For Commodities To Compete, Real Value Has To Be Found In The Brand And the Experiences It Creates

Consumer packaged goods brands are losing share to less-expensive store brands, a fact that marketing execs working at CPG companies and their partners in agencies around the globe are trying to reckon with.
According to eMarketer, and its new report there’s hope for brands in online loyalty programs.

In addition to regular e-mail communication, CPG marketers need to develop tactical social media hooks and integrate them with relationship marketing programs. These hooks will help marketers get closer to consumers and can also offer insight into the motivations and behaviors of specific target segments.
CPG marketers pursuing this approach will need to change the way they think about relationship marketing and loyalty. It requires going beyond coupon-based incentives to building brand loyalty based on more intangible, emotional values.

Social media hooks? Intangible, emotional values?
The argument, of course, is an argument for the value and importance of brand advertising. But is the problem as simple as CPG brands needing to adjust their messaging for the social space–and all digital is pretty much social today? Will better branding, updated for a new collaborative medium, do the trick for commodity brands being beat by price?
I’m not going to argue against the need for brilliant brand advertising and online loyalty programming. In fact, I’m all for those activities when they drive prospects and current customers to retail and/or a brand event. Done right, this communications cycle leads to a sale and then repeats, with new and better brand experiences and more sales. In the meantime all the store brands have to offer is a lower price.
I’d love to hear your thoughts on the topic…



About David Burn

I wrote my first ad for a political candidate when I was 17 years old. She won her race and I felt the seductive power of advertising for the first time. Today—after working for seven agencies in five states—I am head of brand strategy and creative at Bonehook in Portland, Oregon.