Where to Find Growth in Consumer Products
This morning, Mars, Inc., announced an acquisition of the pet health care company VCA Inc. (NasdaqGS:WOOF), a deal valued at approximately $9 billion.
In recent years, Mars has seen steady growth in its pet business, not just with their traditional retail brands such as Pedigree and Whiskas, but also with their ownership of Banfield Pet Hospital and BluePearl Veterinary. Their acquisition of VCA, which owns and operates nearly 800 animal hospitals and 50 diagnostics laboratories in the United States and Canada, is a signal that not only is Mars doubling down on its pet business, but in a diversified way.
While the growth of the pet category continues to outpace that of other CPG categories, Mars diversification within this segment is the interesting strategy to find growth opportunities. Mars realizes that the consumers who are buying their traditional pet care products are looking to invest in and care for their pets in an increasingly significant way. By being able to satisfy this demand, across a diversified spectrum of products and services, Mars is focusing on and tapping into the true value proposition of their consumers, as opposed to simply trying to sell them more products.
When we look at other consumer products companies who continue to struggle with flattening sales, where do they look to find growth in consumer products? How can they follow the lead of Mars to truly understand their consumers? How can a consumer business deliver the value proposition to their shoppers and cater their investments, acquisitions and product development accordingly?
Here’s our list of five ways a consumer-centric organization could follow the Mars lead in the hunt for growth in consumer products:
- Encourage an organizational culture of striving to know your consumer and consistently engaging, communicating, and reacting to ever-changing consumer behavior;
- Invest in data analytics platforms and agile processes to test and react quickly;
- Develop a cross-functional, fully integrated business planning cadence;
- Encourage participation in strategic innovation workshops or practices;
- Build an agile consumer-focused supply chain strategy.
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