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Facebook Tesco Dunnhumby

Facebook inks landmark partnership with Tesco’s Dunnhumby to show FMCG brands how ads impact in-store sales


By Jennifer Faull, Deputy Editor

April 5, 2016 | 6 min read

Facebook has inked a deal with Tesco-owned research firm Dunnhumby which will give FMCG brands the ability to see how ads run on the platform effect in-store sales at the supermarket.

It’s a landmark partnership for the social giant, which is increasingly turning to third-parties to show it’s not “marking its own homework”. Despite doubling efforts to illuminate the impact of its ads, Facebook has continued to find it challenging to carve a role for itself on shopper marketing plans.

Last year, The Drum revealed how a number of top-level marketers including Pernod Ricard and Johnson & Johnson were being forced to put more budget than they might like to TV advertising, rather than digital, because the buyers at supermarkets – the people who decide if a product will go on shelves – believe that mass marketing is sill the only way to shift stock at scale.

Facebook’s latest solution, dubbed 'Sales Impact', looks to go some way to solving this problem, moving beyond clicks or view count and towards a more powerful measurement metric that marketers can take into boardrooms.

Dunnhumby’s data bank of some 17 million shoppers in the UK will be married with that of Facebook’s 37 million monthly active users in the UK via Acxiom, a “safe haven” which will allow analysis of how the ads online impact sales offline.

“It’s been done directly in response to advertisers and agencies asking for the value in advertising on Facebook,” Alex North, head of marketing science R&D, EMEA at Facebook told The Drum.

At its most basic level, the method involves serving one group of Facebook users an advert versus a control group that are not. Dunnhumby then observes the impact on sales both during the campaign and up to eight weeks after its run the insights are delivered to advertisers.

“What we’re trying to get to is a census level, robust measure of how to advise clients on what’s working on their campaigns. It’s a very valuable solution to helping clients understand their investment on Facebook and providing a real tangible business value,” added North.

However, it can also help brands to answer more nuanced questions, such as;

  • How do different types of audiences respond to certain ads
  • How does differing creative or ad products perform
  • What is the ideal frequency of ads to be shown to certain audiences?

While it will only be available to Facebook advertisers in the beginning, extentions to other platforms it owns, including Instagram, are planned for the future. Meanwhile, Dunnhumby will also include additional modelling as part of the methodology to help provide a representative view of campaign impact across all grocery retailers, not just Tesco. An interesting move given Dunnhumby's owners, but by scaling the data to project sales at the likes of Sainsbury's and Asda Facebook is looking to show that it can be a one-stop shop for FMCG marketers looking for more robust measurement.

Early results

During early tests, a number of un-named FMCG brands put their Facebook efforts under the spotlight.

Campaigns for 10 different brands in categories spanning soft drinks, laundry detergent, personal care, and beers wines and spirts, across eight different FMCG companies were analysed.

Some 60 per cent of the studies run indicated what Facebook described as a “statistically significant sales uplift".

Meanwhile, analysis into what kind of mobile ad content was driving in-store sales – specifically for premium brands – resulted in a list of best practices. Those brands that then employed these best practices for an advert saw a ten per cent uplift in in-store sales.

Another example comes from a new product launch for an established brand. The advertiser targeted the ad at two different demographics before measuring which group bought more. One of the groups proved much more responsive, which is leading the brand to rethink who it’s targeting with the product.

'Don't necessarily see this partnership as a panacea'

While the tool is generally being seen as a step in the right direction when it comes to understanding the value of digital marketing spend, agency-side marketers for Pantene and Peroni have warned that it shouldn't be seen as a silver bullet.

Rob Sellers, managing director, Grey Shopper - which counts Gilette, McVities and Pantene among its clients - said that with Facebook and Dunnhumby partnering there is a real chance that advertisers will get a robust comprehension of the value of ‘social’ advertising versus more traditional channels.

"Unlocking the ‘online to offline’ conundrum lies at the heart of many brand and shopper strategies, and this will hopefully give us some clarity to build more effective ideas," he explained.

"However, it would be surprising if the picture that they paint is anything other than one of great value for money. Both Dunnhumby and Facebook are essentially media owners, and it is in their interest to try to convince brand owners that they need to invest in their platforms. And although no players in this market are quite as big as Facebook and Tesco, there are other ways of measuring the effect of digital (and particularly mobile) communications and how they can influence physical shopping. In order to maintain a sense of impartiality, it would be my advice not to necessarily see this partnership as a panacea."

Similarly, Bonnie Boodram, head of e-commerce at Leo Burnett/Arc London - the shopper marketing agency for Coca-Cola and Molson Coors- said that with two of the biggest super tankers joining forces, theoretically it should provide the missing link between sales and social advertising.

"It can only be positive that our super tankers of grocery stores are interested in a new generation of shoppers," she said. "This of course won’t provide an immediate correlation between social habits and sales as we know shopping habits and the data landscape is a lot more complex than that. However I am optimistic this new insight taken in combination with traditional advertising data will provide new insight on customer behaviour on and offline. We haven’t yet seen the impact of mature programmatic advertising yet – but this is a hopeful step in the right direction."

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