Insights & news

FMCG/CPG advertisers can Snapchat to talk to Gen Z and drive sales

By Alvaro Botella Caballero, Marketing Analyst in Snapchat, IMS & Httpool

The new post Covid-19 reality has propelled digitalisation forward by five years. McKinsey research suggests that it could take anywhere between three to ten years for us to feel that going to supermarkets is again a safe and convenient way of grocery shopping. 

Why does this matter? Because the global FMCG market size is projected to reach $15,361.8 billion by 2025, registering a CAGR of 5.4% from 2018 to 2025, according to the Research and Markets Report. This makes FMCG the largest group of consumer products alongside the  production, distribution, and marketing of these consumer goods. 

Alongside the growth in the industry, FMCG/CPG also achieved notable growth in digital ad spend worldwide. Research from eMarketer shows that quarter two of 2020 saw up to a 53% increase in ad spending in the FMCG/CPG sector. According to eMarketer research, CPG advertisers in the USA spend heavily within the mobile sector, with the most popular form being display advertising on social networks and video platforms. 

In 2021 digital video advertising is expected to be the fastest-growing format in CPG ad spending, rising 17.1% to $5.54 billion in the USA alone. Digital video ad spending will make up 47.5% of CPG’s spending on display advertising in the USA and 28.6% of its overall digital spend. 

fmcg creative 1

FMCG/CPG advertisers can Snap away to reach Gen Z members.

With over 265 million people using Snapchat daily worldwide, the app offers an exciting and effective platform for FMCG/CPG to open direct dialogs with millenials and Z generations. All eyes have been on Gen Z, the cohort that according to eMarketer, has an estimated purchasing power of $143 billion a year. 

Users on average are reportedly spending a minimum of 30 minutes daily on Snapchat. The platform offers a unique and powerful window for FMCG/CPG companies to reach younger generations. 

Some of the largest brands, including Mondelez, P&G, Reckkit and Unilever are already actively leveraging Snap ads for maximum impact. 

Johnson&Johnson successfully implemented a Snap campaign to drive efficiencies at scale, delivering over 30 million impressions, at an average CPM of $1.342. Furthermore, Clean & Clear achieved strong interests through Snap Ads with over 104,000 Swipe Ups to the website. Check out the success story here.

FMCG advertisers should not be afraid to leverage the opportunities that AR brings to the advertising world. They should instead learn to harness the power of Snapchat, and embrace the new era of consumers who will soon hold the largest purchasing power. For example, by making two friends shop for a prom dress together and add on a virtual try-on app for Gucci shoes. Look at your feet through a Snap camera to see how the latest design would fit you and then simply push a purchase button! In addition to developing such lenses on the platform, Snap is also letting brands like MLB and Nike build Snapchat AR lenses into their own apps.

To create a successful Snapchat campaign, FMCG/CPG advertisers should specifically focus on:

  • Defining the target audience, whether this be by gender, age, or hobby etc. 
  • Deciding if your campaign is to be run on a specific date, such as an international holiday. Determining and applying these targeting and media inputs will help to identify the most optimal creative execution for your campaign.
  • Determining which metrics to value: play time, shares, or conversions. Establishing this from the onset will be helpful for the creative direction and ensuring the concept matches the goal.
  • Settling on which method will be used to measure success: impressions, playtime, click through, or app downloads etc. This will aid you in selecting the most effective formats (lens, snap ad, filter, etc), and provide you with a clear overview of your campaign.

No matter what your objective is, on Snapchat you’ll find solutions to help you reach your business goals (from awareness to driving consideration), ensuring you are able to transform your campaign into a success story.

In the quickly changing world, it is sometimes difficult to keep track with the latest technologies. But being where your audiences are, is essential to any successful marketing campaign. Snapchat and its attractiveness for the younger generations thus offers an important window of opportunity for all FMCG/CPG advertisers aiming to talk to the members of the next big cohort, as the first members of Gen Z are now slowly coming of age.

Read the full #HttPaper on FMCG/CPG vertical here.