Digital CPG Blog

How does your organization assign an ROI to your efforts in social media?  Take Twitter for example.  Have you been able to actually assign a value to your followers and those 140 character tweets?  As CPG gets more serious about investing dollars in social media, this question is going to move front and center. 

For Dunkin Donuts, the value of Twitter isn’t in some immeasurable reference to “engagement.”  DD is actually using Twitter to create measurable customer data and drive actual sales.  How?  By giving followers a persuasive reason to interact. 

The company’s Twitter efforts (featured here) include tracking customers that sign up for the company’s rewards programs and sweepstakes offers via Twitter, and assigning a dollar value to those customers that can then be tied to an actual ROI.  Closing the social media donut hole, if you will (sorry, I couldn’t resist) 

Dunkin isn’t the only company using Twitter to drive measurable results (it’s been widely reported that Dell has generated millions of $’s of sales from @delloutlet), but it is great example of how CPG is starting to get more serious about their social media investment.  

Having a program to engage the consumer (via an online loyalty program, a sweepstakes, or even your own online store) is going to be critical to the efforts of CPG to move social media spending from the experimental to the mainstream.

Consumer Packaged Goods marketers have a big challenge:  how do you create engaging content to effectively support your  digital marketing?  The digital consumer isn’t passive; you need to provide them a quality reason to pay attention to you.

Rob Go summarized this challenge nicely in a post yesterday in which he predicted a massive shift in CPG ad $’s to the web:

Auto companies can get a lot of engagement in their ads because people love looking at pretty pictures of cars.  But not a lot of people really want to watch a great online video about paper towels. 

Exactly. 

That’s why I found it so interesting to read in AdAge this week that some big CPG marketers are experimenting with the latest darling of the SXSW crowd—Foursquare.  I haven’t spent a lot of time on Foursquare, but I’ve really enjoyed watching their growth and speculating about all of the advertising opportunities that evolve from their location-based mobile platform. 

The Mayor of Pampers?

The AdAge piece, entitled “Would You Check in to Box of Tampax? For Charity?”, summarizes the efforts to P&G and Kraft to jump into this new location based world.  Using an app from start up CauseWorld, these CPG heavy weights allow consumers to “check into” their actual products on the store shelves (scanning the bar code) to accumulate points that can be donated to charity.

Will this work?  Are consumers willing to engage in this behavior?  If CPG can make this work on a location based mobile platform like Foursquare, getting consumers to engage in more mainstream web formats like Facebook should be a cakewalk.    

My opinion is that this kind of app will have an extremely small appeal, although I’d love to see it succeed. 

Commerce is the Key to Engagement with CPG

I think charitable efforts have a lot of potential for digital CPG advertising, but the mainstream consumer isn’t going to engage with CPG brands online without some tie in to actual commerce. 

Without the opportunity to buy or save money on my paper towels, I’m not going to pay any attention to them in the digital environment.     

Want proof?  Look at some of the data coming out of Facebook, which is clearly taking over the world.  Following a brand on Twitter or Facebook will make you more likely to buy a product from that company, according to a recent study by market research firm Chadwik Martin Bailey (results here and here).  But the study also revealed that the top reason people friend a brand on Facebook was to receive discounts and special promotions. Commerce is king. 

Want more evidence of the important of commerce to digital advertising?  Consider a recent experiment by P&G on Facebook.  P&G ran a special promotion to its Facebook fans last month that allowed fans to buy a new Pampers Cruisers product before the product hit the store shelves.  The promotion was a huge success, selling out the 1,000 packs it allotted for the effort in less than an hour (coverage here).  I think there is amazing potential here.   

I salute the creativity of P&G and Kraft in experimenting with Foursquare, but the real payoff involves tying digital marketing to some form of actual commerce.

 Agree or disagree?  I’d love to hear your thoughts.

We’ve talked a fair amount on this blog about the giant shift occurring in ad dollars from traditional media to digital opportunities.

A study released this week presented further evidence of this trend.  The study by research firm Outsell, predicts that Companies will spend more on digital and online marketing than print advertising in 2010 for the first time ever ($119.6 billion versus $111.5 billion).  You can read more about the study here and here.

Digital is clearly on the rise, but one interesting question remains for the CPG industry-will there be enough high quality digital opportunities for CPG to continue to shifting a larger amount of their budgets online?

As I’ve mentioned on this blog before, I think eCommerce can (and will) be a critical element in the growth of digital CPG ad spend.  In particular, CPG manufacturers have a huge opportunity to inject an eCommerce component into their websites, and allow that online fulfillment capability to serve as a centralized collection point for a host of diverse online campaigns, driving a much higher level of accountability and measurement to their online ad spending.  Many of the big CPG companies are beginning to invest in eCommerce, and it will be fascinating to watch how they leverage this new capability into their overall marketing mix.