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Can CPG go D2C?

No doubt you’ve seen the buzz in the past few months about the surge in online grocery. We’ve documented it in NAILBITER’s Crisis Behavior report series, and there’s been plenty of reporting on the trend from other outlets too. But there’s another peripheral, quieter opportunity for CPG manufacturers…and it got a little bit louder this week.

Why do Amazon, Walmart and Instacart need to be the only beneficiaries of the grocery eComm boomlet? Why can’t CPG manufacturers take their products direct to consumer?

CPG D2C has historically been a narrow slice of the (until now) small eComm pie, a way for smaller manufacturers to gain a point of market entry to build a fan base before taking their case to brick & mortar retail (see: Perky JerkyHonest Company). Sometimes, they get so big that they attract the attention of large manufacturers before they even get in-store (see: Dollar Shave Club).

But earlier this week Pepsico announced the launch of their own D2C websites – Snacks.com & PantryShop.com – sites that were reportedly in consideration for some time, but developed and launched in-house at Pepsico within the last 30 days. And the timing couldn’t be better.

In NAILBITER’s Crisis Behavior reporting, we documented how consumers love their brands, but not their online retailers so much. They’re seeking value, so private label remains a threat to branded products. And they will remain concerned about safety in their shopping experience. Aren’t these conditions all great prerequisites for big CPG brands to go D2C, with the added benefit of getting to communicate directly with your consumer? Are we at the edge of (yet another) shift in CPG retail?

If you’re a big, medium or small-sized CPG manufacturer who’s exploring a D2C launch, NAILBITER can help you with behavioral data to understand what shoppers are seeking from the online grocery experience, how they navigate the eComm environment and make purchase decisions.

More info at: info@nail-biter.com

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