Consumers today expect any problem they face to be solved quickly and easily. This demand for convenience and immediacy is critical for brands — research from PwC shows that one in three (32%) customers will walk away from a brand they love after just one bad experience.
Digitization has become a critical factor in brands’ ability to develop superior solutions that can drive consumer and retailer preference, reduce cost and enable rapid and efficient decision making. To achieve this, digital strategies should be deeply integrated into the business, rather than simply “bolted on.”
That’s why at P&G we’re getting even more intentional about building our digital acumen across the organization, from how we engage with consumers, to how we innovate, how we go to market and how we operate our business. We have committed to developing the overall digital fluency of our organization, and to accelerate innovation and increase productivity, we have invested in the power of the cloud, artificial intelligence (AI) and automation.
These actions enable us to meet ever evolving consumer needs and habits by solving their everyday challenges, activate efficiently across rapidly transforming channels and accelerate growth and productivity for the benefit of our consumers, our customers and our business.
Let’s explore a few examples of how we leverage digital capabilities to address challenges consumer and retailers face in key areas like supply chain, retail execution and consumer communication.
Unlocking Consumer Insights to Improve Product Offerings
Understanding what the consumer “job to be done” is critical in developing superior products and consumer experiences.
Traditional consumer research based on panel questionnaires does not always provide a full picture of consumer behaviors and habits. That’s why at P&G we equipped consenting households enrolling in research panels with sensors that measure real usage of products and resources. Sensor examples include smart power plugs which monitor appliance cycles, smart faucets that check water consumption, and scales which check product dosages. These sensors collect data in real time, and send them to a cloud-based data environment where they are processed to derive meaningful insights.
Using this “connected home” approach, for example, we have been able to demystify the use of the dishwasher and educate consumers on ways to reduce their water consumption.
Using a dishwasher consumes less water — up to 20 gallons per load — than washing in the sink. In fact, as of the 4th dish, you will save water and energy by using the dishwasher. Still, our research revealed consumers resisted using the dishwasher because they thought it was a waste of water and energy. Quite the opposite!
Based on these insights, the Cascade team kicked off the ‘Do it Every Night’ campaign, encouraging consumers to run the dishwasher every evening. And our follow-up research has shown that, as a result of this data-driven innovation and sustainability, auto-dish loads per week increased significantly. So, consumers saved time and water, the brand reduces its impact on the planet and the business drove sustainable growth.
Ensuring Consumers Can Get Products When They Need Them
To overcome supply chain challenges, and to ensure consumers have access to our products whenever they need it, wherever they need it, we‘re using automated modeling and simulation to optimize our formula design and deliver the best cost, the right quality and irresistible superiority.
We integrated a massive amount of data on detergent formulas in our data lake, built proprietary algorithms which model the effect of changing ingredients on product specifications and seamlessly integrated innovation systems with production lines. As a result, we are now capable of developing formulations much faster with the ability to send them to the manufacturing lines with a “one click, no touch” approach.
This capability proved essential in February 2021, when a winter storm in Texas and Louisiana impacted supply of raw materials from many of our partners, impacting over 60 supply chains. Thanks to this approach, we were able to optimize the formulation for nearly 60 percent of our U.S. liquid laundry business in less than 28 days, keeping our product available at a critical time for consumers.
Creating Seamless Shopping Experiences
Digital technology also helps ensure consumers can find what they are looking for, whether it’s on a physical store shelf or a virtual one. When this is done right, both our consumers and our customers win.
In the past, our teams would go through a long process to create a better physical shelf layout to ensure products are showing up in the right places to maximize growth of the overall category, based on P&G’s in-depth knowledge of the category and consumer needs. Building these recommendations was a laborious process, which has been significantly shortened and improved thanks to digitization. By leveraging machine learning algorithms trained on large amounts of category performance data in our data lake, we have taken the guessing and long timeline out of the process, creating an even more more seamless shopping experience. And with new research showing that consumers are returning to in-store shopping at rates exceeding pre-pandemic levels, making the shelf easier to navigate is essential to creating value in store.
Digital capabilities also help transform the online shopping experience, starting with helping consumers find our products online by optimizing search results. In the past, managing paid search campaigns was a very manual process. Our teams would be able to check on our ‘search’ performance only about once per day. By applying machine learning algorithms to large amounts of constantly updated data, we disrupted this approach with automation, allowing us to monitor and adjust 24/7 on the 15-minute mark. This reduces wastage and ensures consumers are served with relevant content that best meets their specific needs, which in turn drives engagement that inspires growth for our retail partners.
Looking to the Future
These are only some examples of how our commitment to digital acumen has truly impacted all aspects of our business.
This journey is a continuous one, driven by a passion to improve the lives of consumers around the world. If we do this well, it will lead to more opportunities to augment our capability to focus our business on the highest order work — work that serves consumers, customers, employees, society and shareowners.