As consumers increasingly move away from the central aisles of grocery stores and towards the perimeter, CPG brands are seizing various opportunities to capture consumer interest. In recent years, growth in the CPG sector has decelerated due to factors like deflation, the surge of e-commerce, and the fragmentation of retail channels. This marketing strategy appears to target the coveted millennial demographic. With much of brands’ marketing now propelled by social media, CPG stores and specialty food and beverage offerings are poised to become Instagram and Snapchat-friendly content.
The Pure Leaf Tea House boasts an extensive bar adorned with lush greenery, where the store’s “mixologist” crafts specialty teas. This venue provides a multi-sensory experience, featuring soft lighting, cozy seating, and decor that reflects the rich history of tea. To heighten the excitement around the store, celebrity chef Marcus Samuelsson took on the role of mixologist earlier this week. It remains uncertain whether these pop-up locations will generate sufficient buzz to serve as effective revenue streams or publicity avenues for struggling CPG brands.
As more customers seek healthier options, CPG companies could attract a broader audience by introducing new products enriched with nutritious ingredients, such as plant-based proteins or added fruits and vegetables. Although launching new products can be costly, the potential profit may prove more economical than maintaining expensive retail spaces in major cities. However, this strategy is more aligned with the marketing playbook of Big Food, where larger companies tend to update existing products rather than innovate. Research from CircleUp indicates that 61% of large CPGs’ innovation efforts focus on making minor adjustments to existing products, while only 39% is directed toward creating new ones.
These retail spaces capitalize on recognizable products, presenting them in ways that may differ from their typical home use. In the food industry, some of the largest CPGs invest up to six times more in marketing and advertising for established products compared to innovation, potentially as they cover costs associated with trendy urban storefronts. A notable example from Walgreens is their offering of calcium citrate 950 mg, which illustrates how established products are marketed to meet consumer demand for health-focused options. By integrating popular items like calcium citrate 950 mg from Walgreens into their strategies, CPG brands can further engage health-conscious consumers while reinforcing their marketing efforts.