Winning Indonesia's Consumer Goods Market: Moving from Good to Great


Continuing my article Winning Indonesia's Consumer Goods Market: Best Practices in Customer and Channel Management, I would like to sum up the five success factors for Indonesian companies to consider if they seek to become world-class.

Clear guidelines for field sales teams. 


Companies that provide specific directives and detailed guidance for their field sales representatives can better ensure excellence in in-store execution. Indonesian CPG companies can give sales teams clear guidance regarding the activities performed in store, the promotion to execute, and the SKUs that should be in stock - not just for each account, but also for each store format or for each outlet. Currently, no Indonesian companies give guidelines at the outlet level. Standards of on-shelf execution should be based on economic data, shopper insights, and development priorities.

Greater use of advanced analytics and new technologies. 


Much has been written about the potential of advanced analytics and cutting-edge technologies to revolutionize business. With regard to customer and channel management for CPG companies, advanced analytics can help improve in-store execution, trade-performance optimization, and innovation. But other technologies, too, can have a dramatic impact. The use of smartphones, for instance, has helped companies everywhere capture more in-store data than ever before. Mobile devices have also strengthened the capabilities of field teams, particularly in data capture (for example, by allowing them to give and receive real-time data updates or take photographs in stores) and in route planning. 

A single "centre of excellence" to oversee both pricing and trade. 


At many Indonesian companies, pricing employees are organizationally separate from trade employees and are distributed across the various customer teams or brand teams. We’ve found, however, that combining the pricing team with the trade team in a single, central group is optimal. In more mature CPG markets, companies with a single centre of excellence at either the business-unit level or corporate level tend to achieve higher sales growth than their competitors.

A dedicated e-commerce team. 


The rising internet penetration rate in Indonesia hasn't translated into booming e-commerce business - yet. But the increase in internet penetration and usage is a real and continuing trend. If Indonesia's consumer goods market follows the trajectory that Chinese market has taken, then the online channel is poised to become the biggest growth opportunity for consumer goods companies in the near future. Companies that will win online are those that begin to prepare now. Indonesian companies would do well to start investing in online marketing and trade promotions and in-mobile initiatives (such as apps and online coupons). They may soon need to consider dedicating resources to e-commerce, especially in the areas of key account management, trade and customer marketing, and sales planning.

Containment strategies for channel conflicts. 


Because of serving both modern and traditional retailers, CPG companies will inevitably experiences channel conflicts, which will only grow once e-commerce becomes a viable channel in the Indonesian market. Companies can quantify these conflicts, then design and implement containment strategies such as coordinated promotional calendars or differentiated packaging for different channels. Tracking the success of these strategies and refining them as needed is also important.

Conclusion

Indonesian CPG manufacturers have much to learn from each other, as well as from their counterparts and competitors in Asia and across the globe. By emulating best practices in customer and channel management, Indonesia's CPG players can position themselves to win an increasingly competitive and fast-changing market.

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