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Catalina has been providing marketing for CPG retailers and brands for 35 years
While most entrepreneurs want to be the one to discover the next Amazon or Twitter, oftentimes major technological shifts are coming from the big companies, the players that have been on the scene for years, if not decades. Those companies have survived because they know how to pivot. They're the ones who either seed new ideas or acquire them and distribute them.
In this column, we talk to those companies and their innovators who are preparing them for what's coming.
One space that has seen a major shift is digital marketing, thanks to a proliferation of big data that have given brands and marketers greater insights into their customers. Not to mention the proliferation of devices, allowing them to send ads to their customers at literally any time of day, on any device.
Catalina, which provides marketing for CPG retailers and brands, offers technologies such as Catalina Catalyst, a consultative service that accelerates brand growth via real-time with insights and analytics. The company has a database made up of over 300 million shopper IDs at 44,000 global retail locations.
In this column, Mark Bees, Vice President of Product Marketing at Catalina USA, talks about the evolution of digital marketing, how Amazon has affected the CPG space and the impact of big data.
VatorNews: Catalina has been in the digital marketing space for over 30 years, and I see that you have been doing marketing for over a decade. How have you seen marketing change in that time? How has it evolved?
Mark Bees: Over the last 30 years, the biggest change has been the evolution from one-to-many to one-to-one, personalized marketing. Brands are looking to connect with customers based on a much richer understanding for who they are, where they are in the buyer’s journey, and what drives their purchase decisions. They’re looking to improve the efficiency and predictability of their marketing spend. Catalina actually helped pioneer this change. Since we were founded in 1983, Catalina has been practicing true one-to-one marketing. Today, we have a real-time view into the evolving purchase history of several hundred million shopper IDs globally that allows brands to deliver personalized advertising and offers based on a deep understanding of shoppers, including what they buy, why they buy, and when they buy. We’re investing heavily in continuously enriching our data and multi-channel delivery platform to make marketing a science for our retail and manufacturer customers. It’s what we call buyR³Science™.
VN: How has Amazon affected the CPG space now that they own Whole Foods? How do you help brands compete?
MB: It’s been over a year since Amazon’s acquisition of Whole Foods, and we are starting to see how Amazon has applied its innovation into grocery retailing. Whether it be expanding Amazon Go into the Chicago market or the launch of one-hour delivery in 19 cities, Amazon is schooling the industry on how to meet the demands of a changing consumer.
As the lines blur between digital and physical, our brand and retail partners are looking to increase their relevance and engagement with shoppers to bridge the gap between digital and physical and increase trial, volume, loyalty and brand affinity. Catalina is helping with this in a lot of ways, all of which stem from our ability to deliver personalization at scale. For example, we’re helping retailers sort through the hundreds of items on sale each week and match them to the right shoppers to deliver the most relevant deals for each shopper.
VN: Tell me about your Marketing as a Service (MaaS) model. What does it entail? How does it differ from what other companies offer?
MB: Catalina Catalyst is our Marketing as a Service model created specifically to address the needs of Emerging Brands that have much more limited resources than bigger players. Essentially, it is a consultative partnership where clients leverage our vast purchase-based behavioral shopper data and our dedicated team of business experts as an extension of their own team. We offer tiered levels of support, which include analytics services and reports you can’t get anywhere else. The most differentiating component is that Catalyst clients have access to what we call, The Hub – which enables them to see impact and performance of their programs as they unfold.
VN: What kind of returns have brands seen from using Catalyst?
MB: We just launched Catalyst earlier this year, but our initial clients are definitely experiencing significant early benefits in terms of new customer acquisition and efficient sales growth for their products. They are also excited about their access to valuable intelligence into key performance indicators and expert support to help them with their business and marketing planning. As we continue working with these customers, we expect to provide more data and case study examples that quantify the impact Catalyst is having for emerging brands.
VN: How has the emergence of big data changed how brands interact with their customers?
MB: Big data is transforming marketing for consumer brands. It’s helping us reach the engage the right consumers at the right time, measure marketing more precisely, and create more meaning relationships with customers. Essentially, big data analytics and predictive modeling is helping our customers efficiently find and engage the most valuable audiences to their brands based on literally tens of thousands of variables that go into determining which shoppers matter. In the case of new product launches, big data can significantly increase trial and repeat purchase rates by delivering personalized ads and offers to specific shoppers across digital and in-store media channels.
VN: How important is it now for brands and marketers to have a solution that encompasses multiple platforms, including mobile, social, voice-enabled services, etc.? How has that changed the way ad campaigns are put together?
MB: Smart marketers know they need to integrate their ad buys across the entire purchase funnel. The reality is it takes multiple touchpoints to effectively convey a brand’s message and activate a consumer’s response. Unfortunately, most multi-channel marketing efforts are siloed or fragmented at best. The opportunity we see at Catalina is to create “micro moments”, key points of inflection between a brand and a shopper depending on where they are in the buying cycle and what the optimal channel of engagement is at that moment. Since we have a shopper’s purchase history, we know the millions of shoppers who recently bought laundry soap and the other millions who are about to run out. We can suppress ads to shoppers who just bought and focus heavily on shoppers who are closer to making a new purchase. We’re also increasingly focused on shopper location and proximity to our retailers so we can serve up relevant offers when a shopper is close to the store and so further down the purchase funnel. All this requires the ability to understand and follow the consumer across multiple devices and channels.
VN: Where do you see digital marketing going next? What technologies are on the horizon that will get it there?
MB: We recognize that brands need to measure the impact of their digital media on in-store sales where 90% of transactions occur. In the past, digital marketing performed best in businesses with a strong digital presence like ecommerce and consumer tech. Online purchases create rich first-party data that can be used to remarket to previous buyers or consumers who exhibit similar behaviors. We are creating an attribution loop in physical retail where brands can measure their digital ad performance on item level purchases. We’re further increasing the efficiency of a brand’s media by enriching purchase data with other sources like product ingredient-based data, demographic data, location data and online behavior data in order to gain a more granular view of individual shoppers. This enhanced targeting allows brands to pinpoint specific audiences based on insights into what items they buy down to specific ingredient level motivations like Gluten Free or High Protein. We see how combining precise targeting of ad delivery with item level attribution of in-store purchases delivers higher returns for brands who are constantly looking to increase the value of their digital media spends.
VN: What are some innovative growth areas that are priorities for you in 2019?
MB: Catalina is innovating quite aggressively across its media platform, data model and analytics, and products and solutions. Over the past two years, we’ve transformed our media platform so that data flows in real time across our entire global network of retail stores. We now see the evolving purchase history of several hundreds of million shoppers, all in real time. This re-platforming has set the table for some major innovations in 2019.
For example, we will deliver new levels of omnichannel, digital-to-physical engagement and attribution that connect consumers online to their purchase behavior in-store, right down to the specific products they buy. No one else can do that. That means our customers can understand, reach and engage shoppers across multiple media channels with a level of personalization that converts shoppers to buyers precisely measured at point of sale.
Another focus is continued innovation around our consumer-centric data model that brings together and analyzes a much richer array of shopper-specific data sources to get a real-time and more predictive view of shoppers and their changing preferences. Shoppers are making purchase decisions in real time, switching brands, and trying new items at an accelerated pace. We give brands the ability to leverage our scaled shopper intelligence to help them acquire and retain their best shoppers before they choose a competing brand.
These are fundamental innovations that will dramatically enhance existing Catalina solutions as well as create new insights and higher ROI’s for our customers.
VN: When do you innovate internally versus going out and partnering, maybe even acquiring other companies?
MB: Over the past two years, we have significantly focused on internal innovation around the re-platforming of our marketing platform. But as we move forward, we’ll be increasingly focused on partnering as well. We’re working to expand our ecosystem of data and media partners to allow our retailers and brands to reach consumers with precision in more ways and in more places.
VN: Is there anything else I should know?
MB: Catalina operates the world’s greatest shopper database made up of over 300 million shopper IDs at 44K global retail locations. The size and scale of our data uniquely position us to meet today’s shopper where they are and maximize the value of our advertisers’ media dollars. Shopper behaviors are shifting in real time, and we understand the importance of delivering insights and media accordingly. We’re very excited about the capabilities of our new media platform and the further innovations coming from Catalina. The shopper intelligence we call buyR³Science™ is the critical ingredient for retailers and brands that want to build deeper relationships with customers to drive measurable improvements in marketing efficiency, trial, volume and loyalty.
(The Meet the Corporate Innovator series is brought to you by Advsr, a startup advisory firm in the business of starting conversations and sparking big ideas.)
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