How Data is Helping FMCG Companies Transform The Customer Experience

The retail sector is often seen as one of the pioneers of digital transformation. The sector has been witness to some of the most promising disruptions aided by digital technology and this is changing the economic landscape every day. For instance, in 2019, 16 % of total retail spending in the US was driven by online spending, and where the US market goes, the world follows soon enough.

E-commerce is a prime example of how the retail sector transformed from a store driven model to one centered on customer preferences taking the store experience to the customer at his or her comfort. FMCG brands too rode the digital wave in retail to improve their customer experience.

In that context, it’s become clear that the key element in empowering FMCG companies to build better customer experience is data. By leveraging analytical insights emerging from customer data, FMCG brands are able to deliver better experiences in all areas ranging from product innovation to new features and marketing.

Let’s examine the 3 key roles played by data in helping FMCG companies build better customer experience today.

Improving marketing ROI

Since time immemorial, marketing has provided more ROI when brands can target the right audience for particular campaigns. For this, they need to know as much data as possible about prospective customers. This data is collected through a variety of channels such as point of sales, social media interactions, past purchase history, and much more. Using this data, FMCG companies can shoot tailored campaigns through their intelligent marketing platforms to help push relevant content to targeted users and entice shoppers to focus on their products.

A simple example of intelligent marketing in this scenario could be upselling and cross-selling for an e-commerce purchase. For example, if a brand gets the data that a particular customer has brought one of its leading products, say a shampoo, then they could shoot a marketing email with links to buy a supportive conditioner that goes well with the shampoo. If the shampoo purchased had some unique properties like specifically designed for reducing hair fall, this knowledge can be used to recommend a conditioner having the same property thereby increasing the likelihood of the marketing effort resulting in a purchase.

Additionally, by gauging public sentiments from channels such as social media, brands can come up with purpose-driven messaging for their marketing content. In the age of the conscious consumer, this can resonate with the general mood of the market. A typical example was the numerous brands that joined with the Black Lives Matter movement in the USA recently to place their values and beliefs into the marketing mix.

Running Smarter Promotions

FMCG brands spend billions every year on advertisements and promotions for better outreach for their products. What if they had access to data such as demographic information on their best buyers, gender, and spending habits of buyers across locations. What if they could combine that with details on local events, festivals, or even weather attributes of a region? All this data can be leveraged to create more convincing promotions of their products based on each focus element identified. As a simplistic example, if we take India as an example of a market critical to the ambitions of most international consumer brands. South India has been known to show more affinity for products suitable for tropical climates most of the year like sunscreens or face washes that are designed for hot and humid conditions. While North India has different preferences based on climatic conditions. The temperature is lower, and winter can be dry and harsh. Hence, while running promotions, FMCG brands can use these demographic-based preferences to create separate advertisements for different regions to catch the attention of buyers from both regions.

Encouraging Intuitive Store Sales

While E-commerce has disrupted the retail sector considerably, it doesn’t mean that physical stores are closing down or going away. Physical stores do have a significant contribution in the sale of FMCG goods around the world, but the COVID 19 saga has created new challenges for them to ensure a safe shopping experience. Also, studies show that nearly 65% of all consumers research a product online before paying a store visit to purchase it. Hence it is important for FMCG brands to ensure that their store partners offer an enhanced customer experience that resonates with what online stores offer to ensure that the consumer gets the best of both online and offline retail for that particular brand. Now comes the question of how to enable this experience.

Yet again data is the magic fuel to drive such a transformational in-store experience. From the positioning of the products within the store to dynamic pricing and optimizing inventory for forecasted demand, data can drive better plans. This could be data about purchases made by customers in the past or their individual preferences such as trends followed, budgets, age, etc. Such consumer data can be used to deliver a more fulfilling experience across retail outlets for all customers. Retail outlets can also become data gathering points for customers to provide more data about themselves in exchange for better experiences. It will be easier for FMCG brands to have their executives run live surveys with store visitors to gauge their feedback and then use this feedback to improve their offerings going forward.

Data is undoubtedly the most critical factor that will drive the future of any consumer-facing business. The FMCG sector today has access to a number of smart and intuitive digital platforms across a range of operational functions like CRM, Marketing Automation, ERP, etc. which can harness data from their existing customer ecosystem as well as market conditions. This data can be used to build better customer experiences which will ultimately drive more sales, customer loyalty, and better experiences.