How can you use supply chain visibility to grasp new business opportunities?
We have all seen, and experienced changes to consumer behaviour over the past year. And many of those changes look likely to stick. According to McKinsey, we have covered a "decade in days" in adoption of digital – and it is interesting to see how consumers now think about buying online.
Yes, there has been a huge surge in eCommerce but there have also been shifts towards trusted brands and a reduction in shopping frequency. Discretionary spend is down but spend on health, safety, fresh food and ‘ready to eat’ is up.
Changing behaviour on this scale is likely to reshape consumer decision journeys in the long term, but to what degree? Economies will recover over time, but the speed will vary depending on the sector and how companies respond to these new demands.
From pricing to branding and even pack size, tweaks to the product presented to the end consumer will be key – and such changes will affect the entire supply chain, including printing, packing and distribution.
Exploring the smart supply chain
This is where a smart supply chain is so powerful. With better communication and a clear view of products as they flow through the supply chain, you can create a business that is quicker to adapt to every change.
The smart supply chain can reveal new customer behaviour and show businesses how to respond.
For example, within the pharmaceutical sector, the use of IoT is helping to streamline drug development and production, creating more accurate data that is pushing the boundaries of medicine.
We all know that clinical trials are essential, but they are costly components of drug development – it takes years to get from initial idea to approved clinical product.
IoT can help make clinical trials more effective, with connected healthcare devices quickly giving feedback into the success of therapies. Costs can be reduced and ineffective trials cancelled sooner — potentially leading to safer patient outcomes.
Across industries, billions of connected devices are collecting huge quantities of information — from freight location to energy usage. Centrally collecting and analysing this information shows companies how best to respond and optimise the supply chain to meet different business goals, such as reducing costs, meeting sustainability pledges or improving responsiveness to customers.
Then, using cloud-based analytics, companies can understand customer preferences in specific geographies. Understanding trends in behaviour can help companies to fine-tune product offerings and make changes to the supply chain to meet local customer needs.
Tracking the reason for product returns can provide vital new insight – from late delivery that is affecting product quality or items that are consistently reported by customers to be the incorrect size. Using this information to identify the causes and rapidly address the problem not only improves the customer experience but also reduces expensive returns and informs future discussions with suppliers around product quality.
There is no point redirecting time-critical products towards an area of higher demand, for example, if safe delivery cannot be achieved on time. Temperature and humidity sensors are being used to reduce wastage of fresh food as well as ensuring essential drugs are stored and transported in the correct conditions.
To the customer door
The "decade in days" adoption of digital has also raised the bar when it comes to the quality of experience and customer expectation.
Our Future Ready Report shows that 72% of consumers are becoming more demanding in terms of ethical behaviour, or requiring brands to serve a wider purpose than their core business.
Ethical delivery options, for example, are growing in popularity – and driving up the adoption of electric vehicles.
In fact, the whole delivery experience is absolutely critical to the customer experience. Tracking goods in real-time to the customer door and notifying them on arrival is just the start. Delivering intelligence can be used to provide new choices in delivery slots – such as fast or green. Convenient methods of returning products is crucial too. Return in store or having the option for a courier to pick up direct from the customers home could make your business more appealing to buy from in the first place.
As technology continues to advance, so do customer expectations.
