The marketing landscape has changed. It’s a simple fact that classic advertising based on one-way messages has become less effective. Consumers are exposed to too many messages, have too many options and are increasingly looking to brands to deliver real value and not just promised benefits.
Digital transformation has created a scalable opportunity for brands to create and deliver real consumer value and utility.
While many lifestyle brands have jumped on this concept early on e.g. Nike, Consumer Packaged Goods have largely been using digital for communication only.
Brands are integrated platforms that appeal to consumers through the combination of core product and communication but also need to add a service and an experience layer to the full brand offer.
The greater opportunity for Consumer Packaged Goods is to not only ask “what can we do in digital” but also “what can we do with digital” in order to get closer to consumers and help them out.
Explore our new The Near Future Report where we dive into consumer context & need, identify brands that get it right and provide implications for brands and business.
Exploring the Impact of Social Media Trends on Society.pdf
The Near Future of Added Value Services
1. UNDERSTAND TODAY. SHAPE TOMORROW. 1
LET YOUR
SERVICE BE
YOUR MESSAGE
LHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG
The Near Future of Added Value Services in CPG’s
Q2 2016
2. ABOUT.
At LHBS, we are curious about the brand opportunities that lie at the
crossroads of emerging consumer needs, enabling technology and
market dynamics. What we learn, we like to share. That’s why we’ve
created the Near Futures Series of inspiration and insights reports
designed to highlight what is happening today and how it can shape
tomorrow for brands and business.
This report is about The Near Future of Added Value Services in
Consumer Packaged Goods.
We hope you enjoy this deck and that it inspires your innovation
process.
This report is powered by the LHBS Inspiration-Hub which
systematically tracks changes in culture, markets and technology.
Our signs collectively point to a bigger story.
INTRODUCTION
UNDERSTAND TODAY. SHAPE TOMORROW. 2
Discover Define Develop Deliver
UNDERSTAND TODAY. SHAPE TOMORROW.
LHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG
3. UNDERSTAND TODAY. SHAPE TOMORROW.
INTRO
DUCTION.
Digital transformation has created an opportunity for brands to create
and deliver real consumer value and utility at scale. While many
lifestyle brands adopted this concept early on (e.g. Nike), consumer
packaged goods have largely been using digital for communication
purposes only.
Traditionally, brands are integrated platforms that appeal to
consumers through the combination of core products and
communication. Increasingly, companies are adding services and
experiences to their full-brand offerings.
Today, brands offering consumer packaged goods must not only ask
“what can we do in digital” but also “what can we do with digital” in
order connect with customers.
Fabiola Lewandowska
Consultant at LHBS
lhbs.com | fl@lhbs.com
INTRODUCTION
3
The marketing landscape has changed. One-way advertising has
become less effective. Consumers are exposed to too many
messages, have too many options and are increasingly looking to
brands to deliver real value and not just promised benefits.
LHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG
4. UNDERSTAND TODAY. SHAPE TOMORROW.
Brands that
Get It Right
CPG Brands that
Get It Right
Consumer Context
and Need
CONTENT
4
CONTENT
LHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG
5. CONSUMER
CONTEXT & NEED
UNDERSTAND TODAY. SHAPE TOMORROW. 5
CONSUMER CONTEXT & NEEDLHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG
6. UNDERSTAND TODAY. SHAPE TOMORROW. 6Source: McKinsey
HYPER COMPETITION
Globalization and emerging forms of retail, such as e-
commerce, present an ever-growing competitive
landscape for Consumer Packaged Goods.
The challenge for Consumer Packaged Goods is to
differentiate themselves from the rising number of
competitors. Advertising is no longer enough.
Implication:
Hyper competition stresses the need to think beyond
traditional advertisement to offer added-value services
to make a real difference and stand out.
CONSUMER CONTEXT & NEEDLHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG
7. 40 %
60 %
UNDERSTAND TODAY. SHAPE TOMORROW.*Source: 7
Digital Services as extensions of the core product can become the new
advertising for Consumer Packed Goods.
“Living services are the third wave of
digital”
Source: YouGov UNDERSTAND TODAY. SHAPE TOMORROW.
CONSUMER CONTEXT & NEEDLHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG
8. UNDERSTAND TODAY. SHAPE TOMORROW.
Percentage of consumers who say
it’s important for brands to make their lives easier
8UNDERSTAND TODAY. SHAPE TOMORROW.Source: razorfish
14 %
86 %
86%
21 %
79 %
79%
19 %
81 %
81%
12 %
88 %
88%
CONSUMER CONTEXT & NEEDLHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG
9. UNDERSTAND TODAY. SHAPE TOMORROW.
Percentage of consumers
who say they value brands
that are useful over
brands that are interesting
9UNDERSTAND TODAY. SHAPE TOMORROW.Source: razorfish
CONSUMER CONTEXT & NEEDLHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG
14 %
86 %
86%
10. UNDERSTAND TODAY. SHAPE TOMORROW. 10
“From transport to retail,
from healthcare to utilities,
every business must now be a
digital business.”
Accenture, 2015
CONSUMER CONTEXT & NEED
Source: Accenture
LHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG
11. IMPLICATION #1
DIFFERENTIATE FROM
OTHERS THROUGH REAL
VALUE CREATION
UNDERSTAND TODAY. SHAPE TOMORROW. 11
LHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG CONSUMER CONTEXT & NEED
12. IMPLICATION #2
ESTABLISH A DIRECT
CONNECTION & RELATIONSHIP
WITH YOUR CONSUMER
THROUGH DIGITAL CHANNELS
UNDERSTAND TODAY. SHAPE TOMORROW. 12
LHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG CONSUMER CONTEXT & NEED
13. IMPLICATION #3
UNDERSTAND INDIVIDUAL
NEEDS AND RESPOND
TO THEM QUICKLY
UNDERSTAND TODAY. SHAPE TOMORROW. 13
LHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG CONSUMER CONTEXT & NEED
14. IMPLICATION #4
THINK BEYOND YOUR
PRODUCT & OFFER AN
EXPERIENCE WITH
RELEVANT INFORMATION &
SERVICES
UNDERSTAND TODAY. SHAPE TOMORROW. 14
LHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG CONSUMER CONTEXT & NEED
15. BRANDS THAT
GET IT RIGHT
BRANDS THAT GET IT RIGHT
UNDERSTAND TODAY. SHAPE TOMORROW. 15
LHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG
16. UNDERSTAND TODAY. SHAPE TOMORROW.
Looking at the state of added value services across industries,
lifestyle brands such as Nike and digital disrupters such as Netflix
have set the tone for added value services that work with real
time data and new technologies.
Several brands have created digital platforms around their core
product and developed services that turn brands into ever-
growing ecosystems.
BRANDS THAT GET IT RIGHT
16
BRANDS THAT
GET IT RIGHT
Though marketers are realising the importance of thinking beyond
traditional advertisement, only a few brands have embraced the
potential of offering meaningful services to build strong brand and
customer loyalty.
LHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG
17. UNDERSTAND TODAY. SHAPE TOMORROW. 17Source:
Nike Digital Service
Ecosystem
Nike+ is a digital platform that lets customers
track their activity and coaches them along their
sportive journey throughout the day.
Currently Nike+ offers three major services - Nike+
Fuel, a daily activity tracker that works with a
wearable smart sensor that is connected to an app;
Nike+ Running App, which tracks your runs and
progress; Nike+ Training Club, a digital personal
trainer that helps you get fit anytime, anywhere.
Explore Sign
Learning
Nike essentially created an ecosystem which has
advantages for both the customer and the brand. The
company understood that by owning data and offering
added-value services, it could gain valuable insights while
also creating a strong and continuous relationship with
their target audience.
BRANDS THAT GET IT RIGHTLHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG
18. UNDERSTAND TODAY. SHAPE TOMORROW. 18Source:
Socks That Pause
Netflix
Netflix Socks will pause the show when they
detect the viewer has dozed off.
Netflix created a do-it-yourself project. In order to
make your own socks, Netflix encourages you to knit
them and put together electronics by yourself. The
sleep detection system is based on a method called
actigraphy: once it detects the viewer has stopped
moving, it triggers a signal to the TV which will pause
Netflix. Since the accelerometer is very sensitive to
little movements, it will not mix up sitting still with
actual falling asleep.
Explore Sign
Learning
Added value services do not always have to be complex.
Often a great starting point can be solving a daily
problem.
BRANDS THAT GET IT RIGHTLHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG
19. UNDERSTAND TODAY. SHAPE TOMORROW.
ASOS Personal Style Guide
ASOS teams up with Google and launches Helpout - a
real time chat that connects customers with professional
stylists. People can show their wardrobe and get advice
from stylists on how to combine their clothes and what
pieces could improve their outfits.
Learning
The personalized service allows customer to minimize the
pain of choosing the right outfit and the process of shopping
for clothes.
Ray Ban “Bright Light App”
The iconic sunglasses company has released an app that
helps people find a sunny spot in their city. It even
recommends the sunniest route to the destination, as
well as cafes and other businesses where Ray Ban-
wearing sun-seekers can enjoy their day.
Customized & Evolving Playlist
The playlists are tailored specifically to users based on
their music taste from the previous week and are
intended to make users feel like their best friends made
them a personalized mixtape. As a user's taste evolves,
Discover Weekly will keep up.
Learning
Personalized services are especially useful when they solve
problems or provide value at the exact time and location they
are needed.
Learning
The personal playlist is a great example for how a brand can
“observe” its customers and provide them continuous content
by curating and discovering new music based on their tastes.
19
Explore Sign Explore SignExplore Sign
BRANDS THAT GET IT RIGHTLHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG
20. CPG BRANDS
THAT GET IT RIGHT
CPG BRANDS WHICH GET IT RIGHT
UNDERSTAND TODAY. SHAPE TOMORROW. 20
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21. UNDERSTAND TODAY. SHAPE TOMORROW.
Historically, CPG brands have only focused on their product and
how to differentiate themselves from their competitors. Many
CPG brands are still establishing a basic online presence and
experience.
Some market leaders such as L’Oréal and Oral-B, have started to
think beyond their product and have invested early in new
technologies which provide real value to the consumer as well as
reveal important insights for the company.
CPG BRANDS THAT GET IT RIGHT
21
CPG brands have slowly started to think beyond their product and
use real-time data to offer relevant services to customers. There are
now some players that offer customers added-value services that are
specifically targeted to their individual needs.
LHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG
CPG BRANDS
THAT GET IT
RIGHT
22. UNDERSTAND TODAY. SHAPE TOMORROW. 22Source:
L’Oréal - “Makeup
Genius”
The “magic mirror” lets users see what they look
like wearing different L’Oréal products without
actually applying them.
The Makeup Genius app projects selected products
such as eyeliner, lipgloss, and blush on users’ faces
with the help of facial recognition. It accurately
portrays what you would look like in different
cosmetics from different angles and with different
facial expressions, in real time. Looks can be shopped
after, saved to the phone or shared on Facebook.
Explore Sign
Learning
The app is currently one of the most innovative beauty
apps, revolutionising the way make-up can be
experienced and tried before purchase.
CPG BRANDS THAT GET IT RIGHTLHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG
23. UNDERSTAND TODAY. SHAPE TOMORROW. 23
Oral-B’s Smart
Toothbrush
The world's first interactive toothbrush connects
to a user's smartphone to record brushing habits
and deliver insights into dental care.
The toothbrush syncs with a smartphone via an app
that gives real-time analytics about the user's
brushing habits as well as relevant mouth-care tips
and news headlines. Future developments include
detection sensors that work with the app to identify
problems like dental disease.
Explore Sign
Learning
The connected toothbrush epitomizes the introduction of
Internet of Things and smart technology into objects
around the home to provide highly personal information
to its users.
CPG BRANDS THAT GET IT RIGHTLHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG
24. UNDERSTAND TODAY. SHAPE TOMORROW. 24
Charmin Finds You a
Clean Toilet
Charmin's “SitORSquat” App locates the least-
dirty public restrooms in your area
The toilet paper brand Charmin wants to assist
people who need to rapidly find a toilet on the go.
The app is built upon the technology of location-
based services and incorporates a real-time map
showing all public toilets in town. Users can rate,
share experiences and give feedback with others,
creating a crowd-sourced public bathroom map.
Explore Sign
Learning
Charmin created a personalized service that is not only
useful but also manages to involve the crowd in a
community-based concept.
CPG BRANDS THAT GET IT RIGHTLHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG
25. UNDERSTAND TODAY. SHAPE TOMORROW.
Hellmann’s WhatsApp Chef Coach
Mayonnaise brand Hellmann’s created WhatsCook, a live
recipe service that lets users chat via WhatsApp with
real chefs or an expert cooking team and learn how to
prepare meals in real time.
Learning
With WhatsCook, Hellmann’s created a highly personal
service that operates through tools audiences use in their
daily lives.
Smirnoff helps to Explore the Night
The vodka brand promotes its new guarana-infused
vodka drink with a digital service that helps its users to
get the most out of each night out by providing free Uber
rides and crowd-sourced cool places.
L’Oréal’s Smart Skin Patch
“My UV Patch” is the first ever stretchable skin sensor.
The very thin plaster contains photosensitive blue dye,
which changes its color when being exposed to
ultraviolet light. Users can take a picture with the
corresponding app to learn more about their current skin
condition and whether to apply more sunscreen.
Learning
Smirnoff provided its customers with a personalized service
“experience’.” Through the partnership with Uber and well
thought through little steps, the app became a fun and
essential tool for a party person.
Learning
With the development of the smart patch L'Oréal expands its
core expertise of a beauty brand and enters a new territory -
skin health & preventive skin care.
25
Explore Sign Explore SignExplore Sign
CPG BRANDS THAT GET IT RIGHTLHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG
26. IMPLICATION #1
KNOW YOUR CUSTOMER &
ANTICIPATE THEIR NEEDS
UNDERSTAND TODAY. SHAPE TOMORROW. 26
LHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG CONSUMER CONTEXT & NEED
27. IMPLICATION #2
AIM FOR NOTHING LESS THAN
TRANSFORMATIONAL
SERVICES
UNDERSTAND TODAY. SHAPE TOMORROW. 27
LHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG CONSUMER CONTEXT & NEED
28. IMPLICATION #3
DELIVER A REAL ADDED-
VALUE
UNDERSTAND TODAY. SHAPE TOMORROW. 28
LHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG CONSUMER CONTEXT & NEED
29. IMPLICATION #4
CREATE MANY TOUCH POINTS
& ONGOING LOYALTY
UNDERSTAND TODAY. SHAPE TOMORROW. 29
LHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG CONSUMER CONTEXT & NEED
30. IMPLICATION #5
BECOME PART OF DAILY LIFE
UNDERSTAND TODAY. SHAPE TOMORROW. 30
LHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG CONSUMER CONTEXT & NEED
31. IMPLICATION #6
BE CREATIVE & THINK
FURTHER.
CONSIDER SMART DEVICES
UNDERSTAND TODAY. SHAPE TOMORROW. 31
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32. LHBS Put the Title of the Report here
HUB.
UNDERSTAND TODAY. SHAPE TOMORROW. 32
https://inspiration-hub.com/
INSPIRATION-HUB
INSPIRATION
-HUB
Our Inspiration-Hub systematically tracks changes in culture,
markets and technology and how these changes collectively
point to a bigger story that carries implications for Business
Development, Brand Building and Customer Experience.
LHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG
33. UNDERSTAND TODAY. SHAPE TOMORROW.
Discover
ABOUT
LHBS. Define Develop Deliver
We are an unconventional strategy firm that helps clients to
better understand today and successfully shape tomorrow. LHBS
has extensive experience & expertise in business development,
brand building and customer experience. The firm works across all
major industries for clients from the FT Global 500, German
Mittelstand and fast growing startups.
http://www.lhbs.com
ABOUT
UNDERSTAND TODAY. SHAPE TOMORROW. 33
LHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG
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LHBS Consulting Berlin GmbH und unterliegen den geltenden Urhebergesetzen. Die unauthorisierte Nutzung,
die ganze oder teilweise Vervielfältigung sowie jede Weitergabe an Dritte ist nicht gestattet.
LHBS Consulting Berlin GmbH
Köpenicker Straße 154
10997 Berlin Germany
UNDERSTAND TODAY. SHAPE TOMORROW.
IMPRINT
www.lhbs.com
THANK YOU
34
LHBS // THE NEAR FUTURE OF ADDED VALUE SERVICES IN CPG