The game has changed, and companies are rethinking their CPG brand strategies. With changing consumer interests, new shopping channels, and offline and online shopping integration, the landscape of selling consumer packaged goods looks different from what it did in years past.
Are you interested in learning the most prominent CPG brand strategies available today? This article will discuss the current trends that CPG brands use to maintain or capture more market share. We will also share strategic insights from our experience working with challenger brands and industry giants.
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Omnichannel Opportunities
The most underestimated change to the commerce of consumer packaged goods comes through the new sales channels available to CPG brands. Long overdue, digital platforms and retailers are getting into the ecommerce game, hoping to capture more profits for their already profitable companies.
Troubling news for DTC brands who’ve been sitting back, hoping a new marketing medium would give them the ability to drive more sales at a low customer acquisition cost. Instead, they must rethink how they do business in the coming years.
Here’s a look at the exciting new ways brands can showcase their products.
Universal Search Marketplaces
First came eBay, then Amazon, Wayfair, and Walmart. Now, we are seeing companies such as Shopify enter this arena. The idea of being listed on every digital shelf can be exciting or daunting for a CPG company. We suggest you maintain an optimistic point of view about these expanding channels because they are the reality of today’s CPG industry.
When creating a universal marketplace strategy, allocate a portion of your marketing budget for each channel. Otherwise, your products will be lost in the shuffle.
Social Commerce
TikTok may be the first, but it will not be the last. We expect more social media companies to take the initiative in stocking and distributing products. This change in the retail landscape should leave CPG marketers chomping at the bits, as there will be higher conversion rates when consumers can shop entirely inside the app.
While you might expect Facebook & Instagram to be next, it won’t surprise us if a company like Pinterest makes the next move. With their audience tuning into fashion, food, and design, they have an audience primed for spending money.
If you are a CPG company, start having this conversation with your digital marketing agency. If they don’t see it, jump ship and find an agency that embraces and creates strategies for this change.
Click n Mortar
Covid put the pedal to the metal on the expansion of click n mortar. Consumer brands had little time to prepare for this, but now that the pandemic dust is settling, we can see clearly that click n mortar will be a long-term aspect of the CPG industry.
To support this integrated channel, your brand needs to look at in-app marketing opportunities that bring exposure to your products. Additionally, showing support to the retailer making such a significant investment into this platform may strengthen the relationship beyond the financial commitment.
Retailer Diversification
Shifts in the economy are impacting the CPG industry. One of the most staggering statistics is how consumers are looking to switch stores at a higher rate than digging for coupons or shopping for private label brands. Diversifying across several retailers helps maintain brand loyalty as consumers seek new stores.
While our advice is to seek retailer diversification, we are not suggesting you pursue retailer saturation. Maintaining shelf space requires shelf performance. If you spread thin across the store’s potential customer shops, it may incline retailers to replace your product, supporting brands that create more per slit revenues.
While we advise seeking retailer diversification, we do not suggest you pursue retailer saturation. Maintaining shelf space requires shelf performance. If your brand exists across every store your potential customer shops, you may not see strong enough per-store sales. Lackluster sales encourage retailers to replace your product to support brands that create more per-slot revenues.
Consider Line Extension or Abridgment
There is much talk these days about line and brand extension, and for a good reason. The “you are either growing or dying” thought process holds for most CPG categories. But sometimes, the growth of revenues first requires pruning. Make product portfolio assessment one of your CPG brand strategies for this year, drawing a hard line of what categories need to grow and what products need to go.
Increase Investment in Consumer Insights
Ignorance of consumer behavior is unacceptable in this data-driven world. Sure, trusting your gut is essential and being a quick draw helps you outpace the competition, but we now have consumer insights available with a single click, so there’s no excuse for being unaware of who your consumer is and what they want. Here’s a look at how your brand can include consumer insights into your brand strategy.
Consumer Communication
Too often, CPG brands tip the scale in existing customer marketing by “pushing” too many products. Your existing customer base isn’t just good for pushing offers; it’s also great for pulling insights. Is your brand using tools such as Facebook groups, email marketing, and tradeshows to better understand how to serve consumers’ needs?
If not, good luck trying to scale your company past the point of mom-and-pop stores.
Artificial Intelligence
Data is becoming easier to deliver thanks to AI. Whether register data mining or organizing information across the internet, work with companies who specialize in collecting and cross-pollinating consumer insights to deliver even more accurate data sets.
Product Testing
Most brands understand the need to collect information about the industry and product category, but few brands find out how their product performs on shelves before launching. Product packaging testing gives you an understanding of how shoppers react to your packaging, design, and messaging.
Search Engine Data
Content marketing will play a bigger role for CPG brands in the coming years. Brand experience is becoming a more critical aspect of customer retention, and content marketing is one of the best ways to accomplish this objective. The good news is that brands engaging in content marketing will learn more about how consumers respond to the topics that interest them.
The more a brand invests in content marketing, the more search engine data it can access. They can use this information in conjunction with on-site analytics to better understand what their customers want from them.
Improve Your Supply Chain
Are your manufacturers and suppliers continuing to innovate their processes to improve the speed of production and lower the number of errors? Shoppers and retailers are looking for dependable CPG companies, and your supply chain plays a role in how they feel about your brand. Your supply chain needs to improve continuously as your product sells faster across the ever-growing amount of marketplaces.
Influencer Marketing
Since influencer marketing is now an established industry, brands can look for points of influencer leverage in more ways than straight- forward product promotions. CPG influencer marketing is now at a point where SKU equity, company shares, and on-package promotion are a real possibility. 99% of CPG brands need to review their influencer marketing strategy to find more ways to leverage these social celebrities.
Revisit Purchase Drivers
Just because a message worked in the past doesn’t mean it is still the needle mover that drives purchase intent. Brands whose message is becoming stale will lose ground faster than ever to brands keeping their purchase drivers relevant to the needs of their consumer audience.
Brand Collaborations
The lines between product categories continue to blur as CPG brands collaborate in non-competing ways. For example, the Kraft Real Mayo and Juicy Couture collaboration, or Starbucks and Samsung brand collaboration, is a CPG marketing strategy worth considering.
Brand collaboration is especially important for challenger brands who can level up by attaching themselves to more prominent names. The financial investment can have a considerable payoff; such is the case with brands like Ryze Nutrition, who have strengthened retailer relationships by creating brand collaborations with their store’s existing products.
Brand Story
You need a strong dose of the truth if you think a home page and an about us page are enough efforts to display your brand story. Except for consumers interested in “the lowest prices,” your brand story affects purchasing decisions made by your target audience.
The trick is, how does your brand story impact them? Environmental impact, supporting causes, committed transparency, and other aspects of your brand communicate to consumers how you make a difference in “their” lives.
Get with a CPG marketing team (internal or agency) and thread your brand story into every aspect of your marketing.
Profitable Promotions
Are you profiting from a marketing campaign where you give up some profit to create immediate revenues? When you think of Black Friday specials, in-store promotions, and email newsletters, do you accurately account for the impact these “deals” have on your company?
Promotion FOMO is real, and too often, brands fall victim to this. Intentional product promotions must be a mainstay of your company.
While profitability is sometimes more than up-front profits, you must attach some metric to your promotions. Otherwise, you’re just giving back to those you fear losing to other businesses, which is never a good strategy.
In-Store Marketing
We have intentionally placed in-store marketing after discussing the importance of profiting from your promotions. In-store marketing is powerful but often passes the brand’s marketing department by and is placed into the hands of the account rep.
Such a mistake. Give in-store marketing as much effort as other marketing mediums. When you create a strategic digital and traditional marketing strategy exclusively for a single retailer, you can penetrate their customer base right when they are ready to make purchasing decisions.
Create a Scarcity Department
Attention spans are short and scattered. The fact that you’ve read this far in the article means you have a longer attention span than most. While most brands complain about this reality, we want you to capitalize on it.
Taking a lesson from direct response marketing, we can increase consumer demand by creating scarcity in our offerings. Limited edition flavors, brand collaborations (mentioned above), and seasonal product packages will put a new spark in your conversion rate and help build long-term brand equity.
The problem is that most marketing teams don’t have time for scarcity marketing, where they need to reinvent the wheel continuously. It’s better to have a department that loves creativity and spontaneity to handle this assignment.
A Persistent but Likeable Sales Department
Mediocre sales departments exist in many small to mid-size CPG brands. A weak sales team is one of the biggest misses in the CPG market. The flip side of that statement is that it creates an opportunity for those willing to find and nurture the right salespeople.
Finding persistent people with likable personalities is a critical strategy you must continually improve. It isn’t one or the other. With heavy competition and frequent communication, retailers must like your people and respect their diligence and aspirations for growing per-store sales.
CPG Performance Agency
SmashBrand is a CPG branding, strategy, and packaging design agency helping consumer goods brands own their target consumer and capture more market share. Through our proprietary consumer testing process, we guarantee shelf performance. We work with emerging brands and category leaders to increase purchase intent.
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