This website does not support Internet Explorer. Please, switch to Edge, Chrome, or Firefox browser to view this page.

Learn more


Executive Council

aim10x blog

How AB InBev manages demand and supply in a volatile and uncertain world

By aim10x|

This is Part One of a three part series:

Part One: Manage demand and supply in a volatile and uncertain world
Part Two: Optimizing price and promotion investment
Part Three: Synchronizing commercial plans in a post-COVID world

Volatility, uncertainty, and unpredictability have become commonly used terms in the Consumer Packaged Goods (CPG) industry throughout the COVID-19 crisis. This has increased the pressure on many businesses within the sector to showcase their agility, resilience, and adaptability.

For companies like AB InBev, the ability to react to COVID’s many challenges and manage its revenue amidst the crisis was crucial to protecting as many of the six million pubs, restaurants, and family-run retailers that sell and serve its products as possible.

Staying in the know: building a market knowledge model

With markets in this dynamically fluctuating state, how easy is it to monitor and react to these rapidly changing trends across channels to spot demand risks and opportunities?

Juan Lopez, Global Director of Sales Operations at AB InBev, comments, “There’s a saying that data is the new oil. But it’s not all about data; it’s about the insights you can capture. That’s why we’re investing in technology and employing an omnichannel strategy so that we can learn from our customers in real-time. This helps us anticipate some of those new trends so we can ‘skate to where the puck is going, not just to where it is right now”.

Key trends identified by AB InBev

During COVID, AB InBev witnessed growth in premiumization. Lockdown incentivized people to look for ‘affordable luxuries,’ and AB InBev offered this form of reward through premium beers. Health and wellness – especially around local beer and low alcohol beer – was observed, especially in the US, while an accelerating trend among Gen-Z and millennials was authenticity and purpose.

“They have high expectations for brands and believe that they can do their part in changing the world and making it a better place,” Lopez remarks. “We put our efforts into marketing and everything else to go in that direction: from Budweiser, which is brewed with 100% renewable electricity, and Corona, which has focused its attention on cleaning the oceans around the world. We’re trying to align purpose with our brands to have the customer at the center of everything.”

Convenience first

From a transactional standpoint, Lopez emphasizes the need for frictionless commerce that melds seamlessly with the consumer’s needs and daily activities. For AB InBev, its e-commerce and direct to customer (D2C) models were integral throughout the pandemic: “Across our platforms in Latin America, in one month, we were able to deliver what was planned for the full year,” he comments.

Online platforms are estimated a 2-3% point share gain post-COVID, which is why many CPG enterprises are optimizing this channel into the future. D2C models remain complicated for CPG, as the average basket value and purchase frequency need to be high enough to justify customer acquisition costs and make per-order economics viable.

Data-driven insights

Understanding how to capture and extract data is important, but how best to extrapolate valuable insights is imperative post-COVID and beyond. The process allows enterprises the decisive advantage of foresight instead of merely acting on hindsight, ensuring they can predict new trends before they happen.

Lopez asserts that investing in technology and building in-house platforms, instead of depending on external agencies, will be critical to a business’ ability to remain agile, competitive, and reactive post-COVID. “Have your own data sets and omnichannel strategy,” he comments. “The aim is to have an Amazon-like model, with a digital twin of each customer to anticipate needs better, their next order and even the next product you develop.”

It starts with collecting market intelligence

Different data sources are relevant, but some are less considered than others for valuable insight extraction. Macroeconomic factors, such as global trade data and GDP, are go-to sources in their holistic overview of the market. But unstructured social data could also be a key consideration in the future. Take product reviews as an excellent example of this: consumer reviews often drive the behavior and a brand’s perceived value in other consumers’ eyes.

“Companies should look for quick and novel ways to keep a pulse on consumer sentiment. In Italy alone, Facebook has seen a 40 to 50 percent increase in usage since the crisis began. A surge in online usage now underway offers the opportunity to tap into insights from social media to rapidly understand consumer sentiment and develop new ideas”. Mckinsey

But data is a commodity

Building a market knowledge model ultimately means transforming data into something you can digest. Looking at social events, for example, gives businesses knowledge of where and when they are happening, allowing them to leverage predictions at a very local, almost zip code level of demand. When it comes to consumer behavior, look to household composition, age profile, and demographic changes, while industry makeups will include seasonality trends, store locations, and regional concentration.

Lopez adds, “Big data is internal as well as external. I think that’s key. Sometimes we find even within the company that we’re not connecting the dots – the data lives in silos. I think o9 Solutions’ platform allows for connecting the dots in one single platform and then building knowledge models on top. But what does that mean? What is the impact on my plan, and how can I use that information to upgrade and elevate my growth in the next 12, 18, 24 months?”

Want to read more articles like this?

Join the aim10x Innovators Network and get access to all aim10x content and connect with your peers!

Join the network

About aim10x

The global community for digital transformation leaders in planning and decision-making.

Previous Post

The Roaring 20s and the Customer-Centric Supply Chain

Previous Post

The Roaring 20s and the Customer-Centric Supply Chain

Next Post

aim10x Global – Recap day 1

Next Post

aim10x Global – Recap day 1