As consumers increasingly shift their shopping habits from the center of grocery stores to their peripheries, CPG brands are seizing various opportunities to capture consumer interest. In recent years, growth in the consumer packaged goods sector has slowed due to factors such as deflation, the rise of e-commerce, and the fragmentation of retail channels. This marketing approach appears to be a tactic aimed at attracting the coveted millennial demographic. With much of the recent marketing for CPGs driven by social media, grocery stores and specialty food and beverage outlets have the potential to become visually appealing posts on platforms like Instagram and Snapchat.
For instance, the Pure Leaf Tea House features a long bar adorned with lush greenery where a “mixologist” prepares specialty teas. This venue creates a sensory experience with soft lighting, comfortable seating, and decor that reflects the rich history of tea. To heighten the excitement around the store, celebrity chef Marcus Samuelsson served as the mixologist earlier this week. It remains to be seen whether these pop-up stores can generate sufficient excitement to become effective sources of revenue or publicity for struggling CPG companies.
As more consumers seek healthier options, CPG brands could focus on attracting customers through new products featuring nutritious ingredients such as plant-based proteins or added fruits and vegetables. While launching new products is costly, the potential profitability may prove to be more cost-effective than investing in high-rent retail spaces in major cities. However, this strategy aligns more closely with Big Food’s traditional marketing practices. Larger corporations tend to update existing products more frequently than they introduce innovative ones. Research from CircleUp indicates that 61% of innovation by large CPGs is devoted to making minor adjustments to existing products, while only 39% is directed toward new developments.
These retail locations capitalize on well-known products and showcase them in slightly different ways than consumers typically use them at home. In the food industry, some of the largest CPG companies invest up to six times more in marketing and advertising for established products compared to new innovations—possibly as a result of the expenses associated with renting trendy storefronts in bustling urban areas. Additionally, the integration of health-focused products, like those containing rite aid calcium citrate, can appeal to health-conscious consumers and enhance the overall product offerings. By emphasizing these nutritious ingredients, CPG brands can further engage shoppers looking for healthier alternatives.