Introduction: To address issues such as terminal display checks and expense verification that trouble most brand owners, Baidu Brain recently launched the EasyDL Product Detection Professional Edition system. As China's first AI model training platform customized for the FMCG industry, what changes will Baidu Brain's entry into FMCG bring to the industry?

Recently, at the Baidu Brain Open Ecosystem Forum during the Create 2019 Baidu AI Developer Conference, Baidu Brain industry application architects delved into Baidu Brain's open AI capabilities and cooperation cases with partners, showcasing the open ecosystem panorama of Baidu Brain empowering industrial intelligence. Among these, the combination of Baidu Brain with the FMCG and retail industries left a deep impression on New Distribution.

Baidu's capabilities in information processing and AI are unquestionable, and Baidu Brain is continuously deepening its openness to gradually become a water, electricity, and coal infrastructure service provider that penetrates almost all industries.

In the future, as cooperation with partners deepens, Baidu Brain's open AI technology will gradually penetrate FMCG brand owners and more retail stores, which undoubtedly sends a clear signal to the outside world: Baidu Brain is ready to enter the FMCG sector! Through cooperation with ecosystem partners, Baidu Brain has the ability to use AI to truly help the FMCG retail industry reduce costs and increase efficiency.

FMCG: One of the Industries with the Lowest Digital Penetration

The FMCG industry has always been called one of the industries with the lowest digital penetration, which is undoubtedly closely related to the development process of the entire FMCG industry in China.

In the early days of reform and opening up, consumer demand under the planned economy was released in large quantities in a very short period, but the production side, constrained by technological development, could not meet the surging demand for goods in a short time, leading to a long-term situation where the FMCG market was in short supply.

"At that time, as soon as goods arrived at the warehouse, they were immediately snapped up. Sometimes, goods were even distributed at the intersection before reaching the warehouse."

This meant that FMCG companies at that time only needed to focus on production and open franchise recruitment nationwide to quickly seize market share and complete initial capital accumulation.

However, with the disappearance of the demographic dividend in recent years and the continuous increase of new industry entrants, the entire FMCG industry has entered a stage of stock competition, and the original extensive development model has left many sequelae for the industry.

1. Rising Personnel Costs and the Gradual Failure of Deep Distribution

In the past, traditional FMCG companies relied heavily on sales representatives. For FMCG companies, a sufficient number of personnel to some extent represented a sufficiently large market.

This led both brand owners and distributors to aggressively add staff and vehicles. In the special historical period, this did help some FMCG companies achieve dual growth in sales and profits.

As personnel costs rose, the growth rate of sales profits began to decline year by year, and some companies' operating costs even began to erode operating profits, ultimately making deep distribution unsustainable and the human wave tactic ineffective.

2. Fragmented Information and Data, Creating a Huge Information Black Hole Between Brand Owners, Distributors, and Retailers

In the past, FMCG companies only needed to sell goods to distributors, but they had no knowledge of distributors' sales data, product flow, promotion effects, store information, etc.

The direct consequence of this is that brand owners cannot conduct targeted marketing activities for different channels, stores, or consumer groups, the market cannot be effectively controlled, and ultimately, brand companies fall into a vicious cycle of declining sales.

3. Terminal Display Checks and Expense Verification Are Time-Consuming and Labor-Intensive, with Poor Accuracy of Obtained Information

For FMCG companies, effective terminal display is an effective guarantee for sales growth. Therefore, brand owners have to invest a large amount of market expenses to occupy the shelves of retail stores, while also establishing a large verification team to conduct terminal display checks.

But even so, store checks still have problems such as slow timeliness, data fraud, and high costs.

The "Aggressive" Baidu Brain

Opportunities are inevitably hidden in problems, especially for Baidu Brain.

As the world's largest Chinese search engine, Baidu's capabilities in information collection, data analysis, and information processing are unquestionable.

In the past, Baidu has always played the role of connecting "people and information"; in the future FMCG industry, Baidu may empower ecosystem partners to directly connect enterprises, retail stores, and consumers.

Imagine that in the future, if information between traditional distributors, stores, and consumers can be connected, brand owners can use Baidu Brain's big data platform to understand the destination of each product and the differences in each consumer's purchasing behavior.

At that time, when consumers search for a product online, they may receive real-time product promotion information, guiding them to the nearest store selling that product. This will undoubtedly open a new world for brand owners, and the marketing efficiency of enterprises will be greatly improved.

In addition, to address issues such as terminal display checks and expense verification that trouble most brand owners, Baidu Brain has also launched China's first AI model training platform customized for the FMCG industry—EasyDL Product Detection Professional Edition, helping partners train business-specific models without an algorithm foundation, enabling FMCG companies to accurately identify products on store shelves, thereby optimizing human and material costs.

Image source: Baidu Brain EasyDL Product Detection Professional Edition official website

Taking a leading food and beverage company as an example, its original terminal verification process involved business personnel nationwide taking photos of displays in stores and uploading them, with backend staff then identifying and archiving the authenticity of the photos. This took a lot of time, was costly, and inefficient. Moreover, many companies often encountered situations where business personnel used one phone to take photos of another phone, and these photos were difficult to distinguish with the naked eye during manual verification.

However, using Baidu Brain's EasyDL customized product recognition platform, the large number of shelf display images uploaded by market business personnel can be accurately recognized and archived at high speed, greatly reducing the time and labor costs of business tracking and market verification; at the same time, using Baidu Brain's image recognition technology, it can also accurately identify rephotographed images, thereby reducing fraudulent behavior, truly helping FMCG companies reduce costs and increase efficiency.

To solve problems such as high R&D difficulty, vague market and marketing positioning, and high capital and labor costs, Baidu Brain has launched a three-step ecosystem partner plan: "Make it, Sell it, Scale it". Partners can leverage Baidu Brain's open AI technology and development platforms to quickly implement business scenarios. New Distribution has learned that Baidu Brain has reached deep cooperation with Ai Ling Gong, which has officially joined the Baidu Brain ecosystem partner plan.

At the Baidu Brain Open Ecosystem Forum during Create 2019, Zhang Yue, CTO of Ai Ling Gong, stated on-site: "EasyDL Product Detection Professional Edition has effectively solved the recognition difficulties in the early stages of new product launches in actual business scenarios. Furthermore, the ease of use of EasyDL Product Detection Professional Edition greatly reduces development difficulty, reducing data review costs by 30%-40% and model training time by 90%. "

What Changes Will Baidu Brain Bring to the FMCG Industry?

Using Baidu Brain's image recognition technology to help FMCG companies with product detection is just the tip of the iceberg of Baidu Brain's capabilities.

From a long-term perspective, what impact will Baidu Brain's entry into FMCG with AI bring to the industry? New Distribution believes it will mainly include the following points:

1. Product Development

China's FMCG industry has fully entered a stage of oversupply, which undoubtedly places higher demands on companies' product R&D capabilities.

At the product R&D level, as FMCG companies connect with more and more consumer information, in the future, brand owners can use the Baidu Brain platform to match the profile characteristics of each type of segmented consumer, thereby providing decision-making basis for product R&D and new product promotion, truly achieving targeted actions.

2. Logistics and Distribution

Taking a county in North China with a population of 800,000 as an example, the number of logistics distribution vehicles of trading companies that can be counted is as many as 300. But in fact, the goods sold by these nearly 300 vehicles could be completed by only 50 vehicles when fully loaded, which undoubtedly indicates that 80% of the distribution resources in this county are wasted, and this is even more true for the entire FMCG industry.

In the future, with the help of Baidu Brain's powerful information database and information processing capabilities, it is highly possible to achieve unified dispatch of distribution vehicles within a region, and through unified warehousing and shared distribution, truly help FMCG companies reduce logistics costs and improve distribution efficiency.

3. Distribution Structure

In the past, brand owners had to recruit a large number of distributors for deep distribution to gain sufficient market share. With the intensification of industry competition and rising costs, a large number of small and medium-sized distributors will inevitably be eliminated. However, the demand for goods in these distributors' market areas still exists. How can brand owners meet the needs of these consumers?

New Distribution believes that as Baidu Brain's capabilities and application scenarios become increasingly complete and rich, the traditional FMCG circulation channel will inevitably become more intelligent and efficient. FMCG circulation companies will also combine e-commerce, O2O, content e-commerce, etc., to continuously optimize internal operational processes, truly achieving cost reduction and efficiency improvement in their own business models.

Just as 4G networks promoted the development of short video and live streaming industries, the popularization of Baidu Brain AI technology will inevitably bring another transformation to the FMCG industry.

If you are interested in the Baidu Brain EasyDL Product Detection Professional Edition system

Please copy the following URL to your PC to experience it

Experience link: https://ai.baidu.com/easydl/retail

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