P&G Builds on Data Foundation With AI-Enabled Optimizations that Can Navigate Evolving Path to Purchase
Procter & Gamble is charting a course toward a data- and tech-enabled operational structure that can better navigate the headwinds that come with a rapidly changing consumer landscape.
While the foundational work has been established, P&G is working toward embedding AI across the enterprise to yield new optimizations and cost efficiencies and better meet consumer needs.
State of Consumer Shopping
The consumer shopping landscape is changing faster than ever, said P&G CEO and president Shailesh Jejurikar during a recent call with investors.
"Consumer media preferences and information collection are increasingly fragmented with new media platforms, including social media and retail media," he said. "Retailers are becoming media platforms and media platforms are becoming retailers."
Additionally, inflation across food, energy, healthcare and many other areas is taking a toll on consumers and how they assess value, he added.
This is changing the consumer path to purchase, creating a non-linear pathway with millions of possible distractions — with even more intense change expected over the next three to five years, predicts Jejurikar.
Building on a Bolstered Data Foundation
Several of the initial investments in P&G's digital transformation began in the last decade, said CFO Andre Schulten, speaking of a global ERP platform, a data lake, a data governance structure and stronger data engineering.
This work has allowed the company to tap into a "continuous flow of new data every day," gathering "petabytes of relevant data" from product research, shopper research, connected homes, ratings and reviews, social media posts, brand fan websites, among other sources.
While the plan is to mine these insights and turn them into new product innovation, brand ideas, performance claims, marketing campaigns, etc., the consumer connectivity portion is the next phase of the transformation for P&G.
On top of the initial investments are plans to activate technologies like AI around innovation and media. And on the supply chain side, P&G is focused on building capacity that leverages automation and digitization within both manufacturing and warehousing.
"We have built data platforms, AI capabilities, programmatic shelf tools, and media creation and evaluation systems," said Jejurikar. "We have supply chain platforms that can run autonomously, reacting to retail demand signals, consumer innovation needs or productivity opportunities faster than ever before."
Also: How P&G's mentorship framework helps support its modernization roadmap
Recent Developments
These efforts didn't happen overnight and required a significant internal cultural change for people who work with the data and systems, according to Jejurikar.
"The next step is to connect the dots to integrate the pieces from identifying consumer friction point to product idea, to product design, to supply, to creative concept, to purchase transaction, to usage in home, to post-use evaluation," he added, an initiative he plans to see accomplished in the next 12 to 18 months.
So far, the company's Supply Chain 3.0 initiative has improved end-to-end connectivity, from purchase signal through inventory systems to production planning and material ordering, so consumers can find the product they want each time they shop.
To tackle the challenge of media fragmentation, the company is using gen AI to "discover consumer-relevant insights at every step of the consumer path to purchase grounded in a unifying brand idea," according to Jejurikar.
Additionally, through AI-enabled product discovery, P&G hopes to enable faster innovation.
"We are creating individual touch point experiences for each consumer at a time. These ideas are activated in claims, demonstrations and visuals that communicate the performance and value of the brand across connected and broadcast TV, online video, social media, e-commerce sites, and in stores," he said, adding that there's increased opportunity for data integration with retail partners across the full supply chain and merchandising activity system.
