When The Clorox Company made its first big investment in programmatic a few years ago, it helped the CPG double its market share in the cleaning category in just a few months.
But a heavy focus on bottom-funnel, promotional ads caused its brand to deteriorate, said Eric Reynolds, CMO of Clorox at the ANA Masters of Marketing Conference in Orlando on Friday.
“We bought trainloads of banner ads to get the right person, at the right time, in the right place,” he said. “It unleashed an enormous amount of short-term thinking and action.”
While sales were good in the short term, Reynolds knew that brand health is essential to long-term success. So, he set out to bring the brand back to life in a way that made sense on digital platforms.
“In our rush to get data-enabled, we were filling moments that matter with cheaply produced, hollow, vacuous brand moments,” Reynolds said. “This is not storytelling.”
With support from its CEO, San Francisco–based Clorox took a page from the tech world, testing and discarding new ideas with speed in order to master online video and bring its brand back to the forefront on digital.
AdExchanger caught up with Reynolds at the show.
AdExchanger: How did brand building play out in your media mix?
ERIC REYNOLDS: It’s about balance. There are certain stories we want to tell, and we’re trying to match our creative to that. The question is: What’s the unit that can tell that story?
You can’t edit 30- or 60-second TV ads for online video. If we’re going to tell great brand stories, we have to do upper- and middle-funnel work on digital. We’re still getting the creative, data and platforms together to create something unique and influential.
Marketers like to trash digital a little, but your punchline was that it works.
We want to be clear on what the problem is before we jump to conclusions. The line can be very thin between digital being great, mediocre or not working for you. The question isn’t: Is digital working? It’s: What level of targeting works? What data works? More people fall in love with short-term thinking, and they need to step back and look at the whole picture.
Data quality and strategy is a big area for improvement. We rushed into doing things with data. Now we’re thoughtful and skeptical about which data to use and where it comes from. We’ve added more data strategists on staff who make sure we have something good to work with.
Did you dial down your price promotions when you put the focus back on the brand?
We’re slowly moving money out of price promotion back into brand. In 2008, when the market crashed, we saw over a decade of increasing budgets on price promotion. That’s a problem because we’re not investing in the brand. Clorox three years ago spent 9% of its sales on advertising. Now it’s 11%. In our world, that’s significant.
Who is the best partner to help you use new ad formats?
We have tremendous relationships with Google and YouTube. They need to figure it out too. We work not just with their sales folks but their data scientists to figure out the best way to story-tell on online video. That will be a very important part of our marketing mix more quickly than we can appreciate.
It’s important we win with Google and Facebook. When we target people on their platforms, we can find them in retail. I don’t complete the sale on my website, so they’re really important.
Do you trust Facebook’s attribution model, which doesn’t work with the rest of your media mix in driving an outcome?
Facebook is creating new environments for us to put other parts of our media mix in, so we can get a more comprehensive view of media exposure and better attribution. We are making advances in making sure we feel better about the attribution.
How are you building a more direct relationship with your consumer as direct-to-consumer brands disrupt the supply chain?
We want to act like direct-to-consumer marketers, but we don’t want to fulfill. Our consumers aren’t going to go to 33 different sites to fill up their shopping baskets. People want to go to a store or sites like Amazon.
We do sell directly on Burt’s Bees, Renew Life and Brita’s websites. We use these as opportunities to gather first-party data because that’s gold for all of our marketing.
What’s your relationship like with Amazon? Do you see them as a competitor?
Clorox has a very tight relationship with Amazon. We invested early across all their functions. We’ve learned how Amazon thinks. It helps us conquer their algorithm. We’re mindful of the strategic risks. We have to be mindful that Amazon holds all the data. But the opportunity is large, and that’s where our consumers are.
We’ve been competing with store brands for 25 years. We think we can compete with Amazon effectively. We’re the premium-branded player. The middle players are the ones that get squeezed.
A lot of CPGs have adopted zero-based budgeting. How are you justifying marketing investments in a period of cost-cutting for your industry?
We are not using [ZBB] because we’re growing. If you’re not growing and you need to make money for shareholders, the only way to do it is through cost savings. That’s why ZBB is so popular. As long as we keep growing and have pricing power, it’s unlikely we’ll go to ZBB.
This interview has been edited.
