The move from traditional selling practices, i.e., brick and mortar, to ecommerce stores has been steadily increasing for some time. With the rise of COVID-19 and the circumstances that developed as a result, many brands who never previously considered an online store are now recognizing the necessity of it in order to maintain revenue.
For consumer packaged goods (CPG) brands, this is not only critical now, but it’s also easier than it might be for other industries. In this post, we’ll talk about what constitutes a CPG brand, what the state of the industry is now, including current trends, how VELOX is particularly suited to help you successfully make the switch to ecommerce, and why it’s a smart move for your brand.
CPG brands encompass an incredibly large and varied collection of products. Everything from food and beverages to makeup and toiletries to cleaning products are covered under the CPG umbrella. If you use it regularly and it requires routine replacement, it’s probably a CPG product.
As a CPG brand, you probably already know this, but you may still consider yourself part of a different industry (like beauty and skincare if your product is cosmetics). As a result, you may be focusing your marketing strategies to align with general beauty and skincare strategies. This is helpful, but it doesn’t address the big picture. Recognizing your brand as CPG and customizing your digital strategies to that end will help you capture a larger, more engaged audience and ultimately boost revenue.
In 2019, online sales for the CPG industry accounted for over $70 billion of total revenue. In the first quarter of 2020, particularly in response to procedures put into place due to COVID-19, CPG brands have seen, overall, a 27% increase in revenue month over month. In April 2020 alone, the week over week market increased by 50%.
In May, we’re seeing the cautious reopening of many brick and mortar retail locations. Things are beginning to return to normal. However, ecommerce isn’t going anywhere–it was already gaining headway in the market, and it’s bigger than ever now. That means your brand is missing a crucial, and large, segment of consumers if you’re not accounting for digital channels in your marketing efforts. Projections suggest that the rising shift in buying behavior to e-commerce, even just in response to COVID-19, will remain a primary channel for consumers once things have returned to normal.
What we’ve learned from the first few months of 2020 is that, now more than ever, it’s important to be prepared for all possibilities. Optimizing your digital marketing strategy and implementing an e-commerce shopping channel for your CPG brand is going to have a lot of benefits in the long term, regardless of potential extenuating circumstances in the future like the coronavirus.
Both online and offline, we’re seeing a number of trends across the CPG industry in an effort to better appeal to a constantly growing and changing market. An increase in omnichannel strategies is one of the biggest, but personalization, mission-focused branding, and user-friendly options like subscription models are also gaining popularity.
Your consumers are everywhere. Research suggests that people are spending nearly 25% more time online than they were just two years ago, and it’s likely that number will continue to increase. But many consumers still appreciate the opportunity to shop in store, to see and feel a product in person before buying. Your marketing strategy needs to reflect every aspect of the buying experience.
How you market in store needs to match how you market online, and vice versa. You should be using similar branding, messaging, and experiential techniques, when possible, to ensure a consistent and unified experience for your customers. Consumers expect a streamlined experience from the brands they love, and that includes everything from how you reach them through advertising to the content and resources you provide to how you handle reviews, both positive and negative.
You can’t know every customer’s name, but they should feel as though you do. Buyers respond to brands who treat them like individuals and, perhaps more importantly, behave like authentic humans themselves. Using remarketing techniques, suggesting products based on past purchases, and having a human customer service experience in place are just a few ways your CPG brand can make your customers feel seen, cared for, and attended to.
One incredibly successful way to personalize the experience for your customers and build brand loyalty is through the implementation of a subscription model. Online shoppers love a simple, user-friendly experience. Subscription models tap into that one-click-and-done mindset by allowing customers to set up the purchase and delivery of a product they want or need without having to go through the entire process every time. It’s a surprisingly easy and pain-free way to secure a consistent revenue stream, benefiting both you and your customers.
As we mentioned, some customers may still prefer to test out a product in person before buying. Even those consumers, though, will find the ease of reordering a product they love through a subscription model more appealing than having to return to the store every time they need a refill. This is another reason why an omnichannel approach to marketing is essential. If a customer buys a product in store for the first time, letting them know through marketing that they can reorder online is a convenient way to instantly capture a returning customer.
Today’s consumers, particularly millennials and younger generations, want to buy from brands they can trust–in more ways than just the quality of the products they purchase from them. We briefly addressed this in terms of personalization for your customers, but it goes beyond simply seeming human.
Your brand needs a mission, whether it’s an effort to do good in the community, protect the environment through recycling or sustainability practices, or simply promise to provide a safe, convenient product for your customers. Regardless of what you choose, your brand needs a relatable, empathetic, and honest personality. Shoppers respond well to this, and following the changes we’ve all experienced from COVID-19, they all but demand it.
The simple answer? We’ve done it before. Our CPG clients have seen consistent cash-on-cash growth beyond COGS as a direct result of their partnership with us. We have teams of experts in all channels of digital marketing strategy, and that makes us particularly well-equipped to provide your CPG brand with a thorough, customized, and holistic online marketing strategy that will increase your revenue for the long-term.
Whether you’ve been offering your products online for some time or have just made the switch, your customers have been undoubtedly looking for you through search engines already. Most shoppers do an extensive amount of research into products and brands before they buy, and, naturally, a lot of that takes place online.
What VELOX does is help you get to the top of the search engine results page; in short, we lift your rankings. We work with you to target keywords that your audience is using to look for you or the products you offer, and we build out an organic strategy with the goal of increasing your authority in the space and helping you hit the top of the list. Most searchers don’t venture past the first page of results, so it’s critical you rank as highly as possible. Our organic search experts have gotten our clients there before, often in the first 60 days, and we’re ready to do the same for you.
Beyond using organic strategies to rank you higher in search results, you need a well-built paid ads campaign. This ties into the trends of omnichannel strategies, personalization, and consistent branding. The benefit of paid management is visibility. These ads show up before organic results, so they’re often the first thing a user sees when they search a keyword. If they see you there, then see you a bit further down the page in the top five results, they’re more likely to trust that your brand is a knowledgeable and authoritative provider of the product they’re looking for. It also helps you get ahead of your competitors, which is never a bad thing.
VELOX has a world-class team of writers and editors who ensure the content under your name is authentic, natural, engaging, and authoritative. When we talk about branding and omnichannel strategies, the key to success almost always comes down to content. In addition to thoughtful ad copy, your brand should be providing content that’s relevant and informative for your target audience. Our content team helps make that happen. We’ll place helpful articles and company spotlights across websites that your audience is already visiting. These lead back to your site, building authority with search engines and your customers at the same time.
Great content that appeals to your audience helps increase the likelihood that visitors to your site are showing up already intent on buying. That raises your conversion numbers and, ultimately, your revenue. More importantly, you own your content, so you can share it on your blog, social media (omnichannel strategies, again!), and anywhere else you think it will benefit your brand.
Essentially, the benefits to employing an online shop are endless. You capture a larger audience, the overhead is lower, it’s easier to innovate, and everything moves more quickly.
Making changes to your marketing strategies offline can take a great deal of time and money, depending on what you want to adapt. But online, you’re able to go in and adjust whatever you need to with instantaneous results. The cost of running an online store is lower, so you’re able to move more money into marketing it than you might with just an offline location. And things move quickly. As we’ve seen with COVID-19, the market, and buying behavior as a result, can change without warning. CPG brands who have an ecommerce strategy in place are better positioned to come out of any sudden changes successfully. Having a trusted partner like VELOX makes that even easier for you to accomplish.
The biggest benefit to ecommerce, though, is how much it increases your revenue. That’s the bottom line for any brand, both in what you provide and how you market it: giving your customers what they want. A holistic, personal, empathetic, and omnichannel approach like the one VELOX can create for you is the best, most effective way to reach new customers, speed up the buyer journey, and maintain long-term success both online and offline.
Schedule your free strategy review with one of our ecommerce consultants.