Trends in Consumer Goods: Understanding Customers with Big Data
By leveraging the vast amount of information available, consumer goods IT executives can deliver an unprecedented amount of decision-making power to their business executives.
by Cassandra Moren, January 2013
The amount of data in the consumer goods industry has exploded in recent years. But many companies are drowning in data and starving for insights. The availability of SKU/store/day-level data, combined with the potential for real-time visibility into the demand and supply chains of an organization, give today’s consumer goods IT executives the opportunity to deliver an unprecedented amount of decision-making power to their business executives.
The quest to effectively leverage big data in consumer goods to get closer to consumers and to improve profitability, customer service, and operational efficiency will move to the forefront in 2013. Data is being generated by internal systems as well as flowing into organizations from various external sources, such as point-of- sale, and more recently via social media channels.
Big data in the consumer good industry creates value in many ways, including:
Providing a better understanding of consumers, which leads to fine-tuned segmentation to target and engage them more effectively, as well as to create more tailored products
Enhancing innovation and new product development
Making information transparent and more usable across the organization
Improving operational efficiencies and accelerating business performance
A recent Oracle report, “From Overload to Impact: An Industry Scorecard on Big Data Business Challenges,” surveyed 333 U.S. and Canadian c-level executives from consumer goods and 10 other industries to determine the pain points they face regarding managing the deluge of data coming into their organizations. The report found that 90% of c-level consumer goods executives say their organization is collecting and managing an average of 71% more business information today than two years ago. In addition, consumer goods company executives say they are not prepared to handle the increasing amount of data they face. In addition:
Forty two percent of consumer goods executives give their organization a “C” or below in preparedness to manage the data. Only 10% of executives give their organization an “A” in preparedness.
Consumer goods respondents say they are unable to realize, on average, 19% of additional revenue per year by not being able to fully leverage the information they collect.
Consumer goods executives do not have or cannot get to the timely information they need.
Consumer goods executives are frustrated with their organization’s data gathering and distribution capabilities. Specifically, 43% cannot provide their business managers with access to pertinent information without the help of their IT team, 37% feel they are using systems that are not designed to meet the unique needs of their industry, and 33% note they do not have the right systems in place.
As the research indicates, it is no surprise that the promise of big data is top of mind for consumer goods executives in 2013.
The ability to capture, translate and leverage increasing amounts of information—from consumer and shopper data, customer or retailer data, social media, and the real-time visibility into the demand and supply chains—is critical. Investing in the necessary tools and analyzing business-critical information can help develop a deeper level of understanding of customers and products, enhance brand loyalty, increase sales, and drive competitive advantage. As such, organizations must equip themselves with the ability to store and quickly process these massive volumes of data with the appropriate technology to develop actionable insights.
Cassandra Moren is Industry Marketing senior director of Consumer Goods for Oracle.