Summary
Tom Gunter joins Michael and Avy for the first guest interview on The Pricing Guys. With more than 35 years in FMCG and senior roles across North America, Tom shares a direct view of what goes wrong in CPG strategy.
The discussion covers growth, innovation, leadership, cost control, and the need to stay close to the market.
Key takeaways
- Local market knowledge still matters, even when technology makes centralized decision-making easier.
- Real growth comes from finding unserved customer needs, not copying competitors or adding minor product variations.
- Companies need to separate structural trends from temporary changes before setting targets or making investments.
- Buying an innovative brand does not guarantee innovation. The acquiring company must protect the focus that made the brand successful.
- In a tougher market, better execution may create more value than more products, people, or spending.
The problem with centralized CPG strategy
Tom’s biggest concern is the way large companies often manage local markets from a distance. Canada is one example. European and US-based businesses may remove decision-making, talent, and resources from the Canadian operation in the name of efficiency.
The problem is that Canada is not simply a smaller version of the United States. It has different regulations, cultural dynamics, language requirements, currency considerations, geography, retail structures, and levels of private-label penetration.
When local teams are no longer close to the market, they lose the ability to challenge decisions made elsewhere. Their jobs can also become focused mainly on sales execution, while strategic and commercial expertise moves out of the country.
That can weaken the business in ways that are not obvious on a quarterly report. It becomes harder to attract strong talent, understand customers, and make pricing decisions based on real market conditions. At Revenue Management Labs, this is why pricing work starts with the client’s industry, data, customers, and operating reality—not with a standard answer applied from outside.
Growth leadership starts with the market
Tom believes effective growth leaders surround themselves with experts and do more than study historical performance. Nielsen data and past results are useful, but they do not explain where the market is going next.
Leaders should also examine:
- Demographic shifts and how they change demand.
- Cultural changes that influence buying behavior.
- Consumer segments with different needs and willingness to pay.
- Unserved opportunities where the business can offer something meaningful.
- The company’s ability to win in that space.
The example of easy-on footwear shows how a company can solve a clear customer problem and create a new growth opportunity. A product designed for older consumers, or anyone who values convenience, can build demand without immediately entering a price war.
This is a better path than treating every market as one broad audience. As customers become more segmented, the strongest volume and margin opportunities often come from more targeted offers and sharper value propositions.
Why buying innovation often fails
Large CPG companies frequently acquire smaller brands because those brands are growing or taking share. But the acquisition can quickly lose its advantage.
The smaller company was focused. The brand had a clear purpose, a committed owner, and a team that treated it as a priority. After the acquisition, the brand may be placed inside a large portfolio and changed to fit the parent company’s existing processes.
That can lead to:
- A new brand identity that customers did not ask for.
- Less attention from senior teams.
- Reduced investment and slower decisions.
- Product changes that weaken the original appeal.
- Several years of instability before the company returns to what worked.
Tom’s advice is practical: stay in your lane and improve what you do well, unless there is a clear reason to enter another market. If the business does move, it needs an honest assessment of the competitors, capabilities, investment required, and right to win.
Do not confuse a temporary spike with lasting growth
The pandemic created major shifts in food and consumer behavior. Products such as cereal benefited as people spent more time at home and looked for convenient items with a long shelf life.
Some of those changes were structural. Others were temporary interruptions to existing trends. The mistake was assuming that pandemic-level demand would continue after consumers returned to normal routines.
This distinction is critical during any downturn. Leadership teams should ask whether a change is:
| Question | What it helps clarify |
|---|---|
| Is the trend structural? | Whether demand is likely to continue over time |
| Is it tactical? | Whether pricing, distribution, or an offer can change the result |
| What evidence supports the view? | Whether the decision is based on facts or instinct |
| What happens if we are wrong? | The downside and alternative actions |
In pricing and revenue management work, this kind of discussion often reveals major differences inside an executive team. Leaders may agree on the data but disagree about what they can control. Making those assumptions visible is an important step toward better decisions.
The uncomfortable truth about downturns
Tom argues that CEOs often feel pressure to present a confident growth story, even when the evidence is weak. Public companies may promise a fast start, a strong finish, or another year of double-digit growth because they are trying to protect investor confidence and their own position.
But businesses sometimes need to accept that the early period will be difficult. A more realistic plan may involve reducing spending, pausing selected investments, and protecting the core business until conditions improve.
That is not giving up. It is choosing a plan based on reality. Scenario planning can help leadership teams compare the cost of acting cautiously with the cost of continuing to invest behind an unrealistic forecast.
Where CPG companies should look for savings
Tom’s recommendations for 2025 are not about cutting blindly. They focus on making sure resources produce a measurable return.
- Hire better, not automatically more people. AI and technology can support analysis and reduce the need for additional headcount, but experienced judgment is still essential.
- Be careful with new facilities and office space. Added capacity should have a clear commercial case.
- Review trade spending regularly. Agreements that worked in year one may not perform in year three.
- Measure retail execution. Companies need to know whether products are in stock, properly displayed, and receiving the space they earn.
- Question line extensions. New flavors and variants can create costs, cannibalization, slotting fees, and internal distraction without adding profitable growth.
Tom’s examples of out-of-stock core products sitting beside weaker variants make the point clearly: sometimes the easiest growth opportunity is already in the portfolio. Give the best-selling products the space and support they have earned.
Execution is where strategy becomes real
The interview’s central lesson is simple: strategy cannot be separated from execution. A company can have strong research, an attractive brand, and a detailed growth plan, but the result depends on what happens in stores and in the field.
Revenue Management Labs takes the same practical view of pricing. AI can help identify patterns and speed up analysis, but it does not replace market understanding or hands-on implementation. The recommendations must fit the business, and the teams responsible for execution need to adopt them.
For CPG leaders, that means staying close to customers, testing assumptions, measuring outcomes, and being willing to stop investments that no longer make sense. Sometimes the biggest opportunity is not a new product or a bold acquisition. It is doing more of what already works—and finally doing it consistently.
