6 Consumer-Packaged Goods Trends That Impact Validation

Kneat is proud to serve Fortune 500 clients and Interbrand Best Global brands, including the U.S. subsidiary of one of the world’s top fifteen CPG companies(1). Learn how our cloud-based digital validation solution, Kneat Gx, helps validation teams and organizations operating in the consumer-packaged goods (CPG) industry to thrive and succeed in today’s fast moving, competitive landscape.

Global demand for consumer-packaged goods like food, beverages, cosmetics, household products, oral health, and personal care items, is increasing at a significant rate. CPG market size was valued at US$1951710 million in 2021 and is projected to grow at a compound annual growth rate (CAGR) of 3.1% over the next six years, reaching US$2418700 million in 2028(2). This rapid growth can be attributed to several factors and new trends, including the growing number of new companies introducing their product lines, seasonal and limited-run items (driven by promotions and special events), and private label brand share.

The consumer-packaged goods industry is changing fast. Read this blog to learn more about six trends in consumer goods that impact validation activities in 2022 and beyond.

✓ Direct-to-consumer business models
✓ Smart technology
✓ Private label branding
✓ Personal care
✓ Rapid cold-chain delivery/Q-commerce; and
✓ Sustainability

1. Direct-to-consumer

Direct-to-consumer (DTC) is the model of selling products directly to customers. Many existing CPG companies are joining the DTC wave and are largely doing so through acquiring or investing in competitors, launching new brands, offering limited-run items, and selling existing brands directly to end users. The growth of social commerce in particular—the combination of e-commerce functionality and social interaction—as a channel to sell CPG is increasingly being implemented by social media platforms, with almost half (48%) of social media users in the United States making a purchase via a social media platform between 2020 and 2021(3). Brands today are leveraging more and more e-commerce omnichannel platforms to market and sell their goods, putting an increased pressure on validation teams to support tighter production deadlines, faster changeover of facilities, and streamlined commissioning of new sites to meet increased demand.

2. Smart technology

As e-commerce and social commerce surges, technology is continually advancing. Machine learning solutions, artificial intelligence, and automation help reduce challenges in the supply chain and on production lines. Digital validation technology, like Kneat —that digitizes and automates validation and quality processes—enables brands to reduce validation cycle-time and costs, improve production times, and get customer products to market faster than ever before.

3. Private label brands

Retailers launching their own brands is another current trend. The possibility of better profit margins and direct control over validation and product development are making private label brands extremely attractive to retailers today. Implementing a digital validation management solution from the outset can help to make private label brands more competitive and agile by reducing quality assurance cost and time burden.

4. Growth in demand for personal care products

There are over 70 million millennials (4) in the United States, and as of February 2021, more than 70%(5) of this generation group indicated that they planned to spend more on self-care and over the counter (OTC) medicines and products to treat themselves(6) . A global increase in dental problems due to poor choices in eating habits and a rise in the popularity of herbal products is also a contributory factor to a surge in demand for oral care products (7).

Kneat serves Fortune 500(8) and Interbrand Best Brand (9) owners, including the U.S. subsidiary of one of the world’s top fifteen CPG companies, to help them to streamline, standardize, and manage their entire validation life cycles and bring their products to market, safely, quickly, and effectively.

5. Rapid cold-chain delivery/Q-commerce

Dedicated, rapid delivery or ‘q-commerce’ has become a critical feature for many fast-moving CPG products including those requiring cold-chain distribution, such as groceries, probiotics and other healthcare products. The uptake in the e-commerce and fulfillment of CPG goods is increasing the complexity of CPG cold-chain networks, now often comprised of both direct to consumer and via retailer distribution approaches – presenting new challenges in cold-chain validation.
Typical cold chain validation processes remain paper-based making them inefficient, labor intensive and susceptible to data integrity and compliance risks. Ensuring cold chain integrity, consumer safety (and the value of brands) is paramount for any cold storage facilities operations. Kneat’s cold chain digital validation application ensures data visibility and enables online monitoring of the validated state of the cold chain network, reducing risk of product loss and giving product owners peace of mind that all transport is operating as it should, with the correct temperature control.

6. Sustainability

Sustainability has been a significant driver of consumer behavior and demand over the last decade. When it comes to sustainability, Kneat helps its CPG clients to deliver on environmental considerations and governance. By digitizing the entire validation lifecycle, through the elimination of validation on paper alone, Kneat enables companies to decrease their carbon footprint by over 1.5 tons, whilst achieving efficiencies that drive the bottom line. Kneat customers, including eight out of ten of the world’s largest life sciences companies, report validation cycle-time reductions between 50%-100%, validation cost savings of over 35%, and speed-to-market acceleration of 17% for tech-transfer and software deployment –while reducing their carbon footprint .

Your partner for validation and business success

Consumer-packaged goods brands are always innovating, whether it be new products, flavors, packaging, or distribution channels. Digitizing the validation life cycle revolutionizes the speed, accuracy, intelligence, transparency, and management of validation processes to underpin innovation. No matter your company’s resources or scale, you can achieve quality assurance best practices, improve productivity, and reduce your time-to-market, changeover, and cycle-times with Kneat.

Go live sooner, scale seamlessly as you grow with our cloud-based solution and enjoy world-class service and support from our in-house Process Engineering and Customer Success teams.

Discover how we can help your validation team and business to stay on trend, thrive, and succeed in today’s competitive CPG landscape.

Talk to an Expert Today

References

1. ‘Leading Consumer Packaged Goods Company Selects Kneat’s SaaS Platform Driving Expansion Into Adjacent Verticals’, Kneat Solutions, [https://kneat.com/january-20-2022-leading-consumer-packaged-goods-company-selects-kneats-saas-platform-driving-expansion-into-adjacent-verticals/]
2. ‘Consumer Packaged Goods CPG Market Size Trends Industry Analysis Overview’, Researchgate, [https://www.researchgate.net/publication/359730559_Consumer_Packaged_Goods_CPG_Market_Size_Trends_Industry_Analysis_CPG_Industry_Overview_2022-2028]
3. ‘Social Commerce Usage 2021’, Insider Intelligence, [https://www.insiderintelligence.com/content/social-commerce-usage-2021]
4. ‘US Population by Generation’, Statista, [https://www.statista.com/statistics/797321/us-population-by-generation/]
5. ‘Millennial Spending Habits’, Influencer Marketing Hub, [https://influencermarketinghub.com/millennial-spending-habits/]
6. ‘Buying and Using Medicine Safely, Understanding Over the Counter Medicines’, Food and Drug Administration, [https://www.fda.gov/drugs/buying-using-medicine-safely/understanding-over-counter-medicines]
7. ‘Mass Beauty Personal Care Products Market’, Fact Market Research, [https://www.factmr.com/report/82/mass-beauty-personal-care-products-market]
8. ”Fortune 500 List’, Fortune, [https://fortune.com/fortune500/]
9. ‘Best Brands List’, Interbrand, [https://interbrand.com/best-brands/]