Examine the revolutionary impact of automated messaging on FMCG businesses - particularly in emerging markets
In the fast-paced world of Fast-Moving Consumer Goods (FMCG) (duh!), suppliers are always on the lookout for innovative ways to streamline their operations and improve their customer engagement. One such innovation that has been making waves in the industry is automated messaging. This technology, which allows for the automation of customer interactions through platforms like WhatsApp, is proving to be a game-changer for FMCG suppliers.
Automated messaging offers a host of benefits, from improved customer service to increased operational efficiency. But perhaps its most transformative impact lies in its ability to revolutionise the way FMCG suppliers interact with their customers, particularly in emerging markets.
In this article, we will delve into the transformative impact of automated messaging on FMCG suppliers, drawing on real-world examples from industry giants such as Coca-Cola, Pepsi, and Nestle in Latin America. These case studies demonstrate the immense potential of automated messaging technology, particularly in emerging economies where conversational platforms like WhatsApp reign supreme.
Automated messaging is a technology that leverages artificial intelligence to automate interactions with customers. It's a powerful tool that can handle a wide range of tasks, from answering frequently asked questions to guiding customers through complex processes. But what makes automated messaging truly transformative is its ability to scale these interactions, allowing businesses to engage with an unlimited number of customers simultaneously.
For FMCG suppliers, this scalability is particularly beneficial. FMCG businesses operate in a high-volume, low-margin environment, where efficiency is key. Automated messaging allows them to streamline their operations, reducing the time and resources required to manage customer interactions. This not only improves operational efficiency but also enhances the customer experience, leading to increased customer satisfaction and loyalty.
But the benefits of automated messaging extend beyond operational efficiency and customer satisfaction. Automated messaging technology also provides businesses with valuable insights into their customers' needs and behaviours. By analysing data generated through automated messaging, businesses can gain deeper understanding of their customers, allowing them to tailor their offerings and marketing strategies accordingly.
Now, let's take a look at how the proposed benefits of automated messaging have played out in the real world. We'll start with a case study on Coca-Cola FEMSA, the largest Coca-Cola franchise bottler in the world by sales volume.
The world of Fast-Moving Consumer Goods is evolving at a rapid pace, driven by technological advancements and changing consumer behaviors. To stay competitive in this dynamic environment, FMCG suppliers must be willing to embrace new technologies and innovative ways of doing business.
Coca-Cola FEMSA has a long history of innovation, from its beginnings as a small brewing company in Monterrey, Mexico in 1890 to its current position as a global leader in the beverage, retail, logistics, and distribution industries. In recent years, the company has turned to automated messaging as a way to further enhance its operations and customer engagement.
In partnership with Yalo, a conversational commerce enabler, Coca-Cola FEMSA built a billion-dollar conversational commerce business from the ground up in just one year. They now reach and sell Coca-Cola products to more than 1 million stores on WhatsApp and are continuing to expand quickly. Today, more than 15% of Coca-Cola FEMSA’s total orders pass through automated messaging – a number that is only growing.
Coca-Cola FEMSA's success with automated messaging can be attributed to several factors. First, they recognised that traditional apps or digital portals were not the right channel for their store owners. Instead, they chose to leverage WhatsApp, a platform that their store owners were already using to communicate with friends, family, and other businesses. This allowed them to maintain their deep relationships with store owners while also automating their order-taking process.
Second, Coca-Cola FEMSA used automated messaging to enhance their sales reps' roles. Instead of simply taking orders, their sales reps were able to spend more time as strategic advisors, helping store owners make better decisions for product re-stocking. This not only improved their sales reps' productivity but also increased their customer loyalty.
Finally, Coca-Cola FEMSA leveraged the data generated through automated messaging to gain valuable insights into their customers' needs and behaviours. This allowed them to tailor their offerings and marketing strategies accordingly, leading to increased sales and customer satisfaction.
Coca-Cola FEMSA's success with automated messaging is a powerful testament to the transformative impact of this technology on FMCG suppliers. But they're not the only ones reaping the benefits of automated messaging…
The Central American Bottling Corporation (CBC) is another example of a company that has successfully leveraged automated messaging to transform its operations. CBC is a Multi-Latin Beverage company with the most extensive beverage portfolio in the region and exports to more than 35 countries. They were the first PepsiCo bottler outside the US and have been determined to generate value for customers worldwide through remarkable service, winning new brands, and building great partnerships.
CBC has partnered with Yalo to enable conversational commerce for more than 50,000 stores in Latin America. Their goal is to enroll more than 100,000 stores in the region by the end of the year. To achieve this, they launched a WhatsApp channel called Pepsichat, which allows store owners to place orders, receive promotions, and review suggested orders based on their preferences and consumer behavior.
This new channel is fully integrated with CBC’s ERP so that orders are placed directly from the stores in real-time. As a result, CBC enrolled 20% of their stores on their new WhatsApp channel in only 5 days.
CBC's use of automated messaging has led to a greater than 80% conversion rate on WhatsApp, and they had estimated that by the end of 2022 more than 10% of their trade channel sales will be placed through automated messaging.
CBC's success with automated messaging demonstrates the immense potential of this technology for FMCG suppliers. By leveraging a platform that their retailers were already using, they were able to maintain their relationships with store owners while also automating their order-taking process. This not only improved their operational efficiency but also enhanced their customer engagement, leading to increased sales and customer satisfaction.
Finally, let’s explore one last case study, which willfurther illustrate the positive impact automated messaging can have on FMCG businesses.
Nestlé Mexico is another example of a company which has harnessed the power of conversational commerce to great effect, by using WhatsApp as a direct channel to engage with store owners in real-time and deepen their customer relationships.
Nestlé Mexico partnered with Yalo to pilot a new product recommendation model that would deliver even more personal and relevant products to their customers. The machine learning powered solution can smartly and automatically recommend products to customers based on historical data from the store and customer’s buying habits.
To test the effectiveness of the model, an A/B test was run with Nestlé Mexico’s customers for one full month. During the test, different hypotheses were tested, to prove which recommendation combination would fulfill the objective of increasing sales.
The test results showed that the upselling strategy was the most effective, increasing the average ticket size by around 5.3%. As a result, product recommendation became a working functionality for Nestlé Mexico, which should continue to bring great results in the future and evolve by adapting to customer's buying habits.
Nestlé Mexico's success with automated messaging is a testament to the power of conversational commerce in driving revenue growth. By leveraging technology, businesses can optimise their conversational commerce strategies and achieve their business objectives with a solution that really understands them and fits their needs.
But perhaps the most exciting aspect of these case studies is the potential they reveal for automated messaging in emerging markets.
The success stories of Coca-Cola FEMSA, CBC, and Nestlé Mexico highlight the transformative impact of automated messaging on FMCG suppliers. These companies have leveraged automated messaging to streamline their operations, enhance their customer engagement, and drive revenue growth. But perhaps the most exciting aspect of these case studies is the potential they reveal for automated messaging in emerging markets.
Emerging markets, such as those in Southeast Asia, present unique challenges and opportunities for FMCG suppliers. These markets are characterised by rapid growth, a large and increasingly affluent consumer base, and a high degree of market fragmentation. At the same time, they also have high mobile penetration rates and a strong preference for conversational platforms like WhatsApp.
Automated messaging is ideally suited to these conditions. By leveraging a platform that consumers are already using (i.e. WhatsApp), FMCG suppliers can maintain their relationships with store owners while also automating their order-taking process. As in the cases of Coca-Cola FEMSA, CBC, and Nestlé Mexico, this would not only improve operational efficiency but also enhance customer engagement, leading to increased sales and customer satisfaction.
The world of Fast-Moving Consumer Goods is evolving at a rapid pace, driven by technological advancements and changing consumer behaviors. To stay competitive in this dynamic environment, FMCG suppliers must be willing to embrace new technologies and innovative ways of doing business. Automated messaging, as demonstrated by the success stories of Coca-Cola FEMSA,CBC, and Nestlé Mexico, is one such technology that holds immense potential. By embracing this technology, FMCG suppliers can position themselves at the forefront of industry innovation, ready to seize the opportunities of the future.
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