From beacons and location to viewability and programmatic trading, Mondelez is adapting to the rigours of media fragmentation by fusing data and creativity to actually make money from its content rather than just use marketing to promote products.
The snack maker wants its media to do more than just work the margins as it looks to make smarter spending choices rather than cuts - the key outcome from recently installed cost-control measures. Consistent sales lifts have evaded Mondelez since it was spun off from Kraft in 2012, forcing the company to recalibrate its go-to-market model to drive more commercial gains from its media tactics, particularly programmatic buying and the growing importance of locality.
The future of beacons business
Over the next few months parts of the plan will take shape, especially in the mobile and location arenas. The food business has been hard at work running beacons tests worldwide over the last year to understand how it can add value and trust when doing location-based advertising. Pilots in the UK, Germany and Europe are yet to solve the company’s issues with infrastructure it needs to focus on the messaging though they have offered food for thought.
The major stumbling block is retailers. “We ran a [beacons] test in the UK that fell over after about four months,” Mondelez’s media director for Europe Gerry D’Angelo told The Drum. “The retailer went we might just do it ourselves internally first and get back to you. The potential of [beacons] is extremely great but then you run into some of these issues that kind of constrain its development.”
For Mondelez, the potential of beacons and more broadly location-based ads is beyond simply sending push notifications at fixtures in-stores. Whether it’s opening up secondary points of sales or reconfiguring store layouts, the business wants to get better at using time and place in the right combinations.
However, much of Mondelez’s mobile is progress is dependent on how its marketers discuss the medium. Instead of talking about the channel, D’Angelo said location was an easier “sell in” to marketers because “if you say to a marketing or commercial director that we can talk two people closer to the point of purchase then that starts too become very powerful as an argument”.
“It’s not about inventing new things to say to consumers [through technology],” he continued. It’s just a slightly different way of delivering it. These are smarter ways to make our dollars go further. And they can be very attractive when we’re beginning to be challenged on our revenue and our overheads. It’s a smart way of taking a large investment area of the business and making it pay back,” he added.
Paving the path to programmatic prowess
Mondelez’s moves to sweat media harder also encompass its early steps into the world of automated advertising. Cost per acquisition, cost per click and other performance metrics “radically improve” when the company has made the switch from orthodox buying to programmatic, claimed D’Angelo.
However, the sheer breadth and depth of the discipline and its myriad of issues, from viewability to transparency, has convinced it to take a step back and learn from its peers. Over the last two months the business has looked at how the likes of Unilever and Procter & Gamble are adapting to the discipline, evaluating the pros and cons of how all are wrestling with the issues. While the snacks business is yet to make a call on how to take programmatic forward, D’Angelo said “things get quite interesting” when most of the programmatic heavy lifting is done by the agency that is using a client specific trading desk to pour data back into the company’s data management platform.
The company’s investigation into a more structured programmatic process comes as it shifts more spend into online video after it struck a global deal with Google last October. The move, given its scale, brought into sharp focus ongoing issues around using a company’s ad tech products when purchasing that company’s ad inventory, amid rumours that Mondelez had been strong armed by Google into axing its DSP with Tubemogul. However, Mondelez continues to work with Tubemogul around its video as seen earlier this year when it helped the business buy its first programmatic Super BowL broadcast TV ad.
D’Angelo said the business had to “tread carefully” in this land of giants” when asked about its deal with the Google.
“I don’t think we’re in that position where we want to bring as much as possible [in-house]. I don’t think we’re there. At the same time I think we’re clued up enough to understand that the approach could be a lot better. It could be a lot more efficient. It could be a lot more transparent. We’re somewhere in the middle,” said D’Angelo.
The need to experiment at a time of such rapid change does not just touch how it produces content but also standards. It is why the company is now having conversations about whether to introduce its own tougher measures on viewability that could see it follow in the footsteps of Unilever.
Being a media first marketer
Ultimately, Mondelez’s efforts will try to shape a media-first approach to marketing.
The company has set in motion several initiatives to try and generate real, incremental revenue from its media, the most recent one being a deal with Channelsight to let shoppers buy their snacks from its owned, earned and paid for media. The snacks maker touched on the shift at this month’s Festival of Media where it discussed its efforts balancing a consumer centric approach with the need to drive sales in a FMCG category heavily impacted by ecommerce.
Mondelez plans to hit the $1bn revenue mark through ecommerce by 2020. Its media chief Bonin Bough has not only been tasked to lead the charge for online sales but also nurture a more robust approach to media, believing it can unlock new revenue streams in the fiercely competitive market.
Mondelez’s shifting media plans are emblematic of the unprecedented number of challenges companies, particularly those in the FMCG space, now face. From data fraud to transparency, precision marketing to attribution, marketers are having to come up with cost-effective ways to leave traditional advertising behind to focus what value their brands can add through content.