Creative Effectiveness: Kellanova’s Recipe for ROI - Advertising Week NY 2023

Thank you, Alex. So happy to be here with you. Clearly I'm taking control of the conversation over from Alex. I am thrilled to sit alongside you and thanks for being a great partner.

A little bit. Thanks for making time on your way around the US. I just landed here last night from Miami, so a little bit of travel, celebrating my birthday which is coming up.

Happy to. So I work for a company called Kellanova, which many of you may or may not know, depending on how engaged you are in what's happening in food and beverage. Kellanova is the remainder of a spin-off of the Kellogg Company. The Kellogg Company did a spin on October 2nd where we split the company into two: WK Kellogg Co and Kellanova. Kellanova is the largest fast-growing snack business, with brands like Pringles, Cheez-It, Rice Krispies Treats, Pop-Tarts. And then WK Kellogg Co is our North America cereal business. We split those two businesses into two, the objective being to allow each of them to realize their full potential, unlock growth and business value for their respective businesses, resource in the ways that are necessary for each business to be their best. And so I am the Chief Growth Officer of Kellanova.

Creative effectiveness in my mind is thinking about how my creative lands with the consumer that I'm targeting and does so in a way that drives them to take some sort of action. And it matters so much in the world today. We've done quite a bit of work prior to working with you guys to understand what role and what contribution creative effectiveness has in total effectiveness for your ad dollars, and we found that it drives almost half of total effectiveness. So imagining that, and then the rest of the pie is really small pieces. So if you think about driving total effectiveness, it means that that's the first place that we should start: landing high-quality, resonant, contextual creative that really connects with people, drives loyalty, drives purchase, drives engagement. And so to me, it is the starting point and one of the most important elements of total effectiveness. And there's this funny saying that marketers of years ago used to say: 'I know that 50% of my marketing is effective, I just don't know which 50%.' But what I like about digital marketing, what I like about the work that we've done with you, is that we're getting closer and closer and more precise about which aspects of our marketing is working the hardest for us. So I think while digital marketing is complex, bifurcated, siloed, with many channels and platforms, it is helping us as marketers tell better stories about business outcomes and performance.

Sure. And I'll add that we've been on a bit of a journey as an organization because many of our marketers were trained in more traditional ways. So to continue to evolve and develop their skills, it was important for us to go on this upskilling journey. That journey started with brand building fundamentals, the very first course you need to take within our company, so that you understand how to brief an agency, what does great creative look like, how do you evaluate it, how do you communicate back to the agency, etc. That was step one. But when you think about how much money we're spending in media and on some of the platforms, we also want to make sure that our creative lands in those platforms and is fit for purpose. So enter VidMob tool, that Lauren, lovely Lauren here, has helped us to embed in our organization. Essentially, we've scored 3,000 pieces of creative, and we went into it thinking we would see one or two points of improvement in terms of video completion rates or engagement, and we've seen four points of improvement. So when that creative lands in market, we are getting better at getting closer to our consumers. Number two, we have 30,000 pieces of creative that we've put into your creative analytics tool, whether it be for special brands like Special K or Pringles or others around the globe, we are seeing improvements there as well. And what it does for our organization: we are a very decentralized company, the regions run their P&Ls, but it allows us to have a common language around what great looks like, what success looks like, what must be the bar that we all will be looking to and measuring against, so that we can make sure our media and our dollars are working hard for us. That's been a really good and important conversation for us. And then holding our teams accountable, having a scorecard that we can all look at and learn from. One of the biggest learnings is that our calls to action are not very strong. That could be because we don't understand what the consumer is doing when they land on a respective platform or what stage they are in their consumer journey. So getting better at our calls to action is going to drive more people to purchase or to take action. But we wouldn't have known that if we didn't have tools like this one. So now we can share our learnings, what great looks like, have a single source of truth, and really get better and better. This is all about continuous improvement.

I think that's a really good point. Because some of the learnings: you're looking at a piece of creative and you have a functional message and an emotional message. Which of those is going to resonate? How important is it to have human presence? How important is it to have positive emotion? We actually saw one of our ads, I think it was Special K, that within the first 3 seconds of having both human presence and positive emotion, we saw up to a 35% increase in our video completion rate. So just that learning, it seems so obvious, but we're all sort of creating, and there is the fun and the brief and those different aspects that go into the creative process. That level of rigor in terms of what needs to be in what order can get lost. So seeing that and being able to test, evaluate, and iterate is really helpful.

We have been working as an organization for about 10 plus years, we have invested in first-party data. We've done that because we are sold mostly in grocery stores and convenience stores where we don't actually get access to our own consumer directly. So first-party data is a great way for us to connect more deeply, understand consumers' buying habits, their affinities, their consumption of media, foods, all of the above. We have upwards of 40 million households that we're able to understand. So what we're trying to do is create that identity graph and really get closer to segmenting our consumers across a variety of different use cases. So that's one way that we're using AI: to be more personalized and to serve those messages, those offers that we know are going to resonate with consumers to get them to engage with a sweepstakes, to get free product, or to be entered to win other things. But we are also partnering with quite a few others beyond VidMob. We're doing that really to create connection. One of our partners helped us for our Pop-Tarts brand to understand culture and which are going to be the right partnerships for us to match with our Pop-Tarts brand. We wanted to reach a Gen Z audience, but we also wanted to have mass appeal with our partnership. So they helped us to identify a partnership with Crocs. It ended up being one of our most successful, Croc-Tarts, most successful since 2020, really resonating with Gen Z. But a lot of similarity between Pop-Tarts which has holes and Crocs which also have holes. We had edible Jibbitz. Thinking about mining social online media consumption habits and putting all of that together to create stories that resonate with consumers in a way that moves them, that was really exciting. So we're doing that on the culture side. On the food side, in the innovation space, we are also partnering. If you think about creating foods and new innovations, we need flavor inspiration. So we have a partner who I cannot name that is using billions and billions of data points from a consumer sensory standpoint, understanding different flavor profiles, and putting that all together with consumer insights so that we are creating foods and flavors and variations that consumers will fall in love with. So really tapping into that mix of things that we're doing internally, but also relying on partners who are expert at what they do, they have a competitive advantage, and we're tapping into that competitive advantage to build our own competitive advantage and really resonate with consumers. So it's been a great journey, and it's really cool to see how companies are investing and how we can partner successfully. So much more to be gained.

Kudos to our agency.

No doubt. I think we have really invested heavily in this understanding of our consumer, the language, mining that language, and upskilling the teams in ways that they can talk to each other. We're at the early stages of this journey, obviously partnering with you and using different tools. But this is really the beginning. We also have this really cool training that we've done called full-funnel marketing, where we're thinking much more holistically about how the consumer shops. As we're building that capability and that program and initiative, it is embedding this new language for our consumers. I would say that the hurdle that we still face is that many of our marketers haven't necessarily worked on the performance side. So how do you balance that natural affinity or leaning towards brand building? That's where we're challenged, and where we bring in agencies and partners like you to help educate us on how your creative should be, how you should be thinking about creative, what great looks like. Leaning into that has helped, and we're on a journey.

Earlier I talked about a decentralized organization, where we have a center team which is globally led, and then we have four different regions. Our regions are really empowered because they control their P&Ls, they're largely empowered to make their own business decisions. But with data, analytics, and AI, you could think about it as a learning journey. Should every region be learning on their own? Probably not, because at the end of the day you will end up behind. Not sharing those learnings is like starting over every single time. So by putting this center team in place, we are helping to embed and create more consistency, more tools, technology, upscaling the organization on how to think about going on this journey of data. So about a year ago, my title changed from CMO to Chief Brands and Advanced Analytics Officer. The reason was that we wanted to bring a center team to help create more of a coordinated effort so that we could collectively learn and build our capabilities together. I think that's been a really big step in the right direction for us as an organization. It also allows us to tell much more meaningful and valuable stories to our leadership, our CEO and CFO, about how our business is performing and how we're translating these great dollars that we're using in market and how we're driving returns on investment. So really a big step forward. Breaking down those data silos is so key, but if you think about the culture of an organization and having this decentralized approach, it has been a journey because it's a new way of working and collaborating and sharing, which can be challenging. So if you think about 'I'm the US and I've always done this on my own in the ways that I want to,' and now relying on this center team to shepherd and build that engagement, alignment, and processes that will help the entire organization be successful.

Well, I think those types of signals are sometimes what need to happen.

Thank you.

I think the human presence piece was really interesting for me because we live in somewhat of a functional world. If you think about foods, yes they deliver an emotional benefit, but really the flip of the switch of having that human presence and having emotion in the first 3 seconds and what that meant in terms of result and response from a consumer changes everything. So now the brief that I share with the agency will be a very different brief than I would have shared previously. The idea of seeing our Pop-Tarts brand, we were launching a new innovation and we wanted to only talk about the new innovation and the form of that innovation versus the emotional feeling that you get from eating that food. Understanding how important emotion is is so key, and it also is a key point of difference for us. We know that we have differentiated brands, and how are brands differentiated? Most of them is through emotion versus through function, because there will always be some competitor out there that can one-up you in terms of the functional benefit, more vitamin D or whatever it is in the food. But if I can connect with you on an emotional level, it transforms the experience. So to me, it just reminds you of the importance of creative, but it also reminds you of how important it is to be precise, and how precision can really drive effectiveness and outcomes.

First of all, as marketers we have got to be agile and learning agile, really curious about what's working, why it's working, and understanding beyond the brand side. I love this debate about performance versus brand, but we need to understand both and we need to challenge both sides to perform and to help us drive that measurement that's so important. Because we all have CFOs, and many of us are in for-profit businesses, and we want to see those messages and those dollars work really hard for us. So we've got to understand both sides of the coin. As you're thinking about going on this journey, remember that it's all about experimentation, and it can be really iterative. Defining what the hypothesis is going into your test is really key. By understanding that we were challenged with creative, whether through looking at your ROIs if you have an MMM or other means, looking at your funnel where you have gaps, those are the beginnings of the conversation around what's working, what's not working, and where do you need to be pressure testing or running pilots. Then framing out what measurement approach will be and what you think success looks like. Then getting advice from your partners who are the experts, who may know more about how to frame that problem, how to set it up, what the holdout group is, how do you measure success, what's the lift you're looking for. Those types of things are really important in this journey. And start small, then iterate on that to get bigger and bigger. Invest in your talent. Investing in talent is so key, making sure that you're training, getting certificate programs, so that you're developing that capability, but also your teams are as well.

Kind of you to say. I don't think we're quite there yet, but thank you.

Thank you very much. Thank you, Alex. Appreciate it.