change management process.
You might be even thinking on the lines of..
“Yeah, I know that the use of such extensive data intelligence can leverage my marketing efforts. However, my team doesn’t even utilize the existing data systems properly, how can I make them use these technologies which sound much more advanced and sophisticated? “
But here’s the deal…
As mentioned earlier, we understand the exact pain-points of the FMCG business. We know that executives face problems in adopting and making use of data intelligence systems.
While the solution as a whole looks a bit sophisticated, the complexity part of it is limited to only attaining greater data accuracy.
Employees don’t have even have to learn/understand these new technologies. Since the solution is powered with an AI bot, your team can get the required data from these systems on-the-go.
Meaning- Just by asking a natural language question to the bot, employees can easily obtain the relevant data whenever and wherever they are chatting/emailing with other team members.
The easy integration of the bot into any of the organization’s messaging platform – SFB, Slack, Skype etc., adds to the convenience of obtaining crucial data at the right time.
In short, you won’t be burdening your team with a new traditional data system, but would provide them with a “intelligent digital assistant” which can quickly fetch the needed data from these advanced systems.
Want to increase your marketing ROI with our customized FMCG BI solutions? Get in touch with us for a free consultation!