Fast Moving Consumer Goods (FMCG) is a relatively broad term that encompasses products that consumers use on a daily basis.
To narrow this description down a bit, they are typically products that are relatively low cost to buy and sell in high quantities.
Examples of FMCG products you typically use yourself include deodorants, soap, soft drinks, alcohol and chocolate bars.
Therefore, businesses that can shift high volumes of products generally have the potential for large profits. Yet, businesses – and products – that make high profits tend to face higher market competition.
This results in competitive pricing wars, where profit margins get cut smaller and smaller and the brands that can sell the most usually come out on top.
Yet, legacy brands such as Unilever, P&G and Coca Cola who have typically dominated the market, are facing increased competition from smaller brands, who are becoming increasing competitive with savvy marketing tactics and utilising the cost savings associated with direct-to-consumer business models.
In this post, I am going to cover the impact that SEO is having on FMCG product marketing, and how it is impacting who the real winners in the FMCG markets are.
The ‘Legacy’ FMCG Business Model
The ‘typical’ business model for most well known FMCG brands is to sell products through in-person mass-market retailers; think supermarkets, discount stores, homeware stores etc.
With access to these mass-market channels, the volumes that could be sold are incredibly high. By increasing volume of sales, attention could turn to optimising operating costs, such as logisitics, manufacturing, distribution etc.
The cost savings associated with the supply chain optimisation, means more money becomes available elsewhere, for example, marketing. More money spent on marketing and advertising, generally led to more sales. In turn, creating the flywheel effect that allowed more volume to sell.
And when somebody came to challenge domination of a brand or product?
Simply release an improved iteration of the product, change the marketing message and put more money towards driving consumer sales.
This model makes it obvious how so many brands came close to falling foul of becoming monopolies.
Luckily, e-commerce helped disrupt this.
A Shift to Online
E-commerce was not an overnight revolution, yet it has taken many years for the industry to become so popular that it has actually become a threat to physical shops and retail locations.
On the face of it, ecommerce should of been another perfect opportunity for traditional FMCG brands to cut costs even further and increase the potential market.
Some brands were better at others in shifting to this new way of selling, yet some traditional brands continue to struggle.
However, e-commerce bought opportunities – and continues to do so – for challenger and start up brands.
Fighting for shelf space in retail stores doesn’t happen in the virtual world; there is room for everyone.
It also means that smaller brands can be present in just about the same online locations as the ‘big boys’ whilst also benefitting from the reduced overheads of complex supply chains.
In a way, it levelled the field, and then opened more doors to compete.
Introducing Direct-to-Consumer (D2C)
Direct to Consumer, sometimes referred to as DTC or D2C, is a method of selling products directly from manufacturers to consumers.
This varies from the traditional sales method, where a middleman such as a wholesaler or retailer may be present.
Direct-to-consumer allows businesses to sell directly to the end consumer which has started to become an increasing popular method of sales, particularly as the internet and ecommerce industries grow.
Consider brands like Dollar Shave Club, Casper mattresses and Graze; all brands that started life selling out via e-commerce only.
And these three brands of just a few of the many hundreds and thousands of less well-known brands out there.
What it has achieved, is more consumer variety and in turn, more consumer demand.
Better Availability and Better Informed Customers
So, as opportunities open up for more brands to take a share of the FMCG market, the competition becomes greater.
With increased competition, brands need to stand out amongst each other, which generally means creating better products, or better marketing!
The knock on effect of this, is that consumers start to become more savvy and spend more time and effort doing the research about what is best for them.
Although this may sound like it is becoming harder to market your product, it also offers great potential.
Where do people turn to when they want to do their research?
The internet of course!
Which after a rather lengthy introduction, leads us to why SEO is such an important thing to consider for any FMCG brand.
The Impact of SEO on FMCG
For FMCG brands that are focusing on ecommerce sales, or increasing brand awareness, driving traffic to a website will typically help with both.
Generating traffic to a website doesn’t just happen; it requires paying for it, whether that be advertising such as website ads or paid search results, or generating content to fulfill user search demand.
The latter is SEO.
In a nutshell, SEO is all about producing and optimising content on a website that users are looking for. Generally speaking, the more time and effort spent on SEO, the more website visitors you will generate.
As an ecommerce brand, more visitors usually means more revenue.
And unlike paid advertising, website traffic generated via SEO is continuous and ongoing – unlike paid advertising where the website visits stop once you stop paying for it.
Here’s what to consider SEO-wise for FMCG brands:
For new brands – or brands that have recently changed names – the most important step is to ensure that you own your branded search terms.
For example, when somebody searches for you by brand name, you want to ensure that you own as much of the first page as possible.
Typical listings that you would see in Google, include your website homepage, some social media pages, videos, or map listings to pages you own and manage.
For example, let’s take the example of Dollar Shave Club.
Alternatively, there may be external listings you have no control over, such as Wikipedia pages, news stories or similar.
If you have done any sort of online brand building or PR, these are the listings that generally show up.
If they don’t, or the results are not favourable towards your business, the first thing to do is to address this!
Unbranded search offers real potential for SEO benefits.
Whenever anybody makes a search for a product or service that you offer – without a brand name – you want to do your best to appear for as many related and intent driven search queries.
With a proper SEO strategy, what you publish on your site can impact what generic keywords you can be found for.
Again, let me use Dollar Shave Club as an example.
As a brand dedicated to shaving, they have produced content with a sensible strategy to ensure they get found for shaving related queries.
It didn’t take me long to find these results for users that may be interested in subscribing to a monthly shaving product service.
The potential for ranking for unbranded keywords is huge, and the intent behind these queries can range from building brand awareness to converting to sales, as dedicated by this rather simplistic digital marketing funnel:
And if you are wondering what keywords may be associated with each level of the sales funnel, here are some examples:
Top of Funnel – ‘How to prevent shaving rash’
Middle of Funnel – ‘Best razor blades for men’
Bottom of Funnel – ‘Buy shaving products online’
Notice how the top of funnel keyword is about awareness, before moving onto a education-based query, and finally an purchase intent query.
Some queries may overlap as to where they best fit into the funnel, and that is fine.
But understanding keyword search volumes and intent groups of keywords will help you build and implement an SEO strategy at a later stage.
So, if you know how to generate visitors to visit your website, how exactly does that turn into value or revenue?
Why Leveraging SEO Can Have Big Value to Your Business
SEO is definitely a mid to long term digital marketing strategy, so it is important that you understand the value that it can bring to your business.
In the previous section, I have mentioned about how you can generate website traffic via branded and unbranded search, but here is how it can be beneficial:
Typically, a digital marketing strategy will be building awareness of your brand elsewhere, whether that is social media, adverts or PR.
When a consumer discovers you for the first time, it is likely that they will look for more information. And that usually means visiting the website.
Higher Profit Margins
If you can generate traffic, you can likely generate sales.
If you can sell to consumers directly, you cut out the middle man and generate a higher profit per product or service sold.
Get Consumer Information
If you sell directly to the consumer, you are in the position of being able to understand consumers. You can understand who they are, their gender, age range, location, frequency of repeat purchases etc.
Consumer information is incredibly powerful to marketing teams as it helps to understand the typical customer profile and allow you to focus more on similar consumers, or target new audiences.
For purchases you’ve made online, you have probably received additional marketing after your sale, to encourage you to come back to buy more.
So not only do you receive a higher profit per sale made, you are also in control of trying to get them to spend more with repeat purchases.
It also allows you to tailor your additional outbound marketing strategy to tailor products that you think are most likely to convert into more sales.
Identify New Opportunities
The last few points I’ve made have all focused around the users that engage with your site and end up making a sale.
But what about the ones that got away?
As part of a good SEO strategy, you are able to monitor and assess additional information through tools such as Google Search Console and Google Analytics.
This lets you understand a wealth of data, such as trend in keywords that people are searching for, what countries show higher (or fewer) interactions with, which of your pages don’t convert or any frustrations with the checkout method.
It is important to understand that SEO is an ongoing strategy, that requires continual effort and adjustments to stay on top of an ever-changing digital landscape!
Time to Consider SEO for FMCG?
I hope in this article, I have helped you understand the shift from traditional to digital marketing that brands are continuing to notice.
Digital marketing strategies are complex and SEO is another part of the strategy to consider.
Ultimately, it is all about understanding how you can benefit from how internet users look for goods online and how you can go about making yourself visible to them.
A well though out and implemented SEO strategy can transform an FMCG business to new levels; generating more income, higher profits and high brand valuation.
All you need to do is to consider whether you want to be a brand that makes it successful online!
Not Sure Where to Start?
Are you considering SEO but don’t know where to start or need some help fully understanding the concept?
Don’t hesitate to get in touch with me to see if I can help you understand whether SEO is right for you and ultimately how I can help transform your business online!