CPG

Retail Media and CPGs: How do Brands Optimize Investments?

by


AMID THE HYPE AND HYPERBOLE around Retail Media Networks, some fundamental issues about CPG marketing spending have barely been addressed. Brand marketers have an opportunity – perhaps an imperative – to elevate the dialog about how funds should be allocated, to maximize returns and sustain mutually profitable relationships with retail partners.

​Ad standards are yet to be established across the RMN universe. The allure of first-party data is compelling, but each network presents its own interfaces and definitions. Established norms around trade marketing spending – the lion’s share of marketing investment by brands – are under pressure. Beneath the surface lurk issues around fairness and proportionality, too.

THIS ARTICLE IS PART ONE of a series, originally published on CPGmatters.com

Experts contacted for this article spoke mostly on background. The consensus is that RMNs are not easy to master and that best practices are yet to emerge. They introduce a heightened degree of intricacy for brand marketers and retailers alike. Some standards may be on the horizon, but trading partner joint planning is not getting any easier.

Concentration at the Top

A relatively small handful of retailers with very broad geographies and high customer counts are sweeping up the lion’s share of retail media spending and decision-making capacity. This presents steep challenges for CPG brands. Their “brand-width” is not unlimited, after all.

Read more

Where’s the ROI for Social Media?

by

AN INSTANT POLL that recently appeared on the home page of CPGmatters.com sheds some light on an important part of social media evaluation; namely, Return On Investment. Every CPG company of consequence has a social media strategy nowadays.

So do marketers think social media is a success?

ShopperTech.org
This article originally appeared on ShopperTech.org

Not really, say nearly nine of ten executives who took part in the poll. Only 12% say that social media is a success in CPG. Three of four respondents say concern over ROI is holding back success:

  • There is not enough ROI so far to be a success (19%)
  • It is very difficult to measure ROI at this time (56%).

Meanwhile, 12% say it’s too early to determine the success of social media in CPG.

Read more

Do CPG Companies Get Online’s Potential?

by

shopping-cart-buttonCONSUMER SURVEYS FROM Deloitte and others consistently report strong intentions by households to purchase more of their grocery and packaged goods online. This has been true for many years. I suspect there’s some response bias in play.

A recent Retailwire.com discussion raised this issue in the context of a gap between measured shopper interest in online CPG purchases and the less-than-dynamic efforts by most CPG companies to take full advantage of the opportunity. Are they missing the boat? Or are they just taking a prudent approach in the face of greater complexity?

Here’s my take:

Until the perspective shifts from, “How will we sell our products online?” to “How will we help households better manage their pantries?”, I believe this business will continue to be “just around the corner” for CPG, as it was in 1997.

Certainly, splintering the grocery shop into dozens of weekly decisions, transactions and deliveries is no way to help shoppers streamline their consumption routines. This was then and remains now the fallacy of the “consumer direct” concept. Disintermediation is bunk.

A re-consideration of the grocery basket and how it arrives to the home is another story. That requires a solution orientation on the part of the service provider (the retailer). Never-run-out tools, bulk shipments of high-consumption items, and secure unattended delivery have all been well-received in the past. Rapid delivery mechanisms from Amazon.com and others may add traction in areas with urban density, but the relevance will vary widely by location and purchase occasion.

Unfortunately for brands, these emerging concepts will not simplify the in-store shopper marketing imperative in any way. They do add, however, a whole new set of required practices for brand promotion and interfacing with online channels and shopper marketing outside the store. Set against the hard reality of somewhat inelastic total demand, that’s a very tough formula.

© Copyright 2013 James Tenser