Why CPG Brands Must Embrace The ‘Age of Experience’

June 15, 2020

At CES 2020, H.S. Kim, President and CEO of the Consumer Electronics Division at Samsung Electronics, announced the “Age of Experience” during his opening keynote:

“The Age of Experience will be defined by personalized technology that meets your needs… [it] will help you make a tangible connection with technology in a personal way that was not possible in the past. Instead of changing your routine to incorporate more devices, your devices will work seamlessly for you.”

To put it in simply, the Age of Experience is using technology to create personalized experiences that make life more convenient, more enjoyable, and more meaningful.

Embrace The New Retail

In the world of marketing and brand building, especially in the digital space, the concept of creating a deeply integrated experience is likely familiar to you. With ever-growing competition, brands are more eager than ever to build lasting relationships with consumers. In parallel, consumers expect a more meaningful experience.

As with these growing demands, brands have felt the pressure to create a more personal and consistent shopping experience, which has been generally referred to as “omni-channel.”

What is Omni-Channel Marketing?

Omnichannel involves integrating each touchpoint to offer the customer exactly what they need, when they need it, anywhere they are and on any device. So, in theory, a customer can be shopping online from a desktop or mobile device, via phone, or in a brick-and-mortar store, and the experience of your brand will be seamless.

It’s a pretty simple concept, however, executing it is where it becomes tricky.

Take booking a trip to Disney, for example. Starting with your first experience on their website - whether you’re on a desktop or a mobile device, the experience is seamless. Once you book a trip, you can use the My Disney Experience tool to plan everything, from where you'll dine to securing your Fast Pass.

While In the park, you can use your mobile app to locate the attractions you want to see, as well as view the estimated wait time for each of them.

Furthermore, the release of its Magic Band program allows a consumer to use a wristband as an all-in-one park admission ticket, hotel room key, photo storage device, fast pass, and food ordering tool.

They are a tried and true example of how to blur the lines between online and the physical world to compete in the new Age of Experience.

CPG Brands in The New Age of Experience - The Problem

Unfortunately for many CPG brands, their ability to improve the experience of their customers is very often limited by their distribution partners.

In fact, there is a sensitive area of overlap where a retailer (e-commerce or brick-and-mortar) is more concerned about the value of their brand than the value of yours. If you don’t have a well-established brand, the retailer would have to decide whether granting you shelf space will hurt or increase their own value.

Most CPG brands often have very limited access to the consumers of their products in mass, because retailers consider the consumers of your products to be their customers. This greatly restricts the ability of a CPG brand to understand the experiences that customers have with their products, and to collect data. This can ultimately negatively impact their ability to drive a true omni-channel strategy.

To thrive in the Age of Experience, CPG brands have to find direct connection with the consumers of their products.

CPG Brands in The Age of Experience - The Solution

Similar to Disney, few understand the concept of omni-channel retail better than Jeff Besos. Amazon is still a poster child of a company designed around customer experience and that is the key to success of the Amazon brand. In fact, Amazon’s stated mission is to be “Earth’s most customer-centric company.”

While Amazon has vastly more resources than most brands today do, there are still lessons to be learned from their success - and it focuses on leveraging consumer data to improve experience.

So how do CPG brands accomplish this when retailers impede on your ability to connect with your consumers and gather important data?

The answer: tactile experience.

There is an old saying: “one picture is worth a thousand of words.” One of our customers, an experiential marketing firm called Flavor Fanatics, modified the saying to “one taste is worth a thousand pictures” (i.e. advertising images). This is a great testament to a power of tactile experience.

Take Le Tote, for example. They are an online fashion rental store who, in November of 2019 purchased the 194-year-old department store chain Lord & Taylor for $100 million. While it raised a lot of questions, founders Rakesh Tondon and Brett Northart defended their decision, stating:

“A lot of these digitally native brands are realizing there is a ceiling to how much you can scale, and how much you can really connect with a consumer online… There are real limitations, there is no tactile experience, there is a lot of lag and latency in the shipping experience.”

How CPG Brands Can Create Tactile Experience

I get it, not every business is capable of making a $100 million dollar investment to expand their offline footprint, nor do I think it’s advisable in many cases.

The point is that you must meet consumers where they are in order to build relationships and create a deeply integrated customer experience in retail environment. An extremely effective way for CPG brands to do this, is through in-store product demonstrations.

You can spend millions of dollars using beautiful copywriting and top-notch design to tell of the greatness of your product, without showing a cent of change in perception of your brand by actual customers.

Alternatively, you can invest $2-$4 per customer, allow them to touch, smell, and/or taste your product, and get direct on-the-spot feedback. This strategy not only benefits your brand’s ability to innovate, but also it benefits your relationship with your consumers. They feel like they’re being heard - not by a robo-chat, or a generic email survey, but by a real person, in real time. And not a "survey", but actual conversation.

Now, isn’t that the better customer experience?