You don’t have to look far to see the new trends in the CPG and grocery sectors: from meal-kit delivery services to e-commerce grocery shopping, online ordering and pickup to high-tech advances that are hitting at a near-constant rate. Marketing to shoppers is becoming a full-contact sport, where the brand who has the best understanding of their audience and habits has a strong lead on the competition. Online grocery still only makes up approximately 2 – 4% of total grocery sales in the U.S., but that is no reason for brand marketers to rest on their laurels, comfortable that what they have been doing for years will continue to resonate. The 2025 horizon looks radically different than the current landscape, with leader Amazon set to scoop up a significant portion of the $100 billion growth market according to Forbes.
The tectonic shifts happening in these key industries present tremendous opportunities to the smart CPG and grocery marketer. Now is the time to enhance your technology infrastructure and build strategic partnerships to prepare for the future. While it may seem that large grocery or retail stores are far ahead of the curve, there is still plenty of room available for nimble organizations to gain market share away from the leaders. Online purchasing and pickup or delivery in the grocery sector are expected to skyrocket as there is still a relatively low adoption rate, with only 9% of individuals shopping online on a regular basis.
Understanding Your Shoppers
Are your shoppers more likely to swing by the store to pick up an order placed online on a weekly basis, or do they prefer to stop by several times a week to browse fresh produce for their evening meal? A deep understanding of your audience is the first step towards tailoring a marketing strategy that meets their unique requirements. Optimizing your online presence or creating a mobile app is no longer enough — they have a higher expectation of technology working well with in-store merchandising and messaging to create a true omnichannel shopping experience. The shopping list of Americans continues to evolve, with more buyers graduating from buying drinks and coffee online to ordering fresh fruits and vegetables.
Creating a connection between your shoppers and your brand is more successful when you understand where and how buyers have purchased in the past. Take Kroger or Target, for instance. The printed coupons delivered by Kroger, in particular, are highly targeted to your buying habits and are often timed to coincide with when you might need to restock. Kroger’s recent purchase of private meal kit company Home Chef for a whopping $200 million is a strong indicator that they are shifting to meet the changing needs.
Build in Convenience
Today, people expect the ultimate in convenience: cars that will parallel park themselves, phones that look up phone numbers and dial them for you with only a few words, and a seamless shopping experience. Any small point of difficulty and you risk losing a percentage of your sales due to frustration that leads to abandoning a purchase. When your digital advertising and coupons link directly to a purchasing page, you’re eliminating these friction points for your visitors and creating a pleasant and proactive online shopping experience. Grocery shoppers appreciate websites and mobile apps that remember their favorites, help build shopping lists from previous purchases, give you hints about what is currently on sale and offer easy online ordering and convenient pick-up options. Leveraging mobile shopping apps helps you get in front of their needs and predict the next steps.
Capitalize on Intent
With all the distractions happening in our world, it’s not surprising that abandoned carts are on the rise. This is one of the reasons that retargeting ads are so incredibly popular with both advertisers and their audiences. Shoppers love that they have an opportunity to grab that item that they were distracted from purchasing earlier, and brands find that these ads perform exceptionally well. Cross-selling and upselling opportunities abound with digital shopping carts, as there are no physical limitations to the number of items that can be displayed together. Individuals in the younger generations are more apt to purchase groceries online, with 12% of buyers from 30-49 and 15% of adults aged 18-29 according to Gallup, email is the ideal way to follow up and help move the intent along to a purchasing decision. Sending proactive recommendations that it’s time for a reorder allows them to quickly and conveniently place their order.
Be Open with Shoppers
It is critical that your brand is open and transparent. Provide compelling stories about your products that will echo shopper expectations or ideals. Engage by making your brand more accessible and show where your shopping experience supports their needs. When users have an opportunity to add to your storyline, your brand messaging becomes a more personal appeal. Simply providing an open venue for conversation around the brand can have a positive effect on your sales as your brand appears more authentic and welcoming of the community. Better still, prospects who are new to your brand will be drawn in by seeing the genuine interest that your organization has for them.
Yes, Amazon and Walmart have an exceptional share of this growing market. But, regardless of how broad their current reach, the industry is still essentially in its infancy in terms of growth. There are opportunities available for the right CPG and grocery brands to leverage their knowledge of shoppers and create a seamless and engaging digital experience that reaches into the stores.