Kraft Foods Fosters Digital Innovation
It’s no secret that Kraft Foods (www.kraftfoodscompany.com) is a leader in digital innovation — not only in the consumer goods market, but also in the business world at large. Mobile, social and web tools, like the iFood Assistant, Big Fork Little Fork and Kraftrecipes.com, have earned the company major accolades from the likes of Parenting magazine and the Mobile Marketing Association. As a consumer goods executive — and a shopper/consumer just the same — you are probably familiar with these industry-leading innovations. Yet, until now, Kraft Foods has rarely talked about its process for bringing digital ideas to life.
In this exclusive interview, Donald King, Vice President Retail Experience, Kraft Foods North America, and Tom O’Keefe, Digital Innovator, Kraft Global Information Systems, take us behind-the-scenes of Kraft Foods’ Digital Innovations group to find out how the company is enhancing the consumer retail experience.
“Kraft Foods believes that as a leader in the industry we should also lead in identifying emerging consumer and retailer trends, and creating the path forward,” says King.
That philosophy has come to fruition many times over. And we’ll preview the group’s newest example, Kraft Foods’ Meal Planning Solution, later in this article.
Inside the Process
In January 2005, when the digital world was still in full swing adolescence, Kraft Foods had the foresight to form a Digital Innovations group. At that time, Facebook was only a year old and the Apple iPhone hadn’t yet been invented. However, under the leadership of then Chief Technology Officer Mark Dajani (now Chief Information Officer), the Digital Innovations group at Kraft Foods was already hard at work finding “digital” answers to three key questions:
- How do we engage shoppers in store?
- How do we increase basket size?
- How do we increase frequency of return visits?
Operating under the motto, “Turning ‘what if?’ into ‘what is’”, the group that exists today is comprised of highly-creative members of Kraft Foods’ Global Information Systems organization. The team works to fulfill the business needs of its “clients”, including the Vice President of Retail Experience Don King, the Head of Consumer Digital Innovation Ed Kaczmarek, as well as business units, customer business teams, digital marketing experts, etc. The team’s goals are straightforward and results driven:
- Infuse digital innovation into Kraft Foods’ culture, and grow participation in innovation by 10 percent each year.
- Grow an ecosystem of internal clients and external partners by 15 percent each year. This includes conducting 15 or more scouting activities annually.
- Deliver a diversified portfolio of five to 10 prototypes.
- Position one to two of those prototypes for commercialization each year.
How does Kraft Foods go about meeting these goals? Generally, the Digital Innovations group’s process begins with a time-based challenge related to a business problem or opportunity. To spark an idea, the team conducts internal technology showcases for the business and goes with them on scouting trips to companies and shows.
“We also get many requests from the business to solve specific business problems,” says O’Keefe. “Wherever the spark starts, the Digital Innovations team works with the business to assess and understand their personalized business need.”
The group then assembles a motivated, multi-functional team that comes together for a directed, fast-paced, collaborative brainstorm session — or “Idea Slam”. Both information systems members and key business partners are among the carefully selected participants.
“The idea is to have each participant bring his or her expertise into the process, but then be free to collaborate with other experts with different perspectives in the room to create an innovative solution to a problem that has yet to be solved,” says O’Keefe.
Together, members of the group settle on a course of action, and then deliver against that course of action over a 30 to 60 day period. The entire innovation process is named “Skunk Works”, an homage to Lockheed Martin’s Advanced Development Programs that are responsible for a number of famous aircraft designs, including the U-2, the SR-71 Blackbird and the F-117 Nighthawk.
Totally New Outcomes
Now six years old, the Digital Innovations group has produced countless forward-looking opportunities that create win-win solutions with retail partners and end consumers. At least 10 to 15 pilots have come to life since the group was formed. Many of them have been integrated into existing programs, like the Lunchables Augmented Reality campaign and putting QR codes on Huddle to Fight Hunger displays this year. In 2010, Kraft Foods conducted 10 pilots, and expects to conduct at least as many during 2011.
Perhaps its biggest digital innovation to date — in size and functionality — is Kraft Foods’ Meal Planning Solution, developed last year in a collaborative effort with technology partner Intel (www.intel.com). The goal for this project was to come up with an innovation that retailers and brands can use to connect with the consumer beyond the point of sale to increase visits, brand recognition and loyalty as well as basket size.
The result, in a nutshell, is a solution that transforms the traditional self-serve kiosk into an interactive, immersive retail experience. The total package delivers content in almost every digital way possible, from digital signage to mobile integration, video analytics and more. Shoppers can use the solution to obtain recipes, shopping suggestions, promotional coupons and even product samples. Click on the “Quick Look” sidebar below for more details.
The Idea Slam for the Meal Planning Solution took place during the summer of 2010. The user experience that exists today was created in 30 days, and the physical prototype was built to match the user interface by the fourth quarter of 2010. By January, the Meal Planning Solution was ready for its close up and debuted at the 2011 National Retail Federation Conference in New York City. It has since traveled to Amsterdam, Beijing, London, Las Vegas and Boca Raton.
While you can’t find the solution in stores just yet, King confirmed that Kraft Foods is working with one retail partner on a potential test market that is expected to commence in the third quarter of 2011. In line with its philosophy to adapt innovations on the turn of a dime to meet changing market needs, Kraft Foods does expect the form factor and the user experience for the test to be customized according to the requirements of that particular retailer. It’s that open-minded point of view that continually establishes Kraft Foods as a leader in digital innovation.
“The most important lesson we learned was to just get started,” says King. “Technology is changing continually, so waiting for a particular platform to emerge as ‘the winner’ is fruitless. It will be necessary to experiment with multiple solutions within each area to learn which ones work best with each company’s existing systems and procedures.”
O’Keefe adds, “There won’t be a right answer, but trying to wait until development in any area is ‘complete’ is certainly not the way to approach digital innovation. Try something now, and plan on trying other things later to improve the results, irrespective of how well the first pilot works.”