A recent study conducted by the CMO Council and Catalina Marketing’s Pointer Media Network indicates that in 2008 the average brand lost a third of its highly loyal customers¹. In an ever-competitive market place, this information can startle even the most seasoned consumer packaged goods (CPG) manufacturer. However, the news is not all negative, as some would have you believe: there are winning strategies that CPG manufacturers can deploy now to take advantage of the current economic climate to grow market share and regain customer loyalty.

According to David Johnston, JDA Software’s senior vice president, manufacturing and wholesale distribution, focusing on efficient promotions for value-based and premium product lines and leveraging the overall strength of the brand has become more important than ever to capture or maintain a very discerning customer. The strategies outlined below can help CPG manufacturers move the needle on market share and improve agility so that they can effectively adjust as the economy begins to rebound:

• Grow Market Share with Value-Based Product Lines: Today’s CPG manufacturers must compete with the price points that are associated with private labels. Most manufacturers have a value-based product line in place but this line is often not as heavily marketed or promoted as premium brands. However, because of today’s consumer-buying behaviors, manufacturers have an opportunity to grow market share and even capitalize on consumers that are “trading down” to lower-priced items or private labels. By investing in efficient promotional strategies that grow sales within their value-based product lines while keeping the overall price competitive, manufacturers can prevent customers from switching to another manufacturer or retailer brand solely because of price.
• Set Promotional Strategies to Support Premium Brands: While it’s no secret that today’s customers are placing a premium on price, that doesn’t mean that CPG manufacturers should abandon premium brands completely. In order to maintain a differentiated product offering, and be ready to capture customers as they trend back toward higher-quality products, manufacturers must keep customers engaged in premium brands.