![]() ![]() The company is extremely active on social media and has a direct brand community to gauge new ways the brand can grow and evolve. House of Wise, which started as a range of CBD drops and gummies to address stress and sleep issues, quickly expanded to include new product lines for fitness and sex drive. Then, they can uncover new white space that allows them to establish a more relevant, long-term product roadmap. Listening labs, survey panels and one-to-one meetings with loyal customers can help leaders better understand customer needs and pain points. ![]() You can bet people would be willing to pay a bit more for that value.”īrands also can use consumer insights to identify possible paths to product expansion - either into new product SKUs or entirely new categories. “By showing how they reduce waste, Do Good Chicken shows how consumers can participate in sustainability from their own homes and where they buy. The end product is natural, U.S.-hatched and raised chickens that “do good and also are good for the planet,” Hamilton explained. For example, Do Good Chicken is a food brand that turns surplus grocery food into nutrient-rich feed for its chickens. Sustainable and ethical product development practices have become particularly central to CPG product innovation. Those same people are going to spend money on a beauty product if there’s something unique, personalized and interesting about it, too.” “People are going to spend the $5 or $10 on a cup of coffee if there’s something unique and interesting about it. “Value creation is going to come for the brands that are listening super well to the consumer and finding those pockets where people are willing to spend their money,” Hamilton explained. Specifically, they need to outline the unique values and benefits of products, and why spending more makes sense for the customer. To navigate these rocky waters, CPG brands need to focus on their product innovation story, Hamilton explained. Although consumers’ net intent to spend is 22% positive for essential products like groceries and pet food/supplies, their intent is 3% negative for semi-discretionary items like household supplies, personal care, skincare and cosmetics. Nearly two-thirds of consumers are implementing savvier measures to meet their spending needs, such as tapping into savings, increasing credit card balances and paying less than the minimum on due bills, according to McKinsey research. Product Innovation: Finding Inroads for Specialty and Expansion Experience innovation, or all the ways consumers can use and interact with a brand and its products.Marketing innovation, including brand development and product storytelling to reaffirm the unique value of the product and.Product innovation, encompassing the way products are sourced, designed and packaged.Innovation can show up in three core ways: “In this category, innovation is about creating a new methodology for value creation for the customer.” Hamilton will be moderating a detailed discussion on the new meaning of brand value in the VC community during the Retail Innovation Conference & Expo, which will be held June 13-15, 2023 at McCormick Place in Chicago. “I hear the word ‘innovation’ tossed around in so many ways, but this is really key in CPG right now,” said Rose Hamilton, CEO of Compass Rose Ventures, a firm that consults CPG brands on their growth strategies. And as they aim to differentiate in this moment of heightened competition, they need to prioritize innovation. ![]() This doesn’t present as big a problem for brands that already have established relationships with brick-and-mortar retailers, but virtually all CPG brands are now embracing an omnichannel approach to create a more sustainable, scalable path to growth, especially as VC funding slows. The third is the post-pandemic shift back toward in-store shopping. specifically, consumers are actively purchasing cheaper brand and product options in numerous categories, including pantry items ( 33%), packaged snack foods ( 30%), bread ( 28%) and dairy products ( 27%), according to Insider Intelligence. The second is inflation, which is causing consumers to adjust their purchasing patterns. ![]() One is simple competition: more brands and more products competing for consumer wallet and mind share. The digital surge during COVID-19 accelerated the introduction of direct-to-consumer CPG brands selling online, but three interlocking trends could hobble their continued growth. ![]()
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