AI and Automation in CPG: A Strategic Shift Driving Long-Term Growth

The Consumer Packaged Goods (CPG) industry is undergoing a seismic shift. No longer content with incremental cost-cutting measures, manufacturers are pivoting toward innovation-led strategies to survive in a hyper-competitive landscape. At the heart of this transformation lies a confluence of rising competition, workforce evolution, and AI adoption—factors that position industrial automation leaders like Rockwell Automation (ROK) and its CPG clients as prime beneficiaries. For investors, this represents a compelling opportunity to capitalize on a sector redefining its future.

The Strategic Shift: From Cost-Cutting to Innovation

Rockwell Automation's 2025 State of Smart Manufacturing Report: CPG Edition reveals a stark departure from traditional CPG strategies. While cost optimization dominated the 2024 agenda, 2025 sees 70% of CPG manufacturers prioritizing AI, robotics, and simulation technologies for long-term growth. This shift is driven by intensifying market pressures: private-label brands eroding margins, and consumers demanding hyper-personalized, sustainable products.

Rockwell's clients are no longer experimenting with isolated automation pilots. Instead, they are deploying integrated digital transformation solutions that deliver enterprise-wide results. For example, AI is now central to quality control, logistics, and cybersecurity, with adoption rates 5% above industry averages. This isn't just about efficiency—it's about building resilience.

Workforce Evolution: Training, Not Recruitment

A critical enabler of this shift is the CPG workforce. The 2025 report highlights a pivot from attracting skilled labor to upskilling existing teams. While 34% of manufacturers now prioritize training current employees, 33% focus on managing change and retention. Rockwell's Plex Connected Worker solution, embedded in its Manufacturing Execution System (MES), addresses this directly. By providing real-time guidance and multimedia tools, it enhances productivity and reduces errors, turning a potential liability into a competitive asset.

Rockwell's partnerships with NVIDIA and AWS further amplify this strategy. For instance, AI-powered predictive maintenance systems reduce downtime, while cloud-based platforms like FactoryTalk® Hub on AWS enable scalable data analytics. These tools align with CPG leaders' demand for usability and scalability, ensuring technology investments translate into tangible outcomes.

AI Adoption: The New Competitive Edge

AI is no longer a buzzword—it's a business imperative. The report notes that 44% of CPG manufacturers now use data for decision-making, up from 40% in 2024. Rockwell's FactoryTalk Analytics LogixAI and Design Studio with Azure OpenAI are accelerating this trend. By optimizing production lines and enabling generative AI for troubleshooting, these platforms help CPG firms reduce waste, improve quality, and respond faster to market shifts.

Consider the case of a leading CPG client leveraging Rockwell's Emulate 3D digital twin software. By simulating production scenarios before physical implementation, the company slashed development time by 30% and reduced energy consumption by 15%. Such outcomes underscore the ROI of AI-driven automation, a value proposition that's hard to ignore.

Why Rockwell Automation Stands Out

Rockwell's ecosystem of partnerships—spanning NVIDIA, AWS, and OTTO Motors—creates a moat around its offerings. Its Plex platform isn't just a tool; it's a strategic asset for CPG firms navigating workforce shortages and supply chain volatility. Meanwhile, Rockwell's focus on sustainability aligns with ESG-driven investor sentiment, as seen in its additive manufacturing solutions that minimize material waste.

Investment Implications

For investors, the case for Rockwell Automation is clear. The company is not only capitalizing on the CPG industry's digital transformation but also shaping its trajectory. With AI adoption accelerating and CPG leaders committing to long-term innovation, Rockwell's stock is well-positioned to outperform as a leader in industrial automation.

However, risks remain. The pace of technological disruption could outstrip adoption rates, and regulatory shifts in AI governance might slow deployment. Yet, Rockwell's diversified partnerships and focus on scalable solutions mitigate these concerns.

Conclusion

The CPG industry's strategic shift from cost-cutting to innovation-led growth is a defining trend of 2025. Rockwell Automation and its clients are at the forefront, leveraging AI, robotics, and workforce enablement to build agile, sustainable operations. For investors seeking exposure to this transformation, Rockwell offers a compelling blend of sector leadership, technological depth, and long-term growth potential. The question isn't whether this shift will succeed—it's whether you're positioned to benefit from it.