How mobile helps Hershey manage impulse purchases

By Natalie Koltun | September 24, 2019

As featured on MobileMarketer

NEW YORK — Candy companies once relied on grocery checkout aisles for driving impulse purchases. Now with mobile and e-commerce disrupting traditional shopping habits, Hershey has had to adapt to snap up sales and brand awareness among consumers craving immediate gratification.

The 125-year-old chocolate brand looks to capitalize on the rising dominance of smartphones and newer platforms through Halloween and into 2020, using mobile as connective tissue to bring together strategies around media, distribution and drawing customer insights, said Vinny Rinaldi, head of addressable media and technology, during an Advertising Week panel on Monday.

"Mobile really needs to be front and center of all our media buying because, in the end, the quicker we get in front of you while you're on the go, the quicker you're probably going to think about us when you're about to check out," he said.

Hershey works with ad-tech company Kargo on building out custom creative units specifically for the mobile web, while dabbling with Google-owned navigation app Waze to better understand how to close the last mile as a consumer packaged goods marketer with no owned retail presence and online sales almost exclusively bulk orders. As a tool for daily activities like communicating and wayfinding, mobile devices hold key insights into the customer journey. Hershey plans to analyze how consumers use their smartphones and connected tech just before making a purchase to determine what pulls them into stores and explore how the brand can leverage that knowledge.

"Not owning that closed loop retail piece, it's kind of a crapshoot, but the more we can tell the story of what's driving people to stores, the more we can unlock some more of those sales," Rinaldi said.

"We've seen an insane amount of reach by doing more gaming."

Vinny Rinaldi

The Hershey Company, head of addressable media and technology

A recent test with Waze's ad pins swapped convenience store logos with an image for its Reese's candy in a mobile-minded move to lift awareness around product availability and trigger impulse purchases among drivers by getting them in stores, he added.

To double down on using mobile platforms to steer consumers toward buying Hershey products, the brand has also teamed with distribution upstarts like in-car vendor Cargo and digital convenience retailer goPuff, which Rinaldi says could unlock significant revenue opportunities ahead among shared target audiences of millennials and Gen Z. Hershey and goPuff previously partnered on a virtual reality shopping experience demonstrated at South by Southwest in 2018.

'Overfrequence' underperforming markets

Hershey in the past year has made a bigger push to incorporate mobile data into its media buy strategy. Rinaldi said each week his team assesses which markets are underperforming sales-wise and "overfrequences" those locations with media. The strategy drove an incremental $4 million in sales around Halloween last year.

"It's very simple. It's geotargeted media. It's nothing earth-shattering," Rinaldi said, adding that the company plans to ramp up the strategy for the October holiday this year.

On the creative front, Hershey is among the many brands putting more muscle into elevating its social presence with thumb-stopping content that resonates with younger audiences. While it's still mostly converting high production-value TV ads into vertical, "snackable" units, the candy marketer is working to adjust to the nuances of social apps like Facebook and Snapchat.

"You can't just take a TV ad and serve it on every platform. It doesn't necessarily work," Rinaldi said. "We've dabbled here and there, but what we really need to start doing more of is taking our audience strategy and developing creative that aligns to every single different audience."

Plans for next year include a big shift toward digital video, connected TV, over-the-top and gaming, he added. The candy maker in October 2018 promoted a new Reese's product with gaming influencers Tyler "Ninja" Blevins and DrLupo as it looked to test new grounds in esports to reach younger cohorts who are the biggest consumers of candy, especially around holidays like Halloween and Easter.

"We've seen an insane amount of reach by doing more gaming," Rinaldi reported. 

Looking ahead, the Hershey marketing team is discussing whether to run similar esports product tie-ins or sponsor a full team or league in 2020.

"Gaming is very high up on our priority list," the executive added.