Fall is here and it’s such an exciting time for Hershey. For one thing, we’re celebrating our biggest seasonal holiday of the year—Halloween. But this year, there’s a bonus buzz surrounding Halloween, because it’s the second year that we’re using digital technology in a new way to help retailers boost sales. We’re doing it through something called geotargeting, which means delivering content to consumers based on their location and determined by local sales numbers. This is thrilling for me, because I’m the one who came up with the idea. It’s so gratifying to see it in action, and to know that I’m a part of a company that embraces innovation.
The geotargeting works like this: Hershey’s media team collaborates with its category management teams and retail partners to access point-of-purchase sales numbers, which give us real-time feedback on the consumer and on the business. That is especially important during a season like Halloween, when a very real-time clock is counting down toward the time when we should sell through all of our inventory. By knowing these numbers, we are aware of our performance in the moment, and we can calibrate if we are off target. We do that by nudging the customer to purchase via geotargeting, and all of this can happen within 15 minutes or less.
Say, for example, that it’s three weeks before Halloween. We look at the data for a store in Harrisburg, Pennsylvania and see that it’s not selling through the amount of product we expect it to sell through. That’s our signal to step in and help out. We allocate ad dollars in order to target this particular market. We do it right down to the zip code. Consumers start to see ads—via their computers, their phones, recipe websites, etc.— reminding them to get their candy before it runs out. These action-oriented messages, which are designed for precise locations, rooted in data and tied to customer behavior, are having strong results: based on our analysis from last Halloween, for every dollar we spend on advertising, we earn four times that as a return on investment.
This approach is remarkably dynamic, and that’s by design. When I came up with the concept right before Easter of 2018, my goal was to solve for a very particular problem. Internally, we get updates throughout the season about the status of how our products are selling in each store. Because I previously worked in sales, those updates were still coming to me, and I thought, “what can I do about this?” We have media tech that can be precise and timely, but the information I had in an email typically has a slight lag. I thought that if we could access more detailed insights from our retail partners regularly, we might be able to help them boost sales by targeting consumers in particular areas.
The geotargeting took a mix of proactivity, communication and forethought. It brings together teams in retail, marketing, sales and media to align, collaborate and ultimately, deliver business results. The activation leans into our innovative capabilities and finds new uses for our data and consumer insights. In the past, we would have established a national plan that lasted throughout the Halloween season, and our digital advertising would appear across all different markets, independent of sales. Whereas now, having made this investment and devised this geotargeting system, we know that, say, a market in Minnesota is hitting its goals, so we don’t need to waste impressions for that market. Instead, we take a performance marketing mindset, investing those impressions in markets that need support. The result is win-win-win: the stores can see greater sales, Hershey sees its products are selling, consumers can enjoy more moments of goodness as they’re reminded to stock up on Halloween treats.
For me, the geotargeting evolution has been a story of what a company like Hershey can do when it’s data-driven and shopper centric. I love that fact that Hershey has an entrepreneurial spirit, even as an iconic company. It’s willing to try new things, and doesn’t let perfection limit progress. By working together with our retail partners, we know that when we share data, it enriches the shopper experience. And when we do things that are relevant to the shopper, it makes them want to go back to that retail partner again and again.
With geotargeting, we’re able to use information that we already had in novel ways. When I think about the results we’ve achieved, it makes me feel excited about the future. Because what other information is right there, in front of us, waiting to find a new purpose and help our partners and our consumers? We’ll let you know as we find out.