The FMCG paradox: why consumer brands are losing control of the last mile
FMCG brands are undergoing a profound transformation: the relationship between brands and their customers must be fundamentally rethought.
The Fast-Moving Consumer Goods (FMCG) market has never moved faster, yet many brands have never felt farther from their end customers. From grocery to personal care, a fundamental transformation is underway: while overall sales volumes may appear stable, brands are caught in a tightening vice. Not only are legacy brands ceding market share to private labels, but they are also experiencing a steady erosion of their ability to own the customer relationship. The foundational model is showing cracks: the real risk is that brands lose ground in direct dialogue, turning into interchangeable options on the retail shelf.
As sales channels continue to multiply, a critical strategic question confronts industry decision-makers: who truly owns the relationship with the end consumer?
Mobile first: when the retail shelf fits in your pocket
The first signal of this transformation lies in the numbers. E-commerce in Italy is now a well-established asset, boasting over 33 million regular online shoppers. However, the metric that demands serious reflection is how consumers access these platforms: the smartphone is no longer just a supporting tool—it is the primary touchpoint.
According to data from Statista Market Insights and the GSMA report, mobile transactions accounted for 65% of total global e-commerce volume by 2025. This means buying decisions are happening on the go, across hybrid and omnichannel environments. Yet, in a market moving at this speed, brands face a critical risk: becoming a commodity—a generic product chosen purely out of convenience, stripping away the emotional connection that makes a brand unique and irreplaceable.
FMCG Brands: Who owns the last mile?
The single greatest threat facing FMCG brands today is losing control of the last mile—that final stretch where the product meets the consumer. This critical blind spot manifests across two distinct touchpoints:
- The physical channel: the blind investment
On-shelf promotions and traditional trade marketing continue to drive massive volumes, but these investments are often made in the dark: they generate temporary sales spikes while returning zero data on who actually bought the product. The result? Increased visibility for the retailer, while the brand remains devoid of actionable customer insights needed to build future loyalty strategies.
- The digital channel: the convenience trap
Marketplaces, quick-commerce apps, and delivery platforms helped protect consumption volumes during the digital shift, but they built a formidable barrier in the process. These intermediaries own the sale and, more importantly, monopolize data ownership. As a consequence, brands end up indirectly funding third-party Retail Media networks—paying repeatedly to regain visibility with customers who technically should already be theirs.
The challenge of international expansion
This dynamic becomes even more complex when expanding beyond domestic borders. For many Food & Beverage and FMCG companies, international growth relies heavily on local importers and regional distributors.
Without a direct-to-consumer relationship strategy, a brand's decision-making autonomy becomes restricted. In these markets, exporting a physical product without simultaneously exporting the ability to engage local consumers means remaining entirely dependent on supply chain dynamics—sacrificing the opportunity to build a cohesive, global brand identity.
Toward a new strategic awareness
The FMCG sector stands at a critical crossroads: continue funding legacy models that monetize third-party intermediaries, or begin engineering direct avenues for customer connection?
Today, reclaiming data ownership is no longer a technological luxury—it is the ultimate strategic asset for driving market leadership. The fundamental question every brand decision-maker must now ask is no longer "How many units did we sell today?", but rather "Who bought our product today, and how do we engage them again tomorrow?"
At Advice Group, we are closely analyzing these market shifts, developing strategies where physical and digital integration returns long-term value to brands. Does this scenario reflect your current market challenge? Let’s start a conversation and build a tailored path forward!
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