Digital innovation is driving a more seamless customer experience for CPG brands through modern features and online efficiencies. 

As digital traffic and online ordering continues to expand in the grocery space, Consumer Product Goods (CPG) companies are stepping up to meet the omni-channel demands of the consumer. In order to both modernize and find opportunities for revenue growth, CPG companies are rethinking the needs of their customers. In this article, we take a closer look at some of the most prevailing ways CPG organizations are transforming to meet the moment.

Build Operational Agility

Establishing a customer-centric environment enables CPG brands to adapt quickly to rapidly changing consumer behaviors. Significant growth in online activity, the need for data and analytics, and the desire for a seamless experience are putting customer demand at the center of the journey. Becoming more Agile will optimize efficiency, minimize waste, and build a customer-focused go-to-market strategy. This model provides the structure needed to deploy new, innovative products to the market quickly and drive revenue growth for CPG organizations.

Establish Direct to Consumer and Marketplace Channels

CPG companies have the opportunity to generate multiple revenue channels by engaging in Direct to Consumer (D2C), marketplace, and social channel sales. Leverage brand awareness consumer loyalty and experiment with product delivery by bringing new products directly to the customer. Pepsi, for example, launched a D2C site at the beginning of the pandemic and nearly doubled sales in by the end of the same ear. 

One study found that 54% of surveyed consumers are using D2C channels to shop for consumer-packaged goods. For the consumer, the convenience of your favorite brands shipping directly to your doorstep makes it easy to keep supplies stocked and reduces trips to the store. By establishing these channels, CPG companies are realizing increased profit margins and continued brand loyalty from their consumers.

Digitize Category Management

To meet the growing online presence of their customers, CPG brands are making a rapid shift to online category management. Partnering with retailers, they will need to implement search performance and optimization, data-driven analytics to engage consumers by offering promotions and discounts, and dynamic promotional content. Additionally, CPGs should consider creative ways to engage new customers. These strategies may include partnering with retailers to offer basket add-ons, promotions that offer cross-category build baskets, and recipe suggestions to increase product awareness.

Engage with the Customer

Marketers are finding new ways to better target offers and advertisements to the consumer, establishing an experience seemingly made specifically for them as an individual. Think email or social channel marketing designed to entice shopper engagement and the promotion of personalized experiences, such as an ice-cream sundae bar for movie night, s'mores by the campfire, or school lunch promotions. These campaigns may include social media channels, personalized offers, product recommendations, and overall engagement with the brand. 

Significant growth in online activity, the need for data and analytics, and the desire for a seamless experience are putting customer demand at the center of the journey.

Achieve Sustainability Goals

Many CPG companies are making bold commitments to overall sustainability goals including product transparency, sustainable packaging, and more efficient carbon emissions within transporting goods. Blockchain technology will show the consumer exactly where food comes from and provide better opportunity for targeted recalls to reduce shrink for retailers. For instance, Walmart says it can trace the source of a product in one of their stores in 2.2 seconds using IBM’s blockchain technology. Before, they would need six days. Transparency in terms of blockchain food traceability can validate and authenticate food origin and improve brand credibility.

Another component of sustainability is packaging. Defining sustainable materials, updating manufacturing equipment, and modernizing processes are the first steps to meeting this goal. This process will require significant financial investments, but with 67% of consumers saying sustainable packaging is important to them, consumers will continue to drive the conversation and challenge retailers to adapt.

As CPG companies make important sustainability decisions, technology will continue to be an enabler within their supply chain. Technology can help generate the opportunity to procure items and services in closer proximity to a distribution center or packaging plant, reducing overall carbon emissions. Warehouse Management Systems can show more efficient ways to get products to distribution centers and appropriately stock store shelves where the product is in highest demand. As the public requires more transparency from their brands and insight into the corporate social responsibility policies of the companies they shop with, CPG product transparency will be key to longevity.