Insights to success
The FMCG industry has survived the global financial crisis better than almost any other business. In fact many top global companies have achieved excellent results and have shown growth during tough times.
No other industry is so marketing focused or so sophisticated in its market research and market segmentation. Some products have a very long life cycle and seem to roll on successfully forever with only minor product changes. Other products come and go very fast but can still be highly profitable. Inevitably some products fail and the key then is to know when to cut your losses, lick your wounds, and move on to the next new product.

Nowhere is head to head competitive marketing more high profile – every aspect of the marketing mix needs to be considered and exploited professionally and effectively.

Key challenges in FMCG
Consumer marketing research is at the core of success. The more testing of ideas, product names, flavours, packaging and actual consumer needs and wants, the more likely you are to succeed; but all the focus groups in the world will not prevent some failures (many academics are very good at analysing after the event why products fail; this is a lot easier than doing it in advance!).

Powerful branding is another success factor. People who feel good about a brand name are more likely to purchase products with that brand. And if the brand continues to be promoted consistently and the image is maintained then the life cycle of all its well established products can be extended. Brand loyalty has the same effect as differentiation – people will trust a brand they know and like, and the branding itself is the differentiator – they perceive higher quality or better performance, and price becomes only a background issue.

Differentiation enables higher prices and greater profits. No one likes to have to compete on price but if your product or service is seen as a commodity, the same as the competitors’ then price becomes the main (or only) purchasing criterion. Differentiation is achieved by creative new product design and clever advertising, which highlights real or apparent extra features or benefits not demonstrated by competitors.
Media advertising is at the heart of the FMCG business and buying the right advertising, from the right channel, at the right time, at the right price is just as difficult as it sounds! Online advertising is the big growth area and yet it is still largely ‘the great unknown’. So making the decision about the best channel mix is even more challenging than it used to be - but even more vital.

Market segmentation was invented as a technique by the FMCG industry and still remains as important as ever. Traditionally it was all about different socio- economic groups needing a different marketing mix, but now with the globalisation of the major brands it is more complex and contains more pitfalls. Behavioural and lifestyle segmentation and the erosion of traditional socio-economic segments make this all the more challenging.

The human factor
The vital skills needed to continue successfully within FMCG include:
Professional channel management to build mutually beneficial relationships with all stages of the forward supply chain (distributors, agents, wholesalers, retailers); you need to advise, motivate and educate all the employees in your various channel partners; in many cases your competitors are trying to do the same thing with the same people.

Good selling technique is essential in any competitive market and FMCG is as competitive as they come at consumer level; B2C marketing skills are needed at the final point of sale and B2B skills for all the other relationships in the distribution chain.

Negotiation skills help achieve the best terms from procurement departments and channel partner principals; in a high volume/low margin business a small improvement in terms can earn a lot more profit. Budgets for advertising and media buying are usually very large and negotiating a small reduction in them can generate a substantial total cost saving.

Project management is at the heart of FMCG operations; in particular new product development and product launches have to be professionally managed and meet the traditional requirements of ‘on time, on budget, on spec’. Not only in marketing, but also in production and distribution, the old adage ‘timing is everything’ often applies!

A special focus on FMCG
Having partnered many FMCG clients worldwide, we have developed great insight into the needs of this ever developing market.

By working with TACK you’ll be in great company
We offer you highly specialised development solutions, specifically designed and fine-tuned to meet the needs and requirements of the FMCG sector. Other FMCG clients we have worked with include:
• AB-InBev
• Carlsberg Breweries
• Eden Spring
• Efes Pilsner
• Gallagher
• House of Prince
• Nespresso
• Nestle
• Pernod Ricard
• Philip Morris International
• Unilever