FMCG

by Greg Thain

  To guide it towards achieving the best online consumer experience, Kraft builds into every campaign three ‘marketing imperatives’: Insights, Ideas and Integration. It also makes sure that it co-ordinates the wide variety of multi-media marketing platforms and tools available by optimising its Modern Marketing consumer experience across multiple touch points by the tailored support of its own stable of product websites via Facebook Pages, Twitter, and Tumblr. Kraft has learned to curate the ‘voice’ or message of its content to particular consumer groups’ particular needs.

  Yet it’s not only niche products or the youth market that benefit from Modern Marketing. Kraft claims that 80 percent of its new brands benefit from online consumer interaction. But perhaps the key takeaway message is less the actual content than the Modern Marketing strategy. Julie Fleischer, director of Content Strategy & Integration at Kraft Foods sums up the vital issue: ‘We don’t chase every bleeding edge technology, but we do pay close attention to the technologies and platforms our consumers are using and, when the time is right, then we look to introduce our content.’

  Knowing where the next effective online ‘space’ is to catch your consumers is a big part of getting it right for the future. But beyond getting the right space for your message, Kraft, like other successful FMCG brands, well understands that it may not be a purchase that online consumers first have in mind but simply an interaction. ‘We're not designing a banner ad, or rich media, or a Web site,’ Riordan says, ‘we're designing consumer experience.’ And in Kraft’s view, it all flows from there.

  Ten: Nestle

  Looking after your brand reputation is vital in today’s busy marketplace. Nestle show how Modern Marketing helped combat negative PR from web users.

  No brand in the world is exempt from damaging online PR. But when the $200 billion food giant Nestle faced a wave of negative online publicity, it fought back with its own ethical customer involvement program: online.

  Although many FMCG brands outsource their social media management to third-party agencies, Nestle has set up, at its US nerve centre in California, an internal social media global response centre to deal internally with the problem of negative consumer coverage. This is what Nestle calls the Digital Acceleration team. ‘With 1.5 billion searches on the Internet, food products are in a quite different category from computers and technology products. Especially in this area, people are looking for transparency and integrity,’ says Dr. Alexander Decker, Head of Consumer Relations at Nestlé Germany.

  The Digital Acceleration team is responsible for the daily monitoring of, and rapid reaction to, potential PR crises. So, instead of viewing the internet public as a potential threat, the brand views it as the world’s greatest focus group. ‘When there is a high number of comments, it alerts you that you need to engage,’ explains Pete Blackshaw, head of digital marketing and global media at Nestle. ‘This can mean a real-time response from a member of staff or the issue may be escalated.’

  In 2010, as a first step, Nestlé began by rewriting its social media engagement principles, developing a code of ethics promoting open, honest engagement and distributing it to all staff. Backing up this ethical stance, the Digital Accelerators team is ready to post positive reactions and an ethical defence of their brands and company whenever the need arises . Such responses might explain why Nestlé has been accused of purchasing social media followers and celebrity endorsements, or paying bloggers for pro-Nestlé posts, charges it strenuously denies. And the results have certainly been highly beneficial, creating a new and positive ethical framework, using data and online insights to guide social media activity in the future and helping to generate successful campaigns.

  There is nothing particularly revolutionary at work here. Nestlé’s transformation is simply one further example of how social media have changed the online marketing landscape, providing new pathways for connections between brands and consumers. Nestlé’s catalysts here were confidence, vision and humility: to drive forward innovative new strategies, among them the Digital Acceleration Team, and to learn from past mistakes the company undoubtedly made in protecting its reputation online. Consumer communication and open collaboration are now the way ahead.

  Eleven: Pepsico

  Even a global giant can target local consumers with current Modern Marketing tactics. Discover how Pepsi Beverages hopped on the newest trend in social: SoLoMo.

  SoLoMo, or Social, Local, Mobile is one of the newest trends in social marketing and Pepsico are just one FMCG producer who are embracing it. SoLoMo allowed brand Pepsi to integrate social media with location-based mobile marketing to establish a geo-local reach-out to a key consumer audience, 18-25 year olds. The company used content taken from their Live For Now campaign on Pepsi.com, targeting consumers in specific geographical locations and following through on the company’s firm belief that cyberspace, rather than traditional television, print, radio or billboard advertising, was the best way to achieve its goals.

  Local customer data came from platforms like Facebook, where Pepsi has a more than 8 million strong community. George Smith, senior manager for social strategy and execution for Pepsi Beverages, says: ‘With digital, you end up with a lot of extra data, and you end up with a lot more understanding of who your consumer is. By comparison, marketers can't deduce nearly as much about customer behavior through other forms of advertising, such as TV and billboards. Like many companies . . . Pepsi monitors what people say online about its products and sometimes steps in to refer disgruntled consumers to its customer-service team.’

  Pepsi is a good role model for anyone interested in using the social media to get demographic information, engagement and brand opinion from an audience. Techniques like newsletter submissions, contest entries and other supporting or relevant promotions automatically amass data invaluable to a marketer, a tech-enabled power shift that has effectively neutralized many traditional forms of outbound, or push, marketing. Today’s savvy consumers want to be listened to and courted, with channels of communication that go directly to the brands. Finding and targeting consumers in their own locations, as Pepsico has, keeps these customers focused on the brand like never before.

  Skilfully deployed, Modern Marketing is a win-win for both brands and consumers. Smith recognizes the mutual benefit of this direct consumer interaction: ‘It's nice to be able to have that direct conversation with [consumers], and not have to rely on a specific media channel to push this, or buy TV constantly to push that message.’

  Twelve: Procter & Gamble

  As many FMCG producers move into the digital space, the two key questions are Where and How Much? What have Proctor and Gamble’s answers been? How much does the FMCG giant spend on digital and is it paying off?

  At the end of 2012, Procter & Gamble estimated an allocation to digital of 35% of its massive marketing budget in the US. The company recently cut $10 million from their traditional marketing budget to re-focus on digital and mobile advertising. All this from a FMCG conglomerate which once leaned heavily on TV and magazine advertising in the past, but has now long been behind the broader market in digital.

  A variety of estimates by industry analysts put P&G’s current digital spend at somewhere between $1.2 and $4.8 billion, with The Interactive Advertising Bureau estimating a total US digital of $36.6 billion, to which the entire US FMCG industry contributes 7% or $2.5 billion. Plainly, exact amounts remain unclear. But whatever they are, P&G has certainly emerged as an extremely heavyweight digital investor. But the bottom-line is that Modern Marketing is working for P&G. Figures suggest the company is ahead of its competition. Even the conservative estimate of $1.2 billion in digital spending amounts to 3.8% to 5.6% of total US sales, compared to an average 2.8% spent on digital marketing by other manufacturers in the survey. Nor does P&G show any sign of retrenchment in either spend or digital commitment. When questioned on the future of digital marketing, P&G’s Roisin Donnelly was quick to defend her employer’s strategy and its more intangible advantages:
‘Fundamental from a marketing standpoint, though, is the opportunity that digital provides you to truly connect people to your brand. The age of one-way, push-only communications is over as digital gives us the chance to build real, emotional and long-lasting connections with people in the spaces they choose. Our ultimate vision is to be able have 1:1 conversations between our brands and all our consumers, tailored to them and their needs and preferences. We're not there yet, but the pace of developments in digital makes it a real possibility in the future.’

  P&G clearly recognizes that consumers are spending more time in digital media. ‘They are getting entertainment, news and views, and doing shopping online.’ Donnelly adds. ‘People have access to information anytime and anywhere they want it, and it's not just what you say about your brands that they can find.’

  With consumer access to brand information better today than ever before, and likely to do nothing but grow, the issue of brand trust is at the forefront. However, Donnelly realizes that traditional and Modern Marketing can work together to build that relationship: ‘Brands need to find the right mix of digital and traditional media for their consumers. But not every brand needs to have presence in every media. You need to make choices driven by your consumers. They key is to be present and effective with the right message, at the right time and in the right place-based on where your consumers want and expect you to be.’

  Thirteen: Reckitt Benckiser

  Find out how the company used an online social media platform only to launch a new consumer product.

  As 2012 marketing campaigns went, it surely ranked as bold: offering consumers the chance to buy the Reckitt Benckiser (RB) Cillit Bang All in 1 Dish & Surface Cleaner exclusively via Facebook. The washing up liquid product that comes with an automatic dispenser was made available to RB’s Facebook Fans only and preceded its rollout in shops. Dubbed f-commerce, FMCG brands like Reckitt Benckiser, plus others Heinz and Asos, have been curious to test the marketing and e-commerce potential of the world’s largest social network.

  Reckitt Benckiser’s UK marketing director Stefan Gaa was quick to defend his company’s campaign at a time when social commerce had and still has its critics. Gaa said: ‘RB prides itself on trying new stuff and this Facebook activity is another example of the company trying to push boundaries and try things out. In the end a business is about sales so to make it viable, you need to make sales but the beauty of social commerce is you’re putting commerce into people’s homes and bringing products to an environment consumers are already spending a lot of time.’

  As our case-studies have already indicated, FMCG companies and consumers already have high levels of online engagement. But many see the next stage as social commerce. This is certainly true of RB, who want to join the likes of Heinz and Asos and encourage customers buy directly through Facebook. For now, however, return on investment is unclear. A study last year by Havas Media Social and Lightspeed Research found that 44% of people remain unconvinced and only 11% have actually bought anything at all.

  Nonetheless, Reckitt Benckiser believes that because so many of its customers are spending so much time on social media sites it is important to target marketing energies in the same place. Gaa is optimistic: ‘You never know before you do something how it will turn out. The world doesn’t stand still - no one expected mobile phones or text messages to be the mass communication that they are. Our responsibility is to experiment because often in marketing you don’t know, so you just do something and then the next time around you know a bit more.’

  Another Reckitt Benckiser campaign, which may just indicate a company tip towards Modern Marketing, was Lysol Power & Free. The household bleach cleaner was marketed in 2013 via Facebook in the US, predominantly to reach female consumers aged between 24-54 years old, and promoted especially to appeal to ethical shoppers because of the product’s positioning as a kinder alternative over harsher chemicals. The results were impressive. The Facebook campaign achieved 310 million page impressions - three-quarters of which were generated via earned rather than paid media. And although the company did use TV advertising in support, Laurent Faracci, US chief strategy and marketing officer for RB, confirmed both that the Facebook marketing results were similar to those RB typically achieves on TV in a similar time frame, and, given Facebook’s low cost-per-thousand rates and the campaign’s emphasis on earned social media impressions during the campaign, that the investment was almost certainly less.

  In many ways, Lysol Power & Free campaign was an ideal online campaign, able to tap into the ecological concerns of the kind of culture-driven customer base that social media sites make it relatively easy to locate and then speak to. The resultant 30 percent boost to brand seems to clinch the argument.

  Fourteen: Unilever

  Modern Marketing means 1:1 marketing. The results Unilever has seen – and the FMCG industry as a whole - suggest the company is betting digital as the key to brand building.

  Digital and mobile are the key components of Unilever’s communications strategy. Jay Altschuler, Unilever’s director of global media innovation, put the point bullishly to attendees at the Internet Advertising Bureau’s annual Engage conference in 2013: ‘For brand marketers, technology has made a 1:1 relationship with customers a reality. The most important value for brands to pursue is trust, because if you don’t have that, then customers won’t let you use their data.’

  Unilever trusts its consumers so much that it puts company money where Altschuler’s mouth is, as its Knorr brand launches an online portal to recruit food enthusiasts to act as advocates in a wider £12m marketing push to raise its profile in the UK. The campaign will unashamedly promote both the quality and taste of its products, as well as continuing to highlight convenience as a key selling point. The move aims to tap into the popularity of TV cookery shows such as Masterchef and Come Dine With Me.

  The launch entails the effective creation of an online community to spearhead the charge and introduce new shoppers to the full Knorr product range. The portal will further serve as a hub for the brand’s digital activity, providing an opportunity for consumers to interact with the brand’s 230-strong team of Knorr Chefs who are responsible for making every single Knorr product. Visitors will be able to share recipes both from the experts and the celebrity chef Marco Pierre White as well as using a Buy It Now feature to purchase products such as stock cubes and gravy pots. Alongside print advertising, sampling and PR supporting the hub, the company will use Facebook to recruit fans for the brand’s Kitchen Academy, which will offers members’ recipes tailored to their preferences. A TV campaign will launch later this year to extend the push.

  Earlier in 2013 Unilever launched its own social network with the aim of increasing trust and fostering collaboration between its in-house international marketing staff and external agencies. The move allowed marketers to share campaign knowledge and best-practice insight using Salesforce’s Chatter technology. With the launch imminent, Marc Mathieu, Unilever’s senior vice president of marketing gave details: ‘The platform provides our team with the tools they need to develop and build our brands in local markets. It also frees up time for our team to create more magic - that is, to engage with consumers and create more effective marketing, which will be key to delivering our ambition to double the size of our business.’

  So, if brand trust is the key universal that Unilever believe lies at the heart of Modern Marketing, the future of marketing is changing for all FMCG producers, with versatility also illuminating the way forward in the Unilever scheme of things. As Unilever’s Paul Polman concludes: ‘We are looking at more dynamic ways of involving the consumer and, no doubt, social networks are part of that. However, I don't think you want to make big statements. Otherwise, all of a sudden, everything is about Facebook. . . . TV [still] has a role to play and it will for a long time, but you first need to really talk about the brand, what it stands for and the message.’

  Managing the Digital Marketplace

  At the begin
ning of this chapter, we asked whether Modern Marketing was simply the emerging markets’ future or everyone’s. The answer must now be clear: everyone’s. This heralds another interesting change. When the marketing media were traditional – the so-called push media – managing them was a simple matter: you had some agency think of fancy ideas, you booked the space or the slot, chose when and where it would be seen and heard. If your product could be written about, you had some journalist plug it. If it just looked good, you got a friendly film director to leave a pack of it in Sean Connery’s Aston or Brigitte Bardot’s bath (vary car, bath, actor as appropriate. Or product, or course: where was Lurpak in Last Tango in Paris?). This was simple stuff: you could make a list of it all. You knew where it was, and what it was, and what it said, and what you hoped it would do. But digital is different. Out there in digital there is a tsunami of information that is growing larger every second. We genuinely are at a threshold moment; over the next few years, the world and everyone in it will be digital and be connected. To the companies we have highlighted in this book, this will throw out both massive challenges and massive opportunities.

  But this is not merely because digital is a new medium. It is not simply a case of local radio taking over from local papers in late 50s America, or TV taking over from them both. We have just pointed out the essential controllability, and in a sense predictability, of the traditional media: the simple stuff you could jot down in a cheap notebook. The digital media are both far more subtle, but far more powerful, than anything that has gone before. It’s as if you’d put a couple of billboards in a town, and the billboards had suddenly started talking to each other, and then one or two more billboards joined in, some of which, as prominently displayed at the first two you’d commissioned, violently disagreed: rogue billboards, bigger than your own. Suddenly your company has a billboard footprint that can walk anywhere it wants to, and leave its grubby footprints all over that pristine brand image you’ve been striving for. That’s digital. And a campaign on digital works in exactly the same way, but on a scale of billions and billions of conversations about you and your product. That is neither essential controllability nor in any sense predictability, but a digital footprint– and almost everyone has a DF these days - that can be a law unto itself. It’s not a couple of actors with the ad agency’s lines to read, it’s a gigantic auditorium of interested parties with an axe to grind, all talking at once, and without a script. And your Facebook page – you chose Facebook instead of the billboards – set the whole thing going.