Even before the COVID-19 pandemic, accessing the CPG industry’s audience was a challenge. Competition was high, selling channels became more numerous, and marketing channels more complex. After the worldwide lockdown, these challenges were only exacerbated.
The only silver bullet for CPG companies to stay competitive now is to build a direct-to-consumer (DTC) model. The DTC model allows brands to develop their relationships and turn consumers into customers. During a pandemic, a direct-to-consumer relationship (not dependent on third parties), be it via email, SMS, chatbot, e-commerce, an app, or other, is even more critical.
The Direct-to-Consumer Model
We offer a strategic operating model for CPG brands using first-party data (1PD) as a foundation to create the most valuable relationships between brands and buyers. Our approach consists of two essential parts: high-quality first-party data growth and efficient, effective marketing to delight the target audience.
The DTC model allows businesses to control their brand’s story, sell more of their product, and convey their message directly to consumers. In the case of CPG, the DTC model enables manufacturers to manage and cultivate relationships with customers that transcend retail channels.
Here are a few examples of how several of our notable CPG brand clients have “gone direct” to take ownership of their most valuable assets: their customers.
Driving Loyalty for Diaper Brands
Marketing to moms is complicated. It requires an understanding of how they engage through digital and mobile, how they react to content, and how to best influence their purchasing behavior. In the case of new moms, it also requires a quick response time and the ability to effectively leverage multiple data sources.
We have in-depth, data-led knowledge and over 30 years of success in building direct-to-consumer relationships between moms and the most trusted global brands, including Enfamil, Pampers, Huggies, Carter’s, Similac, Tide, Gerber, and Disney Baby.
A leading diaper brand selling through thousands of national stores, including some of the country’s largest retailers, turned to us to help find new moms and establish loyalty and brand preference even before birth.
We created high-impact digital content (not just ads) to deliver value to consumers, including interactive tools and education, co-marketing partnerships to provide exclusive content, and coupons. Delightful email, mobile, and web experiences delivered personalized messaging by child due date to drive consumer 1PD at scale.
As a result, 10 million new moms opted into the program over several years, which accounted for more than one-third of the overall market. Beyond the 31% increase in digital engagement, our program helped deliver an 18% increase in incremental DTC sales and millions of dollars in total incremental sales per year.
Thirsty for Connection
Coca-Cola has a complicated relationship with consumers. Their business is a B2B2B2C model, selling to bottlers who sell to retailers who then sell to consumers. While the brand has a long and storied marketing history, its relationship with consumers was at an arm’s reach at best. To overcome their distanced business model, Coca-Cola launched My Coke Rewards (MCR), a direct-to-consumer marketing program.
After launching the initiative, Coca-Cola turned to us to help increase new member acquisition efficiency. We helped Coca-Cola create offer tests and strategies to encourage return participation by new members and encourage users to incorporate the program into their daily routine. The plan optimized the MCR communication flow by recruiting and retargeting new members via email, digital, social, and text channels.
The efforts helped decrease spending by 15-20% and helped Coca-Cola find more engaged new members; opt-in rates and overall engagement increased by 10%. Due in part to our help, My Coke Rewards became the largest CPG loyalty program in the world and generated millions of dollars in sales for Coca-Cola from their most loyal households… an audience the brand had not previously spoken to directly.
Hungry for Better Relationships
ConAgra Brands offers a variety of brands primarily used as recipe ingredients rather than consumed on their own. Historically, these brands solely interacted through retailers with little connection or understanding of the shopper and consumer. Seeking to optimize these brands’ success, ConAgra turned to us for a cost-effective program to acquire new consumers and engage them with digital recipes and meal-planning content.
We analyzed and activated cost-effective digital media aligned with ConAgra’s target market of family-focused women looking for quick and easy recipes for family dinners. Acquisition tactics included registration through display advertising, email newsletters, targeted emails, mobile, content syndication, and paid social communications.
The work with ConAgra resulted in the brand acquiring more than 5 million new consumers for the brand’s CRM database and a 10% decrease in cost per acquisition year-over-year. Social media interactions increased by 124% while decreasing the cost per engagement by 33%.
Not Just for Big Brands
The above examples showcase the success of some of the most recognized brands that have benefitted from a direct relationship approach. However, CPG brands of any size can build beneficial DTC relationships.
Launching a new product is always a unique challenge, but we helped a global food company launch a new dairy alternative product with our 1PD approach. Leveraging their CRM database + personalized emails, we asked the most engaged and loyal consumers to give the new product a try. Within one day of launching the hyper-targeted program, the brand was overwhelmed by positive responses and had to cap it. Surprise and delight care packages turned trial into advocacy, with 86% of participants buying the new product and 76% indicating repurchase. Important for a new brand, the program helped launch the new product with hundreds of genuine product reviews, even before the product was available widely. The positive reviews helped catapult DTC and e-commerce sales from the moment the product hit virtual shelves.
The Opportunity of a Lifetime
DTC is an opportunity to build up the lifetime value of consumers. A robust database of connections allows brands to gain information about their customers and tailor personalized experiences. Beyond marketing, these first-party data relationships can also enable broader business objectives, including research, product development, customer value analysis, and pricing.
Bottom line: Brands going direct to consumers take ownership of their most valuable asset: their customers. And when brands own their customer relationships (instead of the retailer), the brand is entirely in control.
First-party data ownership plus successful CRM is a critical “must-have” for successful DTC sales. It is more important than ever for driving e-commerce and click and collect consideration in the post-pandemic world of CPG.
The results showcased above are just a few of the success stories of how CPG companies build DTC relationships to grow their businesses. As an agency, this is a core service offering. Our approach to growing brands facilitates innovative, relevant, and personal digital connections at scale for CPG brands. For every brand client, we develop and implement a customized, rigorous optimization strategy to achieve growth. If you need help with orchestrating a DTC strategy, reach out to see how we can help.
