The promise of more data and better insights into customers is causing more FMCG brands to test direct-to-consumer models but few have found the recipe for success yet.
For the FMCG sector the formula for success used to be relatively simple. As long as companies had good relationships with the major high street retailers, great products, strong brands and marketing that turned heads things worked well.
But the market has become a lot more complex. The rise of ecommerce and new high street players such as the discounters has shaken up the route to market. Their products have been disrupted by nimble startups able to authentically target tight segments. And marketing channels have changed, meaning creating strong brands and high awareness has become more difficult.
And so many in the FMCG sector turned their attention to ecommerce and in particular selling direct to consumers. Here, they thought, was an opportunity to cut out the middle man (retailers) and go direct to their most loyal customers, with the added bonus that it would give access to their own data for the first time.
Unilever has just launched its first major direct-to-consumer trial with its mayonnaise brand Hellmann’s. Partnering with on-demand delivery startup Quiqup, visitors to the Hellmann’s site will be able to order ingredients needed for a recipe and have them delivered in an hour, as long as they live in London.
If we have the opportunity to present our products, talk about our ideas, charm our consumers and get them to buy something at the same time then of course we want to do that.
Aline Santos, Unilever
Aline Santos, Unilever’s senior vice-president of marketing, says the test reflects the growing importance of data and having a direct connection with consumers. And that even though the trial is still in the early stages it is already revealing new insights for the brand.
“Before our products were just on the shelves and we didn’t know who was buying them. Now we know who is buying, who is buying again, who is buying more,” she says.
“The sorts of insights this is giving to us and to Hellmann’s is ideas in terms of size, the flavours they want to launch, the social, economic and age groups they are reaching. It is a plethora of new insights that are unfolding to us that we never had before.”
Unilever has also bought Dollar Shave Club, which Santos describes as a “huge inspiration”. Here is a business designed for direct-to-consumer relationships and where there are obvious areas for expansion. It wouldn’t be an enormous leap, for example, for Unilever to start selling Dove moisturiser alongside razors.
“More and more the area of marketing and ecommerce is blurring, and if we have the opportunity to present our products, talk about our ideas, charm our consumers and get them to buy something at the…