2020 saw an unprecedented change in consumer behaviour around the world, with shoppers finding new ways of discovering, evaluating and buying products. This has created fresh expectations for both brands and retailers to drive consumer closeness, embrace the digital moment and transform their operations to be more agile and sustainable. These themes have been top of mind in my conversations with our CPG customers, and set the tone at Google Cloud Summit for Retail and Consumer Goods, which concluded this week. I couldn’t be more proud of our team and thankful for our customers that supported us by participating in our sessions and attending the event.
I joined Google Cloud in January 2021 after a long career in the CPG industry, and as I shared in my CPG keynote at the summit, I am thrilled to be helping bring the power of Google to drive industry innovation in CPG. At Google we call this ‘new normal’ the transformation cloud era, where we’re working with customers who want to not just save money on storage or compute, but to use cloud and digital technologies to drive agility across their business. I also call it the era of ‘consumer switching’, because Covid-19 has accelerated the likelihood of consumers to switch brands or the way they shop. Some of these changes are still happening; over 40% shoppers in a recent Google survey reported that in March 2021 they changed brands or shopped online for something they were previously buying in store.
At Google, we have an amazing team of strategists who have been researching, observing, and analyzing the many facets of consumer behavior over the last few years. In the opening keynote at the Summit Capturing the Hearts and Minds of Today’s Consumers, Google’s Human Truths Team kicked off the Retail & Consumer Goods summit by sharing some of their consumer insights, including what behavior patterns they think will “stick” as we move into a post-pandemic world. I think these insights are especially relevant for brands, as they speak to some of our latest findings on the CPG shopper’s mindset.
Accenture estimates that there could be a 3 trillion dollar shift in value between companies as a result of consumers shifting brands and behaviours. While it is not known who the winners of the shift will be, one thing is certain – those who will be able to leverage data and analytics fastest will benefit the most from these times of rapid change. I shared some of the implications for the CPG industry in my keynote How to grow brands in times of rapid change along with the three key areas in which Google cloud is helping CPG companies drive brand success:
Unlocking consumer growth with data powered insights
Transforming go-to-market in the omnichannel ecosystem
Driving connected, efficient, and sustainable operations
Let’s take a quick look at each of them:
Unlocking consumer growth with data-powered insights
The digital marketing ecosystem is transforming for a privacy centric world, and brands are seeing a direct impact in marketing effectiveness. As the CPG industry becomes more consumer-centric and shifts more toward direct-to-consumer (D2C) business models, acquiring and activating consented first-party consumer data presents a clear opportunity to capitalize on new consumer demands.
As a result, CPGs are turning to consumer data platforms (CDPs) to help them unify, manage, enrich, and secure all of their disparate data from different marketing tools, website analytics, email campaigns, loyalty programs, and more. Google Cloud and our ecosystem of partners can help CPGs build a privacy-centric CDP which brings together all their customer and marketing data into a modern data warehouse, with built-in predictive data visualization tools and models. With a CDP built on Google Cloud, you can integrate data from Google Marketing Platform to drive predictive marketing and media effectiveness. And with pre-built connectors you can also easily integrate non-Google media and data from other enterprise platforms like SAP and Oracle to leverage consumer data for more integrated decision making. Democratize access to data across the organization with our Business Intelligence tool Looker to enable faster decisions in real-time from marketing to supply chain to product innovation.
At the Retail & CPG Summit we shared how retailers and brands can drive consumer closeness in a privacy-centric world featuring Procter & Gamble’s experience building and activating consumer data in a privacy-safe way to serve consumers better and maximize marketing effectiveness and drive growth across their business. And in a demo, Constellation Brandsshared how they’re leveraging real-time data from several commercial sources using Looker to unpack insights and develop action plans.
Transforming go-to-market in the omnichannel ecosystem
Amidst COVID-19 restrictions and rolling lockdowns, ecommerce activity has surged past a point of no return. Direct to consumer (D2C) or digitally native brands were able to minimize consumers switching during the pandemic by offering a great online experience. While in-person shopping remains important, consumers are expecting more digital and omnichannel experiences and many will continue to explore new brands and purchase online. CPGs that want to maintain their market leadership can no longer afford to ignore the key role omnichannel capabilities will play in capturing the attention of both retailers and consumers. Even if D2C sales are not a big portion of your business, you will benefit from first-party data that can help you drive insights and product innovation.
CPG brands want to transform their older, clunky ordering processes into modern digital shopping experiences. Re-platforming legacy solutions on Google Cloud not only accelerates application innovation, but also makes it easier to quickly launch new features and products. At Google Cloud we have transformed ecommerce for large D2C brands and traditional retailers, so we know what a best in class D2C experience looks like. And we can bring it to your brands. We already help some of the biggest brands in retail modernize ecommerce and enhance product discovery with solutions like Visual Search and Recommendations AI. All of these can help you build a best in class omni channel presence for your brands.
We had several sessions on improving your omni channel experience, including
Why search abandonment is the metric that matters featuring Macy’s and Conversational Commerce with Google with Albertsons, where we shared how Google’s conversational experiences can help consumers message businesses from wherever they are, and whenever they need them.
Driving connected, efficient, and sustainable operations
The superpowers of AI/ML are not just for marketing. Did you know that research from MIT and Google Cloud has found companies that use AI/ML can drive 2x more data-driven decisions, 5x faster decision making, and 3x faster execution? By connecting your operations in real time with demand signals like search, trends, weather, mobility and supercharging this data with AI and ML, you can make smarter and quicker business decisions. For example, you can use search trends to drive demand forecasting and ramp up manufacturing for popular products.
Google Cloud can help you modernize legacy business applications by migrating them to the cloud and using AI/ML and smart analytics to drive business outcomes. Take SAP for example – a Forrester study found that modernizing SAP with Google not only resulted in 56% more efficient IT teams – it also generated 160% 3-year ROI.
SAP data on Google Cloud breaks down silos across SAP, marketing, manufacturing systems, and external data sources for next-level intelligent operations. For example, with SAP and Google Cloud, you can combine product, media, CRM, digital commerce and site data from SAP and non-SAP sources to uncover stronger consumer insights and fuel product discovery along the path to purchase. You can merge SAP product and sales data with consumer, market data and Google geo trends to drive targeted promotion outcomes, maximizing the ROI of promotional dollars across retail channels. You can also integrate supply chain and manufacturing data from SAP systems with consumer, marketing and Google geo market data to improve demand forecasting and optimize supply chain logistics. The possibilities are endless. This is why we describe SAP modernization as The Gift That Keeps On Giving.Check out the session on SAP from the Summit and hear from Rodan + Fields on their experience of modernizing SAP on Google Cloud.
Another solution that excites me is Vertex AI, which transforms the demand forecasting process. Traditional demand forecasting accuracy is a challenge for most CPGs. Current forecasting methods do not take into account granular factors that impact demand, like local weather, demographics, or unforeseen events. With our recently launched Vertex Forecast, Google is making it much easier to start using cutting-edge machine learning models for demand forecasting. In our session Demand Forecasting: Time for Intelligence, Not Intuition featuring American Eagle Outfitters, we share how you can adopt a data science approach to demand forecasting that’s customized to your unique needs.
CPG organizations come to Google for help solving their toughest problems, whether it be driving new consumer growth, unlocking new routes to market, or building connected, sustainable operations. And we bring the best of Google: innovation, culture, infrastructure, AI/ML, and a deep understanding of consumer behaviour to help them build best-in-class brands.
I’d like to end with a topic that’s very close to my heart. This is around Solving for Sustainability in Retail and Consumer Goods. Our research shows that 62% of shoppers cared about at least one sustainability aspect when purchasing online in 2020. In addition, the events of the past year have triggered consumers to re-evaluate their relationships with brands and prioritize those that are more sustainable in the context of the pandemic. Watch this session to learn more about how retailers and consumer goods companies can leverage technology, data, and machine learning to help make sustainability a core part of the recovery.
All our session content is available on demand. Ready to learn more about how we’re helping CPG brands and manufacturers drive results? Learn more about Google Cloud’s consumer packaged good solutions and reach out to your Google Cloud sales executive to set up a deeper conversation on how we can help you grow your brands today and in the future.
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