Brands must make it easier for CPG online shoppers to buy through digital channels
Grocery shoppers are already using digital in myriad ways, from product research to purchasing groceries online for at-home delivery or in-store pickup. Meanwhile, brands have been building robust websites, as well as employing video and social media to market their products.
For shoppers, however, the divide between using digital to research products and actually buying them remains wide, according to a new eMarketer report, “CPG's Digital Conundrum: Turning Digital Shoppers into Digital Buyers.”
Nonetheless, the CPG category is poised for significant growth in online sales. According to October 2012 data from Nielsen, online CPG sales are expected to grow at a 25% compound annual rate from 2012 to 2015.
While CPG brands have invested millions of dollars in creating robust brand sites and digital marketing campaigns—all in the interest of engaging loyal buyers—pushing the buy button is not happening as frequently in the CPG category as others. One reason is that this button isn’t available in many cases, especially on brand sites, which are not prepared to deal with the issues of fulfillment and shipping.
Even when the option exists, the cost of shipping, premium prices and the wait for delivery can all disincentivize online shoppers. And these are not generation-specific issues. Better prices, free shipping and same-day service matter equally to millennials, Generation X and baby boomers, according to a February 2012 survey by Integrated Marketing Services.
To resolve these issues, brands are turning to retailers such as Ahold’s Peapod, which offers a click-and-collect service, as well as third-party fulfillment services such as Quidsi’s Soap.com and Diapers.com.
As CPG brands work with etailers to convert more shoppers into buyers, the relationship between these companies is becoming critically important.
Sharing shopper insights, offering cross-merchandising opportunities and giving consumers auto-replenishment and shopping list applications on their sites are ways etailers can help brands increase sales, according to a Q2 2012 survey of manufacturers conducted by etailing solutions.
Among etailers, etailing solutions found that 100% believed new product launches and exclusive product offerings would entice shoppers. Nearly three-quarters (71%) suggested exclusive web-only offerings. And more than two-thirds (67%) of etailers noted that stronger shopper insights from manufacturers and better display and description of products would be welcome.
The full report, “CPG's Digital Conundrum: Turning Digital Shoppers into Digital Buyers” also answers these key questions:
- What is the clickable path to purchase for CPG? How can brands create opportunities for shoppers to begin and end their journey online?
- Do brands need to participate directly in ecommerce, or is this better left to retailers?
- What are the benefits for brands that do take control of their own ecommerce?
- What digital strategies are helping brands move the buy button closer to where the consumer is?
- Are there some CPG categories that make more sense in the ecommerce space, or should brands consider ecommerce a necessity for every category?
- Will brands’ stronger involvement in ecommerce initiatives be the catalyst for stronger online sales in the CPG category?
This report is available to eMarketer corporate subscription clients only. eMarketer clients, log in and view the report now.
Check out today’s other articles, “Online, Offline Marketing Budgets Worldwide to Rise in 2013,” “China, South Korea Lead World in Mobile Commerce Adoption,” “In the UK, Girls Surpass Boys for Smartphone Ownership, Usage,” and “Canada's Smallest Businesses Struggle to Get Online.”