The Consumer Products Pulse Check Survey
Conducted by SAP & Deloitte
Analysis Summary
GET STARTED
DOWNLOAD THIS REPORT (PDF)
INTRODUCTION
Sales & Marketing
Demand Planning
Procurement
Video Spotlight
Webinars
Download Report (PDF)
Q2: Additional Safety Measures
Q3: Reopening Workspaces
Q8: Shifts in Consumer Demand
Q9: Balancing Supply & Demand
Q4: Changes in Go-To-Market
Q5: Consumer Interaction Changes
Q6: E-commerce Acceleration
Q7: Trade Spend Changes
Q10:Top Supplier Relationships
Q11: Raw/Packaging Materials
Q12: Visibility to At-Risk Suppliers
Q13: Alternate Sourcing
AN INDUSTRY FUNDAMENTALLY IMPACTED
SURVEY METHODOLOGY
SUMMARY
The Consumer Products Industry Pulse Check Survey revealed data-based insights into the current marketplace and consumer trends that can help CP companies prepare to respond, recover, and reimagine their brands throughout and beyond the pandemic.
Introduction
more >
Q1: COVID-19's Impact
DEMAND PLANNING
SALES & MARKETING
PROCUREMENT
Now, consumer demand and the integrated supply chain that fulfills it has fundamentally changed. The pandemic has dramatically accelerated industry disruption and highlighted the need for executive-level attention on specific areas of business operations – many of which were traditionally overlooked.
Before the pandemic, the CP industry faced significant operational issues and adapted slowly to emerging industry trends driven by rapidly evolving consumer demands. These market expectations included increasing convenience and personalization, demanding sustainable goods, and embracing insurgent brands and private labels.
The Consumer Products Industry Business Unit from SAP collaborated with the Deloitte Consumer Industries team to measure the impact of the COVID-19 pandemic and its economic implications on the consumer products (CP) industry.
Survey Methodology
Survey responses represent executives from global and regional CP organizations across eight major segments – varying in size in terms of annual revenue and workforce. Apart from identifying overall industry trends, the survey focuses on affected lines of business, including procurement, manufacturing, and sales and marketing
Consumer Products Categories Represented
Company Size By Number of Employees
Company Size By Annual Revenue
Food & Beverage
Health & Personal Care • Apparel & Footwear
Consumer Electronics • Agribusiness
Household Products
Durables
Tobacco
41%
14%
13%
9%
5%
3%
Small & Medium
Large
Enterprise
(less than 1,000)
(10,000+)
(1,000-9,999)
27%
32%
(less than $1B)
($10B+)
($1-$9.9B)
38%
33%
29%
Fundamentally Impacted
A brand’s company size and category did not insulate operations against the effects of the pandemic. Across all CP categories, the impact on revenues is virtually the same, regardless of company size, region, or segment they run in. Half of surveyed CP organizations experienced a decrease in revenue, while one-quarter experienced increased revenue.
How HAS THE COVID-19 PANDEMIC IMPACTED YOUR REVENUES?
Top Priorities of Consumer Products Companies
Although some CP companies in the packaged foods and home-care segments benefited, positive effects on topline growth and margins were limited by supply disruptions, regulation-mandated store closures, rising operating costs, and overwhelming demand fluctuations. During the health crisis ignited by COVID-19, most consumer products companies emphasized employee health and wellness as their top-most priority, followed by financial recovery and supply chain resilience.
Employee health and wellness
Post COVID-19 recovery and financial liquidity
Supply chain resilience
Q1
1
2
3
An Industry
Increase
About the same/both
Decrease
48%
22%
A DEEPER LOOK: JOIN THE WEBINAR
Lead to Loyalty
Make the customer experience a more human experience—one that strengthens relationships & business outcomes. Learn how Lead to Loyalty from Deloitte can help you create a unified ecosystem for driving loyalty across touchpoints. WATCH IT NOW >
Pulse Check 2020: Where the Consumer Product Industry Is Heading Next
Regardless of size and global reach, consumer product companies are incredibly focused on their employees' health and safety. But how can they balance a safer work environment without losing traction in a highly volatile marketplace?
In this webcast series, guest speakers from Deloitte and SAP will discuss the latest insights from a pulse check survey conducted earlier this year. You'll hear how brands are adjusting to new economic realities by pivoting their channel strategy to focus on direct-to-consumer business models, agile supply chains, and the capabilities to respond to never-ending changes in consumer demand.
Today, it's more important than ever to optimize the links between the supply chain, sales and marketing, and procurement to keep your workforce safe and deliver products that consumers love.
JOIN THE WEBINAR
JOIN THE WEBINAR >
As CP companies reopened their workspaces and gradually entered the recovery phase, requirements such as safety protocols, personal protective equipment (PPE), and virtual working environments began to reshape the employee experience and customer engagement.
What additional safety measures have you adopted?
In the face of disruption, consumer products organizations are proving to be resilient. Our survey findings indicate that 90% of surveyed CP organizations have already reopened their workspaces or progressing towards it.While reopening the physical workspace is paramount, CP companies face notable changes across four primary business functions: sales and marketing, demand planning, procurement, and manufacturing.
Has your consumer products operations reopened the workspace?
An Industry Fundamentally Impacted
Q2
Q3
COVID testing
Employee temperature checks
Providing PPEs to employees
Reconfiguration of workspaces
Sanitizer stations
Social distancing protocols
15%
18%
20%
25%
53%
37%
10%
"Yes"
"In Progress"
"No, Not Yet"
Sales and Marketing
Most CP companies are actively pursuing alternative customer channels or routes to market as they adapt go-to-market strategies to transition their business model for a post-COVID world. While the impetus for this change may be the pandemic and its economic implications, this move is a strategic, long-term commitment, not a transient strategy.
Do you foresee changes in your go-to-market strategy?
Has your organization made adequate changes to your consumer interaction model?
Unfortunately, the survey data shows that over two-thirds of CP companies have not made the radical shifts required to accelerate their new routes-to-market strategy and consumer interaction models such as e-commerce. This finding indicates a gap between the existing state of engagement for most consumer products organizations and their desired state. Factors that cause such disparity in the busines model include ineffective and mistargeted marketing and customer service messaging, technological difficulties when creating user-friendly Web sites, and limited data and analytics capabilities to understand consumer behavior and act accordingly.
Q4
Q5
VIDEO SPOTLIGHT
SAP Customer Experience for Consumer Products Companies
See how consumer products companies can use customer experience portfolio across could sales, marketing, and commerce channels to make the consumer experience more engaging and responsive, drive revenues and turn consumers into fans. WATCH IT NOW >
Pulse Check 2020: The Accelerated Customer Focus in Consumer Products
The pandemic has become an accelerant to digital transformation that could radically alter consumer behavior. According to recent research, nearly two-thirds of surveyed consumer products companies have not shifted their channel strategy and consumer interaction model deep enough to confront today's challenges.
4%
Yes
64%
28%
54%
Minor Changes
Moderate Changes
Significant Changes
No
Made Some Changes, But Not Enough
Hear guest speakers from Deloitte and SAP further discuss the findings from their recent pulse check on the industry's approach to sales and marketing including:
• Delivering a consistent customer experience across all consumer touch points • Gaining market share in a multichannel world • Providing a more personal and human experience • Anticipating problems and reacting faster using intelligence-driven solutions.
Although only one-third have successfully accelerated their e-commerce strategies, 80% of CP companies consider it an alternate route to market. Businesses that cannot pivot and respond quickly and nimbly to the transformed e-commerce landscape will likely struggle to catch up.
Have you accelerated your e-commerce strategy as a result of the COVID -19 pandemic?
How is your organiations reallocating trade spend?
CP companies that relied heavily on wholesale and marketing campaigns to market their products indicated efforts in retooling and diversifying their distribution channels. Our data shows that 56% of surveyed participants are significantly reducing their trade promotional spend to increase financial liquidity, while 33% are increasing their investment in direct-to-consumer channels.Investments in a direct-to-consumer strategy provide opportunities for creating new revenue streams and building direct consumer relationships. Additionally, CP companies can access consumer data – which is traditionally challenging to obtain, compared to their retail counterparts – to facilitate a comprehensive and holistic omnichannel sales strategy.
Q6
Q7
Not At All
Moderately
Significantly
Cash Conservation
Increaase in Direct-to-Customer Channels
Other
46%
56%
11%
CP companies need to consider evolving consumer demand patterns and supply chain disruptions to understand the impacts of the demand-planning process.While 80% of respondents said their businesses considered shifts in consumer demand during demand planning, more than half believe their organization’s ability to balance supply and demand is average.
Has your organization considered shifts in consumer demand in the demand planning process?
How confident are you in your organization’s ability to balance supply and demand?
Demand-forecasting solutions help identify growth opportunities by using data and analytics to explore a variety of scenarios. CP companies that invest in these technologies can adjust and pivot to take on unforeseen problems quickly and with greater ease. Balancing and aligning demand management with supply management enables organizations to be agile and adapt to demand volatility.
Q8
Q9
Digital Supply Networks: Building Resilient Supply Chains Through Digital Transformation
Supply chains are being severely disrupted everywhere, challenging the ability to match changing demands with scarce supply to serve people’s most urgent needs. Listen on-demand for transformation insights for the Consumer Industries. WATCH IT NOW >
SAP Integrated Business Planning Overview – the Cloud Solution to Run Your Digital Supply Chain
WATCH IT NOW >
78%
Average
7%
Below Average
Above Average
40%
Pulse Check 2020: Resilience in the Consumer Products Supply Chain
It's undeniable that supply chains across the consumer products industry have seen its share of disruption over the last few months. Yet, some brands demonstrate an astounding level of long-term resilience when planning around short-term supply and demand shocks.
Guest speakers from Deloitte and SAP will share their pulse check survey findings on how consumer products companies handle supply chain challenges such as demand spikes, supply shortfalls, and ever-shifting packaging and fulfillment requirements. The webcast will provide an inside look into why greater visibility leads to fewer disruptions and which capabilities can supercharge the balance between supply and demand to create an always-on, strategic differentiator
The COVID -19 pandemic has unquestionably severely disrupted supply chains globally. Procurement leaders are now focusing on risk mitigation strategies to anticipate and minimize supply chain challenges and risks as their organizations continue to face uncertainty.More than half of CP companies feel that their relationship with the top 10% of the strategic suppliers is very or extremely effective. Meanwhile, the top 10% largest suppliers use EDI technology to communicate with their buying organizations effectively.
What is the effectiveness of your relationships with the top 10% of your strategic suppliers?
However, less than 20% of surveyed organizations have full visibility into their at-risk suppliers. For 84% of respondents, some degree of disruption of raw materials or packaging materials has been experienced. Even direct materials, such as packaging, have become scarce, particularly for businesses selling high-demand goods.
How disrupted is your supply of raw or packaging materials?
What level of visibility to you have in at-risk suppliers?
Q10
Q11
Q12
Leading with Confidence During Disruption: Supply Chain Strategies
Watch this 20-minute webcast to hear supply chain strategies you can leverage to navigate current events and prepare for what comes next. WATCH IT NOW >
SAP Ariba and Coca-Cola FEMSA: Innovating procurement to optimize experiences for employees, suppliers, and consumers
Together with SAP Ariba, Coca-Cola FEMSA transformed their procurement processes and improved collaboration between suppliers and internal stakeholders. As Jorge Martín Torres Pérez, Strategic Procurement Director, says, "Everybody wins." WATCH IT NOW >
Very/Extremely Effective
Moderately Effective
Slightly Effective
42%
Many Disruptions
17%
No Disruptions
Few Disruptions
67%
No Visibility
Full Visibility
Some Visibility
68%
Pulse Check 2020: The Rise of Intelligent Spend Management in Consumer Products
Although more than half of consumer products companies feel their relationship with the top 10% of their strategic suppliers is extremely effective, less than 20% have full visibility into at-risk suppliers. This finding from a pulse check survey conducted by Deloitte and SAP provides clear insight into why disruption of production and packaging materials has been widespread.
Throughout this webcast, guest speakers from Deloitte and SAP will dig deeper into this research. You'll discover how procurement organizations can monitor and address supplier risk proactively and continuously with intelligent spend management, for example:
• Assess the supply market in terms of alternative suppliers and reduced pricing • Develop a risk adverse supply chain through alternate geographical sources of supply • Establish smart strategies to run sourcing events and acquire new sources quickly • Use cohesive risk intelligence to guide supplier selection, qualification, and segmentation.
Although larger suppliers use EDI and other technologies, CP companies still do not have in-depth visibility into upstream disruption within their suppliers’ manufacturing plants and country regulations and compliance issues. As CP companies deal with short-term supply-and-demand shocks and plan simultaneously for longer-term resilience, 85% of CP organizations have determined alternative sourcing arrangements. Intelligent technologies – such as artificial intelligence and machine learning – have made previously expensive supplier monitoring techniques more affordable and readily accessible.
Has your business determined alternate sourcing arrangements?
A procure-to-pay platform enhances interaction among a business’s supply chain, buying, and sourcing capabilities while identifying suppliers with high-risk factors and generating meaningful insights that guide the business toward the right actions.
Q13
85%
Rapidly changing consumer behavior has led to a substantial shift toward e-commerce on the customer engagement side. CP companies should extend their digital strategy to the supply chain to effectively translate demand fluctuations to their suppliers.
Summary
CP companies that tackle evolving consumer demands with agile and resilient supply chains are best positioned to respond effectively to today’s uncertain environment. But conventional cost-cutting strategies are not enough. The best path forward is investing in a comprehensive digital transformation strategy that is made to adapt to constant change, drive a return to profitability, and pave the way for long-term success.
www.deloitte.com/sap
© 2020 SAP SE or an SAP affiliate company. All rights reserved.No part of this publication may be reproduced or transmitted in any form or for any purpose without the express permission of SAP SE or an SAP affiliate company.The information contained herein may be changed without prior notice. Some software products marketed by SAP SE and its distributors contain proprietary software components of other software vendors. National product specifications may vary.These materials are provided by SAP SE or an SAP affiliate company for informational purposes only, without representation or warranty of any kind, and SAP or its affiliated companies shall not be liable for errors or omissions with respect to the materials. The only warranties for SAP or SAP affiliate company products and services are those that are set forth in the express warranty statements accompanying such products and services, if any. Nothing herein should be construed as constituting an additional warranty. In particular, SAP SE or its affiliated companies have no obligation to pursue any course of business outlined in this document or any related presentation, or to develop or release any functionality mentioned therein. This document, or any related presentation, and SAP SE’s or its affiliated companies’ strategy and possible future developments, products, and/or platforms, directions, and functionality are all subject to change and may be changed by SAP SE or its affiliated companies at any time for any reason without notice. The information in this document is not a commitment, promise, or legal obligation to deliver any material, code, or functionality. All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from expectations. Readers are cautioned not to place undue reliance on these forward-looking statements, and they should not be relied upon in making purchasing decisions.SAP and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered trademarks of SAP SE (or an SAP affiliate company) in Germany and other countries. All other product and service names mentioned are the trademarks of their respective companies. See www.sap.com/copyright for additional trademark information and notices.
< back to home
SAP Ariba & Coca-Cola FEMSA: Innovating Procurement to Optimize Experiences for Employees, Suppliers, and Consumers
Click to play
CP 2021 – Checking the Pulse of the Recovery
The Accelerated Customer Focus in Consumer Products
Resilience in the Consumer Products Supply Chain
The Rise of Intelligent Spend Management in Consumer Products
