Trends and innovations

  The FMCG industry is undergoing a significant transformation in response to the demand for more convenience, the COVID-19 pandemic, and changes in customer behavior. The major FMCG industry trends that address these changes involve sustainable solutions for product development and packaging, improving customer experience, and implementing digitalisation.
    To offer better experiences to their customers and gain a competitive edge, FMCG companies seek omnichannel sales and e-commerce in addition to deploying big data analytics and Artificial Intelligence (AI) solutions, among others. The Internet of Things (IoT) sensors and devices and 3D Printing technology further enable FMCG companies to focus on direct distribution to meet the growing customer expectations.

Impact Of FMCG Industry Trends
    Working on technological solutions to meet the growing consumer demand for convenience, sustainability, and engaging experiences. The permeation of smartphones globally also pushes the digitisation and growth of eCommerce, driving companies towards implementing technologies such as AI, Big Data, IoT, Blockchain, and 3D Printing.
    FMCG brands adapt product development, manufacturing, and packaging to meet consumer demand for sustainable processes and improved convenience. Online shops open new avenues for data management and analytics that further increase revenues for FMCG companies. For example, a growing number of brands directly distribute and sell to their customers via online channels which reduces transportation and logistics costs.

    Consumers are becoming more conscious about climate change and its impact on the environment. Thus, they pay more attention to companies’ social activity and seek those that support them in making more responsible choices. As sustainability comes to the forefront, companies not only address how they present and package their products but also what materials they use in their products. To meet consumer demand, more and more FMCG companies offer compostable, recyclable, and reusable packaging. Additionally, cruelty-free, vegan ingredients are on the rise not only in food but also in non-food items such as cosmetics and cleaning products.
    To meet the increasing demand for healthy products, Vegshelf develops a digital business-to-business (B2B) platform connecting vegan FMCG brands with online stores, supermarkets, and food services. The platform enables round-the-clock exposure and direct access to buyers. Vegshelf shortens the sales cycle, in turn, helping FMCG brands build and maintain relationships with new and existing customers.

Customer Experience
    With the demand for convenience increasing in the FMCG sector, companies strive to significantly improve customer experiences. Employing Augmented Reality (AR) and Virtual Reality (VR) to make products more engaging and interactive. 3D videos and gamification attract and entertain customers while providing them with more information about the product.      Further, investing in improving customer experiences builds trust and increases brand loyalty. To this end, more and more companies are providing higher convenience with digital technologies.
    DRNKAR’s solution consists of AR social media, an AR Mobile App & AR Platform. AR social media entices shoppers through ads and social media activity and redirects them to make a purchase on the website. The AR Mobile App offers 2D and 3D animation to display extended product details while the AR Platform enables FMCG companies to control and manage their content and product information, as well as get insights into consumer behavior. Overall, the solutions create memorable customer experiences and improve consumer engagement.

    Digitisation is increasingly becoming a priority for FMCG brands as customers interact with brands across multiple online and offline channels. Companies get access to valuable data from multiple sources including various social media platforms, web, and mobile applications, and also engage with their customers directly. Integrating digital technologies not only offers an omnichannel experience to customers but also converts one-time buyers into repeat customers.
    Gladminds offers a cloud-based platform that acts as a two-way communication channel between brands and customers. Gladminds’ Connected Platform allows companies to leverage their brand experience and create value for the customer. For example, they enables optimising and personalising services, marketing, and communication, among other functions. This connects brands with consumers and ensures prolonged product support and engagement.

FMCG e-Commerce
    The share of sales coming from e-commerce is increasing exponentially. The outbreak of the COVID-19 pandemic has further shifted consumers’ shopping habits towards online channels. Brands are now building their online presence to boost their engagement with consumers. Social media also plays a significant role in the world of e-commerce as more items are sold via social platforms such as Instagram. To this end, FMCG actively incorporate diverse social traditional and media, leveraging mobile and headless commerce, to market their products.
    Crystallize provides an API driven eCommerce platform for subscription-based businesses models. The software delivers APIs for product information and content management to digitise the sales process. The headless content management is powered by a semantically structured content engine that enables brands to build and deliver content in different languages, market and sell their products online as well as offer product subscriptions.

Big Data & Analytics
    FMCG companies actively leverage Big Data to innovate and compete in the industry. As data is becoming more and more accessible with consumers shopping online, brands explore new ways to increase relationships with their customers and gain insights from their behavior. Data analytics explores customer preferences and behavior to provide FMCG companies with a deeper understanding of their customers. Big data solutions allow brands to optimise communication with their customers and offer more personalised experiences.
    A consumer-based data operation platform taking into account offline behavior data within shopping centers. Through its Re-ID technique, they accurately analyses traffic flow within shopping malls. Combined with online data, Zhimatech creates customer composition insights. They also monitor on-site traffic distribution and helps determine the value of individual shops. Further, this data can be used to guide marketing activities from planning to promotion.

Artificial Intelligence
    AI-powered solutions, such as machine learning (ML) and natural language processing (NLP) are gaining popularity and create opportunities for the FMCG industry. For instance, voice-based systems support consumers round-the-clock to find products and serve customers, in addition to recommendation engines that provide personalised product suggestions. By implementing AI-based solutions, FMCG companies provide an enhanced customer experience thereby increasing customer satisfaction and retention.
    Chatbots and personal virtual assistants for multiple platforms to increase customer engagement. Hosted Bots offers a modular system in which companies create building blocks from small bots, group them together to make a complex chatbot, and customise it according to their needs. The chatbots can be used in multiple channels depending on the type of interaction companies have with their customers.

Direct Distribution
    More and more FMCG companies are leveraging direct distribution to increase customer loyalty and ensure growth. For example, manufacturers directly interact with their end-customers through their own online and offline distribution channels. This increases their profit margin and offers consumers a direct channel to their favorite brands. This FMCG industry trend is closely associated with e-commerce growth as well as the penetration of smartphones and the internet.
    An AI and Machine Learning-powered Platform to automate sales and distribution in the FMCG industry. The solution enables companies to enhance their customer experience, increase revenue at the shelf, and improve the productivity of their field force. Ivy offers a Software-as-a-Service (SaaS) enterprise customer relationship management (CRM) solution where users can manage stock, complete in-store selling, and process orders. The solutions support multiple types of sales channels simultaneously.

Internet of Things
    As IoT evolves, its applications gain popularity in the FMCG sector. IoT sensors and devices are automated and affordable, enabling FMCG companies to employ them in brick & mortar stores, warehouses, and manufacturing facilities. One example of IoT device implementation is to provide targeted messaging to consumers while they are shopping. Another one is inventory management, both in stores and in warehouses, for which IoT is widely used. In combination with related emerging technologies including ambient intelligence and smart objects, IoT creates new consumer interaction channels and revenue streams for FMCG brands.
    Connected Fresh offers plug-and-play sensors that give FMCG companies instant and continuous access to live data on the temperature in their storage and warehouses. This includes sensor readings, historical data, and real-time notifications to key stakeholders based on temperature fluctuation. Automatically and continuously monitored products give both companies and their customers peace of mind knowing that the product is held at specific conditions and any deviations are reported to team members with enough time to act.

    The competition within the FMCG industry is increasing and brands invest in Blockchain to gain a competitive edge. Smart contracts and Blockchain traceability allows FMCG companies to understand their supply chain bottlenecks and make necessary interventions. Blockchain also increases transparency for consumers by allowing them to track the source of their purchases. Additionally, Blockchain platforms offer cryptocurrencies and loyalty programs that allow consumers to collect, exchange, and redeem points thereby increasing customer engagement.
    Greenfence develops an open blockchain platform. The platform connects the entire value chain of the FMCG industry and enables remote auditing and certification. The helps brands communicate directly with shoppers thereby increasing trust and interaction while removing the risk of fraud. This enables marketers to control their budgets and consumers to participate and interact with a greater level of anonymity.

3D Printing
    Additive manufacturing and its applications create disruptive solutions for the FMCG industry. The vast amount of waste generated by use-and-throw consumer products, from personal care to food packaging, prompts industry stakeholders to find sustainable alternatives. 3D printing allows FMCG brands and companies to design and develop products that use eco-friendly materials and reduce plastic use. To this end, FMCG companies leverage 3D printing for prototyping, designing, tooling, and scaling production in a sustainable manner. Further, food companies are able to offer extra nutritional value in their products by utilising 3D food printers.
    Essentium offers a 3D printing platform specifically for industrial production. The platform allows companies the flexibility to create multiple product iterations without impacting quality, strength, or performance. FMCG companies use the platform for rapid prototyping, to finetune designs and print end-use parts and components with exact precision and repeatability.