Legacy CPG Companies in the Digital Age

As the world has shifted to digital, many brands have been slow to pick up on the trend and adjust.  So far, being slow on the uptake has not stopped some of these CPG companies from surviving and thriving despite the digital shift, but the COVID-19 pandemic has accelerated the need for brands to go digital, and now many legacy brands are scrambling to get on the train.  The biggest changes we are seeing happen are in different types of customer buying behavior.  75% of US consumers are trying new shopping behaviors since the pandemic hit, and as such, the sales funnel and the customer’s path to purchase has re-calibrated.  Customers are interacting with products and with brands differently.  And these these trends will have staying power, with or without the eventual eradication of COVID-19.

A success story in this has been Kellogg, which rightfully injected significant investment into tech and talent to fulfill the e-commerce elements of their growth strategy.  But a great deal of their success in weathering the pandemic storm may have had to do with growing strong pre-COVID, which makes one wonder if post-COVID survival is in some ways a luck of the draw.  Other legacy brands that have not prepared as well for the pandemic that forced their hand into digital, investing in new tech and talent starting now can take more time than they have, and may require infrastructure changes.  As Julie Bowerman, chief global digital customer and consumer experience officer at Kellogg, said of the keys to Kellogg’s success through the pandemic: "It's really important finding talent that understand that model, unique to CPG, but also have the e-commerce depth and the digital acumen to be able to transform and lead an organization.”  

Demand for talent and tech is high, and those that have prepared for this push will win out.  Other brands may have to rely on strategic partnerships with smaller D2C companies that can help jumpstart them into the digital world.  This can help them reach new markets, of course, but from a marketing perspective, this may also open up ways to develop social programs with those D2C partners, giving them opportunities to put their legacy brand name on a digital product.  But the endgame is clear, and these partnerships are a good stepping stone for making the longer-term necessary changes in order to survive and thrive in the digital world, and to have more of a defense against crisis. 

Sources:

https://www.marketingdive.com/news/how-kellogg-prepared-for-the-e-commerce-surge-by-boosting-tech-and-talent/588559/