Digital Transformation: Analog to Digital
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Digital Transformation: Analog to Digital

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Read more on the digital transformation taking place in Africa and the future for Consumer Goods companies.

Read more on the digital transformation taking place in Africa and the future for Consumer Goods companies.

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Digital Transformation: Analog to Digital Presentation Transcript

  • 1. Analogue to Digital: Consumer Goods Trends
  • 2. Agenda What the future holds for the consumer goods industry The journey to a digital operating model How to transform to a digital operating model Copyright © 2013 Accenture All rights reserved. 2
  • 3. What the future holds in consumer goods In Emerging Markets 1 billion new consumers • New drive for localized products and choice • Newly affluent emerging market middle class • Newly urban populations as new consumers In Developed Markets Mature markets seeking value • Growing cash-strapped segment of consumers • Greying urban population living longer, healthier lives • Green consumers seeking sustainable options In The Digital World An entire generation of consumers has grown up on digital / social media • Low-cost connected devices are widely available to consumers worldwide • The rise of multi-channel buying is dramatically changing the consumer experience • Consumer expectations for products and services are at an all time high Copyright © 2013 Accenture All rights reserved. 3
  • 4. More than 720 million Africans have phones, some 167 million use the Internet, and 52 million are on Facebook Africa is going Digital Africa is undergoing a digital revolution… 67m # of smartphones in 2012 ..with consumer becoming more connected to a global marketplace 50 386 760 African Facebook Users Tunisia 3 436 720 Algeria 4 322 820 Egypt 13 010 580 360m # of smartphones in 2025 167m Internet users in 2012 600m Internet users in 2025 Copyright © 2013 Accenture All rights reserved. Ghana 1 465 560 Nigeria 5 357 500 South Africa 5 534 160 Kenya 1 886 560 D.R Congo 891 140 *source: www.socialbakers.com 4
  • 5. In Africa new consumers and digital are happening at speed and simultaneously Retailers will need to open 15 million outlets by 2015 to reach these new consumers or connect online Millions of first time consumers are there to become loyal to brands Emerging and developed market consumers are going digital and social at the same time Copyright © 2013 Accenture All rights reserved. Leveraging digital technology is the only way it’s economically viable to compete and win in this environment 5
  • 6. The digital world is driving dramatic industry disintermediation Converging Moments of Truth Digital blurs the distinction between “selling” and “marketing”. Increasingly even off line purchase is proceeded by points of search to drive purchases. Retail Revolution Smaller formats emerging in developed markets and remains key in emerging markets. New consumers may leap frog brick & mortar retail. New digital retailers emerge – merchandising and promotions will be different. Monologue to Dialogue Reinvent Product Marketing Traditional analog media are one way. Digital is all about engagement and interactions leveraging huge amounts of data to be relevant. It does not work digitally. Product ranges should expand exponentially as physical store constraints disappear and customization becomes possible. Extended Enterprise Focus on Individual Digital is changing the way CPGs manage their whole ecosystem beyond the enterprise – suppliers, distributors, retailers are all connected Consumer, influencer, shopper, employee – they are all digital and expect specific attention Copyright © 2013 Accenture All rights reserved. 6
  • 7. This digital revolution has become a launch pad for a new generation of digital entrepreneurs Digital Case Studies Jumia The rapid growth of Jumia.com has seen it emerge as arguably the country's number one online shopping portal The site controls 70 percent of the online retail market in the country and has serviced about half a million customers in its over one year of existence Copyright © 2013 Accenture All rights reserved. moWoza moWoza is a mobile phone marketplace platform that allows informal cross-border traders to access pricerelated information and an order and pre-pay inventory, and to receive delivery status notifications and access credit on their mobile phones Paga Paga allows its users to transfer money to anyone via a mobile phone or other internet connected device. According to the Paga website, its service is currently being used by over 57,000 Nigerians. The company has a grand ambition to serve 40 million users by 2015 7
  • 8. And the impact is significant for consumer goods companies Boundaries between the traditional participants will continue to blur Manufacturers will become retailers, distributors and media owners Shoppers will drive product design and development Copyright © 2013 Accenture All rights reserved. 8
  • 9. Industry trends have influenced the development of consumer goods companies over the last two decades They have been on a journey from their local roots to become global giants. Global reach, billion dollars brands and global capabilities have been the targets for the past decade The alignment and synchronization of the enabling capabilities and a sustainable business case along the transformation have been key elements of the Operating model evolution The journey defined winners and losers (growth, M&A, profit). Different speed and navigation paths were followed. Generally this transformational journey has been associated with increased earnings and profitability - more than double digit growth in earnings in every year since 1995. However earnings have outpaced sales growth in all but the last two years. Copyright © 2013 Accenture All rights reserved. 9
  • 10. And now it is time to evolve to a digital operating model Where We Have Come From Improve Margins Through Cost Reduction Where We Are Going Double Size of Business Increase Profitability Digital Economics drive change, and each operating model change delivers a competitive advantage. New Consumers Global Economy WTO Market of One Enabling Capabilities Global trends provide opportunities. Margin Reach Scale Leverage Autonomous Business & Operating Model Local Copyright © 2013 Accenture All rights reserved. Regional Global Super Global/ Super Local Digital Disintermediation Fluid 10
  • 11. Capabilities have to evolve to support the journey to a digital operating model Ecosystem Leverage Consumer Pull Real Time Archetypes Consolidated None Very Few Companies Most of the Industry Enabling Capabilities Interactive Processes & Technology Back-end Package Driven Front-end Process Driven Relationship and Experience Driven CPG Push First Movers Some Companies Few and Far Between Fragmented Business & Operating Model Local Copyright © 2013 Accenture All rights reserved. Regional Global Super Global/ Super Local Digital Disintermediation Fluid 11
  • 12. What’s made you successful in the past will not make you successful in the future Ecosystem Leverage Consumer Pull Archetypes Consolidated Leap Frog Enabling Capabilities Interactive Geek Real Time Processes & Technology Back-end Package Driven Front-end Process Driven Relationship and Experience Driven CPG Push Top Down Agencies Consensus Bottom Up Big Bang Fragmented Command Business & Operating Model Local Copyright © 2013 Accenture All rights reserved. Regional Global Super Global/ Super Local Digital Disintermediation Fluid 12
  • 13. Evolving the operating model …will involve a fundamental rethink of corporate structures, customer engagement, product development, supply chain, marketing and sales. Global Super Local Digital Disintermediation Leverage Brand Emerging Market Challenge End Of Dominance of Bricks And Mortar Retail Global Product Marketing Local Product Marketing Digital Media Ownership Global R&D Local Sensing Mass Customization Centralized Centralized and Decentralized Extended Enterprise Leading consumer goods companies will abandon geography as a basis for organization and reorganize around archetypes for route to market / retail and category /consumer types Copyright © 2013 Accenture All rights reserved. 13
  • 14. It will revolutionize how consumer goods companies operate Disrupt with a digital operating model! Be deliberately digital. Move digital responses from tactical to strategic. Start with the consumer and work back Must be driven by your commercial business, not IT department Integrated across the business Geography is no longer the basis for management and organization Not about digital marketing – about the digital enterprise Copyright © 2013 Accenture All rights reserved. 14