A Complete CPG Market Research Guide

Imagine this: You are building a CPG brand in this highly competitive market, and now you want to launch your brand in the optimum way. 

The challenges you are facing are:

• You lack consumer insights for your product. You have built a product, but you’re not sure if it resonates with your audience’s needs and preferences. 
• The CPG industry is an ever-evolving market, and it is even harder to navigate emerging trends and demands when you lack consumer insights. 

Every challenge has a common root cause: a lack of consumer research! Without an understanding of your targeted audience and market, growing your CPG brand is a never-ending struggle.

So, the only solution to the root problem is to invest in CPG market research. 

By conducting thorough research, you can have real-time data for your CPG brand. This data is highly effective in developing the product, creating the right marketing messages, building brand strategy, etc., to drive more success for your brand.

So let us answer some of the major questions for you through our comprehensive guide to conducting CPG market research. 

What is CPG Market Research?

CPG market research is a systematic process of collecting, analyzing, and interpreting consumer data. This process is the foundation of your brand and contributes to almost everything. From defining the look of your brand’s packaging design to conducting marketing campaigns, everything is derived from the insights and data of this research. 

Consumer packaged goods market research can be done through 

• surveys and questionnaires
• focus groups
• online and offline store monitoring 
• observation
• competitive analysis
• experiments and field trials
• interviews
• social media
• sales data
• syndicated 

Why should companies invest in conducting CPG Market Research?

Do you want to increase your CPG brand’s YoY (year-on-year) revenue? If your answer is yes, then you know why you should invest in thorough and systematic consumer packaged goods research. 

Investing in CPG research is the most important step in establishing a successful and thriving CPG business in this highly competitive market today. This step is responsible for making your product stand out among the thousands of products on the supermarket shelf. So, if you’re still skeptical about investing in this CPG research, read further to learn the end results. 

By the end of the research process, you will be able to 

• Study consumer behavior to understand preferences, interests, buying habits, segmentation, and decision criteria, among other things. 
• Evaluate competitive landscape
• Gauge how consumers perceive their brand against competitor’s brands.
• Identify trend shifts 
• Build the right marketing strategies.
• Craft appealing marketing messages and packaging
• Identify the most effective marketing channels to reach their target audience.

CPG market research is a systematic process that contributes throughout a CPG brand’s existence. From enhancing the shelf presence of your products to creating appealing promotional taglines, the research backs almost every execution in the brand’s marketing process.  

What are the types of CPG market research?

Here are two primary types of consumer packaged goods market research you should know about.

Primary CPG Market Research

1. Brand Equity Surveys

The brand equity survey is used to evaluate and measure the value and perception of a brand in the market. Simply put, this survey tells you whether your customers know your brand exists and what they think of it.

How does it help CPG Brands?

A brand equity survey is different from the usual customer satisfaction survey. It helps you understand critical KPIs such as 

• Brand awareness and perception
• Comparison against competitors
• Word association
• Brand loyalty

2. Mobile Ethnography with shoppers

Ethnography is an observational technique for studying human social life. This research aims to describe everyday life and practices using qualitative methods. Hence, mobile ethnography is a marketing research approach that combines mobile devices with traditional ethnography. 

How does it help CPG Brands?

This marketing research approach helps in determining the following critical KPIs for CPG brands;

• Shopper’s behaviors, attitude, and decision-making process.
• Customer’s purchase intent.
• Consumer shopping habits.

3. Customer Segmentation

Customer segmentation refers to the process of breaking down the customer base into discrete groups of people who share comparable attributes. These attributes are divided on the basis of factors, including demographics, geographics, behaviors, age group, and gender, among others.  

As a result, marketing strategies, products, and services can be tailored for specific groups of customers.

How does it help CPG Brands?

Customer segmentation can assist CPG companies in understanding KPIs, including;

• Market penetration
• Customer Lifetime Value (CLV)
• Purchase Behavior

4. Shelf Testing

After developing the product concept, you now want to see how your target consumer base responds to it. That’s when you conduct a shelf test for your products. 

 A shelf test simulates a retail environment in order to determine how consumers interact with products on store shelves, including their placement, packaging, and pricing.

How does it help CPG Brands?

Using shelf testing research method, you can find out the following KPIs of your brand;

• Product Visibility
• Shelf Impact
• Purchase Intent

5. Focus Group

A focus group is a research method for collecting direct feedback from a brand’s target audience. It typically has 8-10 members who share their opinions on the brand’s product names, taglines, packaging, logos, advertisements, etc. 

How does it help CPG Brands?

The focus group research method helps in understanding the following KPIs of your brand;

• Consumer feedback
• Consumer insights
• New product development & testing

Secondary CPG Market Research

Secondary Marketing research involves collecting existing data and information from sources like reports, press releases, books, surveys, census data, and other publications.

Secondary data for CPG market research can include;

• Industry reports like Nielsen and Circana (formerly known as IRI Worldwide).
• Market studies from sources like Pew Research Center and Ipsos.
• Trade Publications like Supermarket News and Grocery Dive
• Financial Reports like Bloomberg and CNBC.
• Social Media listening like Hootsuite and Mention.
• Retail data from retailer’s owned analytics platforms including Kroger Precision Marketing, and Amazon Retail Analytics.
• Government Data such as the U.S. Census Bureau and Bureau of Labor Statistics (BLS).
• Syndicated Research, including NielsenIQ and Mintel.
• Academic Research like the Journal of Marketing Research and Journal of Retailing.

How does it help CPG Brands?

Secondary data helps in evaluating critical KPIs of brands, such as

• Consumer trends and preferences
• Retail channels and distribution trends
• Competitive landscape overview
• Customer Acquisition and Retention
• Brand loyalty and awareness

How to conduct market research for your CPG brand?

Now, as we have discussed everything related to CPG market research, here’s the execution part. Follow the below steps to perform market research for your brand. 

1. Outline your goals for the research

Describe your project’s precise objectives for conducting market research. A few examples of research objectives are to gauge the success of your marketing initiatives, comprehend customer preferences, and appraise novel product concepts. 

2. Define your target audience

This is the demographic of consumers you want to reach and eventually win over as loyal customers for your business. Identify the optimal target customer segments for your company’s products. Consider elements like demographics, psychographics, and behavioral factors relevant to your research objectives.

3. Select a research methodology for your brand

Now that you know the goals and target audience, it’s time to select the most suitable method. Choose one of the above-listed methods, such as surveys, questionnaires, mobile ethnology, or focus groups.

4. Create a Design Roadmap

It’s time to start developing your research study with your research methods in mind. This may include developing an observation protocol, discussion guide, or questionnaire that (again) complies with your research goals. 

5. Data collection and analysis

After that, select a reputable sample supplier (or use a list of clients you have provided yourself) and send out your survey! In most cases, real-time results analysis is possible when using a survey platform to gather respondent completions. In the case of other data collection techniques, like conventional agency surveys, your analysis will probably begin after the final results are received. 

For qualitative interviews or focus groups, you need to pick a time and date to invite respondents, either virtually or in person. While collecting your data, you should also consider subscribing to statistical testing and data visualization tools for analysis. These tools will make your analysis much simpler and quicker.

6. Interpret and report findings

Analyze the research data to conclude your brand and competitors. Present key findings in easy-to-understand graphics and compile them into a final report. Distribute the report to stakeholders along with recommendations.

7. Implement

Use the insights from your market research to inform your company’s decisions and strategies. Based on the gathered information, improve consumer experience, product development, marketing, pricing, and distribution.

Conclusion

CPG market research is the foremost step towards establishing a strong brand. Using the valuable insights from this research, you can drastically increase sales, create marketing campaigns, design product packaging, stay ahead of industry trends, increase YoY revenue, etc.

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