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In a pandemic, legacy brands are taking control of their own sales models. Yesterday, PepsiCo announced the launch of Snacks.com and PantryShop.com. Customers can build their own snack packs ($15 minimum for shipping) or buy pre-bundled pantry kits, respectively, by browsing Pepsi brand products on a simple, aesthetically pleasing site. PantryShop, targeted more at families, has an option to create a membership. As of this morning, a few products on Snacks.com, like a 1 oz. bag of nacho cheese Doritos and a 2.6 oz bag of dill pickle Lay’s, were sold out.
It took a crisis – one that ravaged the grocery store supply chain, sparked months of panic buying and sent Amazon’s typically efficient operations into a tizzy – for a company like Pepsi to make the push to direct sales. This means that CPG brands will need to compete against the giant for ad space and mindshare. After weeks of low CAC and CPMs thanks to a broader industry pull back on advertising, those are expected to rise again.
PepsiCo’s push into DTC raises questions around how we shop for groceries, and how that might now be changing. CPG brands, launched direct, have eventually been made to make their way into retail channels to be where the customer is. Brandless, which attempted to build an online-only pantry with cheap products that didn’t rely on brand or marketing to sell, never took off. PepsiCo is in a different position for several reasons: It’s a massive company selling brands that people already know. And it’s launching at a time when people have good reason to avoid visiting the grocery store or placing an order with Amazon. Ultimately, what seems to be the most true is what we’ve known for a while. The future of retail isn’t direct-only or wholesale-only. Companies need both, no matter the category.