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Forrester recently partnered with Consumer Goods Technology and RIS News to survey 120 manufacturers and 80 retailers about the state of industry collaboration. Check out the report, which has findings like:
43% of manufacturers believe there's a fundamental lack of trust in the industry.
42% of retailers also believe that there's a lack of trust.
40% of CP manufacturers are evaluating RFID.
52% of retailers have no plans for RFID.
Only
21% of retailers regularly share POS data with manufacturers.
Forrester is actively recruiting for a senior consumer products marketing analyst. If someone you know has what it takes to provide thought leadership on consumer products marketing, please contact Jill Yates at jyates@forrester.com.
You can listen to speech excerpts from Forrester's 2005 Consumer Forum: Innovating In A Consumer Driven World. Get video and audio now.
The consumer products industry spends $23.4 billion on advertising annually. But just how good are CP firms at communicating the brand image online? To find out, Forrester performed Web site brand evaluations on several CP sites. The results? Wendy's is an all-around winner for both brand image and brand action, while Nike and Adidas only passed our brand image test.
To learn more about Forrester's Web Site Brand Evaluation, please contact jstrepacki@forrester.com
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Some people love making lists. I don't. Maybe it's the leftover dread from the list of chores that my mom used to post on the refrigerator. Still, every once in a while, I recognize their value. Like right now. In addition to my holiday gift list, I've worked with other analysts to compile the list of top consumer products technology trends for 2006. Next year, watch for manufacturers -- many with higher IT budgets -- to undertake:
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B2B collaboration technologies for better retail execution. Overall, manufacturers are committed to better collaboration with retailers. That's why nearly half of manufacturers will spend more on collaboration technologies in 2006. Specifically, manufacturers will focus their collaboration efforts on new demand planning tools, trade promotion management, sales-force automation, and those perennial data efforts: RFID pilots and global data synchronization. With manufacturers now paying more attention to better store execution, we'll be keeping our eyes open for case studies in effective collaboration, such as Whirlpool and Lowe's. Stay tuned!
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New ad technologies to reach tuned-out consumers. We're all pulled in a million directions these days, so intuitively, we know that fewer things stick in our memories (hence our love of lists). Our lack of recall spells trouble for CP advertising. Did you know that only 12% of US consumers buy products because of their ads? CP brands are taking notable action. Companies like Pepsi and Procter & Gamble are shifting money from traditional TV ads to in-store campaigns, which are increasingly delivered using "smarter store" technologies. Also on the rise: online advertising budgets and bleeding-edge channels like RSS and podcasting. We expect the shifts to grow more pronounced next year. As the admittedly over-indulgent owner of two fat kitties, I love the new Purina podcasts.
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New market research and PLM tools for product innovation. CP spending on product life-cycle management (PLM) tools has been on the rise for the past 18 months. Now we're seeing complementary investments in new market research tools, like online focus groups and blog monitoring tools. These tools help brands listen to consumers more frequently -- and inexpensively. Not surprisingly, small vendors dominate this new landscape, so we'll be publishing research in the new year identifying these new vendors and the best ways to work with them.
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eSourcing and price optimization to control materials costs. With the recent increases in commodity prices, manufacturers are stuck between higher upstream costs and downstream price pressure from retailers and consumers. Forrester believes that eSourcing tools can help CP firms negotiate savings with suppliers, while price optimization tools help identify what price increases the market can bear -- and tolerate. We have a new Forrester Wave™ on eSourcing and a Quick Take on SAP's acquisition of Khimetrics -- both of which should help those of you making decisions about these technologies.
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Global supply chain providers to support emerging markets. The move to global supply chains shows no signs of slowing, especially for CP sectors like apparel and consumer electronics. But cheaper production also means more complex distribution and logistics. How can manufacturers cope? By adapting to a new global trading market structure called the Adaptive Trading Network. My colleague Noha Tohamy has written a slew of relevant research, including drill-downs on global trade orchestrators like Unisys and IBM.
I know that it's a long list of technologies. Does this mean an economic boomtown for technology suppliers? Not exactly. CP firms will increase their IT spend, but this industry still spends only 2.6% of revenues on IT -- lower than other sectors like financial services and high-tech. Given this, we expect that most CP firms will winnow potential IT investments to fit their most acute pains.
We'll be using these trends to shape Forrester's consumer products research agenda in 2006. We'd also welcome your feedback on research topics that help with your upcoming tech initiatives. Feel free to send ideas my way at christine.overby@forrester.com.
Happy holidays,
Christine Overby
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