
U.S. retailers and consumer packaged goods (CPG) companies are rapidly evolving to meet shifting consumer demands, adapt to new technologies, and comply with increasing regulations, according to a new report from Information Services Group (ISG), a global technology research and advisory firm.
The 2024 ISG Provider Lens™ Retail & CPG Services report highlights how data-driven strategies are essential for staying competitive in today’s market. With the rise of e-commerce, customers now have more options than ever, making it crucial for companies to adopt flexible, customer-focused approaches that ensure both customer and employee satisfaction.
“Retail and CPG companies are realizing that comprehensive, customer-centric strategies are critical,” said Sunder Pillai, ISG Retail & CPG practice leader. “They’re partnering with providers to plan and execute these strategies while maintaining cost control.”
As the balance between online and brick-and-mortar retail continues to shift post-pandemic, consumer behavior remains fluid. Companies need advanced data analytics to monitor demand, manage inventory, and deliver personalized customer experiences. To keep pace, many are moving to cloud-based platforms for scalability and cost efficiency.
To provide seamless shopping experiences, both online and in-store, U.S. retail and CPG companies are integrating inventory management and order fulfillment systems. They’re also adopting customer data platforms that use AI to generate personalized recommendations. Extended reality (XR) technologies, such as augmented and virtual reality, are also being employed to offer immersive digital experiences like virtual clothing try-ons.
Amid a fragmented regulatory landscape, stronger national data privacy laws are expected in the U.S., pushing companies to adopt robust data governance and management systems. With labor regulations evolving, workforce management tools are being utilized to adapt to changing needs. Additionally, sustainability regulations, such as waste reduction and eco-friendly packaging, are driving the adoption of tracking and reporting tools.
Automation is enhancing retail and CPG operations through technologies like robotic warehouse assistants and generative AI (GenAI), although companies are mindful to retain a human touch where necessary. Learning management systems are helping employees upskill for these new technologies.
“GenAI is now central to discussions about the future of retail,” said Jan Erik Aase, partner and global leader of ISG Provider Lens Research. “Retailers are working with providers to understand how this technology can benefit their business.”
The report also explores other key trends, including the rising use of robotic process automation (RPA) and the increasing importance of workforce management tools for optimizing employee schedules.
For more insights into the U.S. retail and CPG industry, including challenges such as business transformation and responsible sourcing, visit the ISG Provider Lens™ Focal Points briefing.
The 2024 ISG Provider Lens™ Retail & CPG Services report evaluates 33 providers across four key areas: Business Transformation Services, Digital Innovation Services, Platform Modernization Services, and Managed Services. Companies such as Accenture, Capgemini, Deloitte, and TCS were recognized as leaders across all four categories, while others like IBM and Kyndryl were named leaders in two.
About ISG:
ISG (Information Services Group) is a leading global technology research and advisory firm, helping clients achieve operational excellence and faster growth. ISG specializes in areas such as digital transformation, AI, automation, and data analytics. Founded in 2006, ISG operates in over 20 countries, assisting more than 900 clients globally, including over 75 of the top 100 enterprises.