By Garner Andrews, Senior VP Digital Experience, Epsilon

Partner Perspectives

Welcome to the second post in the series, “Trends driving CPG commerce growth.” As we found last week, when it comes to purchasing products, consumers expect convenience, personalization, accessibility, and next-level digital experiences. On top of that, they expect brands to not only know what they want, but speak with them directly in their preferred tone of voice. Customers want to have individual relationships with their preferred brands and are getting more and more demanding.

To meet these increased expectations, we discussed last week how Consumer Packaged Goods (CPG) brands can sell direct and collaborate with retailers.

To pick up where we left off, let’s now discuss the second trend behind how pioneering brands are meeting customers’ needs in order to drive CPG growth over the next several years. 

Trend 2: Exploit new models of selling depending on the market

Online marketplaces such as Amazon, eBay, and Alibaba continue to be key channels driving CPG growth in 2018 and beyond. As of 2017, more than 50% of all units on Amazon’s marketplace were sold by independent vendors. Consumers prefer online marketplaces where they can seamlessly shop multiple vendors, finding almost everything they want in one place. Plus, marketplaces offer convenient delivery options and high-end customer service, creating customer happiness and loyalty to the marketplace brand. So it’s no surprise that traditional retailers like Tesco, Marks & Spencer, Walmart, and Target want to expand their long-tail product range to become marketplaces. CPG brands that offer their own subscription services like Amazon does could potentially form a closer relationship with their customers, building a lifelong relationship, with the potential to upsell more premium products. 

Understand the regional customer journey

With these new selling models, marketers need to have a global approach as strategies differ in emerging markets. For example, the Total Cost of Ownership (TCO) for launching a robust commerce platform may not make sense in emerging markets where digital marketplaces dominate. Plus, customer buying varies from country to country. For example, some cultures often buy in large quantities, while others like to gather opinions and browse with friends and family before purchasing. Marketers need to first understand the customer buying journey based on locale, then tailor a brand or system for a particular country or region.

Five considerations for selling in local markets

We see five different principles that should be addressed in any globalization strategy when entering those markets from a selling perspective:

  1. Market selection: Select pilot countries for migration based on commerce requirements, geography, digital readiness, legal and regulatory complexity, economic relevance, and customer relevance.
  2. Localization: Consider presentation design, local content, local commerce, workflow processes, information architecture, legal / regulatory implications, and language translation.
  3. Internationalization: Consider application functionality, content types, meta-data strategy,
    infrastructure, application architecture, brand, and enterprise content.
  4. Cost / benefit analysis: Evaluate costs and benefits for implementation, maintenance, training, skills readiness, and business process changes.
  5. Commerce requirements: Identify requirements for core commerce, merchandising, product information, order management, fulfillment, payment processing, customer service, and analytics.

There is no priority order in addressing these five principles; all need to be addressed equally. Otherwise, CPG brands will not be consistently addressing what their customers want. With careful implementation, a nuanced global commerce strategy can offer enormous potential for growth.

Stay tuned next week for our final post covering the third trend: Leverage digital innovations to create brand experiences, not just sell products.


Garner Andrews is Senior Vice-President, Digital Experience at Epsilon, a Sitecore Silver Solution Partner. Follow him on LinkedIn.