By now you likely saw the news that Mindtree has acquired Relational Solutions, a pioneer in demand signal repository technology for the consumer goods industry. Since then a few people have asked me what was behind this acquisition – what market opportunity we feel we are seizing upon.
My answer was that this wasn’t just a matter of scooping up a specialist company to help move the needle a little bit. Instead, this strategic acquisition is a highly complementary pairing, and it fits in well with Mindtree’s mission of ”˜Making Digital Real’.
The Consumer Packaged Goods (CPG) industry is on the verge of massive global growth. According to McKinsey, the sector will almost double in size (from $8 trillion to $14 trillion) in the next ten years. But capturing these new dollars will be a complex undertaking. It will not come merely from geographical expansion. With intense competition and new ways of doing business, CPG companies will need to use data and analytics in new ways to reach the right consumers with the right products at the right time.
Doing so will require a deep understanding of the markets at a very granular level. Given that each growth market is actually comprised of many unique micro-markets, identifying the right assortments and promotions requires a comprehensive understanding based on many sources of data, both internal and external, offline and online, coming in batches and in real-time. What’s needed is a Demand Signal Repository with Analytical and visualization capabilities. Likewise, evaluating the right promotions mix, sales lift and ROI for promotional tactics requires a rare mix of data warehousing skills, business problem and data intimacy, and analytical tools and experience.
I think this acquisition has brought all of that together.
Mindtree has proven experience in delivering cutting edge solutions for CPG sales and supply chain improvement worldwide, especially in emerging markets. We’ve also invested in cloud-based business analytics platforms such as APEX, our next-generation tool that helps sell the right assortment, in the right quantity, unique to every store, on every sales rep’s visit.
Relational Solutions are enterprise demand signal repository specialists with advanced data-driven solutions for supply chain optimization and trade promotions analytics. By merging our expertise with Relational Solutions, it adds the right mix of skills and intellectual property to accelerate our journey in areas of supply chain analytics, trade promotion analytics and media spend. Relational Solutions has best-in-class products for:
Now Mindtree will bring it all together, and take it global, accelerating Mindtree’s roadmap to deliver comprehensive solutions for trade spend ROI improvement, assortment optimization and supply chain optimization.
But this isn’t just about acquiring Relational Solutions’ IP. It’s also not just about beefing up our CPG capabilities. Relational Solutions will become a part of Mindtree’s broader Digital team under our Data and Analytics Services practice. In fact Mindtree will grow its U.S. Data and Analytics Centre out of Relational Solutions’ Cleveland office.
And that’s why this is a 1+1=3 proposition: We have every reason to believe that the same Relational Solutions experts who created such impressive solutions for the CPG industry have a lot to offer in helping our Digital team build sense and respond systems that enable businesses to use data for smart decision making across industries.
“Three myths about growth in consumer packaged goods” –
McKinsey&Company, June 2015