How tech trends can lead the next generation of the consumer industry

CP&R businesses proactively implementing and scaling evolving technology will be best set up to succeed in the near and long term.

In brief

• Research shows that executives may not be implementing technology at the pace the market demands
• To become truly “consumer-centric” and stay ahead of competition, CP&R companies will need to rapidly implement new technology
• We identify four CP&R technology trends and considerations for executives to transform trends into force multipliers
  

In the dynamic landscape of the consumer products and retail (CP&R) industry, staying ahead of the curve is essential. Rapid market shifts and disruption, coupled with increasingly sophisticated and fragmented consumer demands, threaten to create a risky environment for executives who take a wait-and-see approach to embracing evolving technology, which is critical to keeping pace in this hyper-dynamic environment.

Fueled by evolving technology, the CP&R industry is and will continue to transform well beyond traditional limitations at a pace stakeholders have demanded for years. The state of the market will reward those proactively enhancing digital capabilities, and those who do not will increasingly fall behind the competition. Below, we identify four pivotal evolving technology trends that are helping to reimagine the industry. From unlocking growth opportunities to strengthening organizational excellence, these evolving technologies are critical capabilities to becoming truly “consumer-centric” and creating long-term value. CP&R organizations seeking to thrive should consider leveraging these technologies against strategic goals across the front, middle and back offices to scale operations and stay ahead of the competition in consumer experience, innovation and loyalty.

Four evolving technology trends modernizing the consumer products and retail industry

1. Artificial intelligence/machine learning (AI/ML) and microcomputing to optimize and enhance experience and supply chain

Why it’s important: In the CP&R industry, personalized experiences and efficient supply chains are paramount for winning in the market. Artificial intelligence and machine learning (AI/ML) and microcomputing technologies are crucial for achieving these objectives by enabling real-time data ingestion and action across customer interactions. This, in turn, empowers businesses to understand consumer preferences at a granular and even hyper-local level, driving increased sales and profitability, brand engagement and loyalty, and streamlined supply chain efforts.

Now and in the future, brands and retailers will implement AI/ML across a host of use cases, such as:

To succeed, companies must leverage technology to deliver exceptional customer experiences, tailor marketing efforts, respond to market needs and ensure their infrastructure can scale to accommodate real-time, sophisticated ML models.

2. Generative AI for content creation and innovation

Generative AI holds immense significance in CP&R for its ability to foster innovation in content creation and product development. By harnessing the power of GenAI, businesses can produce fresh and engaging content, get to market with speed and build rapid customer engagement models.

GenAI is still in its early stages and so are its applications in CP&R, but it’s already clear that the possibilities are endless.

CP&R companies should consider integrating GenAI into operations more broadly across the value chain. Organizations that find the most appropriate use cases and implement them at scale will drive the operational agility that industry stakeholders have been expecting for years. It will be critical to rethink how talent and capital allocation can be repositioned to better drive value when content and innovation can be available at the drop of a hat.

3. Digital twin and predictive analytics to drive process controls and decision-making

Digital twin technology and predictive analytics play a pivotal role in revolutionizing CP&R operations. They facilitate agility and offer a comprehensive view of product lifecycles, supply chains and manufacturing processes.

Digital twin and predictive analytics are not new in CP&R, but applications for their use are becoming more robust

As the CP&R industry becomes increasingly more digitally connected and complex, driven by software proliferation and the Internet of Things (IoT), companies should expand their use of digital twins to a wider range of interconnected value chain nodes. This approach will enable a more proactive response to disruption and market shifts by transforming these tools into a means for a truly dynamic enterprise, from the front office through to the back office.

4. Cloud and ERP upgrades for efficiency and scalability

With enterprise resource planning (ERP) upgrades imminent by 2025, modernization is foundational to integrating evolving technology capabilities. Cloud computing provides on-demand data storage and computing power, which is essential for supporting and scaling these new technologies.

CP&R executives should be considering these applications to derive the most value from Cloud and ERP upgrades.

Companies must look at their legacy transaction systems and rationalize how to modernize them to create efficiencies, whether by integrating evolving tech that makes their systems more usable or by upgrading legacy transaction systems to keep pace with their front-end infrastructure.

Considerations for consumer products and retail leaders to help transform evolving tech trends into ‘force multipliers’

It's imperative to recognize that the true power and value behind an evolving digital landscape lie not just in the technologies themselves but in how companies strategically integrate and orchestrate them into their operations and strategic initiatives. The following considerations serve as a guide to help CP&R leaders start a journey down this transformative path.

Data strategy: Establish robust data quality and governance frameworks, as inaccurate or poor-quality data can undermine the success of tech implementations.