In the ‘70s, annual FMCG market segmentation studies were routine. FMCG marketing was superior. Businesses in FMCG reigned supreme… but as fast-profit-taking management styles became more dominant, market research budgets tightened, and knowledge decreased; even though knowledge is power.

To be fair, trade marketing sale people, stretched the truth, were lazy interpreters of data, and didn’t need anything more than a good story to capitalise on or explain swings in warehouse withdrawal changes.

In the ‘90s, retailers developed scan data…  their knowledge grew, and retailers enjoyed the power shift of more knowledge than they’d ever had before… Again, in the ‘00s, FMCG marketing became even harder. FMCG retailers became more powerful as they honed their analysis and knowledge and pooled tactical experience.

You would think FMCG marketers would want to balance power. You would think FMCG marketers would return to the very source of where they found their power. You would think FMCG marketers would be doing segmentation studies routinely, turning their hand to the strategic guidelines that built their industry… But no.

Sadly, FMCG has pursued tactics that contradict the Marketing Concept. They used cheap tricks to gain debatable gains, employing tricks like less quantity of quality in pack contents…. Like enlarging the whole to make consumers inadvertently use more product “per serve”.  They’ve adopted red ocean strategies trying to push each other off shelves rather than expand their market size. They’ve ignored customer needs, wants, trends, indicators and complaints.

Instead, they’d rather complain that Woolworths and Coles are being mean rather than admit marketers are mismanaging their businesses. They’ve reacted tactically rather than move strategically. They’ve succumbed to clocking and cliffing as retailers have teased them into submission.

In my capacity as a presenter of keynotes and workshops for FMCG events, I have asked the audience, “Who has done a segmentation study this year?” and had no replies. I’ve asked, “Who has done a segmentation study in the last three years?” No delegate raises their hand. “Who has done a segmentation study in the last seven years?” Less than one in 10 raise their hand! One event I spoke at I didn’t get a single raised hand when I asked that same question!

No wonder FMCG marketing has become so hard!

Not conducting regular and routine market research in ANY #business is like not opening your eyes while driving a motor car.

 In FMCG, lack of research is sleeping at the wheel, while the engine light in on, in the middle of the night, with your headlights off.

Look at the stagnant product development of Kellogg’s… How long will they continue to wear out a declining market that has been screaming for innovation for decades?

Look at the self-destruction of Mars Petfood… who once owned 85% of the canned pet food market with shelf space that almost filled a whole supermarket aisle? (Remember the yellow wall of Pal?)

See how the weak lethargy of innovation has sacrificed so many categories to the will of retail private labels and generic brands…

Where are the decent brand and product portfolio management plans that deliver the explosive growth of FMCG in the 50s, 60s and 70s?

The dormancy of FMCG strategic marketing has manifested itself in a series of SKU deletions that have served to further undo consumers’ faith in branded products while nurturing retailers’ own brands and labels, power, and independence from branded products.

While one might argue that WW & Coles are only training their customers to switch to Aldi, the point is the duopoly know no better and in the lust for private label, is ignorant of undermining their genuine competitive advantage, (which is inconsistently keeping the IGA brand in existence)?

The point is that all inefficiencies could be removed if the FMCG industry picked up its act!

My fear is that it is too late!

  • The truly elegant FMCG practitioners have retired, died, drawn to more attractive industries if pushed into early retirement.
  • The 40-somethings are naive tacticians who appear to simply lack possession of the knowledge to discern between tactics and strategy.
  • Market research standards have dropped over the past 30 years
  • Corporate cancer (arrogance, bureaucracy and complacency) reigns supreme in many larger multinational FMCG businesses

For a purist like me, this is such a waste. Unhappy, unfulfilled consumers. Unengaged and disengaged employees in suppliers and in retailers. A lost passion for marketing science. Lost ROSF for investors/owners in retail and manufacturing.

Maybe I just need to transcribe FMCG strategic aptitude into Chat GPT?