When consumer organizations fully embrace the cloud (rather than just using it for IT), they are expected to reap a wealth of benefits, from bringing new products to market faster to lower costs. McKinsey predicts that digitally enabled innovation will allow companies to bring new products to market 50 percent faster, at a third lower cost, and double the return on investment. (1)
How will this happen? Cloud can enable data and analytics insights in real-time. This allows for faster reaction time and better resilience. Companies can generate and test new concepts faster, supported by consumer insights. Changes in demand can be identified faster and even predicted, so companies aren’t hindered by market fluctuations.
Leveraging the Internet of Things (IoT) and operational technology (OT) can increase manufacturing efficiency. This can be through machine-to-machine communication to streamline production lines, supply chain monitoring, picking optimization, and more. It can also identify needs for equipment maintenance early on, allowing maintenance to happen during scheduled downtime.
Cloud will enable the connected, autonomous supply chains needed to avoid future disruptions. PwC found that the payback period for investing in advanced supply chain capabilities, such as analytics and smart logistics, was just 1.8 years. (2) Digital supply chains can:
- decrease costs
- reduce inventory
- improve delivery reliability
- increase revenue
Scale is another benefit of cloud technology, whether by building cloud-native applications, adopting new technologies, or expanding existing offerings. It can also help businesses expand their reach and channels. More industries are shifting to sell products direct to the consumer, requiring changes such as the addition of eCommerce platforms.
Data-driven personalization is another opportunity for consumer products organizations to explore. Advanced technologies can make personalized products affordable for a much larger market. L’Oréal cosmetics created My Little Factory and are able to produce a personalized foundation shade for customers on-site in about 20 minutes. It scans the customer’s face to formulate the ideal shade and has been rolled out in select stores under the Lancôme luxury brand. (3) Many cosmetic companies have also recently added shade finder technology to their websites that use the customer’s phone or laptop camera to assist in purchasing the right product online. Adopting this technology can increase sales—usually direct from the producer’s website—and reduce returns.
Digital is the future, from design to production to sales. While there are several challenges consumer product companies must overcome before they can reap the benefits, experienced help is available. Taos can help you grow and modernize your businesses, capitalizing on scalability, enhanced security, and cloud economics. Taos offers Advisory Services, Professional and Managed Services for Development, Data, the Cloud, and managed IT and Security Services to support your business needs.
Learn more at https://www.taos.com/industries/consumer/
1 – The next frontier in consumer goods: Digitally enabled innovation, McKinsey, April 2022
2 – Connected and autonomous supply chain ecosystems 2025, PwC, 2020
3 – L’Oréal presents system for large-scale personalisation of cosmetics products, Fashion Network, May 2019