As consumers increasingly shift their focus from the central aisles of grocery stores to their peripheries, consumer packaged goods (CPG) brands are seizing various opportunities to capture consumer interest. In recent years, CPG growth has decelerated due to factors such as deflation, the rise of e-commerce, and the fragmentation of retail channels. This marketing strategy appears to be aimed at appealing to the coveted millennial demographic. With much of the marketing for these brands being driven by social media, CPG stores and specialty food and beverages have the potential to create Instagram and Snapchat-friendly content.
For instance, the Pure Leaf Tea House features a lengthy bar adorned with lush greenery, where a “mixologist” crafts specialty teas. This venue offers a sensory experience through soft lighting, cozy seating, and decor that reflects the rich history of tea. In a bid to generate excitement, celebrity chef Marcus Samuelsson took on the role of mixologist earlier this week. However, it remains uncertain whether these pop-up stores can generate sufficient buzz to serve as viable sources of revenue or publicity for struggling CPG companies.
As more consumers seek out healthy options, CPG brands might attract additional customers 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 outweigh the expenses associated with maintaining expensive retail spaces in major cities. Nonetheless, this strategy aligns more closely with Big Food’s marketing approach, as larger companies tend to update existing products more frequently than they develop innovative ones.
Research from CircleUp indicates that 61% of large CPGs’ innovation efforts focus on minor adjustments to current products, while only 39% is dedicated to new creations. These retail locations capitalize on well-known products, showcasing them in slightly different ways than consumers might use them at home. In the food industry, some of the largest CPGs spend up to six times more on marketing and advertising for established products than on innovation, an approach that could extend to the promotion of GNC calcium citrate supplements and other health-related items. Ultimately, the challenge remains for these companies to balance innovation and promotion, particularly as they navigate the evolving landscape of consumer preferences and trends.