Despite the doubters, Data-driven Marketing can be successful – if the right balance is struck

By Nick Broomfield, Director and Peter Kirk, Senior Consultant, The Customer Framework

The smart use of data to drive marketing performance and commercial growth within the Consumer Packaged Goods (CPG) sector has been on the agenda for several years. But amazingly, given we’ve all been living with it for so long, there still seems to be much confusion in the world of consumer brands about the role and value of consumer and shopper data. And equally remarkably, despite the wealth of evidence now available from both within CPG and from other sectors, there are those (for example, popular commentator Bob Hoffman) who still question whether a targeted Data-driven Marketing (DDM) really does deliver benefits compared to a traditional mass-reach strategy. He argues that DDM is only relevant for performance and direct response businesses.

The data proves it: Data-driven Marketing works

Whilst there is very little doubt about the efficacy of data in traditionally data rich environments such as financial services and telecommunications, there is now increasing evidence that a data-driven approach works in Packaged Goods:


  • P&G’sdata asset has enabled them to cut media waste by 20% while increasing reach by 10% (in China it was higher; cutting 30% of wasted digital media spend while increasing digital reach by 60%).
  • CEO David Taylor has claimedthey have a data asset of 1.5bn consumer records that “will get more powerful as we continue to collect data, refine it and become more accomplished at performance marketing”.
  • In the Q4 2019 investor resultsP&G reported an 8% increase in organic sales in the beauty segment and a 10% increase in healthcare year on year


  • CEO Alan Jope creditedthe shift to a more Data-driven Marketing approach for the “significant step up” it has seen in marketing effectiveness and ROI.
  • 24 digital hubs responsible for more than 600 data-driven marketing campaigns and 1.5 billion consumer connections are helping Unilever decrease brand and marketing investment by 30 basis points while maintaining effectiveness through “new disciplines” including digital advertising and real-time spend optimisation.
  • Recently Unilever reported Q2 sales growth of 3.5% and volume growth of 1.2% year on year


  • L’Oréal became famous within CPG circles for making public statements about upskilling 20,000 of its people and recruiting 2,000 digital experts to put a focus on personalisation.
  • 65% of L’Oréal’s digital media is now traded programmatically, enabling it to deliver what Lubomira Rochet, CDO at L’Oreal, calls“precision marketing at scale” helping to generate €2.1bn in ecommerce revenue in 2017 – equal to 8% of its total business and making it L’Oréal’s ‘third largest country’ to quote Rochet.
  • 2018 earnings results reportedthe best sales growth (+7.1% year on year) in more than a decade and a record operating margin of 18%

So if data-driven Marketing works, why do people in CPG still question it?

TCF believes this comes down to 4 core problems in how some brands have applied Data-driven Marketing:

1)  The “too much targeting” problem

Like any other activity, there is such a thing as a bad data driven marketing strategy. Some early adopters (and the odd late adopter) unquestionably got their strategy wrong: rather than seeing consumer data as a valuable enabler of  core marketing principles, some brands went all in for ultra-precision targeting, no doubt on the assumption that if targeting is a good thing, lots of targeting must be a very good thing.  But of course, the problem is that with increased targeting precision came reduced reach (obviously critical for low involvement mass market brands), sometimes to the point where there simply weren’t enough potential consumers being targeted to bring in the sales required to deliver commercial payback.

For us (and for brands such as P&G who are making a success of it) the focus, quite clearly, is to strike the right BALANCE between reach and targeting. P&G have recognised that they went too far towards precision only and failed to strike that balance. This should be at the centre of a best practice Data-driven Marketing strategy…using data across the path to purchase and post-purchase to drive a range of objectives (from penetration to advocacy) and using the optimal balance of media channels to deliver the message to maximise reach and frequency. We call this approach ‘Relevant Reach’.

2)  The ‘not bringing everyone with us’ problem

Lack of senior leadership alignment and buy-in will stifle digital transformation. For CPG brands whilst there can be goodwill (lip-service?) at senior levels towards being more data driven – what is often lacking is a precisely defined vision that senior leaders both understand and share about what data needs to deliver (especially from a commercial and outcomes based point of view). And any lack of clarity at the top gets amplified as messages are filtered down through the layers of the organisation into hearsay, mistakes and misinformation.

At TCF, we’ve developed a tool called ‘Direction Shaper’ to help leadership teams understand and achieve alignment in client organisations based on a short online survey followed by a high impact face to face workshop. We find that in many companies the first time that leaders have had an honest conversation about the aims of their big change programme is when they discuss it in the Direction Shaper workshop.

3)  The ‘structure and skills’ problem

CPG organisations have traditionally built their Marketing teams around the skills needed to utilise broadcast channels, with a heavy reliance on external agency support. Those that have been slow to recognise that digital transformation requires more than hiring a digital lead to sit alongside traditional brand teams, or recruiting a new agency, have often found the results disappointing. Whilst not every brand will need or be able to follow the lead given by L’Oreal and re-train everyone, a clear focus on identifying and acquiring the necessary in-house skills to collect data, gain insight from data, apply that insight in targeted campaign planning and execution and measure appropriately, is a necessary step to long term success.

4)  The ‘process agility’ problem

CPG marketing departments have traditionally had long development cycles for campaigns and new ideas. Whilst these robust processes have served them well in the past, some businesses have been slow to understand how to adapt their Target Operating Models to the new reality of the always-on consumer. In particular, the interface between Consumer Insight (CMI), Brand Marketing and Agency as businesses have  sought to move from a deliberative process taking several months, to one where insight can be turned into action almost instantaneously, is a process that needs serious attention.

How The Customer Framework helps deliver commercial benefits rapidly

The Customer Framework is a global Management Consultancy solely focused on helping clients achieve business growth by making change happen. We help organisations deliver sustainable business growth by clarifying purpose, simplifying structures, improving agility and creating a culture of accountability across the Marketing function. Our proven SCHEMA® methodology focuses organisations on priorities that deliver commercial benefits rapidly and has been used successfully with Global clients across multiple sectors, and extensively within the Consumer Packaged Goods sector.

Get in touch if you would like to understand more.