The most transformative tools food and beverage manufacturers and brands have at their disposal are artificial intelligence and machine learning.
This pair of technologies can be used to predict consumer preferences, optimize a company's inventory, and streamline its operations with unprecedented accuracy.
Predicting CPG Market Trends
Artificial intelligence and machine learning are valuable because of their ability to predict market trends, helping businesses stay ahead and make informed decisions based on demand forecasting.
By offering a consistent and accurate picture of historical data and external factors that could impact the production of a food or beverage product, companies can reduce their waste, instances of stockout, and overstocking and improve their supply chain efficiency.
Monitoring Storage Conditions
AI tools can monitor inventory levels at a warehouse in real time and adjust orders for ingredients and supplies to ensure product availability. In turn, companies can minimize their holding costs and ensure the freshness of even the most perishable goods.
"[Using AI tools to] reduce food waste is better for the environment because of lower rates of spoilage leading to greater shelf life and better transportability," says Chris Cassidy, a leading expert on supply chain efficiency at Keychain, a popular online AI tool that matches food and beverage brands with vetted manufacturers.
As businesses improve their monitoring, they can adjust storage temperatures and know the precise amount of time their ingredients have been in the warehouse, allowing them to ship their products more reliably.
Monitoring Production Quality
In the production process, AI tools play a crucial role in helping businesses to meet regulation standards. Machines equipped with cameras can identify defects and inconsistencies as well as potential hazards on production lines. This can help manufacturers detect quality issues before their products reach consumers.
Predicting Consumer Behavior
Another area where AI is helpful is analyzing consumer behavior. Large amounts of data available from online shopping histories, browsing histories, social media channels, and customer feedback can help businesses identify trends and create programs that drive loyalty through personalized experiences.
Several major players in the beverage industry have embraced technology, which gives them a competitive advantage. PepsiCo uses AI to predict flavor trends on the internet, allowing them to launch viral and innovative products with a reduced risk of failure. Their competitor, Coca-Cola, also uses AI to inform their marketing campaigns.
As AI and machine learning continue to evolve, their ability to not only optimize operations but also tap into consumer psychology will redefine how food and beverage companies innovate, making these technologies essential for staying competitive in an ever-changing market.
