Download: The CPG Post-inflation Reboot
CPG leaders are embracing the uncertainty by building timely marketing plans with clear triggers for when key decisions need to be made and how consumers want to hear them.
Consumer Packaged Goods (CPG): What They Are (vs. Durable Goods)
Consumer packaged goods (CPG) are items used daily by average consumers that require routine replacement or replenishment—such as food, beverages, clothes, tobacco, makeup, and household products.
While consumer demand for CPGs largely remains constant, this is nevertheless a highly competitive sector, due to high market saturation and low consumer switching costs, where consumers can easily and cheaply switch their brand loyalties.
Understanding CPG
According to Investopedia, CPG is one of the largest sectors in North America. It's led by well-established companies like Coca-Cola, Nestlé, Procter & Gamble, and L’Oréal. All brands, regardless of size, must continuously fight, earn, and retain their shelf space in stores. To accomplish this, they advertise, increasing brand recognition and likelihood of purchase.
To stay competitive and foster deeper affinity with shoppers, effective and balanced media strategies in the CPG space need to go beyond search optimization to improve ecommerce performance and in-store sales. Below are a few strategies leading brands are embracing.
A Healthy Data Diet
Fortunately for CPG brands, there is vast availability of audience data that can be activated across digital platforms. This allows marketers to scale among niche audiences, driving new consumer behavior learning to adjacent personas and capitalizing on custom segments unique to their brand. This data is especially rich because it combines insights from a variety of sources. These can range from offline purchase data to behavioral or interest data from third-party data providers to proprietary first-party data.
The audience data can help your CPG brand build a customized media strategy, fueled by unique consumer insights, and identify the most effective platforms, channels, and ad types to achieve key goals through the consumer journey. Using this consumer data and research-driven approach, brands can stand out with campaigns catering to the mindsets, motivations, and preferences of consumers, and reach them when and where it matters most.
CPG Omnichannel Shopping Tactics
This amount of freedom in knowing you can scale cross-platform campaigns and access millions of data points of audience targeting can be overwhelming. The potential of going down the rabbit hole is real when assessing disparate campaign elements—such as selecting data partners, combining multiple creatives, and focusing on seemingly ever-changing ad spaces. When this happens, marketers risk losing a core purpose, valuable time, and budget. Instead, focus on building a cohesive strategy using channels working together rather than being siloed and inhibiting cross-platform performance. Metrics matter and data visualization platforms provide the big picture to accelerate performance, achieve KPIs and maximize ROA.
Stay Fresh
Be disciplined about your creative diet by utilizing fresh imagery, keeping up with consumer trends, and maintaining seasonal relevance. Keep things relevant while being mindful of digital privacy and the passion points of shoppers. For example, are consumers packing lunches for school? Looking for easy recipes for dinner? Do they want alerts for sales on items? A great way to drive loyalty is through rewards programs that serve all this information and more.
Customer Loyalty Is in Flux
But as mom says, remember your manners. It's a fine line between serving your customers and being intrusive. Consumers are more mindful of privacy concerns, and with the decline of third-party cookies, CPG advertisers need alternative ways to track customers' locations in the sales cycle.
Consider a Balanced Multichannel Marketing Campaign
Digital shelf effectiveness is about more than search (however important it may be)—brand building also encompasses providing value and establishing dialogues with consumers. As many brands battle over the search box, savvy players are looking up the funnel simultaneously. They’re using purchase-based targeting to drive long-term brand-building and make bottom-placements more effective.
A minority percentage of various grocery store customers are reachable on the retailer’s website, while the majority can be found on the open web, according to May 2022 research from Epsilon. Hence, much of the ability to drive brand purchase via ecommerce or in-store resides outside the primary digital shopping channels. Optimize ad performance and branding.
When conversions, sales, bookings, sign-ups and driving business are the goals, focusing on ensuring that the customer experience and journey is cohesive is a priority for any marketer. Use data visualization to make sure you're getting a bird's eye view of consumer touchpoints and interactions.
Shoppable Content is on the Rise
Millions of internet users click on posts to learn about products every month, and billions of people worldwide browsing various platforms daily. Users do this to get inspired, find solutions, new products and explore options through content. Enter shoppable content.
Benefits of Shoppable Content
- Control of the customer journey
- Track every sale
- Capture first-party data
- Increase conversions
- Increase brand awareness
This content provides consumers with a direct purchasing opportunity at that critical moment of inspiration. It answers consumer questions at the right place and time, the same way content marketing does. It presents the solution, allowing them to add products to a cart while browsing. As a marketer, seeing that journey is everything. What it brings is the better ability to track sales and pivot quickly, capture first party data, increase conversions and, of course, grow brand awareness when a consumer can go deep at the moment they’re interested.
The goal with shoppable content is to organize the information your customers need to make easy, quick, and convenient decisions and follow through to transactions. It’s designed so the item can be purchased from the desired retailer without leaving the platform that originally piqued your interest.
Shoppable Recipes Drive CPG Sales
Shoppable recipe sites share similar features, such as ingredient lists and “add to cart” buttons, but all have their own unique elements.
Whisk, Allrecipes, and Tasty let people shop ingredients from retailers like Walmart or Whole Foods, but have different shoppable recipe button placements and ways of prompting customers to select desired retailers.
Economic Realities
Amid rising inflation, price-sensitive grocery shoppers are switching brands, trading down, and shifting back to brick-and-mortar. Grocery ecommerce has incurred the biggest spike in inflation this year, per Numerator, as shopping behavior swings back toward more cost-effective channels like club stores. We know from past downturns that cutting spending doesn’t work. Brands that maintain presence, consistently come out on top.
Leverage In-Store Media
Stores with big footprints offer audience reach like scaled social media. Retailers have a real opportunity to create in-store multi-channel campaigns by providing contextually relevant moments close to the point of purchase. Do this with the same attention you would ad creative, and you have the home field advantage to inspire and motivate purchase. Providing customized magazine ads, running relatable videos in-store, or providing mobile coupons are just a few ways.
Food for Thought with MNI
Consumers crave information that makes their lives better and technology serves it up. A balanced diet of messaging and moments will put CPG brands on radars.
MNI's team of experienced experts are excited to take this journey with you.
Learn more about digital solutions that meet consumers where they are.
