By expanding its core business and entering new markets, MARS has found a way to evolve from a pet food manufacturer to an animal care expert—becoming one of the world's most important partners for pet owners. The company’s ability to find relevant partners, like animal hospitals and innovative start-ups that cater to the domestic animal, plays a substantial role in this transformation process.
The shift from a product focus to a consumer experience strategy
What applies to pet food manufacturers, like MARS, is equally relevant to other product categories in the consumer goods industry. The market, formerly occupied by a small number of global companies, has become increasingly fragmented. With lower barriers to entry, agile start-ups and online retailers are entering the market—blurring the boundaries between retailers and suppliers and creating complex ecosystems with different players. This trend has far-reaching consequences, especially for traditional FMCG and CPG manufacturers. Increased competition is eroding market share and hindering growth. While current figures show a general increase in the growth rate of leading manufacturers, it is mainly due to expansion-driven mergers and acquisitions (M&A).2 In complex ecosystems, however, the main objective of an acquisition should be to optimize the customer experience, which will be the only way to create a real competitive advantage. To survive in this new reality, consumer goods manufacturers must consider the entire value chain and identify which points along the customer journey to optimize the brand experience.
Without their own sales channels, product-focused FMCG and CPG companies relied heavily on the retail trade because of its reach. Initially, this was a solid strategy. Today, however, consumer goods manufacturers are realizing they’ve lost the interface and connection to the consumer—which is essential in creating a cohesive and consistent brand experience.