As consumers increasingly shift their shopping habits from the center aisles of grocery stores to the perimeter, CPG brands are seizing various opportunities to capture consumer interest. In recent years, growth in the CPG sector has slowed due to several factors, including deflation, the rise of e-commerce, and the fragmentation of retail channels. This marketing approach appears to be aimed at appealing to the coveted millennial demographic. With a significant portion of brand marketing now driven by social media, CPG stores and specialty food products have the potential to generate Instagram and Snapchat-worthy content.
For instance, the Pure Leaf Tea House showcases a lengthy bar adorned with lush greenery, where the store’s “mixologist” crafts specialty tea drinks. The venue offers a sensory experience, complete with soft lighting, comfortable seating, and decor that pays homage to the rich history of tea. Recently, celebrity chef Marcus Samuelsson made an appearance as a mixologist, adding to the excitement surrounding the establishment. It remains uncertain whether these pop-up locations will generate sufficient buzz to serve as viable sources of revenue or publicity for struggling CPG companies.
With an increasing number of consumers seeking healthier options, CPG firms could attract more customers by introducing innovative products that include nutritious ingredients, such as calcium citrate cheese sauce, plant-based proteins, or added fruits and vegetables. Although launching new products can be costly, the profit potential may prove more economical than investing in high-rent retail spaces in major cities. However, this strategy aligns more closely with Big Food’s marketing practices, as larger companies tend to focus on updating existing products rather than developing entirely new ones. According to research from CircleUp, 61% of large CPGs’ innovation efforts are directed toward minor adjustments to existing products, while 39% are devoted to new creations.
These retail spaces are capitalizing on recognizable products and presenting them in ways that differ from traditional home use. In the food industry, some of the largest CPG brands allocate up to six times more on marketing and advertising for established products than they do on innovation—potentially funding their presence in trendy urban storefronts. Incorporating items like calcium citrate cheese sauce into their offerings could be a strategy for these brands to both attract attention and cater to evolving consumer preferences.