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Competing in FMCG against the duopoly, rapidly becoming the ‘Triopoly’ as Aldi makes share inroads is not easy, never was. However, the optimist in me sees opportunities that few are leveraging, so set in ‘process concrete’ is the status quo.<\/p>\n
The driver of the great change can be summed up in one word:<\/p>\n
Digital.<\/p>\n
It is the enabler of all the changes that are occurring before our eyes if we choose to see them, and the change has just started. Following is a list of the things I see evolving<\/p>\n
Two way conversations with consumers<\/b>.<\/p>\n
Brands can now have a direct and two way dialogue with consumers. Digital technology is the enabler of a personalised dialogue across a variety of platforms and subjects. This new found ability has the promise of breaking the iron grip the retailers have over packaged goods sales. The flip side is that there are so many people and brands competing for the limited attention of consumers that it is increasingly hard to break through, and we marketers are kidding ourselves if we believe that consumers are as engaged, indeed, passionate about our brands as we are. The reality is FMCG brands are more a comfortable habit that removes another decision from our lives than something that consumers are waiting to hear from. Pewdiepie<\/a> has well over 43.3 million<\/a> Youtube subscribers, the largest number, and few over 35 have heard of them, a couple of blokes who make cheap satirical videos of gaming. Coca Cola, one of the leviathan of branded packaged goods, spends hundreds of $millions around the world on\u00a0 digital content creation and distribution, has been one of the biggest brand advertisers for the last 50 years, and currently has (as of today April 15 2016) has 759,411 subscribers<\/a>. If Coke cannot do it, why should you think you can? Are you the new Pewdiepie?<\/p>\n Engagement and awareness is earned. <\/b><\/p>\n In the ‘old days’ awareness was paid for by media advertising, the bloke with the fattest wallet won. Those days are well and truly over. As noted, Coke spends a fortune, but the level of engagement is not in the ballpark of someone who earns it by being relevant and interesting to a niche market, albeit now\u00a0 being a niche that is more like a crevasse.<\/p>\n Availability of behavioural data.<\/b><\/p>\n Scan data<\/a> that all grocery retailers now collect offers a huge depth and variety of data related to purchasing behaviour. Time of day, makeup of the basket, price sensitivity and elasticity,\u00a0 competitive impacts, and much more. When combined with the loyalty card data giving demographic and individual behavioural data, this is a deep and rich marketing resource. Increasingly this data will be combined with so called ‘big data’ scraped’ from social platforms, and real time geo location<\/a> data, we will be deluged with offers exquisitely tailored to us.<\/p>\n Consumer feedback feeds NPD & C. <\/b><\/p>\n Market research has always been a vital component of product development and commercialisation, irrespective if the development is an evolution of a pack design or a category creating innovation. The research was flimsy at best, and the investments needed to bring new products to market where the failure rate has always been closer to 99% than 90%, significant. That also has changed. We are now able to test new products<\/a> in newly available digital channels and collect data almost in real time, using it to inform ongoing development.<\/p>\n Point of sale. <\/b><\/p>\n Point of sale has always been important. I am old enough to remember excitement around a sales meeting induced by a fancy new shelf wobbler! The opportunities at POS for things as diverse as MVS code<\/a> driven interaction, interactive video, as well as the more usual promotional stunts are considerable.<\/p>\n Be a publisher. <\/strong><\/p>\n The supermarket business\u00a0 model is under considerable stress,\u00a0 and the number of suppliers has become way smaller, and they seem to be starting to realise you cannot buy a brand, you have to earn it.\u00a0In the old days, if you\u00a0 had enough money, you could almost buy a brand, as there were just a few TV & radio stations, and a few newspapers and magazines, all owned by a few people.\u00a0Nobody else had the means to communicate beyond one to one.<\/p>\n Then along came the big bad internet and blew it all away.\u00a0Now anyone can publish<\/a>, and if they are good enough, reach and interact with their consumers.<\/p>\n Focus on your strategy, not theirs.<\/b><\/p>\n If your strategy centres on building a brand, do not waste your time and resources working with a retailer that does not have proprietary branding as part of their strategy. A former client took on a contract to pack for Aldi. The margin was very slim, but the volumes significant , so the contract appeared to be a good way of covering overheads to enable brand building activity elsewhere. As it evolved, the management and operational demands of meeting the Aldi orders overwhelmed the operational capacity of my client, consuming all their resources, and preventing any of the proprietary development it was supposed to enable. This comment applies equally to the two gorillas<\/a> as it does to Aldi. Allowing your strategic implementation to be driven by the volume power of a single or even small number of customers will have a sticky end.<\/p>\n