Digital CPG Blog

There’s no doubt about it. Couponing made a huge comeback in 2010 when most of us thought it was out for good.

Most young people with mobile phones choose their own device, with price being the main purchase driver. Interestingly, more males than females have smartphones in every country except for the U.S., where women lead the way in smartphone usage – certainly an opportunity for manufacturers trying to target their up-and-coming key demographic.

See the numbers below and read more here. How can you create apps and mobile experiences for Gen Y women?

The recession was good for one industry – coupon clipping. And while the newspaper industry can thank the deals for holding off their eventual defeat, the part of the industry that is really seeing growth in coupons is the digital side.

“Newspaper inserts still prevail,” reports AdAge, “but as a younger generation gets hooked on print coupons, they’ll likely be ones that arrive in the mail or from their own printers. And that doesn’t even factor in the harder-to-quantify growth of mobile coupons, which don’t go through clearinghouses.”

And that means there’s a lot of opportunity for internet coupons, which still only account for 1% of the distribution.

“I think we’re seeing this whole recession really helped us pick up those millennials who were not as focused on money management and savings and now have entered the marketplace with a real savings mentality,” said Suzie Brown, chief marketing officer of Valassis.

How is your brand responding? Will you offer deep discounts to lure Gen Y attention and loyalty?

Photo Credit: Stitch.

The new commerce will no doubt be mobile as teens are showing through their large use of texting and mobile app usage. Read Write Web reports:

New data from Nielsen out today delves into the behavior of the youngest mobile consumers: the American teenager. The study further solidifies what we’ve known for some time – teens are heavy-duty users of text messaging services.

No other demographic group texts as much as teens do, with an average of 3,339 texts sent and received per month. (For girls, it’s even higher – 4,050 texts per month!) But the study also revealed that teens are now turning to mobile applications, too, with 38% of teens using downloadable apps like those from Facebook, Pandora and YouTube. And usage in this area is growing, says Nielsen.

Application usage among teens is up, too, going from 26% last year to 38% this year. The mobile Web is used more than apps, however, with 49% reporting they surf the Net on their phones.

Is your brand taking advantage of the increase in mobile?

Photo Credit: Chaztoo.

There are three things that matter most to Gen Y in the CPG foods market:

1) Cost – Hardest hit by the recession, unemployment is rising rampantly in this demographic. Gen Y is after convenience products as well as shopping at discount retailers.

2) Convenience – This isn’t a group that is planning out weekly meals to eat leftovers. Instead, pre-packaged and portable choices are just right.

3) Cravings – As the, “I want it now” generation, they don’t take to waiting lightly. That means no preparation time and spontaneous decision making.

How will your brand respond?

While this crosses into the food category, I absolutely love this idea of branding, innovation and customer engagement from Chiquita Bananas. They asked, ““How do we leverage the iconic real estate that we already have on all our bananas, throughout the world?” A tiny bit of real estate at that! But a piece of real estate we would all immediately notice if changed. The New York Times reports how they did it:

The campaign involved using this inconspicuous and familiar little bit of branding turf for a visual experiment: instead of the familiar logo, the stickers carried bold and whimsical iconish face imagery — a monkey, a happy Cyclops, a vaguely anime-style girl, a luchador and so on. Using the same colors as the familiar Chiquita logo, the designs were genuine eye-catchers.

And they may have caught even more eyes online than they did in the store: Chiquita set up a Web tool for people to whip up their own sticker drag-and-drop mixes, and an obliging public created more than 25,000 of them in less than five months, according to the company. This enthusiasm has led to a competition — 1,355 entries were submitted over several months, and online voting starts tomorrow at eatachiquita.com to pick 18 designs that will be stuck onto actual bananas.

By actually contributing to the defamiliarizing of something familiar, the contestants layer new “intrigue” onto one company’s supply of what is, after all, a pure commodity.

It’s an amazing campaign of community and letting go of the control of your brand to bring emotion to it. Or as Chiquita reps put it, the campaign is “designed to re-engage that emotional connection with consumers.” So many brands try to this, but with little success. The attempts are usually fairly meaningless, because adding your words to a coffee cup isn’t nearly as interesting as genuinely engaging, re-working and re-imagining an iconic brand to include your ideas, not your ideas of what you think the brand will like. Way to go, Chiquita.

Millennials are sharing and according to a recent survey, few expect them to stop. 895 technology experts were asked whether they think Millennials’ openness will diminish with age. Two-thirds said no.

This is the first generation that is always connected. Growing up with a culture of sharing and a standard of communication created a culture that will perpetuate itself through the years. That doesn’t mean drunken photos will stay posted forever, but the children of Millennials might be annoyed by their parents’ blog about potty training (via WOMMA).

This not only means millennials will share their personal lives, but also their love of their favorite brands – and dislike of brands that fall out of favor. Gen Y will blur the lines between what is appropriate and will expect a higher level of customer service and performance from the brands and services they use.

Marketing Daily recently asked Paul Parkin, founding partner of SALT Branding, an integrated brand consultancy in San Francisco, to make sense of Gen Y and brands. Here are two key takeaways from the interview:

1) Gen Y is less loyal. “They grew up in an age when there was always a new site emerging that was better than the old one, and they’re happy to leave it behind. But they are more loyal to channels. They may not be loyal to any brand of shoes or department store, but they are loyal to the Internet channel, and brands like Zappos.com and Amazon”

2) Use Social Media to keep up w/ Gen Y. “The fastest-moving consumer companies, like Virgin, Red Bull and Pepsi recognize that consumers want to engage with brands in entirely new ways, such as through mobile or social media. And they know people want to do it on their own terms.”

In the new digital age, channels and those brands increasingly rule. We’ve seen it in marketplaces like Orbitz and e-Bay where young consumers are given all the tools to find information and make the best decision.

I’m always reminded of the movie Miracle on 34th Street where the fictional Macy’s store opens up the door on pricing and allows their customers to compare prices  to all of their competitors right there in the store. What a revolution that was!

In the CPG sector, sites like our own Alice.com also work hard to bring the power back to the consumer, empowering them with a wide range of unbiased information to find the best products. Such transparencies are surely a big reason why channels are outperforming individual brands.

A young woman walks through the drive-through. Photo Credit: joelogon.

As someone who lives in a small downtown condo, walks everywhere, and has never owned a car before my current position and 20 minute commute, a culture much less dependent on cars make total sense to me. Jack Neff of AdAge reports on this growing trend and how it affects e-commerce for CPG manufacturers:

William Draves,  president of Lern, a consulting firm which focuses mainly on higher education, and co-author of “Nine Shift,” has a theory that almost everything about digital media and technology makes cars less desirable or useful and public transportation a lot more relevant.

Gen Y will be working on “intangibles” in professional jobs, not on tangible things that require physical presence, Mr. Draves said. “Time becomes really valuable to them,” he said. “You can work on a train. You can’t work in a car. And the difference is two to three hours a day, or about 25% of one’s productive time.”

Mr. Draves predicts a resurgence of urban living in denser housing surrounding train stations. As a result, suburban shopping malls and big-box stores such as Walmart, Target and club stores that rely on people hauling big purchases away in cars stand to suffer.

Gen Y’s driving-behavior shift, however, won’t just be about helping main streets return as big-box retailers fade, Mr. Draves said. E-commerce is likely to benefit, too, as categories at first resistant to e-commerce take another serious crack at it. Alice.com, which is providing the platform and fulfillment now for more than 60 mainly package-goods e-stores, is seeing a growing share of its business, which drew close to 700,000 visitors in April from Gen Y shoppers, according to Compete.com, said CEO Brian Wiegand.

“This new generation, their first thought is not ‘let’s drive to the store to get these things,’” he said, “but ‘let’s get them the easiest, fastest, cheapest way.’ We call them internet-first people. We think that’s an important segment for us, and it’s also the biggest segment for our iPhone app, which is almost all Gen Y.”

Read the full, fascinating article >

CPG Marketers are smarting up to the face the fact that more women are in the workplace and more men are staying home. P&G just launched a content site, ManOfTheHouse.com that caters not to “the 18 year-old man in the hunt. We’re not the glossy fashion magazine that tells you that you need to have a pair of $3,000 shoes. We’re not one of those magazines you have to hide from your wife or boss.” Instead, Man of the House claims to be for the real man, “a guide for the jack of all trades trying to be better – at work and at home, as a father and as a husband.”

Dave Knox cites a Nielson study that showed “almost one-third of men are now the principal shoppers in the household” and provides Toyota’s “Daddy Likes” campaign for the Sienna Minivan and “Everyman Challenges” from Klondike as proof of marketers capitalizing on the growing trend.

Dad blogs in the social media space are gaining rapid ground and even Alice.com has a newly-minted Dad appearing as one of their guest bloggers every Friday. As Gen X and Gen Y get older and traditional gender roles are turned on their head, CPG marketers will face new, exciting challenges; it’s great to see so many brands ahead of the curve.