As our customers turn away from the traditional model of interruptive, impression-based advertising, most companies have chosen to continue to spend most of their marketing dollars in this way, while they hope that some scalable, new-media alternative takes hold quickly. But a handful of organizations are not waiting for others to build the next model. Instead, they are investing their money and time into creating new media platforms in which their marketing itself adds value to consumers’ lives. In my book, I share specific examples of how brands as diverse as Nike and The Partnership for a Drug-Free America have shifted their approach this way over years of testing and learning. Today, I wanted to share another killer example: Kraft.
In both my book and this blog I have written about how Kraft is producing some of the most meaningful marketing in the CPG business. The company has created an impressive website with everything from money-saving recipes to instructional cooking videos. The company has at least 15 million people in its email database. And who could forget its recent foray into iPhone apps, where its $.99 iFood tool blew away expectations and continues to serve as one of the best examples of useful, branded mobile marketing. In fact, the company recently announced that it will launch a 2.0 version and says that 60 percent of people use the app regularly, which is impressive given that only 30 percent of apps are used after the first day they are purchased.
Increasingly, Kraft marketing efforts are looking like the central strategy of this CPG leader, rather than just a series of experiments. Last week Advertising Age shared a video segment of the Kraft VP for Global Media Services, Mark Stewart, in which he shared a few words about how the company is becoming a media platform. The entire video is worth watching, but some of my favorite quotes include:
- “We’re in the food solutions business.”
- “We’re a scaled marketer and a scaled publisher.”
- “In this new world… brands have to stand for more than the functionality of their product. You have to provide real solutions and real services.”
- “The future is really about how do you add utility to your brands, which is way beyond what the product delivers.”
For perspective, these words are coming from a person who spends $800 million in measured media each year (i.e., putting Kraft brand ads on others’ media platforms). This means that all of these in-house efforts still only represent a fraction of consumer marketing, but it also shows how far Kraft could go if it started carving a large chunk of this spending for its owned-media business. And the company certainly appears to be headed in that direction. It’s once-free magazine for database members, Kraft Food & Family, is now becoming a subscription-based magazine. And the company is launching other branded apps, including something called “Triscuit Small Plates”—a partnership with Wine Enthusiast that gives tips on pairing wines with snacks and cheese.
This move to a meaningful media+marketing strategy fits well with the overall company strategy. With its focus on premium food brands and the wide range of categories in its stable, a scalable marketing platform makes a lot of sense. Ironically, while Kraft was expanding its media platform last week, another major multi-brand CPG marketer, Procter & Gamble, learned that its owned media platform was being canceled. Its long-running show, As the World Turns, was shuttered by CBS. Recall that the soap opera was invented by P&G as a platform for radio advertising for its brands in 1933.
Why would one owned-media effort rise while another falls? I’m sure part of the story is that tastes are changing in favor of digital tools and are moving away from daytime dramas, but I think the bigger story is that Kraft’s new efforts put the brand in the center of the meaningful content, while soap operas are merely a package for interruptive advertising. Interestingly, while its soap opera business has been failing, P&G is making new investments in sites such as Petside.com, which offers pet health information and provides a meaningful marketing platform for its Iams brand (which has health benefits and claims). This changing of the guard it but one example of how the world is moving toward Marketing with Meaning, and I expect both Kraft and P&G to continue to lead the way in the years ahead.
