Report Summary

Consumer goods (CG) manufacturers are aggressively exploring ways to integrate new channels such as social media and mobile into the marketing mix to attract and engage consumers. However, they are not ready to abandon traditional approaches to consumer marketing. CG marketers say they want to increase engagement with consumers and improve their direct-to-consumer initiatives—but are they really ready to do so?

Perhaps CG companies looking to get closer to consumers ought to think more like retailers, which have made significant investments in understanding consumer behaviour and sentiment across physical and digital environments. New directions: consumer goods companies hone a cross-channel approach to consumer marketing, an Economist Intelligence Unit report sponsored by Oracle, draws on a survey of 221 CG executives as well as in-depth interviews with corporate leaders in the CG industry to explore the changing face of consumer marketing.

Key findings in our research include the following:

Pushing traditional media through new media channels is not enough to reach today’s more plugged-in, product-savvy consumer.
An increasingly complex, non-linear buying process requires a different approach—one that integrates multiple channels to put their brands wherever consumers are, in a way that encourages participation, not passive consumption of marketing messages.

CG companies are experimenting with new ways to establish and enhance direct, two-way relationships with their target consumers across multiple channels. Over the next 12 months, survey respondents plan to leverage social media for such activities as product promotion (73%), capturing consumer feedback (63%) and customer service (62%). In addition, social media participation is growing in importance as a tool to increase consumer loyalty. Nearly twice as many respondents say it will become a top priority in the next 12 months (up to 33%, from 17% today). Deeper relationships, CG marketers believe, will enhance brand loyalty and drive product sales, either directly (through digital commerce) or via traditional retail channels.

Vibrant online communities can serve as an entrée into e-commerce and other direct-to-consumer sales for CG manufacturers that have traditionally sold through third-party retail channels.
Forty-one percent of respondents to the Economist Intelligence Unit survey say they expect to sell products directly to consumers over the next 12 months—up from the 24% who say they currently offer direct sales.

Survey respondents and other CG executives see their nascent e-commerce efforts as complementary to, not competing with, existing retail channels. Forty-one percent of respondents say they work with their retail partners on a variety of marketing, sales and service programmes. However, 23% of respondents say that while they collaborate with retail partners, they are also committed to expanding their competing direct-to-consumer strategies.

An increasingly complex relationship between CG manufacturers and their retail partners is just one example of the evolving nature of CG makers’ direct-to-consumer marketing efforts. As marketers experiment with new channels such as social media and mobile, they are discovering that traditional messaging won’t work in these new media. But they are not prepared to simply abandon the old in favour of the new. Instead, they are finding that a blend of digital media and traditional methods such as in-store marketing is the most effective way to establish two-way relationships with consumers.