The Shoppers' Journey

Consumer sentiment and spending is on the upswing, but consumer goods (CG) manufacturers still find themselves facing intense economic and marketplace challenges. Kirk W. Wheeler, executive vice president, general manager, CPG Practice for Manthan Systems, explains the prerequisites that consumer goods manufacturers must pass in order to understand and activate the new shopper’s journey.


What opportunities exist for CG manufacturers to reignite sales and revenue growth?

Wheeler: Now more than ever, brands need to make sure that their value proposition is adapted to today’s drastically changed marketplace realities and consumer needs. For example, shoppers now look for multiple benefits in the brands they prefer. A toothpaste brand today must do a lot more than prevent cavities. Competing and winning in this new environment takes a lot of things, but product innovation is certainly at the top of the list. Just launching a brand line extension is no longer sufficient; that’s not real innovation. And, given the general lack of innovation in consumer products these days, it’s not a big surprise that sales growth has virtually been nonexistent in most major CG categories. Beyond innovation, it is incredibly important that CG companies truly understand the shoppers’ “journey” and then interact with that shopper before they ever get into the store. To achieve this, manufacturers need to shift from analyzing what already happened to understanding and predicting what the shopper will do in the future. This requires a major shift — from the legacy “descriptive” analytical approach to the more forward-looking “predictive” analytics. The Holy Grail here is to engage the shopper through the channels that matter most (like social media), and then provide authentically relevant and compelling offers. This represents a massive opportunity for CG manufacturers to drive real revenue growth.


What do CG companies actually need to do to “activate the shoppers’ journey”?

Wheeler: The first step is to understand the shopper journey in the context of the particular needs that your product/brand addresses. Having a good handle on that “path to purchase” is a prerequisite for engaging and ultimately activating the shoppers’ journey. It also drives a more efficient marketing mix, higher conversion rates and an overall better ROI. Activating the shoppers’ journey also requires a deep understanding of how, why and where that journey occurs. With this knowledge you can then build a detailed strategy around the journey, including effectively leveraging big data. This is much more than just a marketing discussion. The shoppers’ journey now impacts all of the CG manufacturer’s cross functional activities, from supply chain sourcing management and sales structures to service. The good news is that there are now advanced analytical simulation tools and predictive technologies that empower CG companies to better understand shoppers’ future needs and behaviors. At the same time, manufacturers and retailers need to do a much better job of collaborating around understanding and activating the shopper. That includes sharing big data assets — like, frequent shopper information and social data — that heretofore were kept close to the vest. Only with this heightened level of collaboration can CG manufacturers and their retail partners really move the needle on growth.


Why haven’t CG manufacturers been more successful at leveraging “big data” to achieve the shopper activation results?

Wheeler: It’s surprising how few CG manufacturers have effectively leveraged big data. In fact, a leading technology analyst firm recently found that less than 10 percent of the companies they surveyed had leveraged big data at all. Partly because of how loosely it has been defined, there is a lot of confusion about what big data actually is and how you get to it. For CG manufacturers, I view big data as a way to apply “magnification” on the shopper, the one who ultimately is buying their products (or not). If that magnification is mainly focused on a rear view understanding of point-of-sale data, for example, then you have a pretty limited grasp of what big data can do. Effectively using big data is not about CG companies having to “boil the ocean”.  It is about having a focused strategy and applying powerful analytics to the total shopper journey. The resulting insights enable the activation of the shopper, which in turn drives incremental revenue growth and ultimately profits.