How to Leverage AI for Accelerated Product Development in CPG

How to Leverage AI for Accelerated Product Development in CPG

Every day, I witness how CPG companies grapple with adapting to ever-evolving consumer demands.

It’s a colossal challenge, contributing significantly to the high failure rate of CPG products – up to 85% according to Nielsen.

It can feel like a never-ending hamster wheel.

5 Key Challenges in CPG R&D

Here’s what I see as the top challenges in the industry:

1. Cost Pressures: Rising costs and stagnant budgets are ubiquitous. Budgets are tight and get squeezed daily.
2. Supply Chain Complexity: Diverse and fragmented supply chains face issues from weather events to global conflicts.
3. Changing Consumer Preferences: Quickly adapting to changing consumer preferences is tough. Social media drives change at a pace never experienced before.
4. Short Product Life Cycles: Rapid innovation is essential to keep pace with evolving trends and recoup development costs.
5. Duplicated Efforts: Lack of coordination among global R&D teams leads to redundant work and wasted resources, becoming a significant money sink.

AI’s Benefits in CPG Product Development

Here’s where AI can help. It’s not a silver bullet that will make all your problems disappear, but used correctly, it will accelerate and support your teams:

1. Faster Product Development: AI enhances data analysis, generating insights that help predict successful products.
2. Improved Product Quality: AI-driven analysis identifies optimal design, ingredients, and formulations.
3. Reduced R&D Costs: Generative AI enables rapid prototyping and cost-effective evaluations.
4. Enhanced Automation: AI automates quality-control testing, data collection, and decision-making processes.
5. Better Regulatory Compliance: AI tools like RegAsk analyze regulatory data, ensuring companies stay compliant.

AI Use Cases in CPG R&D

1. Personalized Products: AI leverages internal and external data to develop products tailored to individual preferences.
2. Market Research: Predictive analytics tools gauge consumer preferences, driving targeted R&D and marketing efforts.
3. Product Testing: AI automates extensive testing processes, identifying defects and suggesting improvements.
4. Organizational Knowledge: AI-powered directories capture and organize tacit knowledge, enhancing innovation and efficiency.

AI and Future Growth

CPG companies must integrate AI to stay competitive and accelerate R&D efforts. All the global brands are already heavily invested, and AI is rapidly becoming table stakes.

By leveraging AI, companies can streamline the entire product life cycle, from ideation to launch, ensuring they meet and exceed consumer expectations.

Our Ecosystem at 6 Seeds

We’ve created an ecosystem of services that work towards the same goal: helping our clients sell more food and make more money. This is how we do it:

1. Product Creation: We use data and AI to help our clients create products that sell and have a product-market fit. Currently, 82% of all newly launched CPG products fail within a year. We think this is unacceptable.
2. Marketing Communications: According to a recent Nielsen study, 70% of all marketing activations in CPG fail to return the budget invested. We use data and AI to craft marketing strategies that earn you money, not cost it. Our approach is highly focused, often personalized, and built on the data we observe.
3. Investment Readiness: We get our clients ready for investments by using data to prove that their business model will be profitable.

The difference this makes

This ecosystem ensures that our clients experience a far higher success rate than their competition. Here are some of our key performance metrics:

• 35% Faster: Get your products from idea to market in 35% of the time it takes you now.
• 43% Cheaper: Marketing and innovation budgets can be reduced by up to 43% while achieving better outcomes.
• 67% Stronger: Our clients perform 67% stronger than the industry average.

As AI technology continues to evolve, we will lead the way in integrating AI into every facet of R&D, resulting in more personalized, sustainable, and innovative products that cater to the ever-changing consumer landscape.