October 15, 2020

How FMCG Brands Can Drive Direct-to-Consumer Communications Going Forward

By Danny O'Reilly at Cheetah Digital

As we tentatively begin to emerge from the COVID-19 crisis, the FMCG vertical, like every other, is in a state of flux. However, unlike its contemporaries in travel, restaurants, and retail, rather than a miserable quarter in terms of sales, it has enjoyed something of a bounce. Like all things though, this too shall pass, and whether you rewind or fast-forward a few months, FMCG brands will still face the same challenges they did pre-pandemic.

Market saturation and an evolving consumer appetite for organic and more locally-sourced products has hit the bottom-line for FMCG brands already jostling in a crowded marketplace. Disruptor brands, whether selling weekly hipster coffee subscriptions or bi-monthly razors with sensitive pre-shave face scrubs are selling direct-to-consumer and eating into market share.

Disruptor FMCG brands are smaller in relative terms, but with that comes agility. And while they may not always have their products on the shelves of behemoth supermarkets, the direct-to-consumer relationships they are fostering empower them with the ability to collect the opt-ins and psychographic data points required to build more meaningful relationships with their customers.

As FMCG brands diligently support their customers during the COVID-19 crisis, it’s essential to prepare for the future too, and adopt a strategy rooted in zero-party data. Zero-party data enables FMCG marketers to foster lasting and more meaningful connections with their customers that are grounded in self-reported data.

The zero-party data path

For the uninitiated, zero-party data is not first-party data with a Hollywood reboot. First-party data is collected during sales, and includes things like purchases, mailing address, date of birth and the like. All valuable information, but it’s purchase history, rather than purchase intentions, and falls short of things like what compels your customer to buy, what features, benefits, and deals they look for — the information you really need to tailor your messaging.

First-party data acquisition is essential, but it’s merely a starting point – it’s zero-party data that will help FMCG brands win a future post-pandemic.

“Zero-party data is that which a customer intentionally and proactively shares with a brand. It can include purchase intentions, personal context, and how the individual wants the brand to recognise her.” – Fatemeh Khatibloo, Principal Analyst, Forrester

It is possible for FMCG marketers to collect preference and psychographic data that is intentionally and proactively shared directly with them by the consumer. This is zero-party data. They collect this by connecting directly with consumers and gathering the data, insights, and permissions they need to power personalised marketing across all stages of the customer lifecycle.

Rather than inferring, you ask, and consumers are willingly and intentionally sharing. It is quite simply data your customer has willingly shared with you, like purchase intentions and preferences to improve personalisation and help build up a picture of who they are. As it comes directly and willingly from the consumer there are no intermediaries, no guesswork.

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By Danny O'Reilly at Cheetah Digital