CPG or FMCG?
When talking about retail products, the term CPG is often used, as well as the less frequently used term FMCG. Sometimes these terms are used interchangeably, and people generally recognize that they have similar meanings. However, there is a distinction between the two words, and understanding the difference may provide an indication to others that you are well-versed in the retail space.
What is CPG?
CPG stands for consumer packaged goods and is typically represented by everyday products that are bought and consumed quickly. We’re talking about items found almost everywhere and includes fresh foods, fruits, vegetables, cleaning supplies, pet foods, and paper products. It’s a highly competitive category that must use broad distribution and sales growth to overcome low margins.
What is FMCG?
FMCG is an acronym for fast-moving consumer goods. The term FMCG was first coined in the 1950s by Unilever to describe mass-marketed products that are consumed frequently and discarded quickly. Successful fast-moving consumer goods do not sit on store shelves long because they have an exceptionally quick turnover rate, which is where the “fast-moving” reference comes from. These are items that have a short life cycle, such as beverages, packaged foods, toiletries, and health and wellness products.
What is the difference between CPG and FMCG?
CPG and FMCG are similar in many ways. Both are part of the same large category of consumer goods that are mass-produced and sold to consumers for personal use.
The goods produced by CPG and FMCG companies are usually sold in retail stores, retail ecommerce stores, on Amazon and other online stores, and direct from their own ecommerce websites. Both types of products are heavily marketed to consumers with branding campaigns that emphasize convenience, price point and quality, with a growing commitment to ethical sourcing and environmental friendliness.
However, there are three slight differences to how the two terms are viewed and applied.
FMCG products, by their nature, move through their sales cycle a little faster than CPG products. Think of household batteries as being CPG and potato chips as being FMCG.
Because the primary differentiator of FMCG is how fast it moves, some prefer to think of FMCG as a subset of a larger CPG.
Culturally, the term CPG is more commonly used in North America, while FMCG is more often used in Europe and other parts of the world.
We help CPG and FMCG brands succeed.
Whether we think of them as CPG or FMCG, Thomas|Ferrous helps brands succeed in a highly competitive marketplace. Our clients are usually leaders in their categories, and they know that we have the expertise and experience necessary to help them meet their goals – and they trust us because we put our clients’ needs first.
So, if you’re a CPG or FMCG business looking for ways to get more out of your marketing, reach out and we’ll bring you some ideas.
