by Greg Thain
Three: Danone
Danone shows how data collected via Modern Marketing can drive people to engage online and buy offline.
Like Colgate-Palmolive, Danone is another brand slow to adopt Modern Marketing techniques but keen to pick up the pace. The French food-products multinational has launched a number of online campaigns to help boost its marketing success and move with the times. One such initiative was a sponsorship deal in early 2012 with the food-related FMCG website Foodie.com, whose tag-line For the Love of Food suited Danone perfectly. The aim was the vertical promotion of Danone’s Activia yogurt brand. But where online or offline display advertising might once have been the natural choice, using the foodie.com website gave the company the ability to tailor much more precisely both its ad content and its on-page placement, thus creating a far more consumer-friendly means of reaching its target audiences.
Modern Marketing ‘ . . . is new for us,’ said Michael Neuwirth, senior director of communications at Danone. ‘We were not really an early adopter in terms of the shift to digital and, in particular, vertical. As the opportunities like Foodie.com shape up with very focused consumer interest areas, we now see a much clearer opportunity than previously.’
Danone have also begun to understand and exploit digital’s ability to gather high-value consumer information. The company was one of a number of FMCG market leaders to use a new data service from Dunnhumby to connect their consumers’ online engagement and in-store shopping habits with their brand. Dunnhumby are able to track the effectiveness of a Modern Marketing campaign by comparing the behaviour of Tesco Clubcard customers who respond to Danone’s online loyalty campaigns and those who do not. By doing so, Dunnhumby can measure the effect of online loyalty campaigns on brand trials, loyalty, sales uplifts and ROI, an information set which allows Danone to improve the relationship between its online and offline activities.What is clear is that Danone, like Colgate Palmolive, is also learning fast, as other recent digital campaigns for Evian, Volvic and Activia yoghurt have successfully demonstrated: the company is moving with the times.
Four: Estée Lauder
How cosmetics giant Estee Lauder leverages social media on a global scale by understanding how consumer word-of-mouth sells products in the beauty sector.
If conversation is king with online communities, then Estee Lauder has surely made the connection: ‘women buy what their friends and family recommend’. And the company that owns Clinique, MAC, Bobbi Brown, Aveda and Estee Lauder proper is justifiably proud to be one of the most digitally forward in its sector, where consumers typically seek quality content and quality information before they commit to buying quality cosmetics. As Estée Lauder’s online president Dennis McEniry confirms: ‘Social plays a huge role. The number one influence on beauty consumers in every market around the world is advice from friends. With social media, not only are they able to get timely brand information directly from brands, but also all of the validation from authorities and friends. In addition to Facebook and Twitter, we also have country-specific networks that are important, local players like Orkut in Brazil and RenRen in China. And because social media allows for two-way communication, it's also valuable for getting great feedback. We can use it find out what consumers like and don't like, how we can get them the latest information, how we can improve our products.’
Whilst the key metrics of success for Estée Lauder are customer engagement and consumer loyalty, the company takes great care to monitor traffic and sales conversions, showing a truly Modern Marketing perspective in developing online business and recognizing then exploiting the current trends that help reach their audience. And once again, one such trend is social media. As McEniry observes, ‘Right now social media are delivering in the top five traffic sources for every one of our brands, and . . . consistently over index in terms of conversions.’
A leading factor in social’s success is that it reaches Estée’s ‘influencers’, whose value to a business reliant on word of mouth recommendation, online or offline, is immense. In McEniry’s words, Estee is constantly looking at ‘what [influencers] do in terms of education and influencing people in their network, how they interact with each other and their overall impact on the business.’
One thing influencers are certainly doing is using their mobile phones. And, whilst most of the FMCG producers are but slowly realizing the power of the medium, this FMCG super-brand is watching this growing trend like no other, as McEniry confirms: ‘The biggest trend we're watching is mobile. For some of our brands in bigger markets like Japan half of our sales are on mobile devices, and generally speaking we're seeing unbelievable growth rates around the world. We're also researching how mobile is affecting real-world retail, [particularly] how consumers are using mobile phones for interacting with and getting product knowledge at the point of sale, both at counters and in salons. We want to know how to make that mobile-enabled experience as good as possible and how to market to consumers in mobile. After all, no one leaves home without their mobile phones anymore.’
Estée Lauder now vies with Coke as one of the best Modern Marketers in the whole FMCG marketplace.
Estée Lauder and China
Whilst the company’s success has been global, perhaps no territory on earth has been a bigger surprise than China. In the 2012 Digital IQ Index on China (released by L2 Think Tank), the luxury beauty brand was ranked as Genius in four key areas: site, digital marketing, social media and mobile. The brand earned its rating by inspired brand specialization, targeting its products specifically at young, affluent Chinese consumers and thus utilizing the key digital platforms the upwardly mobile visit. Additionally, and also crucially, the company implemented highly effective online search strategies across the major Chinese engines. But perhaps most importantly, Estée Lauder saw the worth, the effectiveness and the beauty of Modern Marketing and invested very significantly. In the meantime, China is just one example of a territory where Estée Lauder enjoys digital dominance. The brand’s future looks bright indeed.
Five: Heinz
When asked to name a brand, any brand, 17 percent of the UK public choose Heinz. For a brand that is such a household word, this major FMCG producer had never enjoyed a unified view of all its customers, across all its numerous varieties, until it embraced Modern Marketing. Finally, if belatedly, Heinz created a new website to host a community of loyal but previously dispersed consumers: a good example of how digital can be integrated into existing marketing strategies to bring consumers together.
Heinz Offers was launched in 2013, and the site now sits at the core of the company’s UK Modern Marketing strategy. Heinz Offers asks consumers to provide data on themselves, rewarding their commitment with a quarterly email newsletter containing money-off vouchers and product news. ‘We set out to integrate all consumer touch-points,’ said Peter Ebsworth, marketing manager at Heinz. ‘What excites me is that we can start to build a picture of our consumers across our entire product range, from baby food to soups to frozen meals,’ he adds. ‘If we can identify consumers who are loyal to Heinz in certain areas, but not in others, we can persuade them to buy into other areas of our portfolio.’
Immediately after the site launch, the first money-back coupons were sent out to registered consumers for new the brand variant Top Down Tomato Ketchup. While Heinz was still tracking redemption rates, some two-thirds of email recipients printed off the coupon, indicating at least the intention to use it. The July newsletter also contained hyperlinks to various Heinz sites so that the company could track who had clicked on what. A second newsletter went out in October and included a coupon for 20p off Heinz Microwaveable Soup Cups, another new launch. ‘As a result of the success of the first coupon, we decided to repeat the idea,’ says Ebsworth. ‘It's only a trial at present, but the results look very promising.’
It’s now policy at Heinz to consider the role of digital with every new marketing campaign it launches. Through supporting websites, the company believes every product can
be marketed actively online, even when there is no activity offline. And it doesn’t stop within the brand’s own sites. Heinz has forged content partnerships with other relevant high traffic websites, whether or not they feature Heinz products. All that matters is the relevance of the link and the act of communication with Heinz. Ebsworth sums up: ‘Digital is all about turning a monologue into a dialogue.’
Six: Henkel AG
Although e-commerce changed the way people buy books, clothes and electronics, shopping for household items such as detergent still largely takes place offline. Discover how Henkel now uses social media to stimulate sales for its domestic goods.
For the German FMCG maker of such household brands as Dial soap and Purex detergent, the first key realization was not that the internet affected direct product sales positively or negatively, but that it transformed how consumers interacted with their brands. As Henkel chief executive Kasper Rorsted observes: ‘Digital and social media have an enormous impact on how people are viewing fast-moving consumer goods, from the way they are being talked about to the way they are being perceived. Consumers also are giving feedback on what is working and what isn't. You've now got to create a community online in the digital environment that you didn't have before, and that has a big impact on how people actually go shopping. We are very much focused on engaging online with consumers.’
Yes despite the fact that e-commerce is changing the FMCG consumer industry, Henkel have not quite moved their full advertising spend to digital, since consumers in its sector still use traditional media for product information. Rorsted explains: ‘People are spending more time online, but they are continuing to spend, in absolute terms, more time watching television. As digital use has gone up, TV use hasn't really been going down. TV advertising still is the predominant vehicle for advertising. The consumer is still fairly traditional in the way he or she is exposed to most of our products. But if you take some of our youth-oriented styling brands, such as the hair-care got2b, that's largely digital, because that's the only way you can engage with that group.’
However, as more FMCG brands target the younger consumer, the future points definitely to an online approach. Rorsted and Henkel, optimistic but cautious about their own advertising spend, are still moving inexorably in the direction of Modern Marketing. Says Rorsted: ‘Our media spend is growing in digital, but at a slower rate than I would say we thought five years ago. Digital a couple of years ago was a high single-digit percentage of our budget, and now it is low double-digit.’
Seven: Kellogg’s
Another FMCG brand focusing on mobile as part of its Modern Marketing mix is Kellogg’s. The company has launched a number of landmark campaigns.
In 2010, Kellogg’s launched its first-ever mobile virtual store app. Consumers could use their phone to choose Kellogg’s brands - Special K or Crunchy Nut, for example - and then add them to the cart of their favourite retailer for their next online shop, all without leaving the portal. Results were encouraging: Kellogg’s reported 20,000 actively-engaged consumers since the launch, with early figures showing that 3 percent of site visitors had added products to their carts. But sales were not the only bottom-line. Insights on online consumer purchasing behaviour enabled the development of new e-commerce opportunities for all Kellogg’s brands, providing vital information for future campaigns As Kellogg’s digital manager Leanda Falcon said in 2010: ‘The e-commerce activity we’re developing at the moment is about giving our consumers choice in how they interact with us. Online grocery sales are set to double in the next five years and we want to be able to capitalise on this by setting up a framework across all digital channels for our customers now.’
In 2012, Kellogg’s remained true to the strategy, releasing an updated app for its Special K product that allowed users to manage their weight loss personally via mobile and desktop. The app is supported by a website, where personal weight loss accounts can sync with mobile or computer devices, with promotion via social media, print and TV/radio campaigns. Yuvraj Arora, senior director of Special K at Kellogg’s in the US, provides an example of how this works: ‘The Special K brand is asking women to think about their New Year’s resolutions differently. Rather than focusing on numbers on the scales, the Special K brand is challenging women to reshape their thinking by answering, ‘What will I gain when I lose?’ such as confidence, moxie, pride or energy.’
Kellogg’s is another FMCG brand that is responding to the meteoric rise in smart-phone ownership; as a result the FMCG giant is branching into mobile. Add this to cross-platform social media support from such sources as Facebook, Twitter, Google Plus and Pinterest and it is evident that Kellogg’s are among the leaders in the creation of interactive, consumer-convenient campaign planning.
Eight: Kimberly-Clark
The classic consumer goods company is using social media to target its diverse range of audiences and is looking into e-commerce to direct-sell its products.
Kimberly Clark may be over 140 years old, but the company has been by no means 19th Century in recognizing the advantages of digital, nor been shy at investing in a Modern Marketing strategy. The makers of Kleenex, Huggies, Scott and Cottonelle have been involved with online marketing and digital outreach for a number of years, continually evolving the effective use of these channels to reach consumers. Consequently, Kimberly-Clark invests in most areas of digital marketing, understanding that this is where consumers now tend to connect both with peers and their favourite brands. The company favours social media as a core means to communicate, build relationships and drive participation and has shown itself adept at tailoring the right social media platforms to its products and its consumer demographic.
As Jeff Jarret, vice-president of global digital marketing explains: ‘We facilitate conversations between consumers and give them interesting content to share with each other. This is especially true among our baby-care brands like Huggies. We see high engagement from moms. They are very willing to share ideas and help each other. With our other brands, especially the adult brands (Depends, GoodNites), we have different strategies because social in these areas requires a lot more discretion.’
The FMCG producer has also noted the supremacy of video over written content in driving sales. ‘Videos - online video product recommendations - are key for driving commerce sales. We’ve even done some testing on this and found it leads to much stronger conversion rates. Our YouTube channels are really important to us,’ said Jarret. Another strand of the company’s multidimensional approach is the practically omnipresent social media. Jarret says, ‘Social is core to our digital marketing strategy. For many of our brands, it is a cornerstone. We use it as a means to communicate to fans but also as a platform to build relationships and drive participation. We facilitate conversations between consumers and give them interesting content to share with each other. This is especially true among our baby-care brands like Huggies. We see high engagement from moms. They are very willing to share ideas and help each other. With our other brands, especially the adult brands (Depends, GoodNites), we have different strategies because social in these areas requires a lot more discretion. We use Facebook, Twitter, Tumblr and YouTube.’ Once again, the central planks of effective digital marketing mean relevant, shareable content, the initiating and then leading of online conversations and the use of the right technical platforms for the right brand audience.
Kimberley-Clark has also joined the growing group of FMCG companies - GSK, P&G, Kellogg’s and Diageo, for example - who have invested in direct-sell e-commerce websites. The trial launch of the virtual Kleenex Shop in the UK allowed the company not only to sell the full Kleenex range, including products not available elsewhere in the UK, but to gain useful insights into consumer preferences, which went on to inform future product, packaging design, and online and retail strategy as well as marketing. As Adrian Percival, senior manager of ecommerce at Kimberly-Clark UK, confirms: ‘We’re seeing significant growth in the online channel through our retail pa
rtners and we’re determined to win in this channel so we need to know what influences their behaviour, that’s the goal of this shop.’
Yet whilst online selling can certainly be a money-spinner for FMCG producers, it may well be even more important for brands to manage their presence in the marketplace and reputation online than to sell products directly. What Kimberly-Clark UK has shown through trialing and testing the marketplace is that they can almost certainly do both.
Nine: Kraft Foods
The FMCG global leader recommends the ingredients needed for effective digital marketing.
Kraft was an early adopter of Modern Marketing tactics and today understands better than most brands just what the parameters of digital are and what it can offer its practitioners. The company believes the focus lies on engagement, user experience and customers’ completion of high-value tasks to measure these processes. Such tasks could be opting into an email newsletter, entering personal information to customize the user experience on the KraftFoods.com website, or interacting with particular parts of the site. ‘If you know what you want [users] to do and you can track it, then you can quantify it and show the value of the interaction,’ said Kathleen Olvany Riordan, VP of global digital marketing strategy at Kraft Foods.
At KraftFoods.com, the strategy is to empower online consumers with information or content relevant to them, such as recipes and nutrition information, as well as demonstrating the values and attributes of Kraft's brands in interactive ways that cannot be achieved offline. Such interaction involves consumers in each brand and encourages them integrate the brands that particularly suit them into their everyday lives. A good example of such a tactic was Kraft’s targeting of ‘millenials’, young adults born between 1979 and 1994. Since many of the millenials had not learned to cook at home, Kraft created the Kraft Cooking School, featuring on-demand video content that explained basic cookery tasks and preparation methods. It proved an ideal way to reach this web-savvy target audience and involve them in the Kraft brand.