Direct to Customer in the CPG Domain

CPG, or consumer packaged goods, companies are seeing a major facelift in the way they sell and promote their products within their domain. CPG companies have begun to face issues with customer loyalty due to the oversaturation of brands and products on the market today. Furthermore, there are many new private label brands popping up that connect directly with the end consumer and interact with them in real-time. These new brands promote their products well, get better shelf space in stores, and are connected to their product and consumers better, which generates loyalty and interest. CPG companies have been forced to alter their tactics so they can carve out their own space in the industry. Thanks to technology and innovative ideas, better direct to consumer (DTC) strategies are made possible and more efficient.

ECommerce

Online shopping has spiked and more and more people are taking to the Internet to purchase their goods. Ecommerce is gaining more popularity for CPG companies as well because it is easier to track progress and information compared to brick-and-mortar stores due to lower overhead and the ability to gain access to customer and establish loyalty more efficiently.

Therefore, some CPG companies find it easier to launch new or redesigned products online as a way to test the success and interest around the product. This is also a great way to create buzz and interest before the product hits store shelves. It is popular for CPG companies to partner with online retail giants like Amazon to help propel their sales and interest around new products. For instance, a company may partner with Amazon and release their product through Amazon a few days before the official launch date to Prime members or they may pick a few select Amazon stores to generate buzz before the official launch.

Machine Learning and Personalized Recommendations

The demand for personalization is on the rise. Consumers want their shopping experiences tailed to their specific desires and needs for easier and more efficient shopping. CPG companies know personalization is what their consumers want, but many do not know how to find and gather enough data and insight to bring personalized shopping to fruition. It can often take a long time to gather enough proper information as well. However, implementing DTC strategies streamlines this process.

CPG companies are creating special website features that allow consumers to personalize goods, such as tasting a quiz that asks about your food preferences to match you up with perfect wines for your tastes. Other companies like Bear Naked allow you to create your own granola flavor online and have it shipped directly to your home. This is all possible through new technology related to machine learning. Machine learning can predict information and preferences based on simple questions the consumer answers. This doesn’t only allow the customer to create something they love through the personalization options, but it provides invaluable insight into their customer base about consumer preferences.

YouTube, Snapchat, Facebook, and Instagram

If there is one way to connect with consumers, especially the younger generations, it is through social media outlets. YouTube was the first social media channel to develop and implement shoppable videos. It allows consumers to watch a catching, interesting, and funny video and then buy the product that s featured within the video. Following YouTube, Facebook, Instagram, and Snapchat created their own versions of shoppable videos that have gained much ground with CPG companies to connect and sell to their preferred consumer base directly. Shoppable videos generate more sales and create brand loyalty.

Subscriptions

Subscription services are something consumers are beginning to expect with their favorite brands. Subscriptions allow the consumer to receive their favorite products or new products on a monthly basis. It is a completely consumer focused tactic, which means it is less about the product itself. This presents a challenge for many CPG companies because they are used to promoting and focusing on their products rather than the consumers.

However, this does not mean it is impossible for them to implement these new strategies. With a few adjustments to their brand, they could create monthly subscription packages that are tailored to different types of costumers. For instance, Listerine could create a monthly subscription box that allows families, couples, or individuals to design their own oral health box with all the helpful products Listerine has in their line. This makes the customer’s life easier because they don’t have to worry about running out of their must-have items, but it helps the company as well. It creates strong customer loyalty and increased revenue.