COVID- 19 has brought about many challenges and changes that are likely here for the long term. The way businesses operate has transformed significantly over the past several months. For the CPG industry, the immediate priority was on managing the supply chain. Focus is now shifting to adjusting forward-looking pricing strategies as shoppers define “New Normal” behaviors. Following is Cornerstone’s first look at these changes, and how we are building agile capabilities to address the needs of the CPG Industry.
There are many sources of information identifying categories that have experienced massive spikes in demand (E.g. Bathroom Tissue, Flour, Canned Soup, Pasta and Rice) while others have declined (E.g. Non-essential Luxury products). Panic buying on high demand categories also led to widespread supply challenges… Another reason to be cautious while using March & Early April data to predict the future.
In response to the shopping dynamic changes brought about by COVID-19, Cornerstone has already adapted our approach to Predictive Modelling. We are controlling for the anomalies in data (“panic purchase spikes”) to ensure our predictive models are not influenced by one-time abnormalities.
Cornerstone’s Curve Software is a “Revenue Management In-A-Box” solution that provides everything from evaluating Market Dynamics right through to Scenario Planning & Trade Spend Optimization.
COVID-19 has affected CPG companies in various ways… From shopping behavior, to category consumer consumption, shopper trip frequency, etc. It has never been more important to put Revenue Growth Management at the forefront of CPG decision-making in plan for future pricing strategies, calendarization of promotions, and trade spend in this “New Normal” environment.