Enabling CPG Growth with Price Pack Architecture

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 & Ashish Sood


The Modern Consumer Dilemma

In today’s highly competitive market, consumers have become increasingly discerning. With an abundance of choices, we often find ourselves comparing prices and quantities when evaluating similar products. For nutrition labels, products may provide information for a standard quantity (like soda) or per individual piece (such as chocolate bars) to facilitate easy product comparisons. But why do modern consumers take the time to compare products before making a choice?

Shifting Focus to Product-centric Analysis

The answer is simple: they can. Ultimately, it’s their hard-earned money, and they want to spend it on products that provide value and satisfaction. Recently, Consumer Packaged Goods (CPG) companies realized that brand power and marketing tactics have their limits. As a result, the focus has shifted towards a deeper understanding of products and their consumers. Companies are investing millions in understanding what works, what doesn’t, and, most importantly, why it doesn’t. Through detailed analytical models and forecasting, CPG companies seek the best data insights to drive revenue growth in a competitive market of low-ticket items. In this endeavor, LatentView plays a crucial role by offering various forecasting models that consider multiple perspectives and focus areas to understand consumer trends better.

Price Pack Architecture: A Cost-Efficient Strategy

Price Pack Architecture offers CPG companies an effective strategy to capture markets that were once dominated by local brands, all without breaking the bank. By adjusting the physical attributes and pricing of an existing product to suit a particular market, CPG companies can increase their revenue without resorting to costly methods like introducing new products, heavy marketing spending, or imports.

Beyond Market Share: The Broader Impacts of PPA

While executives monitoring a new PPA initiative typically focus on market share and revenue growth, it’s essential to consider the broader impact of these initiatives. Adapting a product to meet the needs of a specific consumer segment places a significant responsibility on manufacturing. It involves sourcing different quantities and sizes of molds, packaging, and products, frequent changes and configurations of manufacturing line equipment to produce new SKUs, and streamlining production schedules and changeovers to minimize unplanned downtime. Monitoring these aspects is crucial, not only for cost reduction but also for employee satisfaction and resource efficiency.

Sustainability Analytics: A Growing Imperative

In an era where sustainability is a prominent industry concern, the need for sustainability-focused analytics has never been more pressing. In 2021, nearly half (48%) of all new products offered sustainability benefits, up 20 percentage points from 2017. Companies are sourcing recycled materials for packaging, reducing waste, and transitioning to renewable energy sources. While these steps contribute to a greener future, we must ask: are these sustainability measures themselves sustainable? Sustainable products will grow over time, but to maintain this growth, we must place value on manufacturing processes.

Harnessing Price Pack Architecture for Sustainable Growth

Price Pack Architecture can facilitate sustainable growth in various ways, all requiring substantial market research. Whether reducing the number of items in a pack of Pringles or charging extra for an additional 0.2L (6.7 ounces) of Coke, the manufacturer or the consumer bears the cost. However, improving the processes behind these adjustments can help offset these challenges.

Data from different points in the sustainability-boosting pipeline needs to be analyzed as thoroughly as consumer market data. These sustainability measures are here to stay and grow, and companies must anticipate and build scalable infrastructure to track data, diagnose issues, predict problems, and prescribe solutions. CPG companies recognize this and have integrated an array of sensors into various aspects of the manufacturing process, but the effective utilization of this data remains a question.

Bridging Data Gaps for Sustainable Revenue

LatentView Analytics seeks to bridge these gaps and maximize available data. We help enterprises derive insights that enable personnel, from the factory floor to the CEO’s office, to make informed decisions that benefit overall revenue sustainably.

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