With Black Friday only four weeks away, most online retailers already have their holiday strategies in place, aiming to pull as many e-commerce dollars as possible between now and the end of the year. And while most online shopping this season will center around gift items like toys, electronics and clothes, CPG brands will also be vying for their own slice of the holiday e-commerce pie.
Consumer packaged goods (CPG) — products you would normally pick up at the grocery store — are not the first thing consumers consider when making out their list of online purchases for the holidays, but online buying trends for CPG markets are changing.
As more stores offer “click and collect” options (buy online and pick up in-store), and more CPG brands open up to selling on Amazon, consumers are adding more CPG products to online holiday shopping lists.
According to 1010data’s “Online CPG Industry Report,” released back in March, online CPG sales grew 36 percent between 2015 and 2016, reaching $10.4 billion.
The report found that the top three CPG categories — health supplements, pet care and cosmetics — each generated more than $1 billion in sales during 2016, and that CPG sales grew twice as fast as total e-commerce sales for the year.
“So many of the consumers are moving online to purchase CPG products, but they don’t shop the same way that they shop in the stores,” says Jennifer Silverberg, CEO of SmartCommerce.
In 2013, Silverberg was CMO for Channel Intelligence when Google acquired the company and used its technology to help power Google’s Shopping Ads. Silverberg says she and her colleagues realized that the same kind of technology behind Channel Intelligence’s platform could be applied to new online opportunities for CPG brands.
The result was SmartCommerce, an e-commerce platform designed to deliver more conversions for CPG brands.
As CEO of SmartCommerce, Silverberg says her team wanted to take the same impulse-buying experience a shopper may have in-store and move it online.
“We want to make it easy for consumers to get a product into a cart. We don’t want to put four or five steps in between, and get them lost on the way,” says Silverberg, “And probably, during the holidays, it’s easier to get lost on the way to purchase than any other time of year.”
Silverberg says one of the things they’ve learned about the CPG market is that it is a very impulse-driven category. Her company is a response to the CPG brands wanting to recreate that impulse buy in a digital environment.
Working specifically with CPG brands, Silverberg says the traditional packaged goods space is the first to make the e-commerce jump within the CPG categories because that’s what consumers are buying more of online.
“The pure impulse buys — the chips, the candy, the stuff that doesn’t make it onto a typical grocery list, or the things that must depend on somebody seeing them in the store, and saying oh yeah, I meant to get that — they’re the ones that are the most eager to figure out how to drive online sales,” says Silverberg.
According to the CEO, brands are using SmartCommerce to enable consumers to buy online the way they buy things in the store — on impulse.
“If you make me want something online, why on earth would you do that and not give me an easy path to be able to act on it?” asks Silverberg.
The CEO says clients are finding unique ways to use SmartCommerce technology this holiday season.
One brand has designed a “virtual bundle” of items on Pinterest for a candy-craft project — making it possible to cart the jar, the ribbons to decorate the jar and the candy that goes into the jar, all in one click.
Another unique use of the technology is three different brands coming together for one promotion, allowing online shoppers to cart all the ingredients needed to make green bean casserole.
“Del Monte Foods has partnered with Campbell’s Soup and French’s (which is now McCormick) — so three completely separate manufacturers working together at Christmas time,” says Silverberg.
In the store, the promotion would be a cardboard kiosk a shopper may see in the canned vegetable or soup aisle, with all three branded products displayed together. SmartCommerce has helped turn that experience into a virtual shopping experience, allowing consumers to cart all the ingredients together at once.
“They’re getting creative,” says the CEO, speaking to how brands are using SmartCommerce, “It’s been fun to watch.”
In the release announcing 101data’s industry report, the company’s senior vice president of marketing, Jed Alpert, emphasized how e-commerce is no longer an afterthought for CPG brands.
“All CPG brands need to understand how consumers are shopping in their categories and consider how e-commerce can help deliver a better experience and complement in-store sales,” said Alpert.
With industry experts forecasting new record numbers this holiday season, e-commerce technology platforms like SmartCommerce — combined with CPG brands being more strategic online — will only add to this year’s holiday e-commerce push.