The Digital Revolution Within Indian Manufacturing and Consumer Good Brands
Digital solutions enable manufacturing and consumer goods brands to get a 360° view of their partners and inventory across all channels, enabling them to stitch together previously-isolated journeys.
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In recent years, India has witnessed high growth in the manufacturing and consumer goods sectors. According to the Global Manufacturing Competitiveness Index published by Deloitte, it is estimated that by end of year 2020, India would become the fifth largest manufacturer in the world. With the lines on the world map blurring fast, organizations are moving beyond traditional business methods, adopting latest technologies such as artificial intelligence, internet of things, augmented reality and virtual reality, in various processes and cycles.
Today, digitalization is making deep inroads into a manufacturing organization's DNA. However, an important leg of the business led by channel partners are deprived of digitization benefits. Channel partners such as dealers, distributors and wholesalers play a pivotal role in making as organization's extensive market reach and coverage possible. They are one of the most effective mediums for manufacturers to reach the "long tail" and, therefore, are key to expanding sales and brand loyalty, forming a part of the team that represents the business and its offerings to the world.
Therefore, it is imperative to understand the channel partners' value as well as invest in building and encouraging their commitment towards the company to ensure that the overall business goals are achieved. As a result, manufacturing companies are taking another look at partner relationship management (PRM) programs, channel engagement programs and other similar loyalty programs. PRM refers to a set of business processes and capabilities through which an organization incorporates policies, procedures and methodologies to communicate and engage with its external business partners.
One of the biggest challenges of establishing such programs is the lack of data – ranging from individual partners' product selling techniques, transactions, issues with current products being sold, to their interactions with other partners at different levels. To harness this untapped and scattered data, technology is increasingly taking a lead role. Digitalization promises to redefine the distribution chain management and its various components and more importantly, the underrated channel partners. Digitalization of the minutest of the transactions, both qualitative and quantitative, between various channel partners would lead to creation of engagement and loyalty solutions for the manufacturing firms that would bridge the gap between the organization's and partners' goals, resulting in better retention and growth prospects.
Digital solutions enable manufacturing and consumer goods brands to get a 360° view of their partners and inventory across all channels, enabling them to stitch together previously-isolated journeys with data, build unified, cross-channel strategies that deliver a consistent, omnichannel experience. For example, in the paints manufacturing industry, the main customer is the contractor and the painter who buys the products from the retailer. Therefore, it becomes important to capture this data and chart out an engagement and loyalty programme. A leading paints company in Asia has adopted the technique of leveraging QR codes on its products, which are mapped to the inventory system. Loyalty points to the painters are rewarded for the transactions done at retail stores once they scan the QR codes through the brand app. In scenarios where the QR code cannot be affixed to the products, as is the case with one of the leading steel producers of India, the data is captured by leveraging the partner authentication system. This helps to capture the tertiary sales, which have traditionally not been captured. Once the data is captured, it can be analysed and segmented on the fly to build targeted campaigns for the target audience.
Also, another vital data to be collated by the companies is the behaviour they want to encourage in their partners. Being able to identify and incentivize behaviour that is beneficial for the business goals is, therefore, the need of the hour. Channel partners that are consistently able to build and maintain customers despite stiff competition need to be rewarded for their commitment. So do those partners who proactively upgrade themselves with trainings and skilling programs. Recent research shows that companies leveraging data and channel insights to implement non-cash reward and recognition programs for their partners record an annual revenue increase averaging 10 per cent compared to other companies, which average 3 per cent.
With technology constantly evolving, in a decade's time, one can expect a massive transformation across the manufacturing industry. Technologically enhanced, well-structured rewards and loyalty digital solutions would become one of the most essential tools an organization can invest in for a healthy and productive long-term relationship with its channel partners.