The Challenge of Online Selling for CPGs

online selling for cog

Back in February 2013, we reviewed that online sellers are quick to think that in order to increase their sales, all that they need to do is to attract more people to their sites.

challenges of online retailers

While this is one part of the equation, it is not all of it. One industry that has a  particularly big challenge in turning digital shoppers into digital buyers is the Consumer Packaged Goods (CPGs).

Great Outlook, Even Greater Task

us online cpg sales

From the graph above, it is easy to see why CPG online retailers believe that it is a simple matter of being a great online marketer. CPG brands have invested millions of dollars in creating robust brand sites and digital marketing campaigns—all in the interest of engaging loyal buyers. A good example is Pepto Bismol with their Millenial-targeting ads

pepto bismol site

However, as much as CPGs invest in driving traffic to their sites, some of their sites do not even have a “shop” button. Wrigley.com I am looking at you! While it is understandable that a CPG company may be not prepared to deal with the issues of fulfillment and shipping at the moment, they need to realize that they need to become a better ecommerce site builder in the future. Diving into ecommerce fulfillment is a good investment.

incentives for us online shoppers

The good news is that online shoppers all look for the same features. According to an Integrated Marketing Services survey in February 2012, Millenials, Generation X and baby boomers all are looking for better prices, free shipping and same-day service as much as possible. There are no generation specific features to worry about.

Creativity is Key

CPG online retailers have to deal with well established incumbent juggernauts: Amazon.com, Walmart.com and eBay.com. CPGs online retailers must rely on creative strategies to increase direct site sales. A great example is Rogaine.

Let’s say I am looking for a 3-month supply of Rogaine. At Rogaine.com, I find:

rogaine products

I wonder whether I can beat that $49.99 price. A quick search reveals that I can beat this deal at Walmart.com.

rogaine walmart

Nice! Not only would I have to pay just $45.97, but also it qualifies for free shipping because it is a purchase over $45.

However, I remember that the Rogaine site was offering a 4-month auto delivery option. I wonder what’s that.

rogaine 3 month supply

The 4 month auto delivery program allows me to have Rogaine foam directly shipped to my door every 4 months so I never run out. The idea is pretty good because it allows you to save time.

rogaine 4 month supply

While the savings equation is not as easy as they put it, Rogaine does make an effort and encourages you to try it out by providing an additional $10 discount.

This kind of creative thinking is necessary for CPG online retailers to stand out.

Damian Davila

Ideas and concepts from Damian Davila, Ecuatoriano thriving in Hawaii. Pro marketer and blogger. Find him at @idaconcpts on Twitter.