PRICE, PROMOTION & MERCHANDISING: 
THE REINVENTION OF CPG MARKETING
EXECUTIVE OVERVIEW

 
IRI's Times & Trends highlights new developments and critical events across all major CPG categories and channels, providing powerful benchmarking data to help guide your strategic decisions. This issue of Times & Trends provides insights into current and emerging CPG marketing trends being employed by an industry seeking to the new world in shopping behavior. A free summary is also accessible via the GMA website at www.gmaonline.org.

INTRODUCTION

During 2008, consumers faced unstable financial markets, major workforce reductions, crunched credit markets, and rising gas and food prices.

Recent headlines have been brighter, and there are signs that the economy is improving. The recession is not over, however, and consumers remain firmly entrenched in savings mode.

Though the consumer packaged goods industry has faced struggles in this difficult economy, growth opportunities have emerged from changing consumer rituals.

CPG prices have remained steadfastly in the spotlight over the course of the recession. Commodity and fuel prices skyrocketed in 2008, sending CPG prices in an upward direction and placing increased pressure of consumers’ already strained wallets. While commodity and fuel prices have eased, CPG prices remain well above historic norms. Consumers are looking for price relief, and CPG marketers are looking for ways to honor this demand.

This year will be an exciting one for CPG marketers.

This issue of Times & Trends provides insights into current and emerging CPG marketing trends being employed by an industry seeking to compete in a new world of shopper behaviors.

KEY FINDINGS

After a surge in 2008, CPG price increases are beginning to ease; 2009 will be a challenging year as CPG companies seek to balance a quest to recoup margin losses incurred earlier in the recession against consumers’ need for price relief.

Though prices have moderated, a majority of shoppers indicate that higher-than-normal prices have impacted their financial situation; planning, trading down and sale shopping have become an integral part of the consumer shopping experience.

A difficult economy has reinvigorated merchandising efforts, but merchandising dynamics are evolving as CPG marketers seek to adjust to the a new world of CPG shopping behavior.

Merchandising is heavily leveraged to drive purchase behavior across discretionary categories and to showcase innovation across key health and beauty categories.

Top Ten Categories by Merchandising Activity Level:
Food, Drug, and Mass (Excluding Walmart) Percent Volume, Any Merchandising

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Private label merchandising activity remains lower, on average, versus national brands; however, increased retailer focus on private label as a differentiator and a means to drive margin growth may lead to increased prevalence of private label merchandising programs.
 

 

 

 

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Source: IRI's Times & Trends Reports
Information Resources, Inc. (IRI) is the world’s leading provider of enterprise market information solutions and services to the consumer packaged goods (CPG), retail, and healthcare industries.