The Consumer Products & CPG (Consumer Packaged Goods) industry offers tremendous revenue potential, especially with high volume sales and purchases. However, CPG providers face high competition due to many brands competing for limited shelf space and consumer dollars. Here are some of the most critical considerations for CPG companies in today’s marketplace. First, consider the importance of packaging branding. Bright orange containers for laundry detergents, for example, are an effective way to stand out among competitors.
Second, rising digital engagement may disrupt the CPG industry and supply chain. Real companies have successfully overcome these challenges by updating technology. On the list of McKinsey’s digital trends, one of the most threatening trends is the rise of online shopping. This trend has made consumers price sensitive. Moreover, a study by the data science firm dunnhumby revealed that consumers were unsatisfied with price promotions after COVID-19.
The growth of the CPG industry is slow in recent years. It is estimated that the market size of this industry is $2 trillion, with the biggest companies like Coca-Cola, Procter & Gamble, and L’Oreal at the top of the list. Despite slow growth, the CPG industry still provides a substantial revenue stream, with a number of household staples being purchased on a daily basis. While some CPGs have a short shelf life, others are made to last for decades and can be used several times. Moreover, they are sold in single packages, ensuring that consumers throw away empty containers.
In times of economic uncertainty, the consumer market can see a significant shift. The CPG industry must be prepared for changes in consumer behavior, spending power, and cultural norms. To meet these challenges, CPG marketers must develop a two-pronged strategy. First, they must determine how to reach their target audience. Second, they must develop appropriate messaging for each audience. Third, they must consider the benefits of their product or service to the consumer.
For the next few years, Amazon’s focus should be on improving supply chain performance, bolstering consumer insights, and improving marketing strategies. Its near-term goals across all business areas are being met. And while the company is still working to develop its future strategies, investors should remain confident in its ability to meet the challenges of the marketplace. This approach is the key to future growth in the Consumer Products & CPG sector.
In 2021, the retail landscape will continue to change. The rise of ecommerce and the pandemic will have a profound impact on CPG markets. Consumer behavior is shifting away from brand loyalty in favor of convenience. Meanwhile, CPG marketers must adapt to changing demographics and a growing number of consumers will be minority. Meanwhile, the growth of private label and online marketing will further hamper brand loyalty.