CPG Marketing: The Top 10 Advertising Channels

/ Thoughtspace - General, Programmatic, Social, Strategy

What marketing channels will give your CPG brand the most bang for your buck? 

Long story short, the place you will make the greatest impact is where your potential customers are most engaged.

Sometimes, it may not be the fastest growing or trendiest channel. However, in-depth audience research paired with testing different channels will determine the optimal media mix for your brand. 

The place you’ll make the most impact is the place your audience is most engaged. 

That said, CPG brands typically lead the way in adopting new marketing tactics, so it’s also important to stay ahead of the curve. Understand and test high growth channels to identify which have the strongest impact on your business goals. Use this data to decide when to be a first mover in channels that make sense for your brand. 

Here are ten of the most effective CPG marketing channels advertisers should consider to maximize the impact of their marketing strategies. 

Social Video

Video ads are one of the most engaging mediums to capture user attention. As a result, video produces meaningful marketing results on social platforms. Short form video has proven to be particularly impactful in driving both branding and performance goals in as little as six seconds. 

Why is social video effective for CPG brands? 

CPG video ad spend is predicted to increase by 38% in 2022. Video-first channels such as YouTube, TikTok, and now Instagram are excellent because consumers choose to visit these platforms to learn and be entertained. Think how-to makeup tutorials for beauty brands or recipe videos for food and beverage brands. 

How to use social video successfully: 

Use short-form video to show your brand personality and bring messaging to life. Additionally, show your product or service in action, demonstrating real-life use cases. Finally, make sure your video is optimized for mobile viewing and is following other creative best practices outlined here

Social Commerce 

48% of all social media users made a social commerce purchase in 2021 and 77% of Millennials and Gen-Zs use social media to shop. These purchases are being driven by trends such as live commerce, in-platform shopping tools, and improvements to in-app purchasing processes. 

Why is social commerce effective for CPG brands? 

Product discovery is now taking place on social media. Platform algorithms are being optimized to showcase brands and sponsored posts in ways that feel organic to the user. CPG brands can cash in on the opportunity to position their product in front of engaged audiences by using various social commerce applications to find their niche consumer groups. 

How to use social commerce effectively:

Explore various ways in which your brand can be discovered on social media, whether through promoted product posts, influencer live streams, or social marketplaces. Create a seamless purchase process and have a measurement and pixel strategy in place to capture the resulting sales. 

Read more: Social Commerce 101

 Influencer Marketing

Influencer marketing ad spend will surpass $7B in 2022. These digital creators are both storytellers and social media experts, well-versed in creating authentic messaging which resonates with their followerships.

Why is influencer marketing effective for CPG brands? 

Although they were once viewed as awareness drivers, influencers are increasingly driving the social commerce landscape. Tactics such as livestream commerce, discount and affiliate codes, and shoppable posts support down-funnel conversions for CPG brands while also building brand affinity and trust.

How to use influencer marketing successfully:

Allow creators to make authentic content that is not overly scripted. Social media users want to see relatable content which feels authentic to the platform they are on. Learn from the social expertise of influencers and the communities they have cultivated.

To learn how to choose the right influencers for your brand, watch this video.

Connected TV

As of 2021, there were nearly 214 million CTV users, and that number is projected to increase to 230M by 2025. With the proliferation of cord-cutting, connected TV is becoming a dominant channel in the digital advertising space. 

Why is CTV effective for CPG brands? 

Connected TV advertising delivers high impact video content on the largest screen in the household. CPG brands can showcase their products and tell their brand story with greater flexibility than traditional TV, while also achieving incremental reach. It also allows for greater addressability through contextual and behavioral targeting, so CPG advertisers can speak to refined audience groups.

How to use CTV advertising successfully: 

Communicate your message with quick 15-30 second ad placements that are visual and compelling to your target audience. Also, be strategic with your channel selection. Rather than running only on one platform, such as Hulu, maintain appropriate frequency and extend reach with cross-channel integrations. 

Listen to our CTV podcast episode: The Future of TV 

Digital Out of Home (DOOH)

According to the OAAA, Americans now spend 70% of their time outside of the home, an increase of 50% over the past two decades. As audiences become increasingly mobile, DOOH is making its way back as a staple in omnichannel marketing plans. 

Why is DOOH effective for CPG brands? 

DOOH placements are a great way for CPG brands to achieve mass market reach with greater flexibility, improved targeting, and quicker activation. Brands can test and swap creatives to cater messages to core audiences and contextual placements. Additionally, you can control spend by only showing up when and where an individual is most likely to convert. 

As more digital screens become available, the DOOH inventory options and contexts are only rising. For example, food and beverage brands can advertise on grocery store screens, gas station kiosks or bars to drive quick purchases. 

How to use DOOH advertising successfully:

Understand the format and scale that your message will be delivered in. Additionally, use a clear font and a simple message to convey your message in the 3-6 seconds. 

Learn more: The Digital Out of Home Primer 

Paid Search

Paid search gives brands the opportunity to have preferential placement on search engine results, while only paying for click-based engagements. Ad spend in this channel increased 39% in 2021 and is expected to rise in 2022. 

Why is paid search effective for CPG brands? 

This channel is particularly important for CPG brands seeking to drive eCommerce sales. 40% of all product searches begin on search engines, so PPC is the key to being discovered by new, in-market audiences. 

How to use paid search advertising successfully:

Support your paid search efforts with organic website search engine optimization.  30.5% of eCommerce traffic comes from SEO, so it must go hand-in-hand with PPC to support your overall search strategy. 

SMS Marketing

Nearly 300 million US consumers will redeem short message service (SMS) coupons in 2022. As a result, SMS marketing is rapidly growing due to its effectiveness in driving quick, inexpensive conversions and high engagement rates. 

Why is SMS marketing effective for CPG brands? 

Many CPG marketers have adopted SMS as a strong purchase driver. After being alerted about a special sale or new release, customers are prompted to redeem a discount code, view a new product drop, or check out a new sale. This can push audiences to complete a purchase they have been considering. In-message links and discount codes also offer a more clear way to track attributable conversions.

How to use SMS marketing effectively:

Tie SMS marketing into loyalty programs to facilitate a value exchange with customers. You are able to collect their contact information. In turn, they receive your special offers, coupons, and are the first to know about new offerings. Make sure you are compliant with the TCPA guidelines. 

Amazon Advertising Platform

Amazon Ads is expected to exceed $32 billion in revenue by 2023, accounting for an estimated 76.2% of US eCommerce ad spending in 2021. Amazon is the undisputed leader in eCommerce with a wealth of valuable consumer data. 

Why is Amazon advertising effective for CPG brands?

Amazon offers multiple ways for CPG brands to engage with its vast audience by advertising on-site or across the open internet. The platform data provides visibility into millions of consumers’ shopping behaviors. There are various ad formats for point of purchase advertising as well as opportunities for awareness and consideration tactics that will ultimately lead to increased sales. 

How to use Amazon Ads successfully:

Utilize real-time data to target in-market audiences with Sponsored Product Ads. Additionally, expand your reach with lookalike audiences who are similar to your best customers to enhance awareness and consideration.

View our blog post: How to Drive Full-Funnel Advertising Results on Amazon 

Retail Media

Retail media refers to media placements owned by retailers using their first-party POS data. These can be executed on retailer sites or programmatically on social and display channels. This channel now accounts for one in every eight dollars of digital ad spend. 

Why is retail media marketing effective for CPG brands? 

Retail media is now the third largest digital advertising channel in the US, making it a pivotal part of any CPG strategy. Brands are seeing more full-funnel implications of retail media’s high value shopper audiences. CPG advertisers can take advantage of eCommerce site ads as well as programmatic placements to find retailer audiences and take them from awareness to point of purchase with closed-loop measurement. 

How to use retail media advertising successfully:

Use retail media in a holistic, connected plan. Connect media across social, ecommerce and DTC channels to ensure they are supporting each other and driving customers through the funnel.

Watch to learn more: Connected Commerce Explained  

High Impact Display

Display ads served programmatically or purchased via direct buys offer CPG brands the opportunity to make a splash with their broad awareness and consideration campaigns. 

Why is display advertising effective for CPG brands? 

Display provides a great opportunity to drive engagement by helping stop the scroll and generate interest. CPG brands can also use high impact display ads to retarget audiences who have interacted with the brand’s website or social channels. This keeps your brand top of mind and helps support campaign efforts as customers move through the purchase funnel. 

How to use high impact display successfully:

For CPG brands, we recommend using dynamic creative for personalized and interactive offers which drive measurable actions, rather than standard banner ads. Create various creative collateral tailored to your unique audience groups. 

 

To learn about additional channels for CPG brands, download our complete CPG Digital Marketing Playbook here

In this playbook, you’ll learn how to: 

  • Understand and leverage the latest digital marketing and ecommerce trends impacting CPG brands
  • Create the optimal media mix by understanding the most effective channels for CPG advertising 
  • Implement cookieless solutions to reach your target audience on digital channels
  • Measure the results of omnichannel CPG marketing campaigns

Download the guide here. 

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