Brand Expectations: Grocery and CPG Trends
Retail and consumer products experts from Riveron recently explored the 2021 Groceryshop conference, a four-day event centered on trends in grocery and consumer packaged goods (CPG). Sessions examined changing consumer behaviors, emerging technologies, and the current complexities of the supply chain. Conference perspectives included marketing executives, product managers, research and development analysts, and e-commerce leaders, with speakers ranging from large corporations (such as Alberton’s, PepsiCo, and Unilever) to major interrelated platforms (such as DoorDash, Google, and TikTok) to smaller start-ups.
The conference was ripe with insights, and here are four notable themes:
1) An omnichannel presence is critical
“Always everywhere” prevailed as a common message. With changes in consumer behaviors and technology, brands can no longer rely on one sales or marketing channel but must have an omnichannel presence —appearing always everywhere—to the consumer. Consumers desire ease and convenience, and —with so much competition in the marketplace— brands must provide full access to their products and services through not just one channel, but all: direct-to-consumer, brick-and-mortar, online, mobile, social media, traditional print, etc. While an online focus may appeal to some, and a mobile or direct-to-consumer approach could seem sufficient, the role of brick-and-mortar stores will not fade any time soon, and it remains important for the buying habits of many consumers.
2) Sustainability and social impacts are growing factors in consumer buying decisions
Brand values and the social and environmental efforts of companies are becoming growing concerns for all consumers, not just Generation Z. Consumers across generations are showing more interest in the environmental impact of a company’s products and processes, and this trend appears here to stay. A study referenced at the conference found that nearly 70% of consumers will make a purchasing decision based on sustainability. In response, companies are finding creative ways to improve sustainability and make brands relevant to consumers. Methods range from using compostable packaging, eliminating plastics, using fuel-efficient delivery mechanisms, reducing greenhouse gas emissions via technology, optimizing logistics (including developing micro-fulfillment centers), and much more. While consumers can wield heavy influence and push companies to become more sustainable, additional legislation may also be necessary to continue this push toward a greener and cleaner environment, as has been done throughout many European countries.
3) The supply chain will remain an ongoing challenge
Within all industries, companies are struggling from supply chain issues, and grocery and CPG sectors face these same constraints. The industry has been struggling to obtain products, which creates many issues for retailers given there are so many channels a consumer can turn to if a product is not available at one retailer. Having inventory is critical, and giving customers a real-time inventory view into a store is something of value. Grocery, especially, can be viewed as having even more dependency on the supply chain when considering fresh produce. Not having streamlined logistics to obtain product on time can cause spoilage, and it can shorten the time periods in which product can be on the shelf and sold. Supply chain issues will likely linger for at least the next 18 months, and companies are looking for ways to mitigate disruption. One approach: decentralizing the supply chain. By adding incremental micro-fulfillment centers or partnering with companies to streamline logistics, companies can spread out their supply chain, creating fewer dependencies. Companies are also using technology and data to develop better just-in-time order processing methods to better predict the needs and demands of consumers and ultimately make ordering more efficient.
4) Companies must harness data and technology to stay competitive and relevant
Amid mountains of data through loyalty programs, past purchases, and more, few brands have effectively been able to unwind all this information. Understanding data and using it intelligently to better refine a consumer’s entire experience is critical. Consumers want their habits to be predicted. This means more than stocked shelves; retailers need to be thinking of consumers’ needs. In addition, consumers want a frictionless and speedy shopping experience, which makes technology advancements important. Streamlining a shopping experience through robotic automation in stores (to ensure shelves are stocked) or having in-store associates using hands-free visual technology (to optimize flow and locate shelf inventory) will all aide in an easier consumer experience.
Overall, the needs of the consumer are changing more than ever, and in a competitive, rapidly growing environment, brands and retailers must be able to quickly adapt to consumer’s needs. It is one thing to collect consumer data and realize how buying habits are evolving, but brands can realize their potential by acting on the data. In the future of retail, brands will need to be “always everywhere” by staying relevant and accessible to consumers, and companies can achieve this goal by providing innovation and ease while aligning to socially and sustainably conscious consumer values.