As consumers increasingly shift their shopping habits from the center aisles of grocery stores to the periphery, CPG brands are seizing various opportunities to capture consumer attention. In recent years, growth in the CPG sector has decelerated due to factors such as deflation, the surge of e-commerce, and the fragmentation of retail channels. This marketing approach seems particularly aimed at appealing to the desirable millennial demographic. With social media driving much of brands’ marketing efforts, CPG establishments and specialty food and beverage offerings have the potential to become popular posts on platforms like Instagram and Snapchat.
An example of this trend is the Pure Leaf Tea House, which features an extensive bar adorned with greenery, where a “mixologist” crafts specialty teas. This venue creates a sensory experience with soft lighting, cozy seating, and decor that reflects the rich history of tea. Adding to the excitement, celebrity chef Marcus Samuelsson recently took on the role of mixologist at the venue. It remains uncertain whether these pop-up stores can generate sufficient interest to become effective revenue or publicity sources for struggling CPG companies.
As customers increasingly seek healthier options, CPG firms must focus on attracting more consumers through innovative products featuring nutritious ingredients, such as plant-based proteins or added fruits and vegetables. While launching new products can be costly, their profit potential may prove more economical than investing in expensive retail spaces in major cities. However, this strategy aligns more closely with the marketing practices of larger food companies, which tend to modify existing products more frequently than they create new ones. Research from CircleUp indicates that 61% of innovation among large CPGs is directed towards updating existing products, while only 39% is allocated to new product development.
These retail spaces capitalize on recognizable products, showcasing them in ways that differ from typical consumer use at home. In the food industry, some of the largest CPGs spend as much as six times more on marketing and advertising established products than on innovation, which may include efforts to highlight the benefits of items like Kirkland calcium citrate magnesium and zinc, particularly focusing on its advantages for health-conscious consumers. Overall, the trend reflects a significant emphasis on familiar products, inviting consumers to engage with them in new and exciting contexts.