Advance Analytics Solution for Consumer Goods and Retail Sector
Amidst global economic uncertainty, Indonesia is still able to maintain economic growth around 5%. The domestic consumption is one of significant contribution to the growth in line with the growth of the country’s middle class. This situation encourages Indonesia’s Consumer Goods, especially Fast Moving Consumer Good (FMCG) and Retail industry to be one of the most attractive industries. Trend of Consumer Goods and Retail business are still promising in the coming years.
Indonesia’s demography currently in a phase of changing the age structure, in which more than 50% of total population is in the productive age. Based on projection by Survei Penduduk Antar Sensus (Supas) 2015, the number of Indonesia’s population will reach 269,6 millions of people in 2020 and there is 185,34 millions of people is in the productive age, which means 68.7% of the total population is people in the productive age. These productive age people will drive the number of consumption. It’s relevant with the latest survey done by The Conference Board Global Consumer Confidence in collaboration with Nielsen, stated that Indonesia Consumer Confidence Index reached 123 during the third quarter in 2019. The number reflects a positive confidence and this is reinforced with Indonesia’s position in the index of most positive consumer confidence that is ranked fourth among 64 countries.
It’s also changes in lifestyle and consumption patterns in line with the rising urbanization trend. It is estimated by Badan Pusat Statistik that 66,6% of the total Indonesian population will live in urban areas in 2035 compared with 56,7% approximately this year.
The consumer, especially the urban and middle class, has a shifting expectation of shopping experience. This increasing trend on shopping behavior creates an opportunity for Consumer Goods and Retail industry in modern channels through convenience stores and e-commerce. On the other hand, the trend also brings some challenges.
Consumer Goods companies face tight competition with a new player and new products coming onto the market. While consumer nowadays is more price-conscious and less loyal, means their behavior might change periodically depending on the promotional mechanism given by different suppliers.
Given the geographic challenges and the huge number of retail outlets in Indonesia, supply chain management is extremely important for Consumer Goods, especially FMCG companies. Indonesia is still a country dominated by small and independent retailers spread in thousands islands. However, the modern retail channel is growing fast. The greatest growth is in the convenience trade, therefore retailers are looking to expand their presence outside of Indonesia’s urban area. They are expanding the business into Indonesia’s second and third-tier cities across many islands. Facing these challenges, Consumer Goods companies need to reduce time delivery to keep the sales increasing.
Consumer Goods and Retail industry require a complete calculation of promotion, order placement on carrier vehicle, cost consumption, the taken route, and time delivery to get optimum results. The company should also have its sales force to achieve the target in more effective ways with minimum cost.
With the potential Consumer Goods and Retail business manage incredible amount of information from consumer interactions, every interaction generates new record and every new record is an opportunity to learn more about how to make Consumer Goods and Retail business more efficient and successful. As retailers have always been at the leading edge of change, transactions can generate a large volume of data on human behavior and action. Therefore, they need pricing insight, customer insight, sales insight, marketing insight and supply chain insight to drive maximum revenue and profitability through all channels.
To deliver insights needed by retailers, Cybertrend has created two Artificial Intelligence (AI)–based platforms named CtrendMax and CtrendVision that utilize the incredible amount of transaction data to generate data insight. Cybertrend provides CtrendMax and CtrendVision based on the expertise in business intelligence, machine learning, AI and deep domain knowledge. As Cybertrend is the leader of data analytics in Indonesia, it has been engaged by many experienced resources with deep expertise in several lines of industries, including Consumer Goods and Retail industry. This software innovation also targeted to Consumer Goods and Retail business by featuring Consumer Goods Analytics, Retail Analytics, and Logistic Analytics.
CtrendVision provides five modules: Product Analytics, Consumer Behavior, Inventory Analysis, Sales and Salesperson KPI and Timeline Based Map Selling Performance. With these modules CtrendVision able to show dashboard visualization on Selling Suggestion, Product Profiling, Customer Churn and Behavior, Drill down capability.
CtrendMax has two solutions: Sales Canvassing Optimizer and Delivery Optimizer. “Route” is the basic building unit for sales canvassing and distribution which arms the sales army to achieve targeted meetings in minimum time, minimum distance and minimum cost. CtrendMax for Sales Canvassing Optimizer helps in advance analytics and data modeling to get Sales Territory Management Optimization, while CtrendMax for Delivery Optimizer is a route optimizer with a more complex combination parameter to be customized and calculated to optimize delivery function. CtrendMax for Delivery Optimizer has complete calculation based on learning and modeling, start from order placement on a carrier vehicle, cost, route, time of delivery up to the delivery business result. CtrendMax is tool for optimize Vehicle Routing & Scheduling (VRS).
The major benefit for the Consumer Goods and Retail business by having a transformation is the visualization, automation and optimization process. New business models can be created to improve efficiency and provides better results by replacing the legacy business processes with more automated workflows. This also provides the ability to improve flexibility, hence eliminate bottlenecks in the current processes.
In the area of marketing, the marketing analytics by Ctrendvision will provide a suggestion on how to ensure the correct promotion and marketing strategy executed to increase sales.
In the area of production and distribution, the production analytics by CtrendMax has the power to predict with high accuracy to let the customer produce as market demand while keeping warehouse on optimum stock level. The rate of accuracy improves from 23 %to 65 %.
In the area of the sales department, the sales analytics by CtrendMax can drive salespeople to get the optimum route and product revenue, not just the shortest route. This will impact on improving Sales Performance Management (SPM) achievement and also company general revenue.
In the area of delivery, the supply chain analytics by CtrendMax creates modeling for complex logistics to optimize route delivery, product and carrier dimension, and also optimize logistic process while saving cost on delivery. The result is a balanced improvement in product delivery and workload to reduce overtime delievery.