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McCormick & Company Uses Big Data to Boost Business

April 15, 2013


It’s safe to say that more than doubling a company’s share of unique online visitors in a specific category in less than two years is an accomplishment worth crowing about. Well that is exactly what happened when McCormick & Company teamed with the digital marketing agency R/GA. “When R/GA took on the McCormick spices account in 2011, the brand was getting just 12 percent of the category’s unique visitors, with rivals outspending it four to one. Now McCormick has grown its share to 25 percent, and with a minimal increase in the media spend.” [“Three Brands That Used Data to Transform Their Media Strategies,” by Noreen O’Leary, Adweek, 25 March 2013] When asked, “What closed that gap?” Tony Effik, managing director of media and connections at R/GA stated, “Creating efficiencies through the use data.” O’Leary continued:

“We all know consumers have never been so digitally connected, generating a limitless amount of data as they click, search and scan throughout each day. So it’s no wonder Big Data dominates the conversation in an industry where almost everything can now be empirically validated, brands have the ability to connect cross-channel marketing with buying behavior, and corporate financial execs are more involved in the marketing process than ever before.”

The industry to which O’Leary refers is the advertising industry not the spice industry. And it’s not really Big Data that is dominating the conversation it’s the actionable insights that can be gained through the analysis of that data that has captured executives attention. O’Leary notes that the ad industry now employs as many “Math Men” and it does “Mad Men” in order to achieve the results that clients now expect. She continues:

“Advertisers may not even realize how much data they have at their disposal since so much of it resides outside of their jurisdiction, in areas like customer service, finance, sales and distribution. Identifying that information and discerning its relevance is an urgent priority for leading marketers — who can bet that their competitors are already doing so. Adding to the challenge, large packaged-goods marketers, understanding the value of all that data, are increasingly keeping it to themselves, creating their own private ‘trading desks’ for information rather than sharing it with their agencies. ‘Data is only [an] asset if you can make value out of it,’ Nick Orsman, international head of data and analytics at Proximity London, tells Adweek. ‘There has never been more pressure on budgets and clients wanting to achieve more with less. Some of this data is already in their hands — it just needs to be put to use, to turn value out of those assets and use data in a way that is intelligent around content, timing and personalization.'”

It should come as no surprise that companies quickly learned that data can be valuable. Data contains knowledge and, as the old adage goes, knowledge is power — and, in some cases, a gold mine. O’Leary reports:

“Proximity should know. At the Data Strategy Awards in London, … the agency won a Gold for Best Use of Social Media for its Procter & Gamble initiative “Mums on a Mission.” Realizing that mothers no longer swap tips on the school run, Proximity sought to replicate that community via Facebook. Working with Supersavvyme, a P&G Facebook community, the agency created a to-do list app via the social network that produced a solutions database. Thus, consumers became the media channel themselves, crowdsourcing searchable advice. Rewards came in the form of coupons, which, in the first two weeks, generated 33,000 redemptions for P&G products. Also during that time, 52,872 tips were shared while the average time spent on the site was 18 minutes. Fifty-one percent of visitors were repeat visitors.”

The P&G effort is an excellent example of how a traditional marketing tool (coupons) can be married with digital-path-to-purchase technologies to create a truly targeted marketing campaign. The campaign was able to get consumers to voluntary enter into a conversation with P&G and share valuable information. The result was a win-win for both consumers and P&G. The remainder of O’Leary’s article discusses the marketing and media strategies of three companies that used Big Data analysis to help them improve their market position. Those companies were: McCormick, UPS, and Sprint. O’Leary reports:

McCormick isn’t just in the seasonings business — it also offers meal inspirations by way of recipe suggestions on its website. With more consumers as budding chefs and Americans developing more of a taste for ethnic and gourmet flavors, that digital real estate has become even more important — and especially so considering that the company is going up against much larger rivals with fatter media budgets and with pure-play sites like that of Food Network thrown into the mix.”

The McCormick website has recently become even more personalized, with consumers now able to discover their individual FlavorPrintTM so that recipe suggestions can be even more personalized. Enterra® is helping McCormick ensure that those FlavorPrints are accurate and up-to-date. Tony Effik told O’Leary, “Recipe views, in many respects, are a proxy for a sale. While McCormick is a significant business, it’s generally outspent by competitors, so we had to figure out a way to outsmart them by leveraging data to execute earned and paid media plans. We do media. But we also come up with creative, and data is the thing that holds all of that together.” O’Leary continues:

“In 2012, McCormick spent $43.3 million in media, per Kantar. Compare that to $404 million at Campbell’s Soup. … With its Responsive Media System, R/GA analyzed the online recipes market, seeking out anomalies and undervalued strategies. The agency studied media-spending patterns and set up a series of algorithmic rules across media channels including search, social, real-time media and promoted videos. R/GA then took what it unearthed and applied it to paid search for McCormick’s Lawry’s brand. McCormick’s and R/GA decided to leverage Lawry’s West Coast heritage in a test using search and Mexican recipes. The agency split Lawry’s media budget between Western states like California (where Lawry’s originated) and the rest of the country. Two data points were key: the clickthrough rate and cost-per-recipe view. The national market did well for clickthroughs. But more interestingly for R/GA was data from the West Coast where the post-click action rate was 20 percent to 60 percent greater than in the rest of the country, prompting it to tailor the media plan geographically. ‘That learning allows us to explore the same rule in other channels, so now we can run display advertising in a more focused way on the West Coast if we want to,’ says Effik. ‘We’re thinking about how the budget responds to the market and how we make changes, sometimes in real time, against the dynamics of the marketing using data. Response for us is not whether something succeeded or failed — it’s an opportunity to learn. What we’re learning from search we can apply to other areas of marketing.'”

Clearly, the more you know about a location and the consumers who live there the better you are going to be able to offer them products that are tailored to their tastes and preferences. That is heart of targeted marketing. Joel Rubinson explains this as going “from being a battle for the mind to becoming a battle for behaviors.” [“From mind marketing to behavior marketing,” Joel Rubinson on Marketing Research, 14 March 2013] He explains:

“In traditional marketing, we ran mass advertising, targeted based on demos, that was intended to change people’s attitudes about a brand. We measured our effectiveness via surveys like copy testing and brand trackers with attribute ratings. All attitudes, all mind marketing. We HOPED that affecting the mind would result in increased sales behavior but there was little direct connection unless you were in the direct marketing business. In a digital, social, and mobile culture, people can do things with media and marketers should want these behaviors to occur as much as possible so the commercial doesn’t pass by like dust in the wind. They amplify the effectiveness of your paid media. Behaviors include sharing links, liking or following a brand, commenting in Twitter or in a forum, taking a picture in Pinterest, searching to find out more and visiting brand.com websites. Add to the list downloading branded apps, Shazamming a TV commercial, scanning a QR code, and who knows what else a few months from now? And media targeting is increasingly based on behaviors rather than old-school demo approaches.”

The ultimate desired behavior, of course, is a purchase. Tapping Big Data strategies can help manufacturers and retailers offer consumers what they want, when they want it, at a price that seals the deal.

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