What Big FMCGs are Missing

For the last 15 years, I've been analyzing trends & innovations in the FMCG industry. For the last 3 years, I've published a round-up of the CAGNY (Consumer Analyst Group New York), based on the analysis of some of the biggest FMCG companies' presentations and conference calls.

In the past, these companies used to be cutting-edge in their industries, whether it's beverage, food, beauty, household products, or any other consumer packaged goods category. I'm not referring only to product R&D and innovation: these companies used to be at the forefront of the marketing industry, with Big Ideas, Engaging Stories etc. (according to the period & trendy term). Shopper journeys had been mapped to the bone; consumer insights - generated and utilized. Collaborations with both retailers and competitors (!), open innovation (consumer / academy / industry) and later, accelerators for start-ups - had been bravely formed, all in search of the much desired growth.

But this time, browsing through the conference calls and the presentations, I realized that something is missing. Yes, we all know that the biggest consumer trends in North America are snacking, BFY (with pure / real ingredients and protein), sustainability, convenience and taste. Yes, we respect the fact that companies managed to drive profitability through premium offerings and size-related innovations. And don't get them started on Millennials!

But how long would this last? What sort of differentiation do these insights hold for companies? It seems to me that the missing ingredients are Data and Data.

The first sort of missing data is - Big & Small data. Good ol' "talk to people and know what's bothering them" small data, as well as the exciting, "new" big data strategy designed to collect huge amounts of facts - mix them together - and extract an innovation-driving insight, responding to needs that consumers didn't even realize that they have.

The second sort of missing data is - market data. Sure, I have noticed that the presentations were filled with truly illuminating facts regarding the industry, impressive numbers, and lots of "CAGRs". However, aside from one competitor's remark on the food start ups that are shaking the industry, none of the companies seemed to respond to the profound change that the FMCG industry has been undergoing over the last 2 years. While all the companies had discussed "digital" and "e-Commerce", the outcome was marketing / website related, while every day, dozens of new competitors are working to make the existing consumer journey obsolete. 

The FMCG market is being disrupted - like any other market - by innovative competitors with no advertising budget but a lot of courage and understanding of new market needs and opportunities.

Big FMCGs should look around them, not only to the physical / digital shelf but also to other industries, to truly understand the disruption that this industry is about to undergo.

To read our round-up of the 2016 CAGNY conference: