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Can Facebook and Dunnhumby prove the value of digital at the shopping till?

By partnering with Dunnhumnby, Facebook is manoeuvring itself to pick up the profitable pieces from the crumbling wall between marketing and sales at FMCG businesses.

The social network believes its tie-up with the self-styled “customer science company” can be crucial to its bid to inflate the value of its media in a last click attribution world where social often gets a bad rep. The missing link Facebook and Dunnhumby are addressing is connecting physical sales with digital advertising, and in turn this provides a powerful marketing utility. One that makes the connection between online Facebook ads and in store purchases more real-time.

"It’s a very valuable solution to helping clients understand their investment on Facebook and providing a real tangible business value,” Alex North, head of marketing science R&D, EMEA at Facebook told The Drum of the partnership’s launch last week. It’s a pitch some critics might argue is quite self-serving for Facebook. However as long as retailers insist on complete transparency this shouldn’t be a problem.

“Privacy issues arise around people’s inability to opt out,” said Niel Bornman, global chief product officer at iProspect. “So it is essential that data remains completely anonymised - Axiom is taking the anonymised data from both parties and provides the matching between the IDs, making privacy a non-issue. For the last eight or nine years the question has always been about how effective Facebook is for advertisers.”

The social network has been wise to giving FMCG confidence in data measurement by removing itself from the matching process with Dunnhumby, which will be handled by marketing technology business Acxiom. Therefore, not marking its own homework. There’s also the question on how good a proxy data is for the larger FMCG shopper. Time will tell. The true test will be how the proposition settles into Facebook’s rapidly growing mobile advertising proposition and consequently the evolution of its ad tech stack.

For any brand or retailer, that premise is likely to pique their interest. It’s whether Facebook is able to convince advertisers to buy into the new concept so that it can scale it relatively quickly. While the Dunnhumby data will only be available to Facebook advertisers initially, there’s scope to extend it to other platforms within the eco-system such as Instagram. Not only that, there’s also the ability to view a campaign’s impact across all grocery retailers, not just Tesco.

“Facebook knows that is a powerful advertising medium, so I don’t think they have to ‘lie’ when it comes to the results,” said Peter Veash, chief executive at the BIO Agency.

“FMCG stores have difficulties in attributing their digital ad spend to in-store sales. Vouchers usually do the trick and supermarkets are now also trialling their own payment apps. Waitrose and Tesco want their customers to use their mobile payment apps which could bridge the online and offline gap, but do consumers really want to have loads of different apps on their phones? I doubt it. The FMCG industry is trialling different ways in order to merge online and offline. The Facebook and Dunnhumby tie-up is one of these solutions for them.”

And it’s the timing of the tie-up, when FMCG advertisers are taking e-commerce and omnichannel marketing seriously, that could ensure that Dunnhumby is the one to get Facebook on more shopper marketing plans. From partnerships (Datalogix in 2012) to working direct with FMCG companies such as Mondelez, Facebook has tried and tested a myriad of ways to spotlight its role in the path to purchase, though up until now it’s not had a model it can scale.

Part of the challenge has stemmed from supermarkets; marketers from some of the world’s biggest FMCG brands including Johnson & Johnson and Pernod Ricard intimated to The Drum last year that their ambitions to invest more in digital are hampered by a lack of understanding of the medium at supermarkets. Media plans are a key way for advertisers to win shelf space in-stores, and TV is still favoured by those making the decisions. By bringing in Dunnhumby, Facebook might just be able to come up with a pitch they can understand, one that can relate the data to both online and offline experiences rather than short-lived sales spikes.

But beyond driving sales, being able to relate this data to both online and offline experiences is key. The opportunity comes in “better understanding the crossover between online and offline interactions” as a route to crafting an “elegant customer experience” that will lead to both increased sales and customer advocacy, said Joy Bhattacharya, managing director of Accenture Interactive in the UK and Ireland.

“Disruption is occurring today where brands and retailers are recognising the value consumers place on experiences as much as they do on simply being able to purchase what they want at the right price,” he added.

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