Four ways retailers and suppliers can grow, together
After more than a decade of consistent performance, Canada’s consumer packaged goods (CPG) sector is navigating a more complex and constrained growth environment. Revenue gains have slowed, margins are under pressure and shopper loyalty has become increasingly fragmented. Since 2012, topline growth for leading global CPG companies has declined from more than 5% to closer to 2% annually, driven by shifting consumer behaviours, economic headwinds and intensifying competition from private labels and digital-first brands.
To move forward, both retailers and suppliers are rethinking how they create value. The new focus is on “cohesive ecosystems”—integrated networks of products, services, partnerships and platforms that work together to drive engagement, differentiation and efficiency. Retailers are evolving beyond distribution hubs to become experience platforms, service providers and media owners. Brands that thrive in this new model will be those that align more closely with retailer strategies and infrastructure.
Here are the key drivers of cohesive ecosystems:
1. Smarter market expansion
Retailers are expanding their assortments and entering high-growth categories to attract more diverse shopper segments and increase trip frequency. This includes areas such as health and wellness, pet care and affordable premium. Costco’s Kirkland Signature line, for example, drives member loyalty, supports margin goals and gives Costco shoppers consistent value across everyday essentials. In the discount channel, Dollarama is becoming a destination for snacks, particularly among value-conscious urban shoppers. Its curated assortment and sharp price points are redefining convenience and trip motivation. These assortment strategies demonstrate how thoughtful expansion within ecosystems can boost loyalty, reinforce brand perception and maintain shopper engagement.
2. Strategic collaboration with suppliers
Joint business planning is evolving into long-term strategic alignment between retailers and CPG partners. The most successful collaborations are built on shared insights, integrated media and merchandising strategies, and co-created innovation. Nou, for example, a textured haircare brand launched by P&G and Walmart, reached market in under one year. The collaboration used shared shopper data and agile development to fill an unmet need—proving that when both sides align on growth and value creation, the results are faster and more relevant. In Canada, CPGs that take this approach will be better positioned to tailor innovation pipelines and execution strategies to retailer-specific ecosystem priorities.
3. Meaningful shopper connections
Cohesive ecosystems prioritize the experience—not just the transaction. Retailers are enhancing the path to purchase through physical and digital touchpoints that simplify, personalize and inspire. Interactive displays, mobile-enabled shelf technology, augmented reality try-ons and AI-driven product suggestions are no longer niche. These tools are helping Canadian retailers modernize stores and meet rising shopper expectations. Shoppers today are not just looking for deals—they want convenience, efficiency and value. Ecosystems that deliver this consistently foster deeper loyalty.
4. New revenue streams through monetization
Retailers are increasingly monetizing their internal capabilities. While some offer white-label delivery services or software platforms, others are focused on scaling retail media networks. In Canada, this has become a growing part of how grocers manage margins. Retail media provides measurable return on investment for brands, while giving retailers a new, higher-margin income stream that supports broader ecosystem growth. This shift is especially important as tariffs and operating costs rise, requiring new approaches to profitability that do not rely on constant cost cutting or price increases.
Cohesive ecosystems are not a retail trend—they are a strategic response to the realities of today’s market. In Canada, the retailers and CPG suppliers that invest in ecosystem thinking will be the ones best positioned to adapt, grow and lead.
This article was first published in Canadian Grocer’s May 2025 issue.
