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This is the second of a three part interview with Catherine Roe, head of CPG for Google, leading up to the IIR Audience Measurement Event in Chicago May 21-23 where Catherine and I will both be speaking. Through special arrangement, I can offer my readers a 20% discount to this event.  Just use the code AM12JR

Joel: Catherine, in our last interview, you dropped a bombshell saying that searches on related to recipes are up 38% in 2011 over 2010 to 7.8 billion.

Catherine: Yes, there are more searches around food and recipes than there is travel, beauty, and luxury.

Joel: How sophisticated are CPG marketers when it comes to digital on a scale of 0-10?

Catherine: I give them a 3.

I would have loved to give them more, but I’m a bit jaded.  Look at how much the consumer has shifted their time off of traditional media and on to online.  I’m correlating my 3 based on what we see as far as shifted media dollars.  I just would have thought that progressive marketers would just say: “We have to follow the consumer.” P&G always talks about the “who” and what the “who” is and what the “who” is doing. I just would have thought that if you start with the “who” and you watched how their habits have changed so dramatically over the past five years that you would naturally lean into this medium and continue to test and shift.

But, if you look at where the dollars are still spent, you’ll see that that isn’t happening. And I’m not just talking Google. I’m talking the whole shift to digital in general. It’s shifting. It’s definitely increasing, but if you asked me three years ago where it would be today, I would have thought it would have been dramatically higher, quite honestly.

A lot of it is cultural. They still fall back on what they know. I don’t want to crash the plane or sink the ship. So, the next plan manager, when I rotate off this team, he can make the decision to jump off the ledge and see if this digital stuff really works. So, right now most of them do enough to say: “Hey, I’m testing in digital”. But, there aren’t too many that have really, in masses, followed that consumer, in my opinion.

Joel: So, if you give manufacturers a 3, what do you give grocery retailers?

Catherine: You know what? I would score them a little bit higher. I would probably put them to a 5, maybe even a 6. Again, it depends on the particular retailer. But at least I do see them doing things such as SMS to the phone from Target for coupon offers. Not fully targeted yet, but at least they’re making an effort there. (Retailers are starting to) understand that even if the vast majority of their sales are still coming at brick and mortar that they are doing more online to stimulate that consumer enthusiasm and do some things in that space. I think the retailers have been pushed harder in a call to action because they are competing with the Amazons and Wal-Mart to a certain extent. If they don’t get into that space then their dollars are going to shift more into an online world. So, I would give the retailers a little bit higher grades and I think a lot of it is just that they have to in order to compete.

Part one of the interview here: For CPG how important is digital in the path to purchase?

Next up, part 3.  What marketers can do to improve their digital marketing practices?

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5 Responses to “Google flunks CPG marketers…See me after class”

  1. Tom Cunniff

    When asking why CPG marketers are “failing”, a good strategy would be to ask an actual CPG marketer.

    That’s why I wrote this piece for Jack Myers MediaBizBloggers — 5 reasons CPG marketers don’t chase digital innovation:

    I’ve been in digital since 1994. But digital media’s growth is stunted by assuming change is slow simply because buyers are chicken.

    It’s part of it, but it’s not even close to being the whole story. Being anti-scale has a lot to do with it.

  2. Joel Rubinson

    thanks Tom. Of course, Catherine and I both worked at CPG companies and I assume you knew that from checking our linkedin profiles.
    It is a bit ironic that you are talking about scale when Combe is all about targeting. In fact, I had that exact conversation with Randy.

    digital now offers tremendous scale, as indicated by the factoid that recipe searches now are nearly 8 billion. that is a lot of shopping trip planning so CPG can no longer hide behind the that argument and my CPG clients no longer do so.

    • Tom Cunniff

      I’m surprised you find it ironic that I talk about scale for Combe. The company is a niche marketer — but our niches are all served through mass retail, which demands scale. We’re still talking about many, many millions of people, not one-to-one marketing.

      I’m not sure how to respond to the notion that “recipe searches are nearly 8 billion” and therefore “digital offers tremendous scale”.

      That’s true for paid search, but clearly not true for all digital tactics. (There’s a reason that Google’s market cap dwarfs most other digital media businesses, but… I digress.) In digital display, there’s tremendous audience fragmentation. To date, despite all the targeting technologies and efforts to emulate Wall Street style trading, applying data to re-aggregate the audiences has not been a success for most brand marketers.

      Digital has great days ahead. In my opinion, we will get there faster if we let go of some groupthink in favor of more critical thinking.

  3. [...] blog is co-posted with the Joel Rubenson on Market Research Blog.  Rubenson is a partner for The Audience Measurement Event taking place this May 21-23, 2012, in [...]