Hidden gems: Why CPG brands are missing out on tons of profit
For our non-CPG friends, the abbreviation stands for Consumer Packaged Goods. In short, these are goods that you buy at the store that have to be replaced/repurchased regularly, think; toothpaste, soda, candy, toiletries, etc… Before we get into the goods I want to preface with the fact that I'm not a CPG expert and the reason I'm writing this is because of the trends I pick up on as a marketer. However, I interviewed someone who lives and breathes the industry.
Why CPG is a tough industry
I interviewed CPG sales velocity expert Tate Glasgow, who runs a successful Retail Marketing Team Focused on Velocity. Tate has an exceptional track record from the past 8 years as a marketing specialist. One of the biggest reasons CPG is a tough industry to break into is “The cost of doing business, building an inventory, creating the actual product, R&D, the list could go on. Truthfully if you don't have a couple million in cash it’ll be difficult”, Tate stated.
How brands can stand out and succeed
The simple answer is leveraging social media. Every business in the modern world
has access to millions of people for free, so why not use it? Some common obstacles that prevent CPG brands from utilizing this free tool is “Budget, time, and the knowledge on how to properly execute”, says tate. So why should brands strive to utilize social media? “From a brand perspective it’s important. Buyers and consumers care whether you have a good social presence or not, and if done correctly the value is there”. As you can see social media is a golden nugget for these brands and they should be thinking about it more often.
What content should brands focus on?
You’ve probably heard the term UGC before. UGC stands for User Generated Content. This takes the responsibility and workload off the company if they can’t afford to hire a marketing department or agency. Simply, the brand creates a project scope and sends it off to a content creator. Then, the creator produces the video with themselves a part of the video giving this an authentic and trusted approach to content marketing. Tate agreed and stated “UGC, and content at a store level. Content of the product on the shelf and customer reactions to the product in store”. Another type of content that could be a focus would be “Short form content for social media. Another interesting route could be getting picked up by a TV network and creating a show around the brand” says Tate.
Here’s what's next for CPG
Aside from focusing on social media, there’s plenty of other variables brands face when it comes to success; merchandising, retail partnerships, co-packers, and even brand related items like websites. Marketing as a whole will face new changes as it always does. Who knows what the next 5 years looks like for CPG brands. One thing Tate predicts is that “Authenticity will become king. With the ease of creating content becoming more accessible with AI, customers will catch on and desire a brand making authentic content that is truly themselves”. This industry truly fascinates me and especially gives me insight on the work brands who are well established had to go through to become successful. If you weren’t familiar with the CPG industry, I hope this article gave you some insight on the struggle brands you love face everyday.