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The Future of FMCG - Digital-Based Sales & Marketing Models

The presentation discusses the history and evolution of disruption in the FMCG sector, emphasizing how technological advancements like cars and refrigerators transformed retail formats by affecting consumer choices. It highlights the ongoing digital disruption driven by rising internet and mobile penetration, urging brands to leverage consumer-focused innovations and omnichannel strategies. Key opportunities and threats are identified, stressing the importance of innovation for growth and competitiveness in a crowded digital marketplace.

Marketing◦
Related topics:
Business Model.• Market Trends• Internet of Things• Consumer Trends•
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The Future of FMCG: The Great Disruption Hamutal Schieber’s Export Institute Presentation, Dec. 2015
First, a story:
The 1940’s: Car ownership 45% penetration; refrigerator sales in the US on the rise; Supermarket sales 10% of grocery sales 1954 Supermarkets: 41% Car ownerships: over 50% 1960’s milkman services penetration 30% 1975: The Supermarket Era Milkman disruption is complete Car ownership: 85%, Supermarket market share: 75% Milkmen: 6.9% How Cars and Refrigerators Disrupted the Milkman
2005 Modern convenience = store format + product format 0.4% milkmen service penetration rate (US)
The milkman disruption happened due to: lack of consumer choice, rising penetration of enabling technologies (cars, refrigerators) and as a result, a profound change in retail formats. You cannot prevent disruption from happening. But you can leverage the next disruption to your benefit, By focusing on the consumer, and adding value through new models. Here’s how…
Where is the Disruption?
Internet Penetration on the Rise (Columino, 2015)
Mobile Penetration on the Rise Ericsson 2015
Connected Devices on the Rise Ericsson 2015
Wearables on the Rise IDC 2015
Stage 1: responding to consumer needs via products & services mix Stage 2: innovation in physical retail; opening of online shops Stage 3: from physical to digital to omni-channel; virtual technology; AR; VR; NFC and mobile payment As a result, the retail environment has changed radically
Followed by omni-channel commerce Consumers expect a seamless experience
Electronics (SF, USA)
Fashion, USA
Facial Recognition
Peapod
House of Fraser iBeacons Mannequins
2012: more convenience through click & collect
2014
Amazon Dash
Mobile payment Apple Pay @ Best Buy
Be wherever the consumer is at (Diapers.com + Pampers)
Wanelo – Buy from Image
FlipKart Shop by Image
Shoppable Content
Mikmak
The Amazon “Treasure Truck”
Democratization Designer furniture direct selling
New models: Rent it, Don’t buy it
New models: Rent it, Don’t buy it
Fresh Organic Food “for everyone”
1971 Insight “Hilltop”
2011 Activation
2015 Shoppability
Added value: reviews  empowerment
Added value: convenience  empowerment Nespresso Multi-Channel
Added value: Adidas – get it before everyone else
Mondelez Focuses on online for X10 growth ($ 100 million to $ 1 Billion by 2020)…
For example: an immediate implementation d
Shoes of Prey: online + point of sale shoe personalization
Online personalization: turning everyday goods to something special
‫פרסונליזציה‬
‫הרפתקאות‬ Nestle Marktplatz: Bringing global brands to German shoppers
Boxes added value: excitement
Premiumization Maille (Unilever): products which are only available online
Added value: Trust Amazon Elements
Trust Google Cardboard + Nescafe Coffee Farmers 360
Try your jewelry before buying fourmine.com
Warby Parker Home Try-On
B&Q in-store 4-Dimension experience
Carphone Warehouse In-store personalization
Nielsen, Global, 2015
Meal Kits Meal Kits
Subscriptions
Subscriptions
‫מקור‬AT Kearney 2014 ‫נתוני‬‫קטגוריית‬‫הטיפוח‬‫והיופי‬
Boxes Consumer added value: excitement, trial Brand added value: Data
Brand as coach PlateJoy: manage your healthy lifestyle
The Brand as a Coach
Brand as coach Asos Online Stylists
Let the brand do the buying: Bud
Loyalty
House Call
Betty Crocker Kitchens focus on elderly special needs
‫לסיכום‬ To sum up…
Digital Age Innovation 1. Enablers: the technology allows us to accomplish much more than before 2. Immediacy: insight to action 3. Shoppability: make yourself available for purchase where the consumers are 4. Democratization: the consumer sets the stage and calls the shots. Brand should consider platforms for participation 5. Flexibility: Adopt a start up mindset (or adopt a start up) 6. Consumer focus: providing an added value is still the key success factor
Opportunities • Approaching micro-segments • Collecting Data • Introduce various commercial offers (and test them) • Build loyalty • Offer exceptional service
Threats • A crowded digital shelf • Logistics challenges • Technological challenges • Competing with the retailers – your customers
Innovation is crucial for growth! innovation Reaching new crowds Consumer involvement Brand building Competitive advantage Efficiency and cost reduction
The Future of FMCG - Digital-Based Sales & Marketing Models
The Future of FMCG - Digital-Based Sales & Marketing Models