Author: Jeffrey F. Rayport / Source: VentureBeat
Historically, consumer packaged goods (CPG) were designed to be sold in a brick-and-mortar retail environment — in packaging flashy enough to catch a consumer’s eyes while presenting the right information to compel a purchase.
But packaging doesn’t need to sell the product anymore. The Internet is becoming the primary channel for marketing and sales, customer experiences are being tailored to reflect our “smart” and “connected” world, and data has become the most valuable commodity to target the right customers at the right time. Producers have new ways to optimize. They may choose more environmentally friendly, cost-effective, or shippable packing. More critically, they may design the product to be the primary relationship manager with the end user.What exactly does it mean for a product to be a customer relationship manager? The product itself will use digital technology to interact with the customer, pre- and post-purchase. On one end of the spectrum, this is manifested in products with actual screens and Internet connectivity as we’re seeing with smart home products like dishwashers. On the other end, with a few embedded components, Johnny Walker’s Blue Label whiskey bottle knows exactly when a user opens and closes the bottle, continuously generating valuable information on user behavior. These technologies and the data they generate will enable the producer to track the product through the supply chain, to know exactly when the consumer may need the product replenished or fixed, and when there may be an interesting opportunity to upsell or cross-sell, based on purchase and ownership behaviors.
A perfect example of this kind of “product relationship management” is unfolding now with Tesla. The traditional automotive sales cycle focuses on building and maintaining a relationship with the customer pre-purchase — when GM markets and sells you a car, they use media channels like Facebook to target you online and a salesperson to build a relationship with you at the dealership. Once the purchase is consummated, GM uses OnStar for navigation and remote diagnostics, although user reviews have been spotty. Tesla, on the other hand, uses the car itself as a relationship manager, monitoring for necessary repairs, using AI to refine its understanding of customer habits and needs, and upgrading performance with a constant stream of software downloads. This has established a new normal for auto makers: a persistently connected product. As a result, Tesla is much smarter when it comes to selling after-market features or knowing when it’s time to tell you about a new…
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