Insights derived from retail and eCommerce data can help the FMCG industry in various ways. Business intelligence tools like Power BI are useful in making faster business decisions based on real-time data. Here, we’ll discuss the role of BI in FMCG markets.
FMCG (Fast-Moving Consumer Goods) is also known as Consumer-Packaged Goods and deals with a large variety of perishable and durable goods from different industries. From food items to cosmetics, stationery, and groceries, many products are categorized as FMCG.
According to Cognitive Market Research, the global FMCG market is estimated to reach $17,939.41 billion by 2030, with a CAGR (compound annual growth rate) of 6.11%. In other statistics, The FMCG’s share is expected to touch 18% this year in Africa.
The FMCG market is always bustling with activity online and offline. Countless sales happen each day around the globe. Needless to say, large volumes of data are generated by businesses, vendors, and customers. This data can be analyzed to make better decisions and streamline internal operations. FMCG Business Intelligence is in high demand in the market to derive data-based analytics and insights. Business intelligence is a part of many industries. The global BI software market is expected to touch US$25.73 billion in 2023.
In this blog, we’ll read more about the use of analytics and reporting in the FMCG industry and the role of Power BI in delivering insights in real-time.
The FMCG industry is going digital by adopting the latest technologies and tools to collect, store, and analyze data generated by businesses. This allows for seamless connectivity, greater flexibility, agility, and scalability.
Business intelligence companies create exclusive dashboards to provide data visualizations about inventory held by the business at the manufacturing unit, warehouses, stores, and the ones in transit. This enables brands to cater to the changing market demands without running out of stock.
The supply chain is vital for the FMCG industry to thrive. We have seen how disruption affected businesses during Covid lockdowns. However, analytics can help businesses prepare for such adverse conditions and minimize losses.
A smarter warehouse is more effective and can reduce the risk of damage to the stored items. Using warehouse management software and integrating it with data analytics tools will provide real-time insights about stock levels, shipment movement, etc.
FMCG analytics and reporting dashboards can help businesses plan their deliveries carefully to avoid delays and increase customer satisfaction. Geo-analytics makes it easier to plan the distribution and delivery routes to minimize cost, distance, and time taken for the shipment to reach from one point to another.
Customers demand personalization in today’s world. Brands can offer personalized products, deals, discounts, and loyalty programs by analyzing customer data to understand their preferences. This will increase customer loyalty and attract more consumers to the business.
The prices of FMCG products are flexible and change based on market demand, quality, availability, etc. Businesses can adopt a proactive pricing model to automatically adjust the prices based on the insights derived from BI tools.
Microsoft Power BI is a popular business intelligence tool used by many leading businesses from different industries. Companies hire BI consultants to set up the Power BI dashboards and customize them based on business requirements, goals, and metrics. In this section, we’ll see how the tool can be used in the FMCG industry to deliver real-time insights for decision-making.
The FMCG data comes from various sources like legacy systems, IoT (Internet of Things) devices, packaging units, distribution units, warehouses, factories, stores, etc. This data has to be combined and presented in a single dashboard to streamline the business operations. Power BI is used to create a unified dashboard with real-time data updates from several sources. Decision makers can get a macro and micro view of the data from each source and organize the dashboard layout to suit their needs.
KPIs or Key Performance Indicators are essential for every business and department to track their progress and ensure they are moving in the right direction. Businesses can build Power BI KPI dashboards to track each indicator/ metric with the goals, resources, and other influencing factors. It allows employees to make proactive decisions to achieve weekly/ monthly/ quarterly/ yearly goals based on real-time data.
How many sales have each product recorded for the defined duration? What is the overall sales value? How is each store performing in reaching the sales targets? The Microsoft Power BI sales dashboard provides answers to many such questions. It keeps the sales and finance departments up to date with the latest information about the stock. This allows employees to plan and implement marketing campaigns at the right time to boost sales. It also shows the weak areas where the business needs to improve to sell more products.
The FMCG industry cannot afford supply chain disruptions. Reactionary decisions can help with damage control but don’t minimize risk. However, with a supply chain Power BI dashboard, businesses can track the internal and external factors that can cause trouble. The dashboard provides warning signs and alerts to be proactive in avoiding risk and minimizing losses. It also helps choose the best path to optimize resources and maximize returns. From comparing vendors to speeding up deliveries, the dashboard is helpful in many ways.
Power BI in the FMCG industry also helps in streamlining marketing campaigns and analyzing their performance. Many brands in the industry rely on omnichannel marketing to reach out to a wide range of target audiences. This data from multiple sources can be easily collected and analyzed to provide clear reports using the Power BI tool. It is a great way to work on the Marketing Mix Model, where multiple factors, such as price, promotion, market demand, product placement, etc., are used to determine if the campaign is converting into revenue.
Business intelligence is combined with machine learning to use historical and present data to determine the potential future demand for a product. Demand forecasting in the FMCG industry uses what-if analysis to get a clear picture of the different possibilities of future market conditions. It helps businesses manage inventory and warehouse product movement to avoid having excess unsold inventory or running out of stock. It helps plan better marketing campaigns to sell more products.
The finance dashboard is vital in the FMCG industry, just like in every other sector. Brands use it to manage their expenses and measure if the revenue aligns with it. The Power BI finance dashboard helps decision-makers identify areas of excess expenditure to find ways to minimize spending. It also provides a clear picture of the business’s balance sheet in real-time.
Data visualization is the process of graphically representing the insights in end reports. The data is presented in an easy-to-understand manner using various graphs, charts, maps, etc., instead of lengthy tables and endless pages of interpretations. Power BI is also a data visualization tool where the dashboards are user-friendly and have a drag-and-drop feature for customization. Businesses can use the visualizations to make more effective decisions and gain a competitive edge in the FMCG industry.
Business intelligence is a set of processes and tools that collect, clean, store, and analyze datasets to deliver actionable insights through data visualization reports. So, what is the role of BI in the FMCG industry?
Let’s find out below.
BI can help a business understand how it uses resources and optimizes the process. This leads to a lesser consumption of resources without compromising quality or production speed.
Brands can analyze CRM data using BI tools to get in-depth insights about customer behavior and journey through the sales funnel. It is used to calculate customer LTV, optimize their journey with the business, and enhance customer experience.
Business intelligence consultants also help the sales and marketing teams to create targeted campaigns for different customer groups. Demographics, customer preferences, market conditions, etc., are considered in this process.
BI also helps the R&D department to develop products customers expect from the business. It helps in bridging the gap between the brands and its customer base. The business can come up with new product ranges instead of relying on existing ones at all times.
From sourcing raw materials to streamlining warehouse management and supply chain movement, business intelligence reports are useful in enhancing operational efficiency in the FMCG industry. It also helps track the performance of the factories and employees.
The retail sector is part of the FMCG industry. Traditionally, retailers relied on intuition, goodwill, and personal experience in making decisions, and many of them are adopting business intelligence tools to understand their data. It empowers retailers to make decisions backed by data-driven analytics.
There are many real-world examples of BI in the retail industry. Amazon, the global marketplace giant, uses advanced analytics, artificial intelligence, machine learning, and data science to run the recommendation engine, streamline pricing, manage sellers, and attract customers with personalized deals and limited-period discounts.
BI firms help FMCG brands with the following aspects by effectively using business intelligence tools:
Business intelligence and data analytics are now an integral part of the FMCG and retail industry (this also includes the eCommerce sector). The BI tools enable the adoption of a holistic approach with a data-driven model for decision-making. Businesses can rely on Power BI in FMCG using Dashboards to access real-time data and actionable insights. From retail startups to manufacturers to distributors, suppliers, and sellers, everyone can benefit from leveraging Microsoft Power BI. Hire a reputed offshore business intelligence consulting company to increase ROI and improve customer experience.