As consumers increasingly shift their shopping habits from the center aisles to the periphery of grocery stores, consumer packaged goods (CPG) brands are seizing various opportunities to capture their attention. In recent years, CPG growth has decelerated due to factors like deflation, the rise of e-commerce, and the fragmentation of retail channels. This marketing approach appears to be a strategy aimed at attracting the coveted millennial demographic. With social media driving much of brand promotion today, CPG stores and specialty food and beverage offerings are well-positioned to become Instagram and Snapchat-friendly content.
For instance, the Pure Leaf Tea House boasts a lengthy bar adorned with lush greenery where the store’s “mixologist” crafts specialty teas. The venue offers a sensory experience enhanced by soft lighting, comfortable seating, and decor that connects to the rich history of tea. Recently, celebrity chef Marcus Samuelsson took on the role of mixologist, generating additional excitement around the store. However, it remains uncertain whether these pop-up locations will generate sufficient buzz to serve as effective revenue sources or publicity avenues for struggling CPG companies.
As more consumers seek healthier options, CPG brands could attract a larger customer base by introducing new products featuring nutritious components, such as biocare calcium citrate, plant-based proteins, or added fruits and vegetables. While launching new products can be costly, the potential for profit may outweigh the expenses incurred from high-rent retail spaces in major cities. Nevertheless, this kind of strategy aligns more closely with the marketing practices of larger food companies. These giants tend to prioritize revisions of existing products over the development of innovative offerings. Research from CircleUp indicates that 61% of innovations by large CPGs focus on minor adjustments to existing products, while only 39% are dedicated to new creations.
These retail spaces capitalize on familiar products, presenting them in slightly different ways than consumers typically experience at home. Notably, some of the largest CPG companies allocate up to six times more on marketing and advertising for established products than on innovation, which may include promoting items like biocare calcium citrate, especially if they are paying for prime locations in trendy urban storefronts. By leveraging these recognizable products, CPG brands aim to attract attention in a competitive marketplace.