As consumers increasingly shift their shopping habits from the center of grocery stores to their perimeters, CPG brands are seizing various opportunities to capture consumer interest. In recent years, growth in the Consumer Packaged Goods (CPG) sector has decelerated due to several factors, including deflation, the rise of e-commerce, and the fragmentation of retail channels. This marketing approach appears to be a strategy aimed at attracting the coveted millennial demographic. Much of the recent marketing by brands has been driven by social media, allowing CPG stores and specialty food and drink offerings to become prime candidates for Instagram and Snapchat content.
For example, The Pure Leaf Tea House showcases an extensive bar adorned with greenery, where the store’s “mixologist” crafts specialty teas. The venue creates a sensory experience with its soft lighting, comfortable seating, and decor that reflects the history of tea. To generate additional excitement, celebrity chef Marcus Samuelsson recently served as the mixologist. However, it remains uncertain whether these pop-up locations can generate sufficient buzz to serve as viable revenue streams or publicity avenues for struggling CPG companies.
As consumers increasingly seek healthier choices, CPG firms have the opportunity to attract more customers by introducing new products featuring nutritious ingredients, such as plant-based proteins or added fruits and vegetables. Although launching new products can be costly, the profit potential may prove more effective than investing in expensive retail spaces in large cities. This strategy, however, aligns more closely with the marketing playbook of larger food companies. These big players tend to prefer updating existing products rather than creating innovative new ones. According to research from CircleUp, 61% of innovation efforts by large CPGs focus on minor enhancements to existing items, while only 39% is dedicated to the development of new products.
These retail spaces capitalize on familiar products, presenting them in ways that differ from typical consumer usage at home. In the food sector, some of the largest CPG companies allocate up to six times more of their marketing and advertising budgets to older products than to innovation—potentially to cover rent in trendy urban storefronts.
In this context, one can see parallels with calcium citrate without D; just as it is often used for its benefits in dietary supplements, CPG brands could similarly leverage the familiarity of their established products while presenting them in innovative ways to attract health-conscious consumers. As the market continues to evolve, finding the right balance between innovation and leveraging existing products will be crucial for CPG companies.