CPG Partner Conversations: Composable commerce leader Spryker – CPG’s future now

The COVID-19 pandemic created unprecedented disruption to businesses and global markets. Most of the world appears to be past the uncertainty and turbulence of the pandemic. However, companies, especially in the consumer packaged goods (CPG) industry, continue to deal with major challenges, like supply chain disruptions and labor shortages. At the same time, consumer buying patterns and expectations that shifted during the pandemic have become the norm. Now more than ever, CPG leaders must think strategically, with an eye toward innovation and agility, to address the continued market volatility and shifting consumer preferences. To gain insight and inspiration, we’ve embarked on a series of conversations with executives from Amazon Web Services (AWS) Partners to showcase their leadership and expertise in challenging times.

In the latest installment of our CPG Partner Conversations blog series, we talked to Boris Lokschin, co-founder and CEO at Spryker, a leading composable commerce platform for enterprises. In this blog, Boris shared his views on the importance of CPGs embracing a digital-first and composable approach to stay agile and evolve with rapidly changing consumer demands.

AWS: Help our readers understand your vantage point, what’s the space you play in and what type of CPG executives are you interacting with?

Boris Lokschin: Spryker is the leading composable commerce platform for sophisticated commerce use cases in B2B commerce, enterprise marketplaces, and Thing Commerce. We’ve designed it specifically for sophisticated transactional businesses and work with a number of international enterprises in the CPG space including Weleda, Prym, Lekkerland, and LR Health & Beauty.

AWS: Many companies across the CPG space have been managing through a period of unprecedented disruption. What have been the biggest challenges your consumer goods customers are facing during this recent period?

Boris Lokschin: CPG is an enormous and diverse industry facing multiple challenges, one being increased competition to win the customers’ choice on the phygital shelf. The last few years of rising D2C sales are put in question now with rising acquisition costs, and a new, technically enabled, omnichannel strategy is the key for success. But digitization is also a challenge as many CPG companies are massive organizations in which sharing and aligning on a shared digital vision can take a lot of time and investment. Lastly, changing consumer demands around sustainability and the evolution of buying habits impacted by the pandemic continue to evolve.

AWS: How do you see CPG firms responding to these market dynamics and changes in consumer expectations to adjust to the current operating environment?

Boris Lokschin: As an industry known for its high competition levels and constant consumer behavior changes, CPG companies must focus on innovating and differentiating themselves through a flexible approach to business, or risk drowning in an over-crowded market. One way we’re seeing CPG firms do this is by embracing digital solutions, such as investing in AI-enabled personalization, cost optimization and efficiency, and data-driven supply chains.

AWS: The CPG industry is incredibly resilient. As you look toward the new normal, what role does technology and the cloud play for CPG firms moving forward? How do you see technology enhancing the way they make, move, or market their products?

Boris Lokschin: Now more than ever, delivering a superior brand experience is key to CPG firms elevating the entire value chain. We are seeing more and more brands engaging with their distribution channels, using our technology to create partnerships that help them to sell more and better. We’ve also seen customers trying to leverage digital to sell to the smaller customers at scale and bypassing distributors. Putting customer experience first can be costly and time intensive, but we have also seen promise in AI-enabled personalization and predictive analytics to create a faster customer experience—something Forrester claims as critical. They state consumers are 2.4 times more likely to stay loyal to a brand if their problems are handled quickly.

AWS: In the face of the current disruption to the CPG industry, how is your company working with innovators to respond to these changes?

Boris Lokschin: Weleda is running a super successful digital commerce business in 40 different countries, leveraging Spryker to diversify their sales channels. Lekkerland distributes groceries for all types of businesses retailers actively using our extensive Enterprise B2B capabilities to really differentiate their value proposition. Another great example is Mercado Mayco. Originally distributing CPG goods in Mexico, the company launched an app powered by Spryker. It enables family owners of the local corner stores, regionally known as tienditas, the ability to order online instead of having to close their store and drive to the far-away wholesaler to re-stock. These are just some examples of how digital commerce technology can strengthen your value proposition, setting you apart from the competition.

AWS: What does the “new normal” look like to you and how do you think the CPG industry will look three years from now?

Boris Lokschin: Data-driven supply chains must and will be the future for CPG firms looking to stay ahead. By collecting more detailed data from their supply chains, businesses will be able to better identify optimization opportunities, comply with requirements and industry standards more easily, and be able to build transparency and therefore a stronger level of trust with customers in order to differentiate themselves. This can help to showcase progress and commitment to important topics for consumers such as sustainability and social responsibility.

AWS: What makes you excited for the future of CPG?

Boris Lokschin: What’s most exciting about CPG is that we are building the future of the industry right now. Competition is incredibly fierce in CPG, and only growing daily as customers keep changing behaviors and technology enables disruption in every single part of the value chain. In order to not only survive, but thrive, CPGs must embrace a digital-first and composable approach to stay agile and evolve with rapidly changing consumer demands.

AWS: Thanks for chatting with us, Boris. We appreciate your insights and expertise.

We hope you enjoy our blog series. If you have questions for Boris Lokschin, Spryker, or AWS, please leave a comment on this blog. To learn more about Spryker, get in touch on their contact page.

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Spryker provides global enterprises with cloud-native digital commerce solutions for B2B and marketplaces. Founded in 2014 in Berlin, it has over 600 global employees, including offices in Germany and the US.