The Consumer Packaged Goods (CPG) market grew rapidly during the pandemic despite being forced to undergo a massive transformation. The market was experiencing a modest 1.8% compound annual growth rate between 2016 and 2019 (MediaRadar). But then the pandemic hit and the industry grew by a strong 10.4%. According to the latest Global Consumer Packaged Goods (CPG) Logistics Market report, growth will remain steady through 2026.
The CPG industry is known for being heavily data-driven. New products come in and out of the market in the blink of an eye. A brand needs to know where its products are sold, what stock exists, how many units are moving, retail partner performance, and how current branding is working – at all times! CPG advertisers spent $5.2 billion in advertising through October 2021. This was flat compared to the previous year, only increasing by 1%. Digital, on the other hand, increased by 118%, reaching $1.4 billion. There are so many data variables that it can be overwhelming for digital advertisers to begin selecting audience data for campaigns.
Historically, it’s been nearly impossible to know what a shopper will do in most real-life situations. Consumer research is often conducted to yield qualitative data, helping to guide marketing choices. In a focus group, for example, one person may articulate choices one way, while they may make different decisions in reality. The solution is to build a dynamic, constantly refreshing audience that will put your CPG campaign into a cycle of continuous innovation and development. By utilizing your brand’s first-party data and seed sets, Dstillery is able to create continuously evolving and optimizing Custom AI audiences that fit into your brand’s DNA. With proper campaign refresh and data cleanliness, the sales cycle will suddenly begin to look like this:
- Sell products
- Collect sales data
- Make campaign adjustments
The primary goal of our Custom AI audiences is to reduce your campaign waste and create a regularly refreshing, constantly laser-focused audience for your brand. Now, we can take our simplified sales cycle to the next phase. We can begin to focus on things that are less high level and have more direct influence on your brand from day to day. For example, data points like promotional lift, share of category, and shopper loyalty can be used to truly infuse your brand’s Custom AI campaigns – giving you the ingredients to beat out the competition.
Promotional lift is a great measure for data for numerous reasons. Many consumers, especially in these inflationary times, purchase based on discounts, value-adds or rebates. Understanding sales around promotions is vital to campaign optimization because it will help indicate if customers find a brand to be overpriced or are detracting from sales you would have normally made.
Share of Category
Share of category data is a key point of campaign optimization as it helps you understand where you exist in the broader market and if your campaign should be focused on brand conquesting. When looking at the share of category data, you can begin with various product attributes like container size or content. From there, you can begin to examine whether or not these factors are influencing sales. As a smaller brand, it can be discouraging to see a bigger brand taking up a larger share of category. Using a container size example, if the lead product in the category is a 12 ounce can at $5 but you are offering a 16 ounce can at the same price, there may be room for aggressive campaigning as your product is a higher value for the same cost. You can get as creative with this as you want, maybe you’ll even get lucky and create a whole new market segment… we’re looking at you, Oatly.
Consumer loyalty is a huge factor in CPG brand development and growth. While it’s nice to pick up one-time customers, winning brands consistently provide a consumer experience earning loyalty, creating brand preference and resulting in an increasingly sizable market share. Dstillery can use your brand’s first party data to understand who your core customers are and find audiences of prospective customers that you haven’t yet reached.
Wow, that was a lot to cover! Hopefully, now you can see that the world of CPG marketing campaigns is constantly in motion and moving fast. On a brand level, the data your product generates should inform every step of your potential growth and conquesting opportunities. We talked a lot about the cycle of continuous improvement, but advertisers can only do that with truly sharp, first party data-driven performance optimization. Consumers are broadening their horizons every day with fresh data. By utilizing Dstillery audiences, built with your brand’s DNA, you will be able to reach more consumers and much faster than before.