CPG Partner Conversations: Manage Your Business Through Market Disruptions with Sigmoid’s Advanced Analytics Solutions
The COVID-19 pandemic created unprecedented disruption to businesses and global markets. Although most of the world appears to be past the uncertainty and turbulence of the pandemic, companies, especially in the consumer packaged goods (CPG) industry, continue to deal with major challenges. These include supply chain disruptions and labor shortages. Simultaneously, consumer buying patterns and expectations that shifted during the pandemic have become the norm. Now more than ever, CPG leaders must think strategically, with an eye toward innovation and agility, to address the continued market volatility and shifting consumer preferences. To gain insight and inspiration, we’ve embarked on a series of conversations with executives from AWS Partners to showcase their leadership and expertise in challenging times.
In the latest installment of our CPG Partner Conversations series, we talked to Sankalan Prasad, Vice President of Growth at Sigmoid, a global big data and advanced analytics AWS Partner that specializes in data science and data engineering solutions. In this post, Sankalan shared his views on the importance of data and analytics as CPG companies confront market turbulence. Furthermore, he explained how CPG brands can become continuous innovation engines.
AWS: Help our readers understand your vantage point. What’s the space you play in, and with what type of CPG executives does Sigmoid interact?
Sankalan Prasad: Sigmoid is a data and artificial intelligence (AI) engineering company focused on building niche big data and advanced analytics solutions for Fortune 500 companies. We’ve built cutting-edge data solutions for some of the largest brands in the CPG industry, such as Belcorp, Kellogg’s, and Reckitt Benckiser. With more than 500 passionate data engineers and scientists, we’ve solved some of the most complex problems across the CPG value chain, from manufacturing and supply chain to planning, marketing, and sales. Our solutions cover multi-touch attribution, marketing mix modeling, manufacturing process execution, demand forecasting, pricing elasticity, overall equipment effectiveness (OEE), and much more. We believe Sigmoid is uniquely positioned to understand the challenges that CPG brands are facing, and more importantly, how to overcome them.
AWS: CPG companies have been managing through unprecedented disruption. What have been the biggest challenges for your customers?
Sankalan Prasad: Across the make, move, and market facets of the CPG industry, we’ve encountered major challenges, such as understanding rapidly changing consumer habits, as well as balancing supply and demand dynamics and increased competitive pressures. CPG companies can tackle these issues effectively if they can access essential data from their marketing, sales, manufacturing, procurement, and supply chain systems. But that’s the tough part – gathering data from different sources, harmonizing it, and building a data lake with specialized multi-temperature data warehouses for marketing, supply chain, and sales. These data warehouses enable CPG companies to make real-time decisions for route-to-market strategies, marketing campaigns, demand fulfillment, and revenue growth management.
AWS: How do you see CPG companies adjusting their current operating environments to changing market dynamics and consumer expectations?
Sankalan Prasad: These are unprecedented times, where the world is rapidly changing. New digital technologies are shifting consumer behaviors, and supply chains are disrupted by unforeseen world events. However, many CPG brands are working against the tide by investing in AI and machine learning (ML) technologies to identify the impact of market dynamics on three major activities: demand shaping, demand fulfillment, and demand sensing.
We’ve also seen a tremendous focus on “test and learn” through direct-to-consumer (DTC) channels to get early feedback about new product launches.
AWS: The CPG industry is incredibly resilient. As you look toward the new normal, what role do technology and the cloud play for CPGs? How do you see technology enhancing the way that CPGs make, move, or market their products?
Sankalan Prasad: I think CPG companies in general are in different maturity phases. As much as possible, companies should focus on “being the trendsetter” rather than adapting to changing technologies as a laggard. Therefore, cloud providers like AWS, along with Sigmoid’s expertise, present a unique opportunity for CPG companies to lead the evolution cycle.
Sigmoid has built marketing-focused data solutions, such as multi-touch attribution, marketing mix modeling, and marketing data hub, using key analytics and ML workloads on AWS services, like Amazon Kinesis, Amazon EMR, AWS Glue, Amazon Managed Streaming for Apache Kafka (Amazon MSK), Amazon Redshift, and Amazon SageMaker, to name a few. These solutions can help CPG brands optimize in-flight/mid-flight marketing campaigns to fine-tune ad spending. Moreover, we’ve seen customers improve return on marketing investments by more than 11% using our solutions.
Although marketing spend helps create demand, supply chains are the driving force that help fulfill demand. Therefore, we’ve seen leading CPG brands build AI-enabled supply chain control towers, as well as models for demand forecasting, inventory management, and production planning. For example, Sigmoid built scalable demand forecasting ML models using SageMaker that helped one of the largest Latin American cosmetics companies reduce inventory costs by 10%. In addition, leading CPG companies are focusing on preventive maintenance on production lines using AI-based OEE solutions.
AWS: With the current CPG industry disruption, how is your company innovating to respond to changes?
Sankalan Prasad: The disruptions are opportunities for CPG companies to transform their existing processes. Sigmoid is working with leading innovators, like AWS, who are constantly evolving their solutions to help create scalable data lakes and warehouses that enable end-user companies to build and operationalize AI models. CPG brands are taking steps to normalize these disruptions by focusing on DTC channels, implementing AI-enabled preventative maintenance systems, and optimizing marketing spend with AI models. The other big shift has been ecommerce, with many CPG companies seeing growth in this channel. Ecommerce has opened access to data, which wasn’t readily available to CPG companies previously. As a result, we are seeing many CPG brands invest in long-term data and analytics strategies with the goal of optimizing and growing their ecommerce business, specifically with use cases around SEO, advertising, and digital shelf analytics.
AWS: There is a lot of talk about a “new normal” going forward. What does this “new normal” look like to you, and how do you think the CPG industry will look three years from now?
Sankalan Prasad: There is a paradigm shift in the industry to identify overlapping areas of demand shaping, fulfillment, and sensing that are leading to precise revenue growth management strategies. Traditionally, CPG brands have focused on sales channels, such as brick-and-mortar retailers and modern trade channels. As I said previously, many CPG company have seen ecommerce sales grow significantly. Interestingly, there are two other channels that CPG companies are exploring: DTC and multi-level marketing. I see a huge opportunity for Sigmoid and AWS to undertake the development of cutting-edge solutions that optimize revenue growth for CPGs in these channels.
In the next three years, I feel CPG companies should embrace more sophisticated prescriptive solutions, such as order recommendation engines, ad spend optimizers, and OEE, to become “non-stop” continuous innovation engines, rather than simple descriptive analytics solutions that help explain what just happened. Some CPGs, such as Kellogg’s, ScottsMiracle-Gro, and Belcorp, have already begun this journey. However, others have yet to identify their true potential.
AWS: What makes you excited for the future of CPG?
Sankalan Prasad: In the future, I believe CPG companies are going to be “phygital,” employing an optimal mix of physical and digital channels, to provide consumers with the right products at the right time. Moreover, there will be systems in place to capture physical data, like assortment, sales, and promotions, as well as digital data, such as ads and marketing surveys. Altough data will be abundant, the information must be cleaned, normalized, and harmonized, to enable real-time decision making. This will be critically important.
CPG companies should work toward consolidating data-rich core systems, such as enterprise resource planning (ERP) and manufacturing execution system (MES), as well as mixing these data points with point-of-sale (POS) and marketing data, to build a strong data foundation and gain countless insights to make faster decisions. Interestingly, there are some early adopters, but this is a difficult assignment with too many moving parts. Having said that, with partners like AWS, Sigmoid can help CPG companies define a data-driven transformation roadmap.
AWS: Thanks for chatting with us, Sankalan. We appreciate your insights and expertise.
We hope that you enjoy our blog series. If you have questions for Sankalan, Sigmoid, or AWS, then please leave a comment on this post. To learn more about Sigmoid, get in touch here.
AWS Partner Spotlight
Sigmoid delivers actionable intelligence for CPG enterprises. Sigmoid’s CPG analytics solution portfolio is specifically designed to equip CPG decision-makers with targeted consumer insights to drive growth. Sigmoid’s expertise in CPG analytics helps companies build robust data infrastructures that simplify every step of managing big data in the CPG industry. By solving complex analytics use cases, brands can engage effectively with consumers, forecast demand accurately, optimize inventory levels, and take actions based on near-real-time sales data across the ecommerce and retail partners community.