How Kraft Harnessed Data to Transform Marketing

bob-rupczynski-kraftBob Rupczynski joined Kraft in 2012, just after the company had split from Mondelez to create its own entity. Back then the grocery manufacturing and processing conglomerate struggled to find ways to use its troves of customer data to push the business forward and away from mass marketing.

Fast-forward two-and-a-half years, and with a complete overhaul of its operations, Kraft has evolved to a company driven by data segments. It is now able to connect with consumers in a more refined way, serving personalized content for more effective marketing of its brands.

Rupczynski explains the journey.

ClickZ (CZ): Kraft Foods has significantly changed the way it uses data to drive marketing decisions. Can you tell us about the changes and the decisions behind them?

Bob Rupczynski (BR): When Kraft split from Mondelez in 2012, it wanted to reinvent its future. This meant getting the agile marketing right, and delivering the right message, to the right person, all at the right time. We knew back then that data was going to be the backbone of how we were going to move forward. We had 18 years’ worth of consumer connections, which first started in the print world, and then extended into Kraftrecipes.com. This receives just more than 100 million visits a year. So we had a tremendous amount of data, but yet we weren’t leveraging the information that consumers had entrusted to us to make the relationship deeper. Nor did we build that emotional connection to them in a way that was value-exchange positive for the consumer. We knew this needed to change. We knew where we were and where we had to go.

CZ: What defines data-driven marketing to you and how does Kraft’s vision of the “three pillars” help to drive it?

BR: Data-driven marketing for us is about getting the most relevant, the most up-to-date, and the best data sets for our consumers. We want to understand them in ways that we historically haven’t. We want to know who they are, what their behaviors were, what their preferences are, their needs, what they were seeing, what they want to see, and what they are experiencing.

To do this, Kraft identified three pillars to really push the business forward: data, infrastructure, and content. For data, we wanted to gain a deeper understanding of what products consumers were purchasing and why. So that meant being able to close that circle of understanding of who they are, what impressions they were being served online, and what their purchases were in-store as a consequence.

Infrastructure was the second pillar and making sure we had systems in place that were capable of handling all this data. It needed to be matched, delivered, and actionable so that we could change the consumer experience. We also had to change the culture and the marketing practice within the organization. We had to educate, and make our people understand what the consumer was expecting in today’s age so they could take it to the next level.

Our final pillar was content. For this, we asked ourselves a lot of questions. We had 18 years’ worth of experience developing content, but how do we move that into the new world? How do we do that quickly? How do we do that efficiently? And how do we do it where it drives relevancy with the consumer, and ultimately drives purchase?

CZ: One of the biggest changes for Kraft was the rewiring of its data systems, i.e. merging the content platform Kraftrecipes.com with its data management platform. Can you tell us a little more about this and the decision behind it?

BR: We combined it right off the bat because we knew we had to look at data holistically. We had a number of disparate pieces of platforms and technologies, and these needed to come together. We always use the line internally, “data is people.” A lot of companies use data for efficiency sake – for saving money or things like that. But for us, data was about understanding human beings, deriving the insights that drive those people. And that was really where Kraftrecipes.com came in; learning the products that our consumers love and want to share. It was our CRM nugget.

We also knew we had to collapse the walls between some of the silos in our organization. We knew we had to seed people the data, but we had to do this through a wider lens than a portfolio view. By merging the two platforms, we get a value exchange that is unrivaled for our consumers. The data sets we use, the information we bring in, the things that we match in the background, has exploded.

CZ: What are some of the results that Kraft has seen due to the data overhaul?

BR: We are now recording more than 34,000 attributes across our 100 million online visitors each year. From that data, we have formed more than 800 segments of consumers to buy ads against. These are customized, personalized, and proprietary to Kraft.

Obviously 34,000 attributes is a huge amount of information for our strategists and planners, so we are constantly going through a learning curve of what’s good, what’s bad, what’s working, what’s not, what the right tool sets are, and how we need to redefine them.

CZ: What about KPIs? How have they changed as a result of using the data differently?

BR: I think the biggest change is the accountability and transparency that we’re now offered. This impacts our KPIs as we now have the ability to measure things with store sales.

I think this industry was built on brand affinity metrics, studies, purchase intent, or even worse, click-through rates. And now we’re at a place where we can measure those impressions against in-store purchases. If a campaign moves our products off the shelves, then we know it’s a good investment. If it doesn’t, then we need to make different decisions.

CZ: Clearly data is improving the efficiency of spend for Kraft. What is the percentage of efficiency that you predict the company gets?

BR: For Kraft, efficiency is not the goal. Addressability and effectiveness is our strategy. That then drives efficiency. But to answer your question, we are seeing double digit increases as a result of using data effectively.

CZ: Can you give us one specific example of how this new data approach changed marketing for a Kraft product?

BR: Absolutely. We began to look at our salad dressings to find out what was really going on. We looked at search data, and data from our own proprietary social observations group. We also looked at our internal websites such as Kraftrecipes.com. We looked at purchase history, what consumers were putting in their carts, recipes they had looked up.

What we noticed trending was an interest in dinner salads, entree salads, and protein-based salads. We were then able to put all those things together in a dynamically served customized and creative content, to give consumers dinner/ entree salad dressing ideas that were very specific to what types of proteins and ingredients they had shown a desire toward. It was also served in real time to deliver the relevant message. The returns on that were amazing. Not only in sales, but also in click-through rates, interaction rates, and search behavior.

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