Data can be a powerful tool to help brands better target consumers on an individual level and serve up the most relevant content. But that’s only when the data itself is actually relevant to the brands in question. And with so many providers offering data, how are marketers to know which source is the best fit?
At Ad Age’s recent digital conference, Julie Fleischer, senior director of data, content and media at Kraft, referenced her now somewhat infamous comment that 90 percent of data is crap at a prior event and she notes Kraft still believes most data is crap, but it is “all in” anyway.
But that’s only when it comes to first-party data.
Things Had to Change…
Like many brands, Kraft had a long legacy of relying on TV to build its brands, but came to realize it had to do something different upon its split from Mondelez in 2012, according to Bob Rupczynski, vice president of media, data and customer engagement.
“The first thing we did was look at our agency statement of work and we literally had the same one we had in 2000,” Rupczynski said. “It had never been updated. We were looking at consumers and technology that were very different, but an agency SOW that hadn’t changed in 12 years.”
But Kraft is a “$20 billion company that had done the same things the same way for 50 years,” Rupczynski said. And so in order to effect change, he had to “scare [upper management] a little bit. There is a doomsday black cloud over head…consumers will change and so we have to change, too.”
In other words, data was the only competitive advantage in terms of understanding consumers in a truly unique way and the brand had to start to activate against that, he said.
“Collecting data is worthless, but understanding consumers and doing something different, that was the approach we had to take,” Rupczynski adds.
The Data Source: KraftRecipes.com
For Kraft, the ability to understand consumers and do something different starts with data from the 100 million consumers it sees every year on its KraftRecipes.com site.
“We can track [consumers], collect information and understand when they’re cooking, what ingredients they’re using, what holidays and seasons they’re celebrating…and deliver relevant content,” Fleischer said.
In other words, Kraft said content is at the heart of its marketing approach and the brand can mine resulting data to create more meaningful experiences by understanding consumers on an individual level.
But, Rupczynski notes, in an era of convergence and empowerment, the brand must match the pace at which consumers live their lives, which means Kraft must figure out how to deliver its message quickly and appropriately.
“Addressability is our strategy,” he said.
But it hasn’t always been a perfect science.
“Last year, we did wonderfully at getting to the right people and understanding when to serve that message to them, but we served all of them the same message, which was a missed opportunity,” he said. “At the end of the day, content has to be put in context, but context has to be powered by a data layer.”
The brand has since pivoted to targeting with more appropriate messages.
But first Kraft had to figure out how to better dissect its data.
“Most all of us are lacking in terms of data literacy. It’s not a skill taught in business school,” Fleischer said. “[But] if you aren’t collecting, interrogating, organizing and activating data, you’re wasting your time.”
Addressability, on the other hand, allows marketers to “get to know consumers on a granular basis and…reach them individually,” she said. “90 percent of data is crap. It just is. In the world we’re working in, the vast majority is crap.”
Third-Party Data is Crap
She points to Kraft’s coffee brand Gevalia and its K-Cups product as a “perfect example of the need for addressability – anyone who doesn’t have a brewer is a wasted impression.”
Fleischer said the brand tested four types of data about brewer owners with two ecommerce players and found only 14 to 20 percent of the data was correct about brewer owners.
It, in part, points to the need for universal data terminology and also exposes additional issues with third-party data, such as lack of knowledge about how the data is collected and even when it was collected.
In addition, she said Kraft’s Crystal Light brand wanted to advertise to “trendsetters,” but with one data source in particular the brand ultimately discovered that “trendsetter” was defined as consumers who shop for contemporary furniture.
“You need to dig into it to understand the context of that data,” she said. “Garbage is garbage, even at scale. You can take data with a stunning lack of quality and you can’t make up for it by just having more of it.”
In other words, data needs to be vetted, understood and interrogated, she added.
“It’s a remarkably opaque industry by design because it allows vendors to sell products, but it is harder for us to use and rely on,” she said.
What’s more, third-party data sources are the same ones competitors like Pepsi and General Mills use, she noted.
So Why is Kraft Still “All In” on Data?
Despite problems with third-party data, Kraft said it simply can’t rely on the media that got it to this point in time any longer.
“Consumers aren’t paying attention to ads,” she said. “We’re at an inflection point as an industry at which we can’t 30-second spot our way out of this.”
That means the only way forward is to go back to KraftRecipes.com to understand consumers, engage with them and get data back for free through the proprietary lens of the product.
“Our mantra is enrich, scale and diversify,” she said.
In other words, the brand wants to enrich first-party data, scale its data so it sees more people and gets to know them on an individual level and then diversify that data by understanding consumers through the lens of the products and cooking behaviors.
“First-party data is not crap,” she added.
What’s more, consumers are willing to share a tremendous amount of data about health and location, so brands that don’t have the infrastructure to collect, store and analyze that data to deliver relevant consumer messages will fall behind, Rupczynski said.
“Consumers of the future are why we’re all in,” he said.
What’s your take on first and third party data?