Welcome to Business Intelligence – FMCG Food and Drink, the fifth of Zenith’s Business Intelligence reports, which analyse the advertising, business and consumer behaviour trends shaping different categories.

FMCG companies had a tough time in 2020, but unlike those in most categories their problem was not a sharp drop in demand. Instead, they were faced with the challenge of retooling their production and distribution networks to get their products to consumers who needed them more than ever, but whose shopping habits were being upended by the spread of COVID. In particular, FMCG companies had to embrace ecommerce in a way they had never previously committed to.

The rise of ecommerce and the continued migration of audiences to digital media are challenging FMCG brands to blend digital advertising effectively with advertising in traditional media – they can no longer rely exclusively on television. With their strong presence in online video and routine use of advertising on ecommerce platforms, Chinese FMCG brands are blazing the trail that Western brands will follow over the next few years.

Consumers are becoming ever more aware of health and environment concerns when buying their food and drink, and FMCG companies will have to respond. Brands that can talk to consumers authentically about nutrition, wellbeing and sustainability will stand the best chance of winning over new customers at a time when their habits and loyalties are in flux.

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