The pitch went perfectly. Your sales team secured 300 new retail doors. The buyer loved your product. Distribution is finally expanding.
Three months later, reality hits: velocity is weak at 2.1 units per store per week when you need 5+ to maintain shelf space. Retailers are issuing performance notices. Your cash is trapped in slow-moving inventory sitting in warehouses and on shelves. And that promising expansion? It’s about to become a costly retreat.
This is the #1 strategic gap killing food brands in 2025: mistaking distribution for demand generation.
The fundamental formula of CPG success hasn’t changed: Sales = Distribution × Velocity. But too many brands are optimizing for only one side of that equation. They chase doors without building the demand infrastructure to drive velocity. The result? According to Deloitte’s 2025 CPG outlook, brands are now pivoting from price-driven growth to volume-based strategies,and demand generation has emerged as the critical lever.
Here’s the framework that separates brands that scale from brands that get delisted.
The Demand Generation Imperative: Why 2025 Is Different
The retail environment has fundamentally shifted. With 74% of consumers highly concerned about food costs and 70% shifting to private label brands, simply being on shelf is no longer enough. CPG executives are prioritizing demand generation, with 95% calling innovation a priority and 80% planning to increase spending in this area.
But here’s what most brands miss: demand generation isn’t about running more ads or offering deeper discounts. It’s about building systematic infrastructure that creates pull-through demand before, during, and after retail expansion.
Deloitte research identified three core pillars of effective demand generation: price-pack architecture optimization, precision analytics to target specific consumers, and occasion-based selling that aligns with consumer need states. Brands that master these three elements don’t just survive retail expansion,they use it as a springboard to category leadership.
Understanding the Velocity Imperative
Before we dive into the framework, you need to understand why velocity matters more than almost any other metric.
Velocity measures how quickly your product sells when it’s available to consumers on shelf, typically expressed as units per store per week (UPSPW). It’s the third most important measure in your database after sales and distribution,because velocity captures everything other than distribution.
Here’s why retailers obsess over velocity:
Shelf space is finite and expensive. Every product on shelf represents an opportunity cost. Retailers allocate precious shelf space by considering how products will move off the shelf, carefully balancing innovative products with reliable heavy hitters. If your velocity is weak, you’re costing them money.
Velocity predicts future success. When pitching new retailers, velocity data from existing partners proves consumer demand. Strong performance within current retailers signals success and appeals to potential new retail partners, providing a competitive edge.
Velocity drives profitability. Higher velocity translates to increased sales volume, revenue generation, efficient inventory management, and reduced carrying costs. Rapid product turnover indicates strong consumer demand and satisfaction, building loyalty and enhancing brand reputation.
The brands that understand this don’t ask “How many doors can we get?” They ask “What velocity can we sustain, and in which doors?” That shift in question changes everything.
The Demand Generation Framework: Four Phases
Phase 1: Build Demand Infrastructure Before Distribution
The biggest mistake food brands make is treating demand generation as something that happens after securing distribution. By then, it’s too late. The window to prove velocity is narrow,typically 90-120 days,and if you haven’t pre-built consumer awareness and demand, you won’t hit the velocity targets needed to maintain shelf presence.
What this phase requires:
Consumer Audience Building (60-90 Days Pre-Launch) Build owned audiences in target markets before approaching retailers. This means:
- Geographic-specific content and social media presence
- Email list building through sampling, contests, and content
- Influencer and community partnerships in target regions
- PR and earned media in local publications
- Digital advertising to build awareness (not direct sales)
Research shows that new shoppers enter categories through specific retailers. For example, new non-alcoholic beverage shoppers are 77% more likely to enter through Amazon, 53% through Sprouts, and 16% through Whole Foods. If you understand where your category’s new shoppers enter, you can pre-build demand in those channels.
Retail-Ready Data Package Before your first buyer meeting, compile:
- Velocity data from existing retail partners (broken down by region, store format, demographic)
- Consumer research showing demand in target markets
- Competitive velocity benchmarks
- Marketing calendar showing demand generation plans
- Budget allocation specifically for launch support
One specialty meat brand we worked with historically approached retailers with product samples and passion. After implementing demand-first methodology, they approached buyers with velocity data showing 7.2 UPSPW in similar markets, consumer research proving 67% purchase intent in target demographics, and a $150K marketing commitment for launch support. Their close rate with premium retailers increased from 23% to 71%.
Bottom line: Retailers don’t want to hear about your product. They want to see proof of demand. Build that proof before you pitch.
Phase 2: Match Distribution to Demand Hotspots
Not all retail doors are created equal. While emerging brands might be tempted to expand into as many retailers as possible, identifying the right retail targets and improving sales metrics in existing partnerships will naturally lead to increased distribution.
Strategic distribution means:
Velocity Mapping Identify your velocity hotspots,the mix of products and locations where you fly off shelves. From here, identify similar opportunities and gather evidence to support the idea that you’ll be successful.
The analysis should reveal:
- Which store formats drive highest velocity (natural, conventional, club, etc.)
- Geographic regions with strongest performance
- Demographic profiles of high-velocity stores
- Seasonal or promotional patterns affecting velocity
A beverage client discovered their velocity was 3x higher in stores with household income $75K-$125K versus $125K+ (counterintuitively, their “premium” positioning actually hurt performance in ultra-high-income areas). This insight allowed them to target the right Whole Foods and Sprouts locations while avoiding stores where they’d struggle.
Retailer-Consumer Alignment Brands must understand which retailers’ shoppers align with their target consumers, since a partnership with misaligned retailers would result in slower velocity.
Before pursuing any new retailer, answer:
- Do this retailer’s shoppers match our target consumer profile?
- What’s our category’s average velocity in this retail chain?
- What share of this retailer’s shoppers are in our target demographic?
- Do we have proof points from similar retailers?
Phased Expansion Protocol Never launch regionwide or nationwide simultaneously. The best expansion strategy:
- Test in 10-20 doors in target region
- Measure velocity for 60-90 days
- Analyze what’s working and optimize
- Expand to additional doors only if velocity targets are met
- Repeat in new regions
This requires patience and discipline. But a specialty brand like Sanzo used data-driven velocity decisions to support rapid growth, seeing annual revenue skyrocket from under $2 million to an estimated $12-15 million.
Bottom line: Pursue the right doors, not the most doors. Every door that doesn’t hit velocity targets damages your brand’s retail reputation.
Phase 3: Drive Pull-Through Demand Systematically
Once you’re on shelf, the real work begins. With 86% of CPG sales now coming from omnichannel shoppers and online CPG sales growing at nearly 5x the rate of in-store sales, demand generation must work across all channels simultaneously.
The systematic approach:
Precision Marketing Use precision analytics to optimize marketing spend by targeting specific consumers with bespoke messaging, avoiding wasted advertising dollars on shoppers who won’t be swayed.
This means:
- Geofencing advertising around specific retail locations
- Retailer-specific landing pages and promotions
- Different creative and messaging by retailer type
- Attribution tracking to understand which tactics drive in-store purchases
One prepared foods brand was spending $40K/month on general digital advertising with minimal velocity impact. We restructured to geotargeted campaigns around their top 50 retail locations, with retailer-specific offers and store locator functionality. Marketing spend decreased 35% while velocity increased 28%.
Occasion-Based Activation Focus on occasion-based selling by orienting sales activity around specific consumer need occasions and demand drivers.
Rather than generic “buy our product” messaging, create campaigns around:
- Specific meal occasions (weeknight dinner, weekend breakfast, etc.)
- Usage moments (post-workout, afternoon snack, etc.)
- Seasonal events (grilling season, holiday entertaining, etc.)
- Life stages (back-to-school, new parents, etc.)
Retail Partnership Activation Work with retailers to maximize your presence:
- Coordinate your marketing calendar with retailer promotions
- Secure endcap displays in high-velocity stores
- Develop retailer-specific content and recipes
- Participate in retailer media networks
- Provide point-of-sale materials and demos
Continuous Optimization Monitor velocity by store to understand which locations are driving performance. Your best store might be moving 60 cases while your lowest performer moves 20,you want to understand what’s happening at each store and adapt accordingly.
Weekly velocity review should identify:
- Best and worst performing stores
- Velocity momentum (accelerating or declining)
- Geographic or demographic patterns
- Impact of marketing campaigns and promotions
- Inventory issues or out-of-stocks
Bottom line: Demand generation isn’t a one-time launch campaign. It’s systematic, ongoing, data-driven optimization.
Phase 4: Convert Velocity into Category Leadership
Once you’ve proven velocity, the path to category leadership becomes clear. Data showing accelerating product velocity proves to potential retail partners that you’re not only bringing a loyal customer base, you’re also expanding your reach and attracting new consumers.
The category leadership playbook:
Expand from Strength When talking with new retail buyers, share specific retailers where your product outperforms the category and your average weekly velocity in those stores. This level of detail can be a game-changer, especially for growing brands.
Build expansion proposals that include:
- Velocity performance in similar stores
- Consumer demographic overlap analysis
- Marketing support commitment
- Category growth data showing your brand’s contribution
- Innovation pipeline and new product velocity projections
Demand Additional Shelf Space For high-performing stores or stores where velocity is accelerating, invest more. Ask for in-store displays or make the case for additional shelf space. You clearly have a connection with those shoppers, and it behooves both you and the retailer to maximize sales potential.
Use velocity data to negotiate:
- Multiple facings for hero SKUs
- Eye-level placement
- Endcap and promotional display opportunities
- Category captain relationships
- Exclusive or limited-time offerings
Build Innovation Pipeline 95% of CPG executives said innovation is a priority, with 80% planning to increase spending. The number of truly novel innovations is phenomenal.
But innovation without demand generation is just expensive product development. The category leaders:
- Test innovations in high-velocity stores first
- Use existing velocity data to predict new product performance
- Launch with pre-built demand (not hoping to create it post-launch)
- Measure new product velocity against established benchmarks
- Kill innovations quickly if velocity doesn’t materialize
Defend Against Private Label With 63% of consumers shifting to private label brands, which now account for 19% of total US CPG sales, national brands must defend their position. Retail giants like Trader Joe’s and Aldi now have private label comprising 69-80% of their sales.
The best defense is velocity. If your product consistently outperforms category averages, retailers won’t replace you with private label. If your velocity is weak, you’re vulnerable.
Velocity-based defense strategies:
- Consistently deliver velocity 20%+ above category average
- Demonstrate innovation private label can’t match
- Build brand loyalty that drives shoppers to stores
- Offer velocity insights that help retailers optimize entire category
- Partner on category growth initiatives, not just your brand
Bottom line: Category leadership isn’t about market share,it’s about being the brand retailers can’t afford to lose.
The Measurement Framework: What to Track
Demand generation without measurement is just expensive hope. Here are the metrics that matter:
Core Velocity Metrics
- Units Per Store Per Week (UPSPW): Your north star metric
- Dollars Per Million ACV: Weighted velocity measure showing performance relative to distribution
- Velocity by Store Format: Performance across different retail types
- Velocity Momentum: Week-over-week and month-over-month trends
- Velocity vs. Category Average: Your competitive position
Demand Generation Metrics
- Brand Awareness in Target Markets: Pre- and post-launch measurement
- Purchase Intent: Among target demographics in specific geographies
- Marketing ROI by Channel: Cost per incremental unit sold
- Marketing-Attributed Velocity Lift: Impact of campaigns on in-store sales
- Customer Acquisition Cost: By retailer and channel
Distribution Quality Metrics
- % ACV Distribution: Weighted distribution showing store quality
- Distribution-Velocity Matrix: Quadrant analysis showing which stores to expand, maintain, optimize, or exit
- New Door Velocity Ramp: How quickly new stores reach target velocity
- Door Retention Rate: Percentage of doors maintained after 6, 12, 24 months
A specialty food brand we advise was celebrating 45% distribution growth. But when we analyzed % ACV and velocity together, we discovered 60% of new doors were in the bottom velocity quartile. They were paying (in trade spend and marketing) for distribution that would never deliver profitability. We helped them exit 130 underperforming doors and reallocate that budget to demand generation in high-velocity markets. Revenue decreased 8% but profit increased 34%.
The Common Pitfalls (And How to Avoid Them)
After working with dozens of food and beverage brands, I’ve seen the same mistakes repeatedly:
Pitfall #1: Launching Without Velocity Targets Too many brands celebrate getting distribution without defining what success looks like. Before pursuing any new retailer, establish:
- Minimum acceptable velocity (the floor below which you’ll exit)
- Target velocity (what you need for profitability)
- Category-leading velocity (what you need for expansion)
Pitfall #2: Treating Velocity as a Sales Problem When velocity is weak, brands often blame sales execution, trade spend, or retailer support. But velocity is a true measure of consumer demand for your product. If consumers don’t want your product enough to create consistent pull-through, no amount of sales effort will fix it.
Ask instead: Is our product-market fit validated? Is our positioning resonating? Are we in the right stores? Is our marketing reaching the right consumers?
Pitfall #3: Underfunding Demand Generation Brands will spend $50K on trade promotion to get distribution, then allocate $5K for launch marketing. This is backwards. The rule of thumb: for every dollar spent on trade promotion and distribution, allocate 1.5-2 dollars for demand generation. Otherwise you’re just buying temporary shelf space, not building sustainable business.
Pitfall #4: Ignoring Velocity Feedback For underperforming stores, talk to the retailer to find out the cause. Is it a shopper disconnect, lack of in-store visibility, inventory issues, or something else? Retailers don’t want to miss sales any more than you do. Velocity data provides the foundation for collaborative problem-solving.
Pitfall #5: Scaling Too Fast The graveyard of failed food brands is filled with companies that expanded nationwide before proving regional success. The craft beer category is full of lessons of local brands that, during the boom, expanded geographies too quickly at huge expense, only to pull out of those markets months later when velocity couldn’t sustain shelf presence.
The Reality: This Requires Investment and Discipline
Implementing a demand-first approach isn’t easy. It requires:
Financial Investment: Building demand infrastructure costs money. Marketing budgets for emerging brands should typically represent 15-25% of revenue, with 60-70% allocated to demand generation and only 30-40% to trade promotion.
Organizational Discipline: Saying no to distribution opportunities that don’t align with demand hotspots is hard. Exiting underperforming retailers is harder. But discipline is what separates brands that scale profitably from brands that chase growth at any cost.
Data Infrastructure: You can’t manage what you don’t measure. Brands need access to store-level data from retailer POS systems, distributor reports, or retail syndication services to measure how fast products sell. Without this data, you’re flying blind.
Strategic Patience: Building category leadership takes 18-36 months of systematic execution. There are no shortcuts.
But here’s what makes it worth it: brands that build demand infrastructure create sustainable competitive advantages. Distribution can be copied. Product features can be replicated. But demand generation capabilities,owned audiences, proven velocity, retailer relationships built on performance,those are defensible.
The Path Forward
If your brand is struggling with retail velocity, facing delisting threats, or trying to figure out why distribution isn’t translating to revenue, the answer isn’t more doors or deeper discounts.
It’s building systematic demand generation infrastructure that creates pull-through before, during, and after retail expansion.
The brands winning in 2025’s challenging retail environment all share common characteristics:
- They build demand before chasing distribution
- They match distribution to validated demand hotspots
- They drive pull-through systematically with data-driven marketing
- They convert velocity into category leadership positions
- They make hard decisions about where to compete
This isn’t about having the biggest marketing budget or the most distribution. It’s about strategic clarity on how to build and measure demand.
Because in the end, retailers don’t care about your story, your passion, or even your product. They care about one thing: velocity. Brands that consistently deliver velocity earn shelf space, expansion opportunities, and category leadership.
Everything else is just noise.
Ready to build demand generation infrastructure that drives sustainable retail growth? YVenture Strategy helps food and beverage brands transform from distribution-focused to demand-led. From velocity analysis to omnichannel campaign execution, we build the strategic capabilities that turn retail presence into category leadership.
Let’s diagnose your brand’s demand generation gaps and build the framework for profitable scale.
Ready to close the strategic gaps holding your brand back?
YVenture Strategy works with food and beverage brands to turn retail challenges into category leadership. From demand generation frameworks to omnichannel execution, we build the strategic infrastructure that separates retail winners from the 85% that fail.
Let’s talk about your brand’s specific challenges and the strategic roadmap to sustainable retail growth.ut for a growth assessment. Yventure helps emerging brands design channel strategies that unlock scale while preserving identity.
