Data Matters Customer Story: Heineken Making Every Touchpoint Count | Salesforce

Now I would like to welcome to the stage a very good friend of mine who I've known for many, many years, a media trailblazer in his own right, Ron Amram from Heineken. Now he's going to talk about their approach to data driven targeting at scale and on a global basis. But before he comes onto stage, would you please roll the video?

Heineken tastes perfect every single time. And that doesn't happen by accident. It takes 15 years to become a Heineken brewmaster. Almost as long as it took me to master this look.

She came, she came to meet a man. She found a manger. What's his name now?

Still practicing. It takes 15 years to become a Heineken brewmaster. There's more behind the star.

Please give it up for Ron.

Thank you, my friend. Thanks, jsd. Good morning, everyone. So that commercial you just saw is on air right now featuring Benicio Del Toro. It's from our credentials campaign. And when you look at Heineken, we have about 200 brands globally. And our biggest brands have all been really built by the power of great television, great creative sight, sound in motion, immediacy and massive scale. But many of us are all here today because that doesn't work in the new world, right? So today television is less effective than it was yesterday. And that's the new reality marketers have to deal with. And we've had to pivot and adjust and get better at digital and more specifically mobile in the new world that consumers are defining this very well documented research as a global issue, right? So television, well, may be declining now in most of the world in terms of audience. It's very true here in the United States. Been happening for over a decade. Over the next 10 to 15 years, television will begin to rapidly diminish on a global scale. So marketers need to learn how to market in this new digital and mobile world because television will not be driving the growth of our brands anymore. Now there's another key issue that's affecting CPG or FMCG brands, and that is just the number of brands. The sheer volume of innovation and choices that consumers are expecting. Now, many of you probably have three or four jars of mustard in your refrigerator. Ten years ago you probably only had one. In the beer category. You used to have a repertoire. The average beer consumer had a repertoire of five or six bar. Today it's 12, right? So brand proliferation, the selection, the choice that consumers have today, just continuing to escalate in mushroom. And that's the other key issue that marketers have to face the repertoire consumption of brands completely diminishes loyalty. And I know that the previous presentation spoke a lot about brand funnels, but our theory and our belief is, and actually JST mentioned this yesterday, that the brand funnel, the rules that marketers have been living with and been trained on, don't apply anymore. The brand funnel's broken. It just doesn't work. Loyalty is not something that you build and keep over time. You actually have to continue and continuously convince consumers to come to your brands because even if they drink a Heineken, they also drink 11 other brands and they're constantly making decisions on which one they want to choose. It's actually much more like a maze because every time they buy a beer or any other fast moving consumer good product that's out there, they make decisions. And every purchase decision based on who they're with, what they're eating, where they are, what they're doing may lead them to a different brand each time. That's the new reality that brands have to live with today. Now, in the new mobile world though, when you add in digital, when you add data, you have an opportunity because you now have the ability to understand what the consumer is thinking a little more about who they are, what information drives the decisions that they make, and potentially applying that information and intercepting them in real time with the power of digital and mobile to influence them and have them disproportionately pick your brand. That's the new opportunity for growth for brands. Now what JSD asked us to do is actually come in and just walk you through our four year journey on data driven marketing. And it really started with an initiative here in the United States that was called the three S's Science, Storytelling and Speed. We needed to really have a stronger understanding, a scientific approach to understanding the consumer. We needed to keep doing the great storytelling that we were doing, but do it much faster and in an accelerated rate and probably much more of it. And that brought us to the data driven marketing initiative that we've been going over the last four years. It really starts for us. It started first with redefining our brand targets. The way we built our brand targets previously were built on an old world, on a TV driven world. Secondly, we had to fragment our targets to talk to them more individually, more on a personal level, based on what we knew about them. We called this Persona building. Then we had to actually match the message within the right media with the right person. And finally we need to test and learn because we're doing things at such massive scale. Lots of versions, lots of sequencing. We need to know what's working and not working. Optimize or move to a different decision and it becomes a virtual cycle. And that's our data driven marketing plan over the past four years. Let me take you through a little bit of each of those. Number one, when we looked at what our brands were doing or what our brands were defining in terms of targets, we still focused on a TV world where we're talking about age and sex. So millennials, men 21 to 34. When you have television, you can be very forgiving with target audiences. You can target men 21 to 34 and you get everybody else. You over index with older demos. But if you believe that television's not going to work for you anymore, you can't do that. You have to really focus on the low hanging fruit that are going to grow your brand and not talk to people that you have no chance or have no interest in your brand. And that's how you have to redefine your targets. If you look at men 21 to 34 in the United States, they only represent 13% of the legal drinking age population. And to be quite frank, when you look at premium beers, Heineken being a premium beer in the United States, they only represented 5% of the volume because were priced at a 150 index relative to mainstream. And most 21 and 34 year olds can't afford that on a regular basis. So we have a tremendous missed opportunity here where we're marketing to really a small percentage of our actual customer base and focusing on millennials, we really need to talk about beer drinkers and premium beer drinkers because we are walking away from a strategic perspective and potentially even a new digital world, the media perspective, 90% of our target audience. So what we did is we actually rebuilt our audience around the beer category. If you look at the United States, about 260 million people in the United States are of legal drinking age. Roughly about half those people drink on a regular basis. About 120 million people in the United States are regular beer drinkers. A portion of those people who drink alcohol don't drink beer. And about 2/3 of those, or roughly 80 million of those either like Heineken and drink Heineken or have in the past or drink something similar. So we now have a really strong base of 80 million addressable people or a target audience of roughly 78 million, 79 million people that we think we can target. Compare that to men 21 to 34, which is roughly 30 million people, it's obviously a much bigger target audience. And when you look at men 21 to 34, 30 million people, about half of those people don't drink beer on a regular basis. So you're actually down to 15 million. Now. We have a much bigger base of people that are much lower hanging fruit and more targeted to our audience. So our brand targets are now adjusted based on how close they are to the category and how close they are to our brand. The next step was breaking down that group based on different positions that we can connect them to our brand. So it's a what other alcohol brands they drink, what beer brands they drink, how close or how often do they buy Heineken? What other interests do they have? What entertainment do they consume? What music do they like? What shows do they watch, what sports they go to, what events they go to? And just demographic data in general, allows you to really separate that group of roughly 80 million people into different subsets where we know more about them, and we could create content that addresses them more specifically. Now, when you start building Personas, the challenge is you start really slicing it pretty narrow. You go from 80 million to a group of 2 million pretty quickly. So what you have to do is take that group and potentially test Persona building. I'm sorry, scaling it. And you have to create lookalikes. Whether it's a strict lookalike or a loose lookalike. Your 78 million people can go to roughly 140 million pretty quickly. But how confident are you that they're actually gonna convert? So you have to. This is where the testing and learning becomes critically important. But the key difference for us is the ability to drive, scale, and grow. And that's the difference between having digital become effective or digital being still less effective than television. The ability to scale and drive larger audiences is critical, but talking to them more specifically and individually than just having one ad appeal to everyone. So what's key is understanding the increased penetration you're doing with each of these Personas. So how many of these people are actually buying Heineken right now? And after the campaign runs, are we driving increased penetration of, say, soccer fans or modern family viewers or foodies or international travelers of each of our different Personas? Are we growing disproportionately, or are we growing based on the creative that we're doing or the media that we're investing? And if not, why? And can we fix it? Or do we have to say that Persona doesn't work for this brand? So that's the constant learning and testing. That we're going through that virtuous cycle to improve our data driven marketing initiative. Now, it's also always important to lay in and go back to the category itself and look specifically as where do we intercept with other brands? Because again, it's a repertoire world. People are Heineken fans, there are people who love Heineken, they still drink other beers. And that's the world that we, the new world that we live in. So many of our campaigns are built within this repertoire mindset. And the ad that we started out with, the credentials campaign, actually is a good example of that. Because when we did ROI studies on who actually likes that ad and who's more likely, which Persona does that ad appeal to more, the key learning for us was that you have people that just sit in premium beers only drink craft beers or imports and others that drink more mainstream beer. And then at moments in time, they're out on a date, they're out with co workers, they're going to a party, that's a Heineken moment for them and they ladder up well. The credential campaign actually works really well with mainstream drinkers who ladder up because it reminds them. 150 year brand, same formula, the history, the taste, the quality, it reminds them, you know what, maybe I should ladder up more often. The campaign works really well with them. It doesn't necessarily work with people who only drink premium beers because each of the brands that they drink has a great story behind it. But for those who ladder up on occasion, this campaign works fantastically well. So the learning here makes it critical to understand what works and what doesn't work. If you're not doing this, then you can't really do Personas. You have to have a constant feedback loop. So what we're focusing on right now with our data driven marketing initiative is again, data acquisition. Because that's what makes all of this work. It's the starting point. It's not just about first party data. It's also testing and applying second party data with key relationships that we have in the media community. It's about testing third party data on top that makes our first party data smarter or expanding it and increasing in terms of look alikes. So it's the full data ecosystem that you have to apply to make this really work and grow at scale. Then it's about generating insights from that. So the key thing is not just the data, but using it to create new theories, new Personas, or new initiatives or new creative that we can connect to and bring more consumers closer to our brands. And finally it's the testing and the learning, the measurement which sometimes is the hardest part to prove what's working, not working, what do we need to iterate, what do we need to change what's working? And we need to double down on. Now the last part is what do we need to do to make this work even better and what do we need to focus on in the future for us, the walled gardens make this really hard because we're doing this now in silos. We do this across our digital marketing initiatives. Digital media, digital video. We have to do it on Facebook somewhat separately, you have to do it on YouTube somewhat separately. Maybe that's closer in Amazon, a completely different animal. We need to remove these barriers that we're looking at our digital holistically and optimizing it as one second, you've heard a lot about this about with the new cloud technology. It's all entire communication hierarchy is critical when you say what in what sequence can completely change the effectiveness of your campaign. So that's the next pivot that we haven't really put enough energy behind and that's going to be something that we're focusing on going forward. And the last obviously is taking traditional and digital and looking at it as one having a fully full media harmonization across all of our messaging. So that's been our journey over the past four years and hopefully four years from now I can give you one of us at Heineken can give an update of where we're going and where we'll be. Thank you.

Thanks Ron. Thank you so much. Thank you so much. Big round of applause for Ron. Right. I think what's really interesting right in this audience, we have a continuum of experiences and perspectives, right? And you know, you just had Ron talk about Heineken and while it seems obvious, we know, we talked about, we know where marketing is going and it is all, it's all about the customer journey. And we have brands like Heineken and other great brands in the room, Clorox, Hershey's, their very well respected competitor, Anheuser Busch and so forth, that have built the most powerful brands in the world on the back of broadcast TV for decades. And so you need to understand that even while all these fantastic brands understand where the puck is going, if you will, to use a Gretzky quote, they still need all the support, the capabilities and the platforms in, in order to realize the new marketing evolution. So I think Ron did just a fantastic job on that.