The recession and subsequent shifts in spending are necessitating a more strategic approach to consumer outreach. Erica Iacono and Kimberly Maul were in Chicago for an Emanate PR-sponsored roundtable discussion on the topic
Shannelle Armstrong, director of PR, Sears Holding
Jeff Davidoff, former CMO of Orbitz Worldwide
Caroline Dettman, MD of US consumer marketing, Edelman
Heather Oldani, director of US communications, McDonald's
Scott Reifert, VP of communications, Chicago White Sox
Kim Sample, CEO, Emanate
Jamie Stein, director of communications, Tropicana
Rashada Whitehead, SVP and MD, Flowers Communications Group
Tim Zimmer, VP of marketing, Sara Lee
Greg Zimprich, director of brand PR, General Mills
Erica Iacono (PRWeek): How is the economy affecting your marketing plans and messaging to consumers?
Jamie Stein (Tropicana): I think it's about value. And it's about value more broadly defined than cost. It's about value from a nutritional standpoint; it's about value we're bringing from a sustainability standpoint and cause-related, that are relevant and resonate to consumers. It's about overall value and what experiences that we're involving our consumers in, whether that's from the social media or social marketing standpoint.
Shannelle Armstrong (Sears Holdings): I think that for us, at Sears and Kmart, it's beyond value. It's really how we engage that customer to make that purchase. Retail is an extremely competitive area, where there is always a sliver or margin between you and the next brand. Even though we may offer value proposition to them, like pricing, we're also adding value, like layaway, where they can be able to make this pricing go further.
Heather Oldani (McDonald's): I also think too that consumers are going back to those brands that they trust, that have built that longstanding relationship with them throughout the years, through thick and thin. I know that there have been several studies out showing brands, and consumers trust to get them through these difficult times. I think it's all about offering value on many different dimensions, but also staying true to who you are as a company and the heritage you have with supporting consumers.
Caroline Dettman (Edelman): To me, it's the added value that you bring, and I would love to hear from Greg and Tim, from the consumer packaged goods standpoint. I think we're in the fight of our lives with private label, because the reality is you can't necessarily always claim you have the best nutrition versus a private label or the best taste, even, with a private label. So I think it's been interesting to really figure out what added value can we bring that the private label can't bring? And then engage consumers on that level.
Greg Zimprich (General Mills): I think we've put a lot of focus on innovation and product news and bringing new things to our categories. And those strong ideas and strong brands drive growth and they bring people to the category.
Tim Zimmer (Sara Lee): I echo that as well. I think that some of the differences I think from private label versus branded is we significantly invest in understanding the insights behind what drives consumer versus private label. They tend to be more generic in their approach from a consumer standpoint and I think it's our ability to take the analytics and insights and intuition and bring it together in a way that is compelling and relevant to the consumer. Looking at innovation and tapping into those insights and understanding what consumers are looking for. And I think second is how we package it, in a contemporary and relevant way, as well. I think those are things that we continue to do that separates from our competition and from private label. It's also about understanding who your loyals are, because in this environment, there are going to be people who are going to leave. They are going to follow the price and I think it is really important to understand who is loyal to this brand and who makes up this brand, and who we want to continue to talk to about our brand. Because those are the ones that are going to stick with us, so I think segmentation is going to be more important in this type of market as well.
Rashada Whitehead (Flowers Communications Group): I think it's also about listening and knowing what consumers are saying to you and about your brand. Sometimes as communications people and marketers, it's easy to talk outward and we probably have all been in situations where we even find ourselves talking to ourselves. But I think the listening piece is important in being able to translate that insight in an authentic way back to consumers, in a way that they want to receive it and really being able to play up those points of differentiation and then staying consistent.
Jeff Davidoff (Orbitz): What we saw on the value side is we have a larger value proposition, but until we were at price parity, all the value add didn't matter. We have all these great value-adds, we have innovation and we have real points of differentiation. But that core price, which is in the online world, it's continuously transparent. Until we matched that, all the value-adds didn't matter. That's the difference I've seen in this environment that I didn't see before.
Armstrong (Sears): Tim had a great point about segmentation. If you say Kmart, that customer is very value-focused, is touched by proximity, and she is not tweeting to her friends that she found a hot dress for $20. She is saying "I have a job interview. I have a new job. I need to buy something that is presentable and I live only X amount from a Kmart and it's on the bus line and I can get there." And that's a real customer. But then you look at Sears, it's a very different customer. Much more educated, much more credit-card savvy. [She] will seek out the 0% financing, so her messaging is very different than [Kmart's] messaging and I think that the challenge is understanding the segmentation of who your customers are and even segment as far as ethnicity.
Oldani (McDonald's): [Erica,] you asked the question about how changing marketing spend. We've all had to get very smart, whereas before it was McDonald's has a very large marketing budget, there's no question. We've had to take a step back and say, "Really, who are the moms coming to McDonald's?" Because it's very different on a day-in and day-out basis, and so we've had to really start to segment our PR efforts, which is a whole new era for PR. Who are we really trying to reach and what are the vehicles they are listening to to get their information?
Scott Reifert (Chicago White Sox):. We think about it in terms of return on commitment for our customer. Because they are passionate and committed to us if we can produce on the field, so my issue is less reaching out and getting that customer to enjoy us,;it's more how do I interact with them on a lot of different levels? We Twitter. We try to connect as many different levels and in many different ways, so that's interesting that you point that out. I think that's a huge opportunity for us.
Iacono (PRWeek): How are you measuring your PR efforts and what metrics are you using?
Armstrong (Sears): I find that if your PR organization is seeded inside of marketing, then your measurement will be really kind of similar to marketing: media impressions, CPM, etc. If you're seeded outside of marketing, and you have a direct link to leadership, it's much more like brand voice, the other brand health measures, the influence value, and those type of things.
Dettman (Edelman): Something that Scott said earlier is I think that we really do believe is this whole notion of return on involvement as a way to drive return on investment. So we're using that as a metric a lot. The longer that someone spends on the site, telling you about themselves, you're recognizing that you should be giving something back. There are millions of different ways to measure it. But we do see a real return when you get consumers involved with your brand. I think there is something that we need to be doing from moving away from awareness and into advocacy. We have a lot of unbelievable advocates that we're doing nothing with. We've got people who are coming to the clients proactively, and we're not harnessing that. We need to be giving people the tools because they are actually quite willing to market for us when we give them the right tools to do it and I think we need to do more of that. Less talking at and more talking with.
Oldani (McDonald's): We're now in this age of participatory engagement. We've got six moms who now want to go speak to and do a field trip with their local schools about the quality of our french fries. They want to go speak to their local community leaders. They are willing to go to our restaurants and host media influencer events just because we engage them in the conversation versus just giving them the information. So that is something that we're looking at: how do you measure and quantify the value of that brand involvement? It's very hard to get people to understand that 13,000 people that have engaged with your brand on a site for a three-or-four week period, six minutes each time they visit, can be much more influential and impactful long term versus the push-it-out-there communication that maybe reaches 100 million people right away, but doesn't have the level of involvement.
Kim Sample (Emanate): I was just going to make the point that one place that we see clients make a mistake is that they've got their message and the way that they want their brand talked about and it is not the way that people talk about their brand. So you have to go online, or other forums, and find out how people are already talking about the brand and then amplify from there. But the age of getting your message out there, that is long gone. It's got to be what people are saying.
Dettman (Edelman): We spend so much time: what is our brand? What's our brand idea? Messaging. All of this stuff that is so archaic at this point. What we have to be challenging ourselves and our industry on, is what is your brand of engagement? That is the question that we need to be answering. Less about what is your brand, but what is your brand engagement. I think if we spent more time focused on that, I think we would get better results.
Armstrong (Sears): Can you go deeper with that? Brand of engagement?
Dettman (Edelman): It's getting back to knowing that consumer really well. You told a really compelling story about your Kmart consumer, so how are you engaging that woman? It would be really interesting to see you may be doing these things already, but you mentioned, she is living paycheck to paycheck and she may be out of a job right now. Is there a way that Sears can engage her and help her, whether it's a partnership with Monster.com or whatever it would be? To actually help her so it's not just even about buying the clothes to get her there, but can your brand, the Sears brand or Kmart brand, actually be a catalyst for the consumer? So we've always talked about what problem does your brand solve, but what about if your brand can actually be a catalyst for consumers to engage?
Stein (Tropicana): Tropicana is doing that too, as we look into social media and building an online community recently for the launch of Trop50– it's not about the product per se, but it's about understanding that this is a different consumer than drinks Tropicana orange juice. It's a younger consumer; it's a consumer who maybe has given up or reduced her orange juice consumption because she's concerned about the sugar and the calories, so this is an orange juice beverage with 50% less sugar and calories. But we're involving her in an experience about things that are meaningful to her, whether it's about life or relationships or other things.
Dettman (Edelman): What we're finding at Edelman through some of the research we've been doing, is that consumers are looking to partner with brands to actually do something together to do good and some of our most successful campaigns over the last two years have been when your brand can be the catalyst and you engage with consumers to do something together.
Zimmer (Sara Lee): I do like the word catalyst. It's almost forcing the action from a consumer perspective. We have a brand, EarthGrains, and we signed a partnership with the Nature Conservancy. When we looked at our consumer target, there was a real care about the earth and taking care of the earth. We also found out, from these consumers, that they are very concerned about our parks and making sure our parks are clean. And what we did to be catalysts on that was we said, "Ok, we'll organize you and help you clean up your parks in your community." So we're going out in each of your communities and we're bringing people together. I think it's a great way to do something that's relevant to the consumer and drive action from the consumer on something they necessarily couldn't organize and do on their own. We can step in and help bring all the people together who share those concerns and be a catalyst to make those things happen. I really liked the way you said that as far as driving action from a consumer standpoint and what that does is inherently, it drives the brand and the equity into the person's mindset and the belief that we share the same values.
Iacono (PRWeek): With trust in companies down, has it become more important for brands to have CSR and cause programs?
Zimprich (General Mills): As long as there is a relevant tie. There can't be a disconnect. You look at Box Tops for Education – we just hit our 300 million giving milestone. That's a great example. Moms are passionate about their kids' education and if they can help in any way to fund that and give these schools the extra funding they need, they are going to get all over it. But it has to have a link. It can't be a false thing that is not linked and there is no relevance there. If there is, I think it is very powerful in these times.
Iacono (PRWeek): Is the investment still there?
Zimprich (General Mills): Is our investment still there? Absolutely.
Dettman (Edelman): You know what we found really interesting? From a budget-challenged environment, which we're all in, from a CSR standpoint, from a cause-marketing standpoint, and from a strategic philanthropy standpoint, so many companies have different people working on these different areas with different budgets and they are doing all these different things. But they are not aggregating something more powerful together. We have found that by bringing those budgets together and actually getting the consumers involved in it, it actually has been a great way to focus efforts.
Armstrong (Sears): I think it's by brand and what you consider cause-related. From Sears Holding, we decreased almost all of our cause elements because it wasn't aggregated. We were spread so thin managing so many partners and it really didn't lead us and we didn't know if the customer was actually getting the takeaway that we were engaged. So we decreased the number of partners. We've got two on Kmart, one homegrown on Sears, called Heroes at Home. I think it's seasonally-based and it has a lot to do with the relevancy to the brand. The other thing is we just had a very long meeting with our brand cause-marketing partners. We said "OK, we've done too much heavy lifting. No more heavy-lifting on our part. You want our money? You want our retail space? Well, what do we get now?" We realized that we weren't being as smart as we were before. We gave away too much retail and you're not delivering a value proposition for my customer engaging with your brand.
Sample (Emanate): I think a lot of times those cause partnerships also completely miss the entire employee base. It gets so powerful when you've got full engagement from those brands like McDonald's and Bank of America, where you have hundreds of thousands of employees who need to really feel it and tell the people that they are touching every day.
Dettman (Edelman): And let's not forget that it's not always about money and probably shouldn't be in a lot of cases. A lot of people are volunteering and that's a big area. For one of our clients, we didn't go the money route at all and instead, invited people to come out and volunteer their time. That worked much better.
Whitehead (Flowers): Consumers are smart at every age, whether you're reaching kids, 'tweens, teens, young adults, boomers. They are smart and they are going to stay true to who they are. So it behooves a brand to stay true to who they are. As it relates to CSR, it has to be something that delivers that credibility because if it doesn't, even if you are talking to me, I will see straight through it and I will go in another direction and that's just a reality. Especially with millennials, they will see right through it and I think people are just at a space in their lives as consumers where you want what's real. We throw out words like transparency, authenticity, credibility. All these things, but really there is no wizard in Oz. There is nobody behind the curtain speaking out this message. It's all about this two-way dialogue and if we share those common interests, I can buy into it because I know it is what you represent and it is legitimate and if it's not, it's even more of a turn off and I'm going to be even more disengaged.
Oldani (McDonald's): I think the budget needs to be there because it's almost like the social media space. Once you're there, engaging, you're engaged and you can't back out. If we are suddenly to pull out, once the economy gets better, or the economy gets worse, that can be disastrous.
Iacono (PRWeek): Building on the millennials piece of it, what are you finding are the most effective ways to reach them and to really engage them? Is it all about social media?
Oldani (McDonald's): What I will say is it's a go in and learn process with us because going back to listening, millennials have a very definite opinion on a lot of topics and it is very important for us to go in and just listen and hear what they're saying versus us trying to bulldoze our way in and saying "Here is who we are and here is what we have for you." So we've spent a significant amount of time in the last year and a half, just listening, trying things out.
Dettman (Edelman): We do a reverse mentor program at Edelman, so we've got 22- and 23-year-olds who are mentoring us on technology and everything else. A big part of that is also listening and one of the most profound things I've heard in a long time was from my 23-year-old reverse mentor who is coming out of college and says, "Brands keep asking us to invest in them. How are they investing in us?" I was like, "Can I quote you?"
Zimprich (General Mills): We've changed the name of ours to co-mentoring because that's really what it is. We have a senior person and a junior person and that's really what it is: two-way learning.
Iacono (PRWeek): How has your approach to social media changed over the past year?
Oldani (McDonald's): Greater tolerance for risk. McDonald's is a very established brand and we have a lot of brand legacy. We know what our brand stands for, or at least we like to think that we know what our brand stands for, and we hope that our consumers do too. But as soon as you've put yourself out there, into this real world and you engage in these conversations and you let consumers participate with your brand in a number of different vehicles, you have to be willing to take the risk. And if it doesn't work, it doesn't work. But what we're finding is people are at least giving us credit for at least trying to engage.
Davidoff (Orbitz): The greater risk is not participating. Brands are going to stumble all over themselves because it is awkward pulling the trigger. Every day you don't pull the trigger is a day you are voted out.
Iacono (PRWeek): There is a lot of talk about who owns social media. Where is the investment coming from? Is it from marketing or PR? Who is developing the strategy?
Davidoff (Orbitz): Who owns social media? The consumers do. It's a backwards thing. We're participating in their game. Our investment efforts aren't at the expense of other things we're doing. I don't think we get to do that.
Stein (Tropicana): But it has to come from somewhere and I do think, at least for Tropicana, the PR functions took the lead into social media this last year and we did have to take some of our PR dollars to fund it. It's all one pot of money, but I think we could have had that for more traditional PR tactics, but we decided that we really wanted to take this risk and move it into the social media area. But the marketing team is also doing things in social media, so right now no one function owns it. And I don't think that it's going to move to that.
Zimprich (General Mills): In our organization, our CMO Mark Addicks is pretty progressive about looking at these things. He talks about how PR has led the way in terms of a lot of digital execution, in terms of a lot of social media strategy and he has backed that up and supported us the whole way.. We don't look at it as a department, and my hope is that we don't form a department. We look at it as a competency that really flows into all the different areas because this is the new marketing and its here to stay and it's going to change and continue to evolve.
Armstrong (Sears): I'm of the exact opposite of Greg. I think it needs to be owned by somebody. Because, when it comes from a budget perspective, voice and influence and what goes on there and what is the timing? What's the message in retail? Those are the questions.
Zimprich (General Mills): I think we look at it around consistency of messaging across all consumer touch points, so from that standpoint, I hate to minimize social media and call it a channel because it's much bigger than that, but we don't have a TV department; we don't have a radio department; we don't have a print department.
Oldani (McDonald's): I do think social media is another channel … and what I've seen in launching our McCafé Twitter profile and the time it's taking my Tweeter on my staff to 24/7 to engage…[is] the level of engagement in that channel is significantly higher than me saying "I'm going to place an ad and once that ad runs, it's done and I can step away." Now, in this other channel, the level of engagement and the expectation that you're going to engage is so much higher.
Stein (Tropicana): What I'm hearing is that everyone's agreeing that there needs to be more resources toward it. And where those resources come from, whether they are marketing, whether they're the PR team, I think it depends. And it might be multiple resources, with some of the marketing team on it. But I think we potentially need more resources.
Iacono (PRWeek): Are celebrities still playing a big role in campaigns?
Zimprich (General Mills): Using them as hired guns is less supported these days, but if there is some kind of a link or connection, I think it's still there.
Davidoff (Orbitz): I bet you'll see some smart executions come out around cause marketing because there is some really creative leaders of cause efforts who have learned how to socialize and globalize people through online media.
Whitehead (Flowers): The whole notion of celebrity continues to shift because you have reality TV shows, you have the everyday person who becomes the most popular in their 15 minutes of fame, and then you have the person that has actually sustained because they stood for something that for whatever reason people were willing to latch onto. And it goes back to who your consumer is and what they consider a credible voice. My sister, if she's been a mom and I'm becoming a new mom, could be that influencer to me, so I think celebrity influencers and all those things are becoming more and more interchangeable, depending on who you are.
Brands must convey a message of value that is going to resonate most with their target consumers.
Segmenting the customer base is more important than ever to develop brand loyalty.
Consumer companies are still investing in cause marketing initiatives, despite the recession.
Breakfast on consumer marketing:
Prior to the Consumer Roundtable in Chicago on June 24, PRWeek and Emanate hosted a Breakfast Q&A featuring Jeff Davidoff, then CMO of Orbitz and Tim Zimmer, VP of marketing for Sara Lee. They addressed topics such as how the economy is affecting marketing plans, communicating value to consumers, and the challenges and benefits of digital and social media. The two also spoke about integrated marketing communications and combining online and offline communications teams. "Everything comes from a brand-centric idea," Zimmer said of Sara Lee's 360-degree marketing strategy. "We are always monitoring and course-correcting."