For consumer-packaged goods (CPG) brands, securing placement in a major retailer is a significant milestone. However, once on shelf the real challenge begins. Driving sales velocities, growing the category, and establishing a strong foothold within that retailer are not easy tasks and take a lot of time and energy. Achieving sustained sales growth requires planning, execution, and innovative thinking. In this article, we will explore a few key strategies that CPG brands can employ to drive velocities with their first retail partner and ultimately building a base for the growth ahead.
1. Develop a Value Proposition:
To drive sales velocities, it is crucial for CPG brands to articulate a compelling value proposition that resonates with their potential consumers. Clearly define the unique selling points of your product, highlighting how it solves a problem or meets a need better than competitors. Craft a brand story that emotionally connects with consumers, conveying the value and benefits of your offerings in a memorable way. Then make sure you are preaching these values and your brands story everywhere you can within your retailer.
Cost: Time and energy
2. Get Product In Consumers Hands
Product demonstrations are a powerful tool for CPG brands aiming to drive early sales velocities. By engaging consumers at the point of sale, demos create immersive experiences that lead to increased sales, brand awareness, and consumer trust. Demonstrations allow shoppers to interact with products, understand their benefits, and make informed buying decisions, resulting in higher conversion rates. By incorporating well-executed (key word) product demos into their strategy, CPG brands can significantly boost their sales and establish a strong presence in their first retail partner.
Cost: Time or $150-$170 per demo
3. Optimize In Store and Digital Merchandising and Shelf Placement:
Securing optimal shelf placement and keeping the product stocked within the retailer is vital for sales velocities. Most early stage brands don’t have the budget to negotiate for prominent positions, such as eye-level shelves or end caps, so you need to put in the work at the shelf to move into those spots. In today’s world the digital shelf has become just as important as the store shelf. Making sure your digital shelf is accurate is vital for those customers using ecommerce and last mile services to buy their groceries. Ensure that your products are appropriately priced, well-stocked, and visually appealing. Invest in merchandising early on, I promise it will be money well spent.
Cost: $17 - $30 per store
4. Implement Effective Promotional Strategies:
Strategic promotions play a crucial role in generating initial interest and driving sales volumes. Work closely with your buyer to develop a compelling promotional campaign that aligns with your target audience's needs. Every retailer is different but consider offering TPR’s, multiple purchase incentives, or retailer exclusive deals to drive trial and repeat purchases. Don’t forget to leverage digital marketing channels, social media, and targeted advertising campaigns to amplify the reach and impact of your retail promotions.
Cost: Varies widely but it’s important to build a P/L by account to manage profitability.
5. Establish Strong Relationships with Retailer Partners:
Building strong relationships with your retail partners is key to driving sales at a new retailer. Collaborate closely with the retailer's category managers, marketing teams, and store level employees to gain valuable insights. Oftentimes retail employees become your best salespeople if you engage with them correctly and consistently. Regularly share sales performance data, market trends, and consumer feedback to foster transparency, trust and partnership. Maintain open lines of communication and seek opportunities for joint marketing initiatives or co-branded promotions that can drive sales synergies. The relationship between your brand and the retailer is about WE not I.
Cost: Time and energy
Driving deep sales velocities in a CPG brand's first retail partner is challenging, but with careful planning and execution, it can be done. By developing a clear plan and focusing on execution, CPG brands can position themselves for long-term success. Remember, sustained sales growth requires ongoing dedication and innovation and the ability to adapt to changing market trends and economics. With a retail focused approach and a commitment to your retail customers, your brand can thrive and pave the way for future expansion and growth.
Questions about your current strategy? Let’s grab a virtual coffee.
The Velocity Shop