'Data Is Gold': Kellogg's Pushes Into DTC With Cheez-It

Google has prolonged the life of third-party cookies on its popular Chrome browser to 2023, but the end is still coming. To continue delivering online ads with precision, large companies from PepsiCo to Procter & Gamble are seeking ways to collect first-party data in a shopper-friendly fashion. One popular method is direct-to-consumer platforms. Last week, for instance, Kellogg’s debuted a website dedicated to century-old cracker brand Cheez-It. Visitors can purchase merchandise, such as a Cheez-It fanny pack and socks, along with an exclusive variety pack containing four flavors of its Extra Toasty crackers. Although Kellogg's has experimented with DTC in the past, this marks the first time the company has created an online destination to sell one of its more mature brands, according to Jordan Narducci, director of global direct-to-consumer ecommerce at Kellogg's. (Cheez-It generates $1 billion in annual retail sales, Kellogg's CEO Steven Cahillane told analysts during an earnings call earlier this month.) Group Nine Media’s DTC Ad Solution Has Generated 7 Figures So Far Extra revenue aside, the idea is also to gather information and test new products before making them available at retailers nationwide. "If you think about direct-to-consumer as a channel, it can really de-risk innovation for companies," said Narducci, who, along with others, was hired in late 2019 to help Kellogg's develop its digital strategy and build relationships with customers. "The best focus group you could ever get is people actually going out and paying for something." Others are noting the same. In May 2020, PepsiCo launched two direct-to-consumer sites: PantryShop.com and Snacks.com. The latter, which offers an assortment of brands such as Cheetos and Doritos, has taught the company that shoppers like to mix and match products in ways the company doesn't offer in stores. "There is no substitute for having a firsthand relationship with a consumer who’s purchasing directly from you and telling you exactly what they want to buy," Michael Lindsey, chief growth officer for PepsiCo Foods North America, told Adweek in June. As for collecting information about shoppers, Narducci explained it's a core part of designing the Cheez-It site. "It's only going to get harder and harder for us to purchase data," Narducci said. "And first-party data is one of the biggest drivers of media efficiency across our organization." Marc Pritchard, Procter & Gamble’s chief brand officer, described his company's approach to garnering consumer data as an exchange that benefits both parties because it makes people's time online more enjoyable. "We only want as much data as necessary to make a better experience," Pritchard told Adweek. P&G's Olay, Pampers, Gillette and Braun brands all have DTC platforms that generate first-party data for the company. Driven in part by the pandemic, Kellogg’s net sales reached $13.8 billion in 2020, up 1.4% compared to 2019. As more people used the internet to buy cans of Pringles and boxes of Pop-Tarts, the company’s ecommerce business also doubled and now represents 8.5% of total retail sales. "At the end of the day, data is gold," Narducci added. "We need to be investing in capturing more of it."

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Kellogg's Pushes Into DTC With Cheez-It Because 'Data Is Gold'

CPG manufacturers are looking to learn more about shoppers

Paul Hiebert

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