Consumer goods industry trends: How companies are driving product sales via big data
The consumer packaged goods (CPG) industry has long relied on a mix of internal data, like merchandise shipments, and external data, like point-of-sale retail figures and consumer demographics, to track industry trends. However, the streams of new, unstructured data generated by shoppers' digital footprints, customer reviews and social media mentions are redefining the way brands stay aware of consumer goods industry trends.
A new marketing approach
Many CPG marketing teams have stopped relying solely on traditional marketing tactics. Instead, they're supplementing old-school methods with real-time data to develop distinct, personalized campaigns. For example, CPG giant Unilever eschewed marketing to specific age groups and income levels when promoting its new hair-care line, instead leveraging data on hair type and needs.
Working off this information, the company partnered with several popular British video bloggers to launch its All Things Hair YouTube channel. The brand hired the bloggers to create short videos based on real-time Google search data in an effort to ensure relevant content. Unilever's efforts appear to have paid off. The channel was viewed over 13 million times in its first year, and Unilever has expanded the initiative to Canada and the U.S.
Consumer goods companies are quickly realizing the harsh realities of marketing in the digital era: The power and reach of TV and print advertising is waning.
In a bid to beef up its branding efforts and better address consumer goods industry trends, Kraft Foods split its business into two segments in 2012. Today, the Kraft Foods Group, its North American grocery spinoff, includes brands such as Maxwell House coffee and Philadelphia Cream Cheese. Recognizing the diminishing value of traditional advertising in the digital era, Kraft saw an opportunity to grow market share among millennial, Hispanic, tech-savvy and health-conscious consumers by appealing to their changing habits via big data and digital marketing, according to CPG Matters.
To whip up sales of its iconic cream cheese brand, for example, Kraft turned to its big data platform to garner new insights on these different customer segments. Linking that insight to purchase data, the company was "able to define and locate where those consumers were. Understanding what motivated them between sweet and savory, we served up messages that were appropriate to the target in the right medium at the right moment," Deanie Elsner, Kraft's executive vice president and chief marketing officer, told CPG Matters. And the brand revival plan worked: These data-driven marketing efforts reaped "tremendous" results, according to Elsner.
Tapping customer analytics
Customer experience has become an increasingly important part of the CPG industry, and many companies are tapping into analytics to figure out their customers' likes, dislikes, wants and needs. For instance, L'Oréal Paris has been measuring and evaluating its customers' experiences when using the brand website. According to ForeSee, the beauty firm wanted to suss out areas of its site that needed improvement and assign priority to changes based on their importance to the total visitor experience. Data analysis revealed that the site wasn't meeting customers' needs in several areas.
"We learned that our website, while strong at highlighting our key products and new launches, wasn't necessarily connecting us with the consumer at a deeper level and driving engagement," Annamarie Bermundo, assistant vice president of digital and CRM platforms for L'Oréal Paris, told ForeSee. "Even though we had a strong suite of consultation tools across hair color, skin care and cosmetics, they were hard to find."
Based on this insight, L'Oréal determined that changing site navigation, product browsing and search functionality would generate the biggest impact on site visitor satisfaction. So it revamped these areas accordingly. The result? L'Oreal saw a 20 percent jump in both customer satisfaction and time spent on site, as well a 75 percent surge in opt-in registration.
It goes to show that to keep up with the latest industry shifts, many CPG brands are turning to big data analytics to stay ahead of the game.
Learn more about how analytics can sharpen your overall marketing strategy with real-time data. Visit IBM's consumer products industry solutions page.