If you have any doubts about how fast business moves and loyalties change in today’s hyper-evolving economy, consider this: The average life expectancy of a Fortune 500 company is now less than 15 years, compared to around 75 years a half century ago.
It’s an alarming reminder of the pressures that today’s consumer products companies are under to maintain relevancy and profitability. We must contend with new competitors that are disrupting the status quo, remain viable across a larger range of channels, capitalize on the explosion of data brought about by the Internet of Things, and keep pace with changing consumer tastes while also forging meaningful connections with our customers and consumers.
CP companies that embrace these challenges, however, are not only finding better ways to connect with end consumers but are also creating new opportunities for growth.
Frito Lay is just one example. The 50-year-old snack-foods giant launched the ingenious “Do Us a Flavor” U.S. campaign in 2012. The campaign turned product development over to consumers, allowing anyone to create, share and vote for new potato-chip recipes on Facebook.
“Today, consumers want to have their voices heard,” the company’s North America chief marketing officer, Anindita Mukherjee, told Yahoo! Finance at the contest’s onset. “They want to have their hand in where a brand goes, what a flavor is for a brand, what direction it goes, they want to have a say.”
She was right. The crowd-sourced recipe campaign spurred innovation, engagement and advocacy all at once, while garnering an impressive 3.8 million contest entries. More importantly, the campaign increased sales 12 percent in the U.S. and tripled the company’s U.S. Facebook followers.
Enter the Digital Core
Major business transformations aren’t the result of iterative step changes or incremental improvements. Rather, they’re the result of companies that make an intentional and oftentimes bold decision to do things fundamentally differently. And in today’s fast-speed, hyper-connected and highly engaged digital economy, this requires a digital business network in which all aspects of a company’s value chain are interconnected.
Central to the digital business network is the digital core, an end-to-end enterprise-management system that connects every aspect of internal operations but also four key areas of the value chain: customers, workforce, suppliers and Internet of Things connection points.
Seamless and real-time access to each of these individual areas can offer unique benefits. For example, connectivity to consumers can help companies engage with consumers anywhere and at any time in the buyer’s journey.
However, it’s only when we have the ability to see and collaboratively act across the entire digital business network that we can begin dramatically simplifying the technology environment and streamlining interactions among groups to the point that it becomes frictionless. This is where true transformation takes root.
“It is not enough to have a social media strategy,” Ernst & Young pointed out in its report, “The Digitization of Everything.” “Companies need to develop a comprehensive ‘digital strategy’ that reaches far beyond the marketing department to tackle issues like ubiquitous cross-channel connectivity, social commerce, and the threat of commoditization.”
Imagine being able to transform the product-development process by enabling real-time cross-functional collaboration all the way from product conception to product launch, while also engaging partners, suppliers and consumers throughout the process. Or being able to monitor a promotion in real-time and adjust parameters on the fly to shape future demand.
These aren’t theoretical concepts. CP companies – possibly your competitors – are already doing these things today to redefine their businesses, processes and workforces in the digital economy. And it all begins with the digital core.
Learn more about Digital Transformation for Consumer Products at Consumer Products. Reimagined for the new economy.