Mobile transforms shopping for staples, opening door for CPG brands
By Chantal Tode
March 9, 2016
Nespresso's connected coffeemaker comes with an app
After years of uninspired attempts by consumer packaged goods marketers to connect directly with online shoppers, several quickly escalating mobile trends promise to change consumer behavior and finally put this goal within reach.
From Nespressos connected coffeemaker and Campbells tie-in with Amazon Echo to retailers growing click-and-collect programs, there have never been so many convenient ways for consumers to order CPG items online. Hoping to address this opportunity, more of these marketers are developing internal first-party data capabilities and overhauling their customer relationship management programs.
While other industry verticals such as travel, retail and healthcare have had a more defined role for digital, it has not always been as clear for CPG brands given the need to connect shoppers from the online experience to offline purchasing activity, said Joe Grigsby, managing director of iCrossing
. That is rapidly changing as we go into 2016 with two major trends changing the landscape of CPG brands within digital.
The first is that we are now truly seeing consumers change their online shopping behavior to include CPG items, he said.
The second trend is the ability for mobile to drive consumers to and activate them at point of purchase in the physical world.
CPG brands have long eyed online shopping but, for the most part, consumers have not shown much interest in changing their shopping behavior for these commodity items. This is starting to change, with mobile a big driver, both in terms of its convenience and thanks to innovative new programs with mobile at the center.
Quick replenishment of frequently used CPG items is an area that is growing quickly, with a long list of brands now offering an Amazon Dash button, including Tide, Gatorade, Maxwell House, Olay and Wellness Natural Pet Food.
The concept is extending beyond Amazon Dash buttons to smart appliances.
Nespresso is offering a network-ready coffee maker that is controlled through a smartphone and which has built-in reordering capabilities.
Campbells has partnered with Amazon Echo to provide hands-free access to recipes based on users preferences and the weather.
This is extremely innovative and a strong example of where mobile can take CPG brands while integrating seamlessly into emerging consumer behaviors, Mr. Grigsby said. The fact that the consumer can automatically add items to their Amazon shopping cart makes the experience that much more useful to both the consumer and the brand.
Retailers such as Walmart, Target and others also continue to build out omnichannel capabilities, enabling shoppers to place an order online and pick it up at the store. Mobile is not only often the preferred method for placing these orders but is also at the center of how retailers are picking these orders and insuring they get into consumers hands quickly upon arrival.
Grocery delivery services are also growing while CPG marketers are making online purchasing a bigger focus of their digital presence, from advertising to Web sites.
Beyond online sales, there are also new opportunities to connect with shoppers in-store, either to activate a digital marketing program or follow through on an online purchase.
For example, the use of beacon technology continues to grow.
Beacon technology is also starting to be more widely adopted across the country, said Sam Cinquegrani, founder and CEO of ObjectWave Corp
. Electronic coupons and targeted promotions through the beacon will soon be a reality.
CPG companies will primarily participate in this technology via their retail distributors, creating offers and possibly content for what will be sent to consumers mobile devices via beaconing, he said.
Beyond beacons, there is a wealth of other emerging opportunities to connect in-store, including mobile shopper marketing programs, branded loyalty mobile applications and mobile payment solutions.
This is only now becoming a viable option for CPG brands at scale as the ecosystem around mobile platforms, retailers, application developers, payment providers and CPG brands has matured, iCrossings Mr. Grigsby said.
The app challenge
The biggest mobile challenge CPG marketers face in 2016 is applications.
Marketers need to look beyond developing apps to build their brand to find innovative ways to use mobile to serve their customers, something too few do today.
The more progressive CPG companies are cleaning house on their app strategy, killing what has been unattended to, and focusing on what has picked up a meaningful monthly active user base, said David Hewitt, vice president for consumer experiences and global mobile practice lead at SapientNitro
. As part of this strategy, they have started pulling app investments closer into their media planning conversations which makes for a less siloed approach and more dollars put towards the experience-driven marketing programs that can make a difference.
Going forward, CPG marketers need to look for inspiration from start-ups such as Dollar Shave Club for how to leverage mobile for more service-based experiences.
These marketers should also look to leverage social media beyond ad placements.
Instagram has proven to be a good value in the media market right now and CPG brands havent been too shy with experimenting on the platform, Mr. Hewitt said. Also, a handful of brands have started to experiment with more two-way conversations with customers with API friendly messaging platforms like Kik that let brands provide a more active persona or branded bot on the platform.