Omnichannel
2023 trends, technologies in CPG and retailing
When consumer goods firms and retailers collaborate, they get better visibility into real-time POS data, enabling them to forecast demand, understand customer behavior and stay on top of shopping trends.
April 6, 2023 by Parag Jain — Senior Vice President & Global Head of Sales Consumer, Retail & Logistic, Infosys
Of the many challenges faced by businesses, lingering supply chain disruptions, the war in Ukraine, and of course, climate change, rank right at the top. Therefore, I believe that the key trends to watch in the next few years are decarbonization to fight climate change, decoupling with China to de-risk supply chains, and dispersing centers of excellence across underserved areas by leveraging digital technologies.
These developments are creating important shifts in the consumer packaged goods (CPG) and retailing sector, such as the emergence of ethical and conscious consumers; autonomous, adaptive and resilient supply chains; frictionless, highly personalized experiences; everywhere commerce; and algorithmic retail.
To be in a position to capitalize on these shifts as they unfold — or avoid obsolescence — CPG and retailing companies need to make the right technology investments, starting now. Here are the most important areas:
In-Store Transformation: Building agile, frictionless, and highly experiential stores will call for investments in infrastructure bandwidth, computer vision, and cloud capabilities linked to store systems.
Cloud Computing: Businesses should replace their legacy systems with a digital commerce platform on cloud to gain agility, scalability, versatility, and cost savings.
Connected Retail: Artificial intelligence, machine learning, and cloud computing are required to create seamless, frictionless online-offline consumer experiences. To support the modern consumer who prefers self-service, retailers will need to invest in edge computing capabilities .
Supply Chain: The pandemic, followed by the war in Ukraine, underlined the criticality of resilient supply chains. With a digital twin, CPG companies would be able to simulate various real-world scenarios to make their supply chains more agile, adaptive, and robust.
Omnichannel Commerce, Metaverse, AR & VR: Gen A will be the largest and most connected generation ever. CPG and retail businesses with legacy technology must switch to agile microservices architecture in order to meet these customers' evolving needs, which would include everywhere commerce and the metaverse.
Besides investing in existing technology, the industry should also watch certain emerging trends, which are likely to become mainstream in the future. These include channels of transaction such as influencer-led social commerce, live stream shopping, and the metaverse, and channels of communication such as conversational AI. Underlying these are technologies, such as datafication, artificial intelligence, machine learning, blockchain, and connected environments, which in my view, will drive the most change in the coming decade. For example, to process the 181 zettabytes of data projected to occur by 2026, companies will need ubiquitous computing and advanced AI/ML-based solutions. And securing the 500 billion devices that will connect with each other on the Internet of Things and elsewhere, will call for a solution such as blockchain.
In the age of connected customers, networked devices and ecosystem fulfilment, CPG and retailing companies must strengthen their links further. Collaboration is the new way to succeed for most businesses, and these are no different. In fact, one could say that retailing of the future is not as much about selling products off shelves — as it is about creating service experiences that add value to consumers' lives. Digitization and technology today enable more accessibility for consumers and greater relevant reach for retailers. This will pave the path to greater profitability.
When consumer goods firms and retailers collaborate, they get better visibility into real-time point of sale data, enabling them to forecast demand, understand customer behavior, and stay on top of shopping trends. Above all, they can leverage these insights for production planning and supply chain operations to build resilience, execute just-in-time delivery, improve shelf availability, and avoid costly markdowns.
About Parag Jain
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