The 6 Most Common CPG Business Mistakes
Most CPG businesses fail because they don’t have a clear idea of who their customer is or what makes them tick. This often results in products that don’t fit the needs of their target market.
But there are other CPG businesses that absolutely nail their target audience but still fail to make a name for themselves in the market!
Here are the 6 most common mistakes that you should be avoiding as a CPG business, as well as our tips on how to improve your CPG branding and make more sales.
Nonstrategic Spending on Media
One of the biggest mistakes is not setting goals and measuring how well you are achieving them. If you don’t know what you want, how will you know when you have achieved it? That’s why it is imperative that you set goals and take actionable steps to achieve them.
Your brand needs to have a clear message before you begin your media strategy. It should be consistent across all touch points — from social media posts to packaging — so that consumers can easily understand who you are and what you stand for. A strong identity is what helps attract customers and build loyalty over time.
There’s no perfect ratio of how much money should be spent on each channel; every company has different needs depending on its size, industry, target market, and goals. However, if one channel is not producing results after several months, you are better off switching things up.
This is especially true when it comes to social media spending, which can be very expensive if you are doing it wrong. For instance, if you are paying influencers with no return on investment (ROI), then you are wasting money. That’s why it is crucial to be strategic about your spending.
Aventive Studio is a design agency for health & wellness brands. As part of our signature branding process, we will develop a comprehensive brand strategy for your CPG business which includes your customer journey, target profiles, brand voice, competitor research and more.
Learn more about our services here.
Incorrect Packaging Design
The design of your packaging is very important, as it is the first thing that customers see when they look at your product. Needless to say, it needs to have an appealing visual design and be easy to read.
The most important thing is the look of the packaging. You want it to complement your brand identity and give you a competitive advantage over other products on the shelf. This can be achieved through color, shape, and font choices. For example, you can’t use soft and calm colors on your packaging if your product is energy-related.
But there are also other factors that need to be considered, such as convenience.
For instance, you should take into account how easily consumers can open your product. If you opt for a complicated packaging or something that’s never been done before for novelty purposes, it could lead to consumers being confused when unboxing your product, which can add to a poor overall experience.
Some of the other common packaging mistakes also include using an outdated design or not having enough information on the packaging to entice customers to purchase it.
When creating a packaging design, you need to make sure all relevant information such as ingredients and instructions are clearly visible so that consumers can easily read them and understand how the product works.
If you don’t have much experience with designing packaging, it is best to hire professionals like the ones at Aventive Studio who specialize in this area. We can help you come up with a strategic CPG packaging design that will make your product stand out in the market.
See examples of our packaging design projects here.
Moving Into Mass Retail Too Quickly
While the lure of increased sales volume and lower costs is strong, these benefits come at a cost. When you sell your products through mass retailers, you lose control over pricing and product placement.
This can lead to unhappy customers whose feedback you will probably never receive because you will never have interacted with them.
Moreover, your product may be amazing, but it is going to get lost in a sea of products that are similar even if they aren’t as good as yours.
Instead of moving into mass retail, focus on building your brand with smaller retailers first, who will be more likely to give you shelf space. Alongside, consider promoting your product through social media marketing campaigns and other paid ads, which will help bring visibility to your brand.
Why? Well, if you want to sell your product in stores like Target, Walmart or Costco, it is important to first establish yourself as a brand. In order to do this, you will need to have a good marketing plan in place with a solid social media presence and online presence.
Basically, you need to be recognizable if you want people to choose you in the market. Once you have garnered a significant customer base, you can consider moving into mass retail.
Not Setting Up an Online Sales Funnel
A sales funnel is the sequence of steps that leads customers from becoming aware of your brand to purchasing something from you. If you are not using a sales funnel, you are missing out on a big opportunity to grow your business.
Many companies think that they can just build a website, throw up some products and wait for the money to roll in. But this is a huge mistake. You need to build an online sales funnel (also known as an automated selling machine) before you launch your store.
There are two reasons why this is so important: one, you need a system that can generate sales for you even when you aren’t actively reaching out to people; two, it is much easier to sell people something they are already familiar with than it is to convert them into customers from scratch.
That’s why it is always cheaper to retain customers than acquire new ones. So, if you have a product or service that’s already popular, you should be able to leverage that popularity into more sales.
When setting up your website, ensure that your website developers provide you with an online sales funnel, such as email marketing, blog posts, social media ads, landing pages, AI chatboxes, and AI assists, so you can avoid falling prey to huge marketing spends.
Creating Mobile Apps Without Any Goal
Creating mobile apps for your brand without any goal in mind. Mobile apps can be an effective way to reach customers on the go and provide them with valuable information about what they are looking for when it comes to your products or services. But before you start creating one for your brand, ask yourself why you need one.
Do customers expect this from their favorite brands? Is there a way for them to access information about your products through other means? If so, then perhaps it is best not to invest money in creating a mobile app just yet.
For example, let’s say you run a skincare brand and you decide to build an app for your products. You can create an app that allows users to browse through the latest collection but that isn’t enough incentive for them to download it. They can simply use other aggregating retail platforms to buy your products.
Alternatively, let’s say that your app allows users to customize their skincare products before buying. Your platform allows them to share their concerns and get accurate solutions for their problems, perhaps through an AI tool or a consultation with a professional dermatologist.
Don’t you think the probability of people using your app will be higher then?
This is what we mean by goal-based planning. For this reason, it is important to understand what kind of customers you are targeting with your mobile app as well as their purchasing behavior before building one.
In most cases, a well-designed website is enough for you to grab your ideal buyer’s attention, provided you get the branding right.
Failing to Get Their CPG Branding Right
Speaking of branding, as with any other product, your brand is what differentiates your product from others in the market. It is also your identity. If you don’t have a good brand name or visual identity, you won’t be able to stand out from your competitors.
A brand is an emotional bond between your customers and your company. It is what makes them choose you over another company, and it is what makes them stay loyal over time.
If you are just starting up, you might be tempted to think that branding isn’t important — after all, you don’t have any customers yet! But this is a huge mistake.
Branding is one of the most important things you can do to prepare for success because it will attract people to your product before they have even tried it out.
That’s also why you need to make sure that your branding is consistent across all channels so that consumers see the same brand image wherever they encounter it — whether that be on Amazon or in retail stores.
Visual identities and branding are two of the most important things when it comes to building an effective CPG business because they define who you are as an organization and how customers perceive you.
At Aventive Studio, we have a team of experts who help you with every aspect of building a solid brand so that you can focus on doing what you do best – coming up with transformational ideas & selling more CPG products. Reach out to us to get started.