“We are about maintenance and repair,” Gooding said. “The boxes are about home improvement. If you want to do kitchen cabinets, appliances or large-scale lumber, we’ll help you find a box. We are the local, neighborhood hardware store owned by the family that’s been in the community for generations, and we’re great for every small project you need to do to maintain your home and yard.”
Gooding spoke with AdExchanger about Ace’s new advertising campaign, its relationship with its media agency and its interest in new opportunities, such as addressable TV.
AdExchanger: How do marketing decisions work in a collective?
JEFF GOODING: Its not a whole lot different than a franchise organization. Every dollar we have is our retailers’ dollars, and we take that very seriously in terms of how we invest it on their behalf to drive the business. We have a retailer advisory committee, which is a set of geographically-spread retailers. We consult with them multiple times of the year, and bring them in where we present key insights and trends and data as it relates to the industry.
Your new creative focuses on specific Ace Hardware locations and specific products. How did you choose both the locations and which products you’d surface?
We wanted to show a good cross-section of those stores. Every store looks different, and every one is customized to that owner and neighborhood they’re in. There’s also authenticity. The retailers and staff you see in the spot – that is their store.
How about the product piece?
Our brand team and our agency did surveys among our most loyal customers, our merchandising team and retailers to find out what the 100 most common problems are that people come to Ace to get solved. So the brands we choose to show are the best brands we carry.
So when you featured, say, WD-40, how did that partnership work? Did you reach out to the manufacturer and try to strike a deal?
We didn’t. If we did, you’d lose the authenticity. It was driven by consumer feedback. That’s not to say we won’t work with a brand, but we didn’t go out and sell advertising spots. That’s not what we do.
What sort of targeting did you do? Say someone does an online search on how to fix a squeaky hinge. Do you surface that WD-40 spot?
From a digital buy perspective, we can do that and will do that in those very specific scenarios. From headquarters we do all national buys. Beyond that, we have local and regional spots retailers can customize to their store.
Has the way you negotiate for spots changed in recent years?
From the national side, it’s still relatively the same. We changed media agencies [to Publicis-owned Spark Media] in the last few years and we’re in a much stronger position to get better and more advantageous placement and pricing. And they’re much more involved at a local and regional level. We’re looking at ways to roll up local retail dollars and leverage their scale to deliver back more than those stores could get on their own.
Publicis recently did a massive media agency restructure, such that Spark is now part of Mediavest Spark. Will that change your relationship?
I don’t see our relationship changing – only strengthening. With the restructuring, they will be able to leverage all of the client dollars in market to get better results for Ace and all of their clients. One of the reasons we chose Spark was their retail experience, nimbleness and ability to leverage dollars collectively to our benefit.
How do local placements differ from the national ones?
We’ve made changes internally. We have people in place who only manage local buys. That’s rare from a retailer or corporate brand team. We used to depend on local agencies out in market or the media agency. Now, we still depend on our media agency, which reaches out to local markets, but we have changed our structure and added folks who specifically work with retailers and our agency to generate local buys.
Why’d you make the change?
It was based on the needs of the retailers. Some retailers are really good at localizing, others don’t have time for it, so we do it for them. But we couldn’t keep up with the volume of requests. When you’ve got 4,400 stores and over 80 retailer groups, requests increase dramatically, 1,000% over what we did a few years ago. We want to give them the tools to make it easy for them to press a button and localize immediately. Boxes can never do that.
Are you pursuing addressable TV buys?
We’re not. We’re talking about it and we’ve been talking about it. We need more in-home penetration so we can test it across the board. But we’re very interested in addressable TV. Not just for certain scenarios – what are people searching for, what problems do they have? – but also from a loyalty side. Our Ace Rewards loyalty program is 50% of our sales. Could we deliver to an Ace Rewards home specific offers based on buying habits? Is addressable a better way to reach lookalikes than direct mail or email?
And would they respond better than those [reached via] other mediums? It’s not just about what you deliver, but what they react to. You can send direct mail all day long, but if they don’t respond, what’s the point?
What’s your take on the online video environment? Is it an extension of your TV buy?
It comes out of the brand team versus the digital team, so it’s an extension of the campaign. But there’s so much clutter out there, it’s even worse than the TV networks. The more targeted you can be, the better it is. We don’t do big buys across big digital networks because it’s not targeted. So when you’re searching for or looking for solutions in specific areas and specific things, that’s when we want it to be served up.
We want to serve up certain scenarios based on the weather conditions – both good and bad, from storms versus temperatures reaching 58 degrees and it’s now time to fertilize.