FMCG brands face mounting challenges, from stagnant volume growth following price hikes to the ongoing pressures of sustainability, health concerns, and looming restrictions on HFSS advertising.

Navigating this complex landscape is no easy feat and for marketers, there’s certainly a lot to contend with.

“We’re now at a point in time, certainly within the food industry, where volumes are pretty static. Consumers aren’t eating more food. So, for organisations to grow, they need to develop incremental opportunities outside of the core to drive incremental volume,” said Mark Brown, CMO at Hovis, speaking at Oystercatchers’ quarterly Club event last night (19 September). 

Discussing new product development and its importance in contributing to growth, Brown said 1% of core growth is “always going to outstrip any contribution from innovation” over the course of a two- to three-year launch period, “unless innovation knocks it out of the park”.  

‘It’s old because it’s good, not good because it’s old’: Hovis’s first CMO on leading the brand

He urged brands to adopt a “growing core, and add some more” approach. This is pertinent in today’s environment, as Brown highlighted the recent ‘artificial growth’ driven by price increases during inflation, leaving brands to now face the consequences. 

“I think the way food brands need to go is grow the core, focus on the core, because that is what pays the rent, but seek out some incremental opportunities because that will be the future of the business in 10, 20 years,” he added.  

Also speaking at the event was Jon Walsh, the CEO and cofounder of gut health brand Bio&Me. Walsh launched the brand with Dr Megan Rossi in 2019 after a career in marketing leadership at Nestlé and John West.  

For a scale-up brand, focusing on the core product is key, he said. “We do granolas, we do yogurts – but 50% of our sales come from one SKU” – the brand’s super seedy and nutty granola, he said.  

I think sometimes the process is designed to understand and try and know all the answers, when sometimes you just don’t have all the answers.

Mark Brown, Hovis

“The first thing we look at every week is, how is that selling, is that growing?” said Walsh. “Even within our little world, it’s all about the core. Just look after the core.”  

Innovation is “a bet, at the end of the day,” added Brown, and can be dependent on trends which marketers, unfortunately, don’t have a crystal ball for. “I think sometimes the process is designed to understand and try and know all the answers when sometimes you just don’t have all the answers,” he said.  

Brown became Hovis’s first-ever CMO this summer, having spent 13 years at General Mills. Reflecting on how he approached innovation at previous businesses, he described taking on a startup mindset “in terms of how they would pitch for rounds of funding”.

‘It’s old because it’s good, not good because it’s old’: Hovis’s first CMO on leading the brand

“During the process as well, we set up a mini-board, and it was incumbent on that board to bring a learning mindset to the meetings, not an answers mindset, so they were able to ask questions, never get an answer, and then the people on the projects would then go away and decide what to do next,” he explained.  

In times like this, brands need their agencies to be close partners. Becky McKinlay, managing director at Oystercatchers, stressed the importance of agencies being “as close to their clients as they possibly can” while also bringing the “external perspectives in”.  

“That sounds really obvious, but the reason the clients are working with agencies, even those clients that have in-house studios, is they need that external perspective,” she added.  

During periods of low growth, the strains on agency and client relationships can show. “I think resilience is important from the agency,” added Brown. “Because they’ll come up with maybe 100 trends, and they’ll get a no to 99 of them.”  

Impact on the marketing mix

“In food and drink, there’s a huge opportunity in digital marketing, and you don’t need me to tell you that, but retailers and their data give brands a unique opportunity for measurement and precise targeting,” said Brown.  

He sees it as an “emerging element of the marketing mix,” with its influence set to rise. And as brands up their focus on first-party data, there will be a lot more opportunities for brands to harness it “in the right way” to get the “right messages to the right people”. However, he added that “every study I still see [says] eyeballs and mass marketing still delivers for FMCG brands”.  

“So, I think it’s going to be a balance over time and a blending. But I do see a big opportunity in performance marketing,” Brown added.  

At Bio&Me, the focus from launch has been on performance marketing and getting the product into customers’ hands. “Our entire obsession has been performance,” he said, until recently.  

This week Bio&Me’s first above the line campaign rolled out across buses and tubes in London. With a £100,000 budget, he noted that while “tiny” compared to big brands, it’s enormous for a brand still in its infancy.  

The campaign is tied to performance, he noted, and backed up by displays in supermarkets. “We’re all about performance. What I would say, is, I think you can mix the two”, with performance campaigns tying in the brand message.  

“I think you can bring the two together, but we’re 100% performance.”