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Consumer goods companies need to move to a digital operating model by rethinking their corporate structures, customer engagement, product development, supply chain, marketing and sales.
The consumer goods industry is experiencing dramatic changes. Approximately 15 million new outlets will be required to serve an expected one billion new consumers in 2015 and the affluent emerging market middle class. Leveraging digital technology is the only economically viable way for companies to compete and win in this environment.
We are moving from an analog to a digital world at breathtaking speed. Digitization is transferring information and power from manufacturers and retailers to consumers. And consumers and shoppers are embracing this digital world effortlessly. We are on the threshold of a dramatic digital transformation that will literally rewrite the rules of doing business.
Whatever stage your company is in on its journey, the digital world will affect its business profoundly. The path ahead is challenging. But it also offers the prospect of stronger revenues and profitability for those companies that can successfully enfranchise new emerging market consumers and digitize their business.
It is time to stop dabbling with digital. It is time to disrupt with digital.
View the presentation we gave at the Consumer Goods Forum 2013 Summit.
Read the speech given by Fabio Vacirca, global managing director of Consumer Goods & Services at Accenture.
Watch our video on how to build the digital model for consumer goods.
Digitization will disrupt your existing relationships, whether they are with suppliers, retailers or consumers. It will affect all aspects of your business—how you structure yourself internally, train employees, engage with your supply chain and retailers, create and market your products, and interact with consumers and shoppers.
The digital revolution is a commercial revolution, and must be driven by your commercial business, not your information technology department. It must be integrated right across the business, as well as along the value chain.
Above all, consumer goods companies need to move their digital responses from a tactical to a strategic level. This is not about digital marketing, it is about becoming a digital enterprise, and to do this they need to transform to a digital operating model. If they can do that, the rewards are potentially very high, as a billion new, connected consumers emerge in the coming decade.
To develop a digital operating model, consumer goods companies need to:
Move digital responses from a tactical to strategic level.
Start with the consumer and work backwards.
Abandon geography as a basis for organization and reorganize around route to market and retail categories, and consumer types.
Use more digital selling and distribution channels to keep up with the pace of change in a cost-effective way.
Partner with new online leaders, breaking the traditional bricks and mortar dominance.
Eliminate unnecessary trade investment no longer required in the online world by revolutionizing economics, and the manufacturer and consumer relationship.
Manage your ecosystem beyond the enterprise, to include your suppliers, distributors, retailers and route to consumer.
Be continuously relevant in your consumer interactions, own media, communicate digitally and win the influencers.
Focus your attention on the largest and fastest-growing consumer segments: gray consumers, newly affluent emerging marketing middle class, emerging consumers in countries such as Africa, and cash-strapped developed market consumers.
Expand your product range as physical store constraints decrease in the digital world.
Involve consumers in shaping products—in terms of price, fragrance, flavor, pack size and color.
June 12, 2013
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