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Advertising Age reports on what it calls a "big movement," described as "an insurgent group of digitally enabled entrepreneurs gnawing away at the dominance of multibillion-dollar brands and their giant marketing budgets."

According to the story, "Small and midsize firms took 1.6 share points, or nearly $10 billion in sales, from the packaged-goods behemoths over three post-recession years from 2009 to 2012, according to a report from IRI and Boston Consulting Group. The smaller the players, the bigger the impact: Companies with sales of less than $100 million gained the most and the share shift accelerated over time."

The story goes on: "That the little guys are making a big impact in an industry long dominated by giants like Procter & Gamble Co. and Unilever is puzzling to say the least. After all, bigger companies have major scale-based cost advantages in manufacturing, distribution and marketing.
"Much of the credit for smaller brands' ability to break through goes to digital disruption in media and retailing, though a host of other factors also figure in, according to industry executives and observers. Those range from the natural agility of small players to changing consumer tastes and the tendency of the massive CPGs to cut off their smaller businesses."

While e-commerce is a piece of the puzzle, allowing small players to have a retail presence at a fraction of the cost of a physical store or to even cut out traditional retailers by going consumer-direct, there also is a sense that smaller companies are simply more open to new players, new ideas, and new approaches to business: "The democratizing effect of social media and the impact of e-commerce likely play a role in smaller players gaining ground. But other changes in the retail environment can't be discounted.

"Take beauty-only retailers such as Ulta and Sephora, each with sales of more than $2 billion annually and growing far faster than the rest of beauty retailing. Several industry players say those chains, whose data aren't included in IRI numbers, are far friendlier than others toward startup brands, frequently adopting and merchandising them aggressively under exclusive deals."

And, the story concludes: "Maybe the biggest advantage for small brands is a willingness to zig away from the strategic and creative zags of category titans."

You can read the entire piece here.

And you should.
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