Multicultural Consumers Driving CPG Trends

ORLANDO, Fla.Significant demographic and economic shifts over the next 10-plus years will dramatically reshape the growth and decline of consumer packaged goods (CPG) products in the future, according to new research from The Nielsen Co.

According to Nielsens projections, the top CPG growth categories in 2020 will include ethnic health and beauty products, medications and remedies, health aids, vitamins and cooking essentials, such as flour, shortening, sugar, yeast and eggs. The slowest growing categories will include toys and sporting goods, breakfast foods, baby care products and pet products.

The category shifts are directly tied to the changing face of American consumers. For many years marketers have relied on middle-class families as the primary target for many CPG products. However, by 2020 Nielsen predicts new challenges for CPG manufacturers and retailers due to fewer households with children, an aging population and the continued growth of lower-income consumers. While the aging population will be dominated by non-Hispanic Caucasian consumers, the majority of new families will be multicultural in less than two decades.

The demographic shifts underway create both challenges and opportunities for CPG marketers, and companies that anticipate the shifts could have a competitive advantage, said Doug Anderson, senior vice president, global research and development, The Nielsen Co. It will be absolutely critical for CPG companies to adapt in order to gain the attention and brand loyalty of the aging baby boomers, multicultural families and lower-income consumers of the future. Those who keep doing what theyre doing today will be left behind.

 While some companies have multicultural marketing initiatives in place today, by 2020, multicultural marketing will be a necessityrather than an optionfor doing business. This shift will impact product selections, product flavors, and the methods marketers use to reach their new target audiences.