Adjusting to digital product innovation has been a long, painful journey for some brands in the consumer packaged goods industry. The speed of technological change continues to accelerate, affecting factories, distribution, e-commerce and marketing. Digital transformation will proceed for a long time, and the more that businesses discuss the concept at a high level, the more likely they will become winners today and remain winners five years from now.
Embracing digital transformation improves the efficiency and productivity of all business activities. However, fully harnessing this potential requires serious consideration of five vital aspects for digital product innovation.
1. Managing Huge Data Influx
Business has already adapted past Web 2.0, implementing digital solutions that generate vast amounts of data. Consumer master data now includes geography, demographics, interests, preferences and dozens of other reference points gathered through numerous platforms. Managing this wave of new information remains one of the challenges for many companies seeking to leverage digital innovation.
More than ever, businesses need to implement digital housing that contains their entire data set, connecting detached systems into a centralized database. Streamlining data management enables quick, organization-wide communication and allows you to derive insight from previously disconnected data sources.
2. Mastering Organizational Change
Digital transformation requires a complete buy-in on an organizational level, beginning at the top. Leadership must envision the benefit of implementing innovative digital solutions through a centralized IT system or risk losing ground to companies that embrace productive disruption of the industry.
Digital product innovation doesn't happen overnight. Capital expenditures must be made to enact digital transformation, especially on a large scale. Focusing on the benefits tends to ease the burden of wholesale change. Improved processes, products and the optimization of sales are a few of the many benefits when organizational change is mastered.
3. Embracing Digital Strategy Instead of Digital Tactics
In terms of digital innovation, winners in the market achieve a strategic mindset by involving every stakeholder of each department in digital transformation meetings. Whenever a major technological change occurs, processes across the entire organization adjust operations to benefit from the advantage.
The opposite mindset tends to involve a piecemeal approach, adding and subtracting apps and processes in a modular fashion. Companies that are tactical may enact change in one or a few departments but lack the initiative to connect the dots to optimize all processes.
4. Connecting Omnichannel Platforms
Data from retailers, manufacturers and suppliers may be shared with your business, connecting partners vital to the success of your company. Omnichannel platforms extend your capacity for collaboration, allowing for joint ventures with trusted manufacturers and innovative roll-outs arranged with retailers who wish to maximize customer demand.
Since digital transformation connects all aspects of your business, data from partners become part of your new IT profile. A centralized database absorbs information management and analysis for external data sources relevant to your business, creating additional value through innovative partnerships.
5. Streamlining Compliance
The consumer packaged goods industry must adhere to a variety of regulations that differ from region to region, adjusting to large changes over relatively small geographies. Digital product innovation also includes the ability to streamline compliance through master data management that processes multiple requirements through a single system.
One aspect of your omnichannel platform includes continuous communication with your supply chain, which relays the data necessary to prove compliance according to government directives. This type of information may also be passed along to consumers through various channels, including mobile platforms that scan QR codes for rapid info access. Catering to socially conscious consumers includes showing compliance with initiatives such as fair-trade manufacturing, while health-conscious buyers may want to confirm organic or vegan dietary requirements.
Digital Innovation Doesn't Stop
Enacting change now makes it easier to adjust to upcoming innovation. A decade from now, people will interact with products much differently than they do today, perhaps utilizing VR to experience an item from the comfort of their homes. Businesses that have already invested in the required digital housing will adapt much faster to these and other technological evolutions in the consumer packaged goods industry.