- The consumer packaged goods (CPG) industry will grow digital spend by 5.2% this year.
- The CPG industry has traditionally leaned toward brand advertising on TV, but the pandemic will see it lean more heavily on digital performance marketing to drive sales.
- Insider Intelligence analyzes this industry and several others to provide in-depth analyst reports, proprietary forecasts, customizable charts, and more. Learn more about what we offer.
While the consumer packaged goods (CPG) industry has traditionally leaned toward brand advertising on TV, marketers will turn to digital performance marketing to drive sales amid the pandemic.
We expect the CPG industry to grow its digital ad spending by 5.2% in 2020, which is higher than overall digital ad spend growth of 1.7%. CPG’s share of the digital ad market will also grow 14.4% to $19.40 billion, up from last year’s 13.9% growth. However, as the overall market rebounds next year, CPG’s share will return to pre-pandemic levels.
Search will see the biggest increase, as marketers turn to performance-oriented direct-response ads. CPG is typically focused on upper- and middle-funnel inventory, with display formats—especially digital video—making up a large portion of CPG’s spend in the past. This will still be true, as CPG continues to allocate ad spend toward social networks and mobile video in particular.
While the pandemic stretches budgets and marketers look for more direct ways to drive sales, we’ll see a strong move toward search. Pre-pandemic, we forecast that search’s share of CPG digital ad spend would be 27.5%. That figure was adjusted upward nearly 8 percentage points to 35.3% because of increased spending overall.
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