Consumer Packaged Goods In 2022: Top Trends Brands Must Know About

The world of consumer packaged goods, like many others, is transforming. In order to remain relevant in the industry and get ahead of competitors, you’ll need to stay on top of the CPG trends 2022 has to offer. Companies need innovative products and approaches to meet new human needs while consumer packages goods marketing has changed dramatically in recent times to accommodate this. It’s an exciting time for CPG brands, with 2022 set to be an excellent year, yet you need to understand the market and what customers want.

Consumer packaged goods is essentially a term for merchandise that customers use and replace on a frequent basis such as groceries, cosmetics or cleaning products. This is in contrast to durable goods which are generally not replaced until a significant period of time has passed or there is a problem with the product itself like furniture or cars. Any small edge or advantage a company can generate will help business, of which one of the main ones is eCommerce.

The Benefits of Selling CPG Online

Typically, consumer packaged goods are sold by retailers in physical locations with packaging designed to set themselves apart from rival products. Due to a limited amount of physical space in these stores, the market can be highly competitive.

However, due to the significant advances in mobile technology, automated supply chain management, machine learning and data analytics, the ability for companies of all sizes can now use the internet to sell goods through eCommerce channels and avoid having to compete in brick and mortar stores.

This boom is clearly shown by the startling recent statistics. In 2020, e-commerce CPG sales grew to $175 billion. Not only has this shown exceptional growth in the past few years, but the number of consumer packaged goods companies list is growing at an increasingly fast rate too meaning that more and more people are looking to purchase these goods online instead of in store. If you do not already have an eCommerce channel attached to your business, you are placing yourself at a huge disadvantage before you’ve even begun.

Top Trends For CPG In 2022

Although some brands can seemingly dominate an industry with no competition, in the digital age, a disruptor can easily and quickly appear to change the hierarchy. Behemoth companies can be toppled by startup companies if they can better serve a customer's wants and needs. So, what makes a brand stand out from the competition and what are the consumer goods industry trends 2022 has for you to follow moving forward? And what are some examples of companies providing consumers with goods in effective and innovative ways to inspire you?

1. Transparency: Transparency is currency for the modern consumer, and it is one of the most important consumer package goods industry trends. It is up there with value and quality in the mind of your customers and it comes in many different forms. It involves being clear about where your products are sourced, how they are made, what impact they have on the environment and where they were made and by who. Transparency also means staying true to yourself. Clarify your messaging and the information you are delivering to your customers.

Recently, Heineken did this incredibly effectively by utilising customer co-creation. As a way to engage with customers as well as champion sustainability, the company held a contest for consumers to design an innovative new bottle design. From this, they were able to engage and bond with customers, as well as illustrate their dedication to great and sustainable packaging and materials.

2. Sustainability: Speaking of sustainability, if you’re not already making an effort to be more environmentally friendly, then you’re falling behind the competition. Consumers care a huge amount about sustainability and they want to see that you are doing something about it, if not, it is a surefire way to get them to consider alternatives instead. With this in mind, Nestlé are arguably doing more than most to reassure their customers in relation to this. They have committed to making 100% of its packaging reusable and recyclable by 2025 and will be reducing its carbon footprint to net-zero by 2050. These are all things that modern consumers want to see the companies they engage with doing in the modern world.

3. Subscriptions: Subscription-only businesses work. It’s why upstart brands like Dollar Shave Club were able to disrupt an industry dominated by Gillette. One of the main reasons for this was their subscription based services. They realised that customers don’t want additional steps when they are looking to buy something so by offering a subscription right away, they encouraged higher sales and built an immediate rapport with their customer base.

Companies can even offer discounts on subscription orders as it encourages repeat buying and looks to turn one-off payments into a continued loyal customer. Now more than ever, customers want less hassle when buying and this is something that a subscription service can do for them quickly and easily.

4. Personalisation: Did you know that 70 per cent of the leading DTC subscription brands use product quizzes? This is either prior to the sign-up process or during it, and the purpose is to ensure the customer experience is as personal as possible.

Function Of Beauty is a great example. This haircare and skincare brand creates personalized products based on the consumer’s goals, for example, repair split ends or add volume. The consumer is then able to choose what colour or scent they want.

As customers increasingly demand products that are tailored to their specific needs, this is something we are only going to see more and more of.

5. More Private Label Brands:  Another trend that has certainly come to the fore is the introduction of more private label brands. With direct control over product development and better margins, private label brands are proving an attractive proposition for retail businesses.

A good example of this is Goodthreads, which is a private label clothing brand set up by Amazon. The company has also established Amazon Essentials and Amazon Basics, as well as a number of other private label brands. And let’s be honest; where Amazon goes, others tend to follow. We have already seen it with Kroger and Walmart, and this is just the beginning.

Tips For Consumer Packaged Goods Companies To Grow Online

So now you know the main growing CPG industry trends to incorporate into your strategies and campaigns for the coming year, you’ll need some tips as to how to use them effectively in order to grow your business successfully. These include:

Be Online: In the case of the retail innovation statistics 2021 has thrown up, it projects that online grocery sales will become a $100b market by 2022. In many markets the online model, more accurately the online plus offline model, can offer better value to shoppers on everything from price to convenience to choice. eCommerce is critical to growth so if you are not offering customers the ability to purchase online, you will suffer greatly as a result.

Be Omnichannel: It’s important to present a fully unified experience across every customer touchpoint, if you don’t it will feel disjointed, disingenuous and untrustworthy. A customer spends time with your brand digitally and offline where they will expect consistency in both experience and messaging no matter where they are interacting with you. Unifying your approach to become an omnichannel one is essential in today’s world. If not you won’t be trusted, and when a customer doesn’t trust you they will not buy from you, no matter how good your products or value may be.

Be Personal: Personalisation is a key buzzword for today’s businesses. Ultimately, it means using data to offer experiences and content to customers throughout their journey in an engaging, direct way, across all digital channels. By treating them as an individual as opposed to just a number in a data set, it will engage with them on a deeper level that forms a stronger connection. When you are connected with your customers, your conversion rates will undoubtedly increase.

Challenges CPG Brands Will Face in 2022

We are dealing with a cost of living crisis at the moment, meaning people have less disposable income to spend on consumer products. This will naturally impact the CPG market, meaning brands will have to do everything in their power to deliver value and to market effectively so consumers feel like the money they do have is worth spending on the business in question.

Supply chain issues are also causing problems. Couple this with rising inflation, and it means the cost of CPG products is going to keep increasing. However, CPGs simply cannot pass these costs onto consumers anymore. Consumers are no longer stockpiling these items the moment they hit the shelves, as supply and demand are levelling out. CPG brands are going to need to look for ways to balance out their costs without simply passing them on to the consumer.

What's Next for CPG Brands?

In an industry that changes at rapid rates, consumer industry trends shift rapidly and you need to be able to adapt with them. However, if you don’t have this forward-thinking mindset, it’s likely that your product will be left behind in favour of your competitors.

Consumers are more connected to brands and products than ever before, so it’s crucial that you foster this relationship and connect with customers outside of just a basic product offering. Focusing on transparency, sustainability and an omnichannel strategy will all help develop your business. Giving your customers what they want, before they ask for it or even knew they wanted it will forge long lasting bonds with consumers and increase the perceived value and integrity of your company.