**London**: The consumer packaged goods landscape is evolving as brands embrace total commerce strategies driven by e-commerce growth and shifting consumer preferences. Industry experts highlight the need for seamless engagement and advanced technology to navigate operational challenges and enhance customer experiences in an increasingly digital marketplace.
The evolving landscape of consumer packaged goods (CPG) has witnessed significant shifts in how food and drink brands engage with customers, spurred largely by advancements in e-commerce and changing consumer behaviours. Amie Owen from KINESSO, part of IPG Mediabrands, highlights this transformation, asserting that a total commerce approach has become essential for these companies.
Historically, consumers would procure their groceries by visiting physical stores, where brands focused on ensuring their products reached retailers. This model experiences a fundamental shift with the ease of last-mile delivery services, which have gained traction among shoppers. In the United States alone, approximately 138 million consumers are now leveraging online grocery services, indicative of a growing preference for convenience in an increasingly busy world.
In a conversation with The Drum, Jamie Needham, e-commerce and shopper marketing lead for General Mills, elaborated on the necessity of embracing total commerce. “Some of the challenges we now face simply didn’t exist a few years ago,” Needham remarked, emphasizing the need for brands to create seamless consumer experiences, a domain traditionally managed by retailers in physical settings. He underscored the urgency for brands to grasp the complexities of the evolving commerce environment to secure competitive advantages.
CPG brands’ responsibilities now extend beyond traditional metrics, necessitating engagement across a range of retail media networks (RMNs) and utilisation of first-party retail data to enhance brand awareness and develop a pipeline of potential customers. Moreover, brands must curate and maintain comprehensive product listings while also navigating the logistical complications posed by last-mile delivery services, such as Instacart.
As digital grocery sales are projected to account for 19% of total US e-commerce sales by 2026—making it the largest sector within the e-commerce industry—food and drink brands face mounting pressure to find effective solutions to challenges that could impact profit margins. General Mills has actively engaged in exploring the commerce landscape, recognising that triggers for sales extend beyond retail media to encompass broader retail ecosystems, which necessitates a deeper understanding of consumer engagement.
The management of a myriad of commerce tasks presents considerable financial and operational challenges. The acquisition of retail data can be costly, and seamlessly driving a brand’s media messaging from broader initiatives down to point-of-purchase formats involves complex logistical coordination.
Brands frequently lack the resources to meet these demands manually, yet advancements in technology are bridging this gap. According to Owen, developments in artificial intelligence (AI) are significantly enhancing capabilities across media buying, data collection, and creative content production, thereby enabling brands to effectively engage consumers across diverse touchpoints.
In response to this evolving marketplace, brands are seeking more streamlined methods for media purchasing, aimed at dismantling the so-called “walled gardens” maintained by retailers. Tools for planning and optimisation are essential for helping brands redistribute their advertising budgets to optimise key performance indicators (KPIs).
Innovative data platforms, such as Interpublic’s Intelligence Node, are supplying various intelligence solutions that aid brands in optimising pricing, content, and search visibility. Additionally, generative AI is facilitating scalable content optimisation for brand stores and product pages, enhancing the overall customer experience from initial awareness to final purchase.
Recent collaborations in consumer technology, including a partnership between Samsung and Instacart, are set to augment grocery shopping convenience, allowing consumers to shop directly via their refrigerator screens. Such developments hint at a future where devices might offer smart recommendations based on available items, such as suggesting cereal when milk is present.
Ultimately, the objective is to integrate disparate AI tools into cohesive systems that enhance connections between CPG brands and consumers, whether the interaction occurs through smart devices, targeted advertisements on connected television, or traditional in-store experiences. General Mills is positioned to navigate this dynamic landscape, as Needham stated, “If we have the right AI to help us fine-tune some of these areas of commerce, we’ll be able to sell more.”
At its essence, the shift towards total commerce involves utilising data and technology to forge meaningful connections with consumers throughout their purchasing journeys, reflecting the new operational paradigms within the food and drink sector.
Source: Noah Wire Services
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