My first guest blog entry comes to us from Mark Ahrens, VP of Product Management at The Nielsen Company. Mark is a career marketer with a strong CPG industry orientation. He shares a very interesting perspective on the tools CPG brand managers ultimately want (and need) to mine data and develop informed business decisions. Thanks for the entry, Mark!
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Given Amazon’s recent stellar financial performance, few people remember the collective mocking of CEO Jeff Bezos when he proclaimed, during the Internet boom of the 90s, that “Wall Street (read: profits) is largely one huge distraction.” At the time, many thought him to be another naïve webbie who couldn’t, as they say, monetize his business model if it bit him on the you-know-what.
Well, the real genius of Bezos was not that he was able to amass a wonderfully efficient network of distribution centers. His genius wasn’t in the clever deployment of a data mining algorithm-collaborative filtering–into the buying process nor was it in being an early pioneer of shopping cart technology and e-commerce breakthroughs (e.g. One-click Shopping). His real genius was that he assembled all of this technology as a means to an end. Bezos’ end game, so prescient when viewed over a decade later, was to enable a consumer to purchase almost anything they could think of, have it delivered to their house overnight, and do so at a low price point – become the Wal*Mart of ecommerce.
Now, let’s take Google. Millions of people have specified Google as their default when they launch their web browser. Is it because they really like its creative interface? Hardly. Is it because Google has one of the world’s most powerful and sophisticated search engines? Sort of… The real reason people set their web browser to Google is because they know that if they need to find something on the web, launching Google will help them find it very quickly, reliably, and easily. Google accomplishes this simple-sounding task so well that to “Google-it” has become part of our vernacular.
The two examples above share a common thread. Both Amazon and Google solve a first-order need state for users in a way that is faster, simpler, and better than was previously possible. At this point, you might be asking “What do Amazon and Google have to do with the CPG industry?” They serve as reminders that technology, by itself, doesn’t solve the day-to-day tasks of CPG knowledge workers.
No Assistant Brand Manager wakes up in the morning thinking their job is to run the latest report or produce mind-numbing rows and columns of numbers. They don’t wake up thinking how great their BI reporting tool or data warehouse is. Rather, they wake up (or at times, are kept awake) wondering “Where’s the next big product idea?”, “How am I doing versus plan?”, or “How’s my shelf price gapping to Private Label?”
CPG knowledge workers want, literally, to be able to “Google” for high-value, business insights. They don’t want to have to track down arcane DB names, memorize multiple passwords, or master complex navigational paradigms across multiple systems both within and beyond their corporate firewall. Rather, they want systems that “talk to one another”…not exact look and feel, but a shared context when moving from one system to another. They want help in interpreting what caused what to happen and what should they do next. They want the proactive answers to questions they didn’t even enough know to ask.
Solving the needs states above for CPG knowledge workers will certainly involve a broad array of technologies. For instance, intelligent, scaleable DB design, including both physical and federated integration, business-issue data marts, and a robust meta-data management system will certainly play a large part of any such solution. Other technologies such as data visualization, expert systems, embedded data mining, modeling and simulation, and social media-based collaboration will play an important role as well.
However, as we have learned from Amazon and Google, it will not be the brute-force assembly of technological piece parts that separates winners from losers in the CPG vendor marketplace. The winners will have focused its technology laser-like against the highest value tasks of a CPG person’s day-to-day job. The blueprint for winners will include a solution that tells someone What happened?, Why it happened?, and What they should do about it? With the same simple elegance as the search answers they currently receive from Google or the purchase experience of Amazon.
Upon reflection, Bezos’ vision is really only a present-day derivation of Ralph Waldo Emerson’s old adage-build a better mousetrap and the world will beat a path to your door. Those vendors who provide the better mousetraps to the CPG industry’s business problems and provide them in a way that is faster and simpler for users to consume and collaborate will capture the marketplace.
This is a clever little application that I can actually see providing value to busy families on the go. A recent writeup references an iPhone app and BlackBerry app are also available for added convenience. This quote from the Charmin brand manager pretty much sums up the strategy for sitorsquat.com:
One thing has been consistent during my 11 years in the CPG industry: marketing, sales and brand professionals generally aren’t big fans of SAP. So what’s up with the lackluster sentiment for one of the backbone systems used across the enterprise thousands of times a day?
Display ads have worked reasonably well for CPG brands to reach an online audience. This ad format loosely emulates traditional TV media, showcases products well and offers great contextual placement. But the online media world has been waiting (somewhat impatiently) for CPG brands to funnel a piece of the ad budget to paid search. It took a few extra years to materialize, but I now see three compelling use cases for CPG brands to invest in the paid search ad format:
