Modus Planning’s Post

🚨Why do most CPG brands fail?!🚨 Here are 5 themes I’ve seen from working with >300 CPG brands at Basemakers … 1️⃣Poor Product-Market Fit This is often the most critical factor. I've seen well-funded teams fail because their product didn’t stand out from what’s already on the shelf. On the flip side, bootstrapped brands with inexperienced teams have succeeded due to high demand, which eventually attracts both talent and investors. Refine your Product-Market Fit through the 5 Cs: [Company strengths, Competitor vulnerabilities, Climate, Collaborators, Customers] than work on Segmenting, Targeting & Positioning into 4 Ps: [Product, Price, Place, and Promotion.] 2️⃣Weak Route-to-Market Plans & Weak Sales Force Some brands target the wrong channels or expand too quickly without understanding trade spend & the cash flow cycle. This often leads to running out of money. When you’re short on cash and seeking investors without a strong sales story, it’s tough to raise the funds needed to stay afloat. A brand must also be able to successful sell into the right doors (with adequate sell through suport) in line with their plan to hit revenue goals 3️⃣Inadequate Sell-Through Support Retail CPG is a physical business. Many brands fail to plan for VOIDs, out-of-stocks, or poor shelf placement. A beverage placed on the bottom corner of a dry shelf in a conventional grocery store is unlikely to gain traction without proactive support. 4️⃣Lack of Funding Let’s face it: CPG is expensive. There are the ocassional stories of bootstrapped brands that hit it big but those are few and far between. Most emerging brands launch without adequate capital to support the brand in retail. There is a misconception that once you get on shelf the product will sell itself. The founder should spend time cultivating a network of investors early on before they need the money while they build out early velocity success stories in a focused way. 5️⃣Overlooking Operations and Supply Chain Inefficient supply chain management or inability to meet production demand can cripple a brand. As you scale, operational hurdles like delayed production or inconsistent product quality can lead to lost retail partners and consumer trust. S/O Simon Solis-Cohen for asking.

Innovation. 84% of CEOs believe it's critical for growth but only 6% are happy with their company's innovation performance. Sound familiar? Sampler's new guide might help. Have a read below!

Throughout my time here at Sampler, I have had the opportunity to witness so many brands bring their innovation strategies to life! Interested to learn more about why CPG innovation is essential and how to leverage it for growth and success? Read the article here: https://lnkd.in/gTrr4NKQ

How is your brand tackling innovation in 2024 and beyond? Check out these 7 ways to keep a competitive edge and how Sampler can help.

Money Money Money Typically costs $100 million to make consumers aware of a national brand. A vast majority of CPG brands will not have that much capital while the big brands have enough money to advertise properly. A new retail CPG brand will require lots of capital to compete, or it will have to capture a consumer demand that isn’t being met in that particular category/market. Please comment, share and suggest how a small, emerging brand can compete in many crowded categories. Emerging or Submerging......

Check out Sampler's newest guide focused on how to de-risk CPG innovation!

How to turnaround a DTC business? In our experience, DTC businesses fail because (top reasons - non exhaustive): ◾ They do not des-average enough their CAC-CLTV per actionable consumer segment and at such they do not understand who should be granularly their specific target consumers & what are their 4Ps preferences ◾ They waste (most of) their resources (CAC & CLTV) subsidizing unprofitable (or low profitability) consumers/ value propositions ◾ They have a structurally too low margin contribution per order as the result of an under-optimized/ inadequate supply chain ◾ At launch, they benefited from both a CAC-CLTV & a value proposition arbitrages but they then failed both to keep relevant their value proposition and protect/ improve their CAC-CLTV differential ◾ They thought they were a Tech company and over-invested in complex, hard to maintain & expensive in-house Tech ◾ For the ones that have a right-to-win omnichannel, they failed to execute at the right time, in the right way ◾ They lost confidence from their shareholders (may that be VC/ PE/ Strategic) as they didn't deliver on their commitments & as a consequence they failed to protect their key success drivers from access to finance through securing the right capabilities/ talents to protect their decision-making autonomy We have seen this 'movie' many times before and although each case & way forward is unique, most of the issues are similar There are often ways to go about it but it requires a fast, consumer-centric & disciplined turnaround approach The objective is to create a strong common understanding between shareholders and management on the past/ current performance's drivers, the business potential (in a fact-based consumer-back manner), the optimal strategy, the corresponding required resources & a de-risked execution roadmap That is what we the 10-steps DTC Turnaround process and it usually takes around 8-10 weeks To learn more, read our last publication on DTC success & failure cases, success drivers & turnaround approach FMCG CEOs: Is DTC Dead? https://lnkd.in/eNbKBFFk We estimate there is still for ~$100bn worth of FMCG DTC assets active in the market. Most of them need a turnaround Time to be decisive to protect the value of those assets Exciting times To get the deck, pl. leave your name in comment To subscribe to our FMCG CEO newsletter: https://lnkd.in/eR8vDpvE Nestlé Unilever Reckitt The Estée Lauder Companies Inc. SC Johnson Mars Procter & Gamble The HEINEKEN Company AB InBev Diageo L'Oréal Coty Henkel #fmcg #cpg #dtc #ecommerce Frederic Fernandez & Associates

CPG innovation is challenging. It's risky and resource-intensive, but the benefits of successful innovation are undeniable. When done right, innovation can build customer loyalty, defend against competition, grow revenue and improve brand recognition and value. Over 1,000 CPG brands have worked with our team at Sampler to digitally target & distribute product samples to the right consumers. Here are 7 ways to keep your competitive edge in 2024.

What brands think they need VS what they actually need: The innovation and NPD edition... Don't get me wrong here, Traditional market research methods have their place, but they're just not cutting the mustard when it comes to helping FMCG brands successfully innovate and improve their NPD win rate. Those big, pricey trend reports, irregular consumer surveys and small, in-person focus groups might help an organisation feel that they are "on the pulse" or even allow them to believe that they're a "data-led" organisation. ...but they're not helping FMCG brands beat the 92% NPD failure rate and succeed with innovation in 2024. YES - the key to winning with NPD is still collecting valuable data insights, and understanding the evolving needs of the consumer... BUT the modern FMCG brand needs MORE speed, MORE agility, and a much DEEPER, more frequent, more meaningful, connection with the modern consumer! They need real-time insights to enable truly data-driven decision making. I've watched countless brands waste £££ millions on outdated research and NPD processes. Yet they never learn from their mistakes. They just reload the innovation cannon and fire another 10 ideas at the wall - hoping 1 will stick long enough to be labelled a success. The smarter, often much smaller brands are the ones who are brave enough to challenge the old way of doing things - and it's not a coincidence that THEY are the ones finding real success with innovation and NPD. They're using new-age consumer engagement tools to enable... 1. Real-time consumer insights ↳ The market changes faster than you can say "focus group" ↳ Implement always-on data collection to stay connected 2. Agile product development ↳ Build products with the consumer, not just for the consumer ↳ Engage the target audience with early concepts and prototypes ↳ Implement rapid, iterative testing and listen closely to optimise everything 3. Data-driven decision making ↳ Gut feelings are out, data is in ↳ Base every decision on solid, ROBUST, relevant data 4. Continuous consumer engagement ↳ One-off interactions won't cut it anymore ↳ Stay connected with target consumers for ongoing feedback - - - - - Do you agree? Do you think brands need to change to find more success in 2024/25? ⬇️ ♻️ Repost this to share with others. And follow me for more FMCG insights.

“We started realizing that DTC was the fastest way to get our products in front of consumers and get real-life feedback.” Carter Jensen Read the article and listen to the audio. Carter goes much deeper on role and purpose of DTC eCommerce. My strategic fixation at the moment is in thinking about the role of DTC for CPG companies and merchandising strategy through leadership in a way that doesn't always focus on sales as the primary KPI. Even though the conversation from Carter with The Digital Shelf Institute is a few months old now, he makes some really key callouts on purpose and reason for being that resonates with me. We are more than 20 years into eCommerce as a channel and the struggle to gain organizational alignment hasn't necessarily gotten easier and in many ways, maturity at the top hasn't grown. Yes, as digital leaders is it our responsibility to educate, train, and move everyone forward. I have found success in pockets and I've grown businesses in many sectors via DTC/eCommerce. The common theme driving success is the commitment and persistence with your team and the bullets below have been guiding principles and learnings across my career. - Build your core team in a way that has everyone committed to the cause. Doubt is fine, but deviating from the vision or fundamental doubt will kill credibility up the chain. - Build trust within your team. Cast the vision for what, but allow room to fill in the HOW. Let your team lead from their position. - Have a consistent message and PR plan with your leadership (sometimes you need to go as far as internal propaganda). Be strategically sound in the WHAT and HOW from your team/the work you will do. Merchandise the wins, be transparent with failure, have a plan for how you pivot. - From jump, be clear on purpose. It's not always sales. Innovative leadership focus on the consumer first, meaning loyalty, product feedback, trial, consumer insights can in many ways be much more valuable than a net sales via DTC channel. Consumers do want a direct relationship with your CPG brand. Maybe not all of them, but a significant and growing group. Don't ignore those consumers. Harness the power to drive your growth.