Most FMCGs are seeing digital as an avenue of growth and competitive advantage. These brands are rapidly expanding their initiatives to include digital commerce and experiment with their products and packaging. But is there a future in digital marketing for these companies?
The Evolving Consumers
From personal care products like toothpaste to edible treats like chips and soda—consumer-packaged goods are truly a necessity. These goods play a functional role in the lives of consumers. Throughout the years, FMCGs dominated the market and made an empire on their own. But along every success comes the challenges. Today, the wants and needs of consumers are evolving—this means that brands should dance along to the rhythm. As per PwC’s 2017 CPG Trends Report, the consumer market is now made up of two key groups—the survivalists and the selectionists:
- Survivalists: consumers, typically millenials and retirees, on a budget and choosing products based on value
- Selectionists: consumers, typically Baby Boomers and Gen X, with disposable incomes and choosing more premium products
Consumer goods companies must navigate two entities of influence to maximize profits. They should also learn to re-evaluate their expectations about the market and consumer behavior, and adapt to an ever-changing industry. In short, there’s no room for stagnancy.
Digital Transformation & Influencer Marketing
Transitioning from traditional to digital is becoming a thing. After having realized the importance of reaching people online, brands all over the world, including those from the industry of consumer goods, started leveraging digital marketing. The internet is now a necessity for FMCGs. Why? Digital marketing validates a brand, help build equity and increase conversion rates.
It’s been proven: From Unilever’s massive half-year growth to P&G’s ROI-focused KOL Marketing, it seems like digital marketing is giving a lot of goodwill for the industry of consumerism. Social media is composed of millions of people, so it’s only necessary to keep abreast of the current trends. Digital marketing uses the same strategies as traditional ones, the only difference is that it’s being done online. But the good thing about digital is that it’s complex and flexible. You can go from doing paid advertisements, video or banner ads, ecommerce site, or even work with social media influencers to promote your brand online!
In the coming years, it is expected that more and more FMCG brands will get into this marketing game.
Artificial Intelligence & Subscription Services
Aside from Influencer Marketing, there are also fresh additions to the sphere of digital marketing: artificial intelligence (AI) and personalized subscription services.
Artificial Intelligence is the use of simulated machines that are programmed to think and interact with people. One of the good examples is Google Assistant. Google Assistant is an AI invention that can perform tasks and answer queries from a consumer. With the help of FMCG giant Unilever, Google Assistant rolled out Dutch and Russian language support for users in Netherlands.
Another innovation that will eventually blow up in the coming years is Personalized Subscription Services. This is basically a method by which the consumer pays a subscription price to have a product delivered on their preferred time. One example would be Gillette’s Gillette Shave Club. Their shift from pay-per-product scheme has evolved into a subscription model that will enable the brand to target more people for a long term customer-brand relationship.
Reinvention, Engagement & Customer Loyalty
The future of consumer goods will focus more on reinvention. The competition in the market is really tight, so brands should know how to stay on top of the consumers’ minds. Consumer goods companies must think of other ways to improve their digital marketing capabilities. It’s also important to consistently deliver authentic, quality and valuable brand experiences across all marketing channels. This can lead to engage consumers and move them from the awareness to purchasing stage. In that way, they can build customer loyalty. But that will only happen if they know how to track the right digital marketing KPIs.
Social Media Marketing Channels
The use of platforms are different for every FMCG brand: some use Facebook to target the older generation. Some use Instagram to attract the millennials. Others use Twitter and Linkedin for more B2B transactions. But there’s really no debate as to which platform is more effective. Brands should just know and understand their audience well in order to know the right channels to use.
The future? Well, Instagram is killing it right now. It’s considered as the number one social media platform to market your brand today. In fact, it’s given a lot of benefits for FMCG brands. We can only hope that it will stay this way.
Digital Marketing for FMCG: Is It Helpful In The Long Run?
Consumer goods companies must ask themselves first: are we ready to build a digital-ready culture? If the answer is yes, then most probably, going digital is a good choice.
We are in the modern world. Technology is evolving, and new marketing tactics and channels will soon sprout. Competition will get tougher and tougher, but rest assured that digital marketing will be helpful in the long run. Just learn how to keep pace with the digital innovation.
But of course, there will be obstacles as this world is a bit puzzling. Digital Marketing is definitely more than meets the eye. But trust your gut: IT’S GOING TO BE WORTH IT.