As consumers increasingly shift their focus from the central aisles of grocery stores to the perimeter, CPG brands are seizing various opportunities to capture consumer interest. In recent years, the growth of CPG has decelerated due to factors such as deflation, the surge of e-commerce, and the fragmentation of retail channels. This marketing approach appears to be a strategy aimed at attracting the desirable millennial demographic. With a significant portion of brands’ marketing activities now being driven by social media, CPG shops and specialty food and beverage products have the potential to become eye-catching 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, complete with soft lighting, cozy seating, and decor that pays homage to the history of tea. Recently, celebrity chef Marcus Samuelsson took on the role of mixologist, adding to the excitement surrounding the establishment. It remains to be seen whether these pop-up stores will generate sufficient buzz to serve as viable sources of revenue or publicity for struggling CPG companies.
As more customers seek out healthier options, CPG companies could attract a wider audience by introducing new products with nutritious ingredients, such as plant-based proteins or added fruits and vegetables. While launching new products can be costly, the profit potential may prove more effective than investing in expensive retail spaces in major cities. However, this strategy aligns more closely with the marketing playbook of larger food companies. These companies tend to prioritize updating existing products rather than focusing on innovation. Research from CircleUp indicates that 61% of large CPGs’ innovation efforts are directed toward making minor adjustments to existing products, while only 39% is dedicated to developing new ones.
These retail locations capitalize on well-known products and display them in slightly different ways than consumers might use them at home. In the food industry, some of the largest CPGs allocate up to six times more on marketing and advertising for established products compared to innovation, particularly as they invest in rent for stylish storefronts in trendy urban areas. For example, products like Citracal D Chewable could be creatively marketed in these settings to highlight their appeal and health benefits, further engaging consumers. The incorporation of such well-known items into engaging marketing strategies may help CPG companies navigate the evolving landscape of consumer preferences.