The Consumer Packaged Goods (CPG) industry is experiencing a period of tremendous change. Shifting consumer preferences, a growing demand for health-conscious options, sustainable practices and ethical sourcing are forcing companies to continuously examine how they approach CGP innovation to stay ahead of competitors. Throw in exterior challenges like nimble startups and volatile supply, and it’s easy to see how difficult the CPG landscape is today.
Despite the challenges, CPGs must still strive to achieve three key goals:
But how can CPG companies achieve these goals in a competitive and ever-changing landscape? The answer lies in leveraging the power of innovation management software. In this blog, we’ll examine four common challenges CPGs face and how the right solution can help them solve it.
Ideas have to come from everywhere, but prioritizing and organizing them isn’t easy. Traditional idea management methods often rely on ad-hoc brainstorming sessions or suggestion boxes, which can miss valuable ideas from employees across different departments.
Solution: With the right Innovation management software users can access a centralized platform for capturing and managing ideas. Employees can submit ideas electronically, with features like idea tagging and categorization for easy organization. It should also facilitate idea evaluation through functionalities like scoring, weighting and feedback mechanisms.
Let's consider a major cereal company facing declining sales. Traditionally, new product ideas might come from a small team of marketing executives. However, through innovation management software, the company could solicit ideas from research and development teams, who might propose healthier alternatives with innovative ingredient combinations. Additionally, the software could help them gauge employee and consumer interest in these new concepts before investing heavily in development.
Departmental silos are innovation quicksand. Marketing teams might have limited visibility into R&D processes, and valuable insights from sales reps might not reach the product development stage. It’s easy to see how silos hinder effective innovation collaboration and knowledge sharing, both of which are crucial for successful innovation.
Solution: Innovation management software fosters a collaborative environment by providing a central platform for all departments to work together. Teams can see the progress of ideas as they progress to products in market, share documents and data and provide real-time feedback. This transparency and accessibility break down silos and accelerate the product innovation process.
For example, imagine a beverage company struggling to develop a new line of eco-friendly drinks. With the right innovation management software, the marketing team could collaborate with the sustainability department to identify eco-conscious packaging materials. Meanwhile, R&D could share early prototypes with the sales team, gathering valuable feedback on consumer preferences for sustainable packaging options. This cross-departmental communication streamlines development and ensures the final product resonates with the target market.
CPG companies generate vast amounts of data from market research, consumer feedback and sales trends. However, turning this data into actionable insights without the right tool leads to gut-feeling decision-making, which can be risky in a competitive market.
Solution: Innovation management software integrates with various data sources, providing a holistic view of the innovation landscape. The software utilizes information from other tools and sources that identify patterns, trends and consumer preferences, allowing CPG companies to make product development, marketing and resource allocation decisions supported by data — not, “That sounds about right” arguments.
Let’s say a leading yogurt manufacturer is struggling to understand the shifting consumer preference for healthier options. Innovation management software can raise awareness of social media trends, sales data and market research reports to identify a growing demand for low-sugar, high-protein yogurt alternatives. The company can now prioritize the development of such products, ensuring they meet the evolving needs of their consumers.
CPG product development processes are inherently complex with multiple stakeholders, rounds of approvals and handoffs. When these processes aren’t efficiently coordinated — and so many times they aren’t — teams are faced with delays, wasted resources and missed deadlines.
Solution: Innovation management software provides CPGs with the necessary workflow management tools to automate tasks, track progress and — most critically — ensure they hit deadlines. The software integrates with existing systems like product lifecycle management (PLM) and customer relationship management (CRM) to create a seamless flow of information throughout the product innovation process.
A cosmetics company might have a lengthy product approval process involving multiple rounds of testing and packaging design iterations. Innovation management software can simplify this process by creating a digital workflow that tracks each stage of development. Stakeholders can review and approve prototypes online, reducing delays and ensuring everyone is on the same page. Additionally, the software can manage version control for agreements made with packaging, eliminating confusion and ensuring the latest version is used in production.
CPG companies can’t maintain a competitive advantage using traditional innovation methods. They need a technology partner that offers a powerful solution, fostering collaboration, streamlining processes and providing valuable data insights. Explore the capabilities of Sopheon Accolade, a leading solution designed to empower innovation across your organization.