Nestlé takes its social media digital vitamins.
Pete Blackshaw joined Nestlé, the world’s largest consumer goods company, as its global head of digital marketing and social media in February 2011— though he joshes that those two and a half years equal 20 years in social media time. Nestlé’s 2,000 brands, including household names like KitKat and Nescafé, have 170 million followers online. The company’s corporate Facebook page has more than 850,000 likes, although as of September the company itself had a relatively modest 22,000 Twitter followers in its @nestle feed.
Blackshaw is well known in digital marketing circles — he’s been at it since the 1990s, when he co-led digital marketing at Procter & Gamble. He’s also piloted a startup, PlanetFeedback.com, a consumer review site that ultimately became part of Nielsen Co. Most recently he was chief marketing officer at NM Incite, a joint venture between Nielsen and McKinsey.
One of Blackshaw’s first moves as global digital media head at Nestlé was to create a Digital Acceleration Team, a combination digital leadership training program and skunkworks for digital marketing projects at Nestlé. The 12 members of each class also are available to work on short-term projects that Nestlé units apply for. Then they return to their units, bringing with them what Blackshaw calls “digital vitamins” — a supplemental expertise that can be used to assist digital transformation in the graduate’s home unit.
Blackshaw’s role at Nestlé is unusual in that he reports into two heads of operations — Tom Buday, Nestlé’s Vice President of Marketing and Consumer Communication, and Rudolf Ramsauer, who runs corporate communications.
Is it important that you report to two departments?
I do. I think the potential of digital is its ability to bridge functions, soften silos, [and] make informal connections that you typically don’t have through reporting lines.
How did the Digital Acceleration Team come about?
We were inspired by hackathon culture. One of the first things I did was take executives out to Google and Facebook and Salesforce.com, companies with rapid innovation cycles, solving problems really fast, and leveraging digital vitamins along the way. It was very inspirational to us. Our first thought was: could we graft some of that onto our headquarters? I don’t think anyone went in with a naïve assumption that a large company like Nestlé was going to operate just like a startup. But we did feel there were some elements we could test.
We were also struggling with how you operationalize community management. People tend to romanticize social media, fans and followers, but there are some really difficult operational questions that need to be asked. How do you ensure you’re properly staffing and resourcing and responding, and doing so 24/7? And with nearly 170 million fans across over 750 brand pages on Facebook alone, this is no easy task.
The thought was, we’ll bring in some of our most high-potential leaders from multiple markets into Vevey [Switzerland, where Nestlé is headquartered], and we’ll put them into more of an entrepreneurial kind of setting, more of an open source collaboration model, that includes a consumer engagement center and a multimedia studio designed to produce content for training and other purposes.
How does it work?
We divide their time in three different areas: community management for some of our top global brands, like KitKat, Nescafé, Maggi, Nestea and the like. Hackathons, team projects, almost like a VC model where we would make our capacity from the Digital Acceleration Team [DAT] available to business units and functions who would compete for the DAT’s time. That would focus on really, really quick projects, things like mobile solutions in emerging markets. We’ve done probably over 100 projects since we started the program. The other piece is really intense training and thought leadership. After eight months, they go back to their markets and either lead digital in those particular regions, or just work on traditional marketing but have those digital vitamins as a back-up.
How did it work?
We went in not knowing how it would evolve. We were pleasantly surprised by the demand. We had way more applicants than available slots. We just graduated our second class [of 12 people]. We’ve probably had 25 countries represented so far.
That’s the part I find really interesting. I’ve always been coming at it from much more of a North American perspective. The local markets bring very, very unique know-how, expertise and experience in digital. Indonesia is a market where word of mouth is a really important part of the equation in marketing. China is leading on many, many fronts, including CRM [customer relationship management]. India’s a leader in mobile and community management. We’re blending that experience together, as we think about the recipe for next-generation leadership — not just digital leadership but next-generation brand leadership. We see digital and social media as a very potent building block for building brands and delighting consumers.
A number of our markets are now doing their own versions of the DAT. They’re bringing their own local flavors to the model, although we’re keeping it all consistent under the common branding, Digital Acceleration Team. India, Italy and China already have fully established DATs. We’ve probably got a dozen more scheduled. Their popularity is a sign that this is working. We often talk about viral effects in the context of external messaging, but internal organizational viral effects are also very, very important.
If you don’t have that, you don’t have transformation, do you?
You don’t have transformation, absolutely not. But in my mind, the notion that you’re unleashing innovation beyond your starting point is a sure sign of transformation. I want to be careful with that word. This is still an experiment. We’re on a journey, and we’re diving into some of these really hard questions related to digital. What I find to be most interesting is just this issue of how do you organize, how do you change the culture, how do you leverage the diversity of different markets to create exponential value?
How does the main DAT help organize your social media efforts for Nestlé’s two thousand brands?
Lead by example. Just by virtue of putting a high level of DAT capacity around things like community management is signaling that community management is central to the new brand building. What managers do today on platforms like Facebook and Twitter is a lot more complicated and holistic than it was even 18 months ago. There’s a little bit of media planning, there’s certainly some deep consumer understanding — in some cases there’s crisis management. We know it’s having an impact on how markets and business are organizing.
What’s an example of how DAT is having an impact?
Nestlé has 170 million consumers that now are friends with our brands. That number is growing somewhere between 5 to 7% a month. That requires a whole recalibration of capacity to serve those needs. Those are 24/7 needs for a constant flow of content and responses.
Where we’ve had an impact is giving our markets and brands a reality check on what’s required to do that extraordinarily well. You can’t just completely outsource it to an agency, you can’t just have interns do it. You really have to build operations around that. Moreover, you need to build models that understand how to incent and reward excellence. I think we’re having a big impact on thinking around investment and how to prime the culture, how to align incentives. But again, we’re learning as we go.
One of the things you put out on YouTube is video of a KitKat social media campaign being monitored through your situation room by your digital acceleration team. How has KitKat brand management changed because of DAT?
KitKat has 16 million fans on Facebook, it’s active on Twitter, it’s doing great things on Google, including one of our best Google+ pages. If I think about the brand today relative to two years ago, you’ve got significantly greater resourcing around community management and content production. There’s also a very strong global manager behind the brand who understands the symbiotic relationship between brand fundamentals and digital excellence. I think the expectations of agencies have changed. We’re less about TV and print; those are important but there’s a very high premium on content every day that’s going to the community to keep them enthused.
Right before the Felix Baumgartner jump for Red Bull, KitKat — within 24 hours — did their own ‘KitKat in space’ ad, a KitKat tied to a camera, posted it on Facebook, got a ton of traction. That’s 24 hours from brand alignment to the concept from the agency to actual execution. That’s what we call adaptive marketing. This whole notion of absorbing real-time signals and acting quickly is becoming common. Historically, we’ve been mass marketers, big TV ads. Now the opportunity is, how do you sense and respond and move very, very quickly. KitKat is probably at the forefront of doing that.
What does Nestlé really get from this? Can you say whether it has an impact on sales or profitability, or demographic growth?
Number one, consumers that self-select and want to engage with your brands on social platforms have inherent value. Whether they purchase more or talk more, they are a de facto sales force. Consumers trust other consumers more than they trust formal advertising methods. So this notion of the consumer being your advertiser has value. We’re quite rigorous in our market research efforts and we have strong confidence that these platforms do translate into [sales].
On the negative side, it’s pretty intuitive as well. If consumers are badmouthing you, there’s going to be exposure. Reporters may ask harder questions, or it may bleed into search results or into your Wikipedia definition.
Nestlé is better versed on the negative aspects of social media than many companies. The flap with Greenpeace over Nestlé’s purchases of palm oil was labeled one of the 50 greatest social media screw-ups. How do you think the company would deal with that now?
That was clearly a teachable moment for Nestlé. There were two fundamental issues there. One was a supply chain issue that no amount of social media tactics was going to solve. But there is also an issue of how well the detractors were managed in social media.
We take all of those as opportunities to become a better listener, a better relationship builder. I do think we’ve come a very, very long way since that particular incident. We have the humility to know that none of these issues are easy to manage. I don’t think anybody’s written the perfect playbook on the new rules of consumer control. I’m a big believer that the consumer is my teacher, and the teacher continues to challenge us with torture tests. I’m deeply honored to be in that classroom.
Nestlé has 2,000 brands, and over 700 Facebook pages. How do you decide social media strategy brand by brand?
I’m not a top-down, “thou shalt not” kind of guy — and in a wonderfully decentralized operating model, such proclamations won’t get you very far anyway. There are some social media guidelines I will author that push out across the markets. We try to develop toolkits and best practices that markets will follow.
I think it’s getting easier with social content management tools, whether it’s Buddy Media with Salesforce, or Vitrue with Oracle, or Wildfire with Google. There’s a lot of tools to help you bring a level of coherence to what may appear on surface to be an unwieldy social ecosystem. A brand like KitKat may have 40 different pages on Facebook. Some of these platforms allow you to treat it as a more cohesive ecosystem.
Is the goal for every Nestlé brand to have a social media presence?
I don’t think that’s a choice the brands make. For most of the brands that have a huge presence in Facebook, I’m not sure that was really by design. A lot of them, like Coke, were started by evangelists, who basically said “I love Coke so much, let’s create our own page,” and ultimately Coke rode the momentum in a big way.
Everybody technically has a social media presence by virtue of the fact that consumers and stakeholders talk about brands. Social media is a reflection of brand love, or in some cases issues that people have with brands. It’s kind of a mirror into brand equity, brand performance, brand reputation. The question is, to what extent will the brands proactively manage it or seek to amplify it?
How does Nestlé use social media internally?
A big reason why things are moving fast at Nestlé is our embrace of social media inside the organization We’ve implemented one of the largest internal social networks — 200,000 users supported by Salesforce.com’s Chatter platform — and this has significantly upped the level of sharing and collaboration. We have communities dedicated to every part of our roadmap — from “Winning with Mobile” to online listening best practices. I now recruit talent based on the relationship-building skills employees demonstrate via these platforms.
To put all this in perspective, back in 1998 I initiated one of the first marketing intranets at Procter & Gamble, and it was a spectacular failure. The technology was clunky and impenetrably bureaucratic, and time-starved managers had little patience for my over-hyped, romantic notions of online community. Today, the friction and access barriers are disappearing from collaboration platforms, and this opens up a world of possibility for large enterprises. Ours is as easy to use as Facebook, and with 95% of our employees well-versed in social media in their personal lives, a whole new world of possibility emerges.
How does digital marketing today compare to what you were having to do in the 1990s?
The biggest difference today is there is so much more agility and flexibility in the system. The costs of content, the platforms that we operate on, are often much lower than they were at the onset of the Web. When I was at Procter, you’d spend a million dollars on a web site. You didn’t have the flexibility to iterate at really rapid cycles, and if the web site didn’t get the result we wanted immediately, we’d throw out the idea and go home. Hugely strategic ideas often got prematurely ejected.
Today you’ve got blog publishing formats that allow you to get content out there relatively fast. You can learn very, very quickly and adapt with high levels of precision.
Another difference is the sheer numbers. I mean, 1.2 billion consumers on Facebook alone? How can anyone ignore that?
When you’re managing social media across so many brands, what are the biggest barriers to creating transformational change in marketing to customers?
I think habits die hard. Big companies have a certain way of doing things. It’s not just a Nestlé thing. Shifting to these new realities takes time. It takes a certain level of belief, proof, if you will. Leadership is always a barrier in all organizations.
That goes back to the Digital Acceleration Team. It’s not just a digital program, it’s a leadership program. I talk about digital dualisms, which are tension points. Digital leaders wear two caps: they are an enterprise stimulant, when the brand or business needs an injection of fresh thinking or highly concentrated action, to ignite the digital agenda. They are also an integrator, highly focused on bringing digital principles to all aspects of the business.
I’m a classic stimulant for Nestlé, brought in from outside, moving aggressively with an agenda. For all companies, there’s going to be a time and a place to do that. We also have to integrate, make sure it’s woven into the core brand building process, the incentive structure. I walk both sides of the aisle. I’ve put together social media policies and guide rails, but I’m also an enabler. In a digital world, it’s as much about managing tension as having an answer.
I’m often asked, “Why do we need a corporate social media team … shouldn’t everyone be doing digital and social media?” The answer of course is yes, but it takes real momentum — even sparks — in large organizations to prime integration. At a time when tools like Twitter are becoming almost foundational to media relations — just think about all the reporters who tweet — we need to keep revising where stimulation ends and integration begins. If we’re good at this, we’ll keep testing and priming new tools for eventual integration with all corporate communications. And if we really do our job right, we might just make ourselves irrelevant.