Neville Dunn, Managing Director

The days of merchandisers relying on gut instinct and manual forecasting are behind us. Today, AI and big data are transforming how fast-moving consumer goods (FMCG) brands operate, creating exciting new opportunities for growth.

AI-powered merchandising and data-driven decisions are no longer a futuristic concept; it’s a present-day necessity that many companies have already implemented. From automating basic processes to predicting consumer behaviour to help you craft merchandising strategies, AI helps you gain a competitive edge.

In this article, I take a closer look at AI and data in the fast-moving consumer goods (FMCG) industry, the benefits of using them, as well as key challenges and considerations.

Understanding AI in the FMCG Industry

In the FMCG industry, AI components—such as machine learning, data analysis, and automation—are commonly used to streamline merchandising, supply chain management, and consumer experience. AI processes vast amounts of data in seconds, empowering brands to make smarter, faster decisions that drive efficiency and profitability.

When integrating AI into business operations, FMCG brands can streamline merchandising, improve product placement, and even create more personalised shopping experiences, helping them stay ahead in an extremely competitive market.

The Impact of AI and Data on FMCG Processes

Product Innovation and Development

With AI, brands can stay ahead of consumer demands through bold innovations. It can do this by analysing data from sources like:

• Social media reviews.
• Purchasing patterns.
• Popular packaging designs.
• Popular product formats.

For example, by using AI-driven sentiment analysis, businesses can learn what customers love about existing products. This allows them to refine their offerings or create new products that resonate more with consumers.

Supply Chain Optimisation

AI is streamlining FMCG supply chains, making them more agile and cost-effective.

Traditional supply chains often struggle with inefficiencies like inaccurate planning, production delays, and logistical issues. But AI-powered systems eliminate these challenges by offering:

• Real-time route optimisation to improve delivery times.
• Automated supplier management.
• Risk management and contingency recommendations.

Inventory Precision and Demand Forecasting

Balancing supply and demand has long been one of FMCG’s biggest challenges.

Overstocking can lead to waste in inventory and cash flow while understocking results in missed sales and unhappy customers.

AI-powered software empowers your business to overcome these issues by analysing:

• Historical sales data.
• Seasonal trends.
• Economic indicators.
• Consumer sentiment.

AI’s predictive analytics can recommend stock levels for specific locations and enable real-time inventory tracking to help businesses stay ahead.

Challenges and Considerations in Implementing AI

Master Data

Data management is critical for AI to perform at its best. Clean master data is a fundamental cornerstone. Inaccurate or incomplete data can lead to incorrect predictions, resulting in inefficiencies in supply chains and suboptimal customer experiences.

Privacy and Data Security

When implementing AI and data management systems, FMCG companies must ensure they have strong security measures in place to protect sensitive information. Not only does this safeguard confidential data, but it also builds trust with consumers and creates stronger connections.

Cost and ROI Considerations

Adopting high-quality AI and data systems may seem like a daunting investment at first. But when you look at the bigger picture, the potential for better customer satisfaction, streamlined operations, and gaining a competitive edge far outweighs the cost.

Resistance to Change

It can be difficult for employees and consumers to understand new technologies like AI and data management. This can make it challenging to adopt an AI-powered merchandising strategy.

That’s why proper education and transparency transparency are essential when it comes to implementing these changes. Being clear about how the systems will be used and what their benefits are can make it easier for everyone to make the switch.

Lack of Expertise

AI data in FMCG is still new, which means that very few teams in the industry actually have the technical skills to leverage it correctly. This makes it difficult to see the big picture and fully understand how AI can propel your business forward.

However, through training and education, these obstacles can be overcome.

How Meridian is Staying Ahead

Meridian is embracing AI and data-driven strategies to help brands become competitive contenders in the industry. Here’s how we ensure they thrive:

• Field mobility and GPS-enabled application for better management on the ground.
• Planogram and shelf management.
• Seasonal activations.
• Digital merchandising.
• Storage, distribution, and point-of-sale management.

Want to know how we can do the same for your brand? Visit our website to learn more.