Speed and personalization will determine how consumer marketing is done in the future.
According to Andrew Appel, CEO of Chicago-based market research firm Information Resources, Inc. (I.R.I.), influencing customer purchase behavior is getting more personal. The industry is moving away from store-centric programs and toward people-centric ones, and the ability of marketers to quickly reach and impact individual consumers may soon determine the success of future shopper marketing initiatives.
Ahead of the company’s annual Growth Summit, which is scheduled for April 16–18 in Las Vegas, Mr. Appel spoke with Food Business News.
“Over the last three to five years, there has been a fairly significant shift toward personalization,” Mr. Appel stated. “Teaching companies to make decisions faster will be the biggest change in the next three to five years.” Artificial intelligence, or A.I., or automatic learning is what we mean when we discuss how a sales team, operations manager, or brand manager can use information more quickly and independently.
As smaller enterprises overtake larger competitors in the market, decision-making speed is already having an effect.
“I believe that speed and a lack of perfection set apart the nimble players from the bigger players,” he remarked. Therefore, if I were the chief executive officer of a large food firm, I would strive to concentrate on decision-making speed, action speed, employee alignment toward performance, and decision-making simplicity and creativity.
Mr. Appel continued, “One problem facing larger organizations is that most large companies’ executives spend an excessive amount of time making decisions and striving for a 90% accuracy rate.”
He declared, “Decisions are reversible.” “Now that’s easy to say and difficult to do, especially if you work for a big company.”
Choosing which data sets to concentrate on while evaluating market circumstances and making decisions is a challenge that all manufacturers adopting data analytics must overcome.”Unless it’s advancing and activating customers, it’s noise,” Mr. Appel remarked.
Mr. Appel made repeated references to the disruption of the consumer packaged goods business during the conversation. He pointed out that CPG producers are facing challenges from artificial intelligence, e-commerce, and the fragmentation of the brick and mortar sector.
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“There are many dimensions,” he remarked. The ones that Amazon can distribute the best are, in a sense, the most disrupted. These would be non-perishable, low-weight, high-value items.Private label has the potential to upend product categories with the least amount of brand distinction, according to him.
“This would be low-cost, reasonably-quality food, like pasta,” he remarked. “I assume that this is the point of private label penetration. Beer and soda have a high level of brand loyalty. These categories seem to be less disturbed.
CPG companies are confronted with an additional challenge: the fragmentation of retail, both in physical stores and online. Businesses—bigger ones especially—are attempting to supply a diverse array of goods to a highly fragmented market.
“It’s in my natural DNA to be where the customers are,” Mr. Appel remarked. “I don’t think you can be overly limited in the formats and distribution channels you serve if you are a product company fulfilling customer needs.”
However, he went on, manufacturers should pay more attention to markets that are now expanding organically and less attention to chances from the past.”Investing in your base, whether it be a particular segment, geography, or channel, is easier than investing in your future base,” he stated. People must observe which areas of the industry are expanding at a rate of 6% and which are expanding at 0%. The next step is for individuals to determine which will be the 6% growers over the following five years.
Mr. Appel also observes a change in the operation of the food and beverage supply chain.
He stated, “I believe that the paradigm of partnership and participation needs to be changed as well.” “One thing to learn from the computer industry is that your rival may be a friend as well. For instance, Apple sources the majority of its parts from Samsung.”I believe that a change in the relationship between producers and merchants is necessary in our sector. They have doubts about working together. We can move more quickly the more we can innovate our supply chain operations.