CPG Direct Retail Provides Brands With Consumer Data

By April 09, 2010

Custom advertising and marketing optimizers Triad Digital Media create targeted content for retailers and marketers. They have identified and acted on the consumer packaged goods industry's need to become bigger players in direct

sales online. An eMarketer interview with CEO Greg Murtagh highlighted key issues in such an evolution.

While CPGs' share of the volume of e-commerce is growing, brands have proportionately low digital ad spend. "It’s somewhere between 2% and 5% of their total media spending," Murtagh estimates. " The opportunity, of course, is to close the spending gap. Consumers now spend 25% to 30% of their media time online."

Now CPG marketers are increasing their online interests, and Murtagh believes this is for a variety of reasons. While companies have been selling on sites such as Amazon.com, Walmart.com, etc. they see good but small results.

By launching their own direct retail sites, marketers have opportunities to test items, pack size and price points as well as new products before they nationally deploy them. They also gain access to shopping behavior, as well offer microtargeted coupons. These sites provide detailed transactional data that is valuable to the brand.

Murtagh recommends that CPG brands bring this information back to the multichannel retail sites. These sites can get sixty million unique visitors a month, which single brand direct retail sites never reach. Further, while big box sites drive online CPG volume to two or three percent of total volume range, and these multinational brands like P&G have $20-80 billion in total sales, so there are huge numbers at stake. The multichannel retail sites can leverage that data from direct sources to maximize sales.

While most online sales volume will still be from high traffic retailer sites, consumers appreciate being able to research brands on single brand sites. Murtagh predicts growing adoption of direct e-commerce efforts if they give visitors a good experience.

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