Consumer Packaged Goods

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The consumer goods industry is booming today. Consumer packaged goods (CPG) have a short lifespan and are in constant demand as customers buy them on a regular basis. They are usually easy to recognize by their colorful packaging. But there’s much more to know about them. 

In this post, we'll cover the difference between CPG and retailers and will take a look at a few examples of CPG marketing. 

Сonsumer goods vs retail store goods

Consumer packaged goods are items that are consumed on a daily basis by average consumers that require regular replacement or replenishment, such as food, beverages, clothing, tobacco, cosmetics, and household goods. But there is not only a CPG business but also a retail one. 

And understanding the difference between the meaning of the CPG industry and retail business is very important. So let's get this straight.

Difference between CPG and retail store goods

Companies that are involved in the development, production, and marketing process and strive to present the final product to the end user are CPG. These brands both create and sell products. For example, these are Procter & Gamble and Johnson & Johnson. And brands like Prada and Gucci design and manufacture exclusive clothing and sell these items in their retail stores.

At the same time, retailers are only engaged in the sale of goods and services through social media, retail or online stores, or other effective sales channels. One of the keys to achieving retail success is to be more data-centric and to use retail products analysis. 

Notable examples of retailers include Target, Amazon, Walmart. These retailers provide their shoppers with everything from food and clothing to equipment rental.

What is cpg marketing: Meaning and examples

Today CPG companies face a big problem: Introducing new technologies and launching a new product, they have no idea whether it will be popular among consumers. The use of big data technologies, long-term and large investment programs in product modernization — all this is not able to give a business the ability to predict the success of a commodity company with 100% certainty. The frequency of refusals to launch new products on the market has been hovering around 60% for a long time. Two-thirds of new business ideas remain unfulfilled.

As consumers prefer to shop online, they are less likely to visit regular stores or supermarkets.

There cardinal rules to success in the CPG industry

These simple rules will help you succeed:

1. Digital comes first

In 2021, one cannot fail to notice a global change in marketing: Technology is at the helm. Smartphones are the primary shopping tool today, and eCommerce sales on the Internet will surpass $4.8 trillion in 2021. So, according to these forecasts, CPG sales will amount to almost $721.8 billion. And it will be the development of digital strategies for mobile that will play a decisive role in achieving sales goals in the coming years.

Social media is a great place to get consumer insights, allowing businesses to quickly target their CPG marketing efforts in line with market trends. In addition, it is social networks that allow you to interact with customers directly and even in real-time. Therefore, the impact of digital communications on CPG branding will continue to have a huge impact on all types of marketing.

Digital technology has revolutionized the shopping experience. In addition, the pandemic has made its adjustments. For over a year now, consumers have made the majority of their purchases online. Customers are used to researching and viewing information online before purchasing, whether in a store or through eCommerce. And now this trend is only getting stronger. 

2. Taking into account the Customers’ Demographics

Market segmentation is vital as it helps you find potential customers easily. By focusing on market segmentation, you can refine your messaging style according to the type of audience you want to reach through targeted market segmentation. Targeting customers exactly at the right time is rewarding.

This way you can quickly increase sales and achieve more profit. Appropriate targeting drives brand loyalty through customer satisfaction. Demographic segmentation in marketing helps stratify people and is a great tool for mass marketing.

3. Keeping in line with Consumer Life Stages

The customer life cycle is a description of the different stages a customer goes through when interacting with your brand. And lifecycle marketing is about changing campaigns based on where the customer is in the cycle.

Choose campaigns according to the stage the client is at right now — then your communication will be useful to them. Showcase reliable, proven campaigns that have worked at this stage before to prevent churn or increase a customer lifetime value.

Finally, remember — the customer lifecycle is not linear. 

A couple of CPG sales examples:

Rihanna’s Fenty Beauty

One of the most prominent examples of successful digital marketing in the CPG space is Rihanna's Fenty Beauty brand. Just four years ago, the famous singer founded the company, and the annual sales volume is already more than $550 million.

Websites and social media have played a role. On the YouTube channel, in the first month alone, the brand gained 132 million views. It is ranked on over 119 thousand keywords on Google and generates around 1.9 million monthly traffic.

So we see that if CPG brands fail to focus on building a digital brand, they risk losing market share to digital companies.

Kylie Cosmetics 

The news is now on about Kylie Jenner, a 23-year-old billionaire who was able to capitalize on her fortune through digital marketing. Today Kylie Cosmetics is one of the best examples of successful package goods cosmetics. 

It was clear from the outset that a girl would do most of her marketing through social media. After all, her social media accounts have over 100 million subscribers.

Kylie promoted her brand on Instagram and Snapchat using posts and stories. Through social media, Kylie has been adept at promoting her brand while gaining valuable product reviews. The possibilities of social networks are great.

In addition, advertising trends show that the younger generation, behind which the future lies, is increasingly relying on social media as a more reliable form of marketing.