Before we take a look at which brands have won the decade, let’s take a birds-eye view of the industry and discover what has changed – and what behaviours have stayed consistent
The FMCG industry has shown itself to be incredibly resilient: delivering consistent growth over the last decade. From 2012 to 2021 the industry grew by 33% – a $650 billion increase in value sales. To understand what has driven this growth, let us first take a look at what’s changed.
Population growth is responsible for approximately half of this increase. We have seen the number of households grow globally by 17% – an increase of 180 million households.
This holds a mixed picture for brands. While there are more shoppers to go after, it also means that 1% penetration globally today is almost 1.8 million more households than it was ten years ago.
And the bigger a brand is, the harder it needs to work to maintain the same level of global penetration. For example, if a brand had 30% penetration in 2012 it meant it had 316 million households buying it. In 2021, to achieve the same penetration, a brand would have had to attract over 370 million shoppers: an increase of 54 million.
When thinking about the next decade, brand owners should factor in long-term population growth when setting penetration targets. (We will discuss the importance of penetration for consistent growth and penetration targets in the next few pages.)
The upside is that this population growth has had an almost one-to-one positive impact on the number of brand choices made. This metric has risen from 329 billion brand choices to 382 billion – a 16.2% increase.
The other driver of the industry value growth is how much shoppers have spent. When we look at this metric specific to brand spend, we see that, on average, the spend on brands has increased by over $130 per household.
Generally, when looking at data, we like to analyse change. It’s interesting, and it shows us how brands must adapt to shopper behaviour and demand – information that is always useful.
However, with ten years of Brand Footprint we also wanted to identify the trends which haven’t changed. The data points that are consistent across the decade. This data offers brands confidence, as they can refer to long-term behavioural truths which will last for the next ten years.
The first behavioural truth is that the number of brands that shoppers buy remains the same today as it did ten years ago. The average household buys a portfolio of 55 FMCG brands in a year.
Importantly, this doesn’t mean the same 55 brands each year. The challenge for brand owners still remains: how to enter a shopper’s portfolio – and then stay there.
The second behavioural truth is that the only way to grow is through finding more shoppers. Across the decade, 88% of growing brands did this.
As a brand owner, increasing your number of shoppers should be your primary goal year after year. Once this is in place, frequency and loyalty follow suit.
The third consistent behavioural truth is that growing brands gain 1.1% penetration points within a market.
This is a benchmark for success: if your brand gains 1.1% penetration points, then it will have had a good year. It’s certainly true that plenty of brands will have gained more than this, but far more will lie below this benchmark, including of course, those brands which saw no growth.
Other considerations for setting sensible penetration targets include your current size. If you are small (<10% penetration) aim for a penetration gain of 0.5%, and if you are bigger you can be more ambitious and aim for 1.5%.
The rules for growth appear simple, but we know it’s not always as black-and-white as the data shows. If we next look at the 50 most chosen FMCG brands globally, and how many of these brands have grown, we see that it’s like flipping a coin: it’s a 50/50 game.
Over the last ten years, on average 25 of the Top 50 global brands have grown.
An important distinction in this is that we are not seeing the same brands growing year on year. In fact, only two brands have grown in each of the last 10 years, with only six more growing 9 of the 10 years.
This highlights just how hard consistent growth is. But these brands should be held up as best-in-class examples – and celebrated. A big congratulations to both Dove and Vim, from Unilever, for achieving this remarkable feat.
So, what can we learn from them? What have these brands done consistently?
Well, both consistently gained more shoppers. Year after year, they reached more households and in turn, they saw an increase in the number of times each household bought them.
This is consistent across all our Brands of the Decade. Each one has increased its shopper base over the ten years.
So, how can brands look to mirror this success by achieving consistent shopper gains? Let’s look at the 11 award winning brands to understand what they have done.
