Coronavirus: How AI can help chart out a better plan amidst COVID-19 crisis

AI-led technology has devised predictive models that help consumers and businesses take creative and preventive measures to live their lives unhindered, despite the global crisis. However, its presence, implementation, and advantages all depend on the user's agility.

Coronavirus: How AI can help chart out a better plan amidst COVID-19 crisis

Monday May 04, 2020,

5 min Read

COVID-19 has certainly changed many things. Countries, businesses and individuals are adopting distinct measures and experimenting with their approaches to survive the crisis. An example of this would be a French luxury perfume behemoth that pivoted to producing hand sanitizers in a bid to help the country fight the pandemic.

The outbreak has uprooted normalcy. With changed circumstances, a variation in demand-supply, consumer preferences, and rate of consumption of consumer packaged goods (CPG) can be observed. Manufacturers are assessing how to address supply chain disruptions and capacity limitations that may prevent them from meeting changing consumer requirements in terms of what people buy, where they buy, how they buy, in what quantity, and how often.

It is forcing CPG companies to rethink strategies and capabilities related to all things business – be it manufacturing, logistics, pricing, customer engagement or commerce.


Here are some ways in which AI can help CPGs respond appropriately to the COVID-19:

Managing demand and supply chain

Here, AI can act in two ways: It can foresee product demand and quantities, and prompt the manufacturers. They can then choose to produce a certain commodity in that quantity, taking also into account the increased tendency of panic buying and stockpiling due to the pandemic, or halt the production of a certain product, temporarily. This will help companies meet the ever-growing demand for products, such as sanitizers, and also alleviate the stress on available resources by temporarily halting the production of non-essential items.

Customer engagements

Personalisation goes a long way in retaining customers. AI-driven insights can help CPGs generate product recommendations and content. With most customers at home and exposed to various digital channels, personalised content, traced with their interests, can help CPG brand retain buyers. CPG players can work on strategies to deliver the right product, at the right time, at the right place, and the right price, to lure customers.

Commercial viability

AI enables grocers to make better decisions regarding assortments, price, and promotion. Through this, CPG can create highly localised assortments while maintaining a centralised merchandising function. By monitoring the unique items of assortments, CPG players can monitor, evaluate, and modify promotional activities daily. For example, people tend to buy trusted national brands during times of crisis. CPG players can curate competitive offers to amplify sales of other items belonging to the same category.

Dynamic pricing

This feature reflects the varying price of the product or service based on the changing market conditions. Economic uncertainty has stressed individual markets and will affect the purchasing powers of families in acquiring goods essential to keep themselves safe from the virus.

AI can help CPG brands predict future demands and consumption patterns to initiate dynamic pricing at times when the demand of a product remarkably exceeds its supply. AI can also ensure that the economically weaker sections are not disadvantaged in their ability to curb the spread of the virus and stay healthy.

AI and logistics

Demand-supply chain

AI can identify the chokes in the supply chain – resulting from the restricted movement of people and goods – as well as quarantined units and farms. It can predict the consequences of supply from a virus-hotspot. By recognizing the potential disruptions in the supply chain, CPGs can develop alternative supply chains to ensure continuous movement of goods.

Accelerating e-commerce and D2C sales

In case of shortage in supply, AI can prompt CPGs to initiate e-commerce and direct the consumer traffic toward their websites to effectively manage demand and drive sales. This can significantly release immediate stress on logistics. Based on the wish list, brands can also maintain optimum inventory levels.

Reassessing future course of action

Manpower vs digitalization of factories

As the coronavirus situation resolves, many CPG items and markets can expect to see a sudden surge in demand. Digitization of manufacturing systems and automation at the production level will be required to meet this demand. AI can help automate manual processes, use data from sensors to improve insights into inventory, and use machine monitoring to better understand the health of machines, and ensure preventive maintenance.

Food and beverage testing

The food and beverage industry relies on in-person sensory feedback from focus groups and tasting. With the lockdown, many focus groups and tasting panels are suspended, and product development cycles have been cancelled. Manufacturers are missing out on the most essential part when developing new products, which is consumer preference. Here, AI and ML algorithms can re-engage customers through a data-driven insight engine and predict the distribution of sensory preferences of any target consumer demographic.

CPGs can predict preferences using a few mobile reviews, which can aid in the development of new products, optimize existing brands and enter new markets.

AI comes handy by providing immediate solutions, as well as gearing up to face the unforeseen. AI is a potent tool that, other than efficiently managing the chasm between demand and supply, can also play a key role in decreasing anxiety and uncertainty among the masses.

Edited by Aparajita Saxena

(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of YourStory.)