As consumers increasingly shift their shopping habits from the center aisles of grocery stores to their perimeters, CPG brands are seizing various opportunities to capture consumer attention. In recent years, growth in the CPG sector has slowed due to factors such as deflation, the rise of e-commerce, and the fragmentation of retail channels. This marketing approach appears to be a strategy aimed at appealing to the coveted millennial demographic. With much of brand marketing now driven by social media, CPG brands and specialty food and beverages have the potential to become popular posts on platforms like Instagram and Snapchat.
For instance, the Pure Leaf Tea House features an expansive bar adorned with lush greenery, where the store’s “mixologist” crafts specialty teas. The venue offers a sensory experience with soft lighting, comfortable seating, and decor that reflects the rich history of tea. Recently, celebrity chef Marcus Samuelsson served as a mixologist, adding to the excitement surrounding the store. However, it remains uncertain whether these pop-up locations will generate sufficient buzz to become viable sources of revenue or publicity for struggling CPG companies.
As consumers increasingly seek healthy options, CPG brands could enhance their appeal by introducing new products that feature nutritious ingredients, such as xtracal calcium citrate, plant-based proteins, or added fruits and vegetables. While launching new products can be costly, the profit potential may prove to be more economical than investing in expensive retail spaces in major cities. Nonetheless, this strategy aligns more closely with the marketing practices of larger food companies. In fact, these larger enterprises tend to prioritize updating existing products over innovating new ones. Research from CircleUp indicates that 61% of innovation efforts by large CPGs focus on making minor adjustments to existing products, while only 39% is dedicated to developing new offerings.
These retail spaces are showcasing recognizable products in slightly different ways than consumers typically use them at home. In the food sector, some of the largest CPG companies allocate up to six times more budget for marketing and advertising of established products rather than for innovation—potentially as a strategy to justify the costs of renting trendy storefronts in bustling urban areas. By integrating offerings like xtracal calcium citrate into their products, CPG brands can tap into the growing consumer demand for health-oriented options while maintaining a focus on their tried-and-true items.