News: Press Clippings

How Middle-Market And Emerging Manufacturers Can Take Advantage Of Digital

Ryan Schulke, Fluent CEO, for MediaPost

Middle-market CPG manufacturers and emerging brands represent a large and growing portion of consumer dollars spent on grocery – tens of billions in the U.S. alone. While the majority of actual purchase activity still takes place at brick-and-mortar retail locations, digital marketing represents an important new area of investment for middle-market manufacturers and emerging brands.

A winning digital strategy can bring them a competitive advantage. Of course, this is easier said than done – middle-market manufacturers may have gross annual revenues from $100 million up to $1 billion, and house anywhere from a handful of brands to dozens of them, but they operate at low margins and have never been quick to jump on emerging trends. Digital (both web and mobile) is certainly not a trend, however. Instead, it represents an important area of investment for all marketers.

So how can these key middle-market manufacturers and emerging brands make their digital dollars count?

Sometimes nothing is better than something. The prototypical CPG approach to digital marketing has been to appoint the youngest person in the room as the “digital guy or gal.” They get a Facebook page, Twitter feed or whatever the flavor of the day may be, and the majority of additional digital spend goes toward promotional efforts by retailers or online vehicles like Coupons.com.

Such bare-bones efforts are sensible, but hardly create opportunities to generate high-impact ROI. In fact, taking half-steps without executing against a more holistic strategy probably results in a waste of marketing dollars and internal resources that could be put to better use.

The digital ecosystem has greatly matured over the past five years, and competition for consumer eyeballs has never been fiercer. Larger CPG titans and other marketers have grown savvy in executing digital programs efficiently, thus increasing the cost of entry for everybody. So middle-market manufacturers and emerging brands must develop a deeper understanding of what the digital marketplace has to offer. This includes not only new vendors and services across search, social, display, email and mobile, but also specific technology products and niche opportunities within market segments or with individual publishers.

Digital plans done resourcefully will result in high value. With so many dollars being invested into digital, free tests and discount pricing are commonplace. The investment by middle-market manufacturers and emerging brands must go towards developing programs that seek to achieve specific goals — and they must commit the resources to test a variety of executions to achieve those goals.  

Middle-market manufacturers and brands should learn from what the leading CPG marketers are doing. Top dogs like P&G, ConAgra, Kellogg & SC Johnson have already begun paving paths that show underlying commonalities. They have placed a heavy emphasis upon content by building out consumer-facing portals with rich and targeted material, along with special savings opportunities.

While mid-market manufacturers may not have the same amount of dollars to invest, there has never been a better time for them to regain equity with their customers. In the past, retailers have been in complete control of how much consumer information is released. It was nearly impossible to discover the buying habits of specific customers without paying a premium. Today, mid-market manufacturers can learn this information for themselves, at a fraction of the cost. That knowledge will let them better engage a larger audience by building customized content around their entire brand portfolios.

From that, they can utilize the new wave in digital — targeted messaging and personalization — to build an advantageous communications strategy based on each consumer’s own needs.

Manufacturers should repurpose more in-store promotional dollars to digital promotions. This will allow them to take back control of the consumer relationship – whose costs, methods and locations have long been dictated by retailers.

Quality content is a must, but it is vehicles like sweepstakes, free product trials and high-value discounts on desirable brands that allow manufacturers to engage consumers — and to build communities that increase brand loyalty and in turn enable more efficient marketing.

For that to happen, an intelligent database acquisition and dynamic marketing strategy is a must. To compete in the new digital world, middle-market manufacturers need to segment against specific consumer profiles in order to create long-term value across their brand portfolios.

Such strategies will prove the key to success in the new digital world — a world in which all sales, whether online or at brick-and-mortar locations, will increasingly be determined by digital marketing.

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