Mondelez Strikes Global 'Mobile-Only' Media Deal with Google
Mondelez International has struck a significant mobile media deal with Google covering 16 countries as the marketer looks to drive more impulse purchases of brands such as Oreo and Trident across the globe.
The pact, which Mondelez describes as its first "mobile-only media deal," will cover mobile search, display and websites. Mondelez executives did not disclose financial terms. But the company characterized the deal as a "global strategic agreement" that goes "beyond a traditional media impressions deal," including "creation of branded mobile websites, training and mobile-capability building, analytics and an opportunity to opt in to Google's mobile beta programs."
The arrangement, which will begin immediately and last one year, was brokered by Starcom MediaVest.
The deal lends more proof that consumer-packaged-goods companies, which have been slow to adopt mobile advertising, are finally starting to get serious. "We've been urging mobile readiness at Google for three-plus plus years, and this year has been the year where it seems like the light has gone off over most marketers' heads," Eileen Naughton, VP of global sales at Google, said in an interview.
Mondelez has a goal of spending 10% of its global marketing budget on mobile. Phones are "the one device that consumers have with them at all times," Beth Reilly, Mondelez's head of global digital strategy, said in an interview. "Our goal is to become one of the top mobile marketers in the world and this partnership with Google will help us get there."
By 2016, an estimated 67% of the global population will have a mobile phone and nearly half of the population will have smartphones, according to Mondelez. Mobile is particularly important for Mondelez because brands such as Trident, Oreo and Cadbury rely on impulse purchases. In the past, brands could depend on in-store displays to drive these purchases, but the tactics are proving less effective with the heads of so many shoppers buried in their smartphones.
Mobile advertising has the potential to get brands back in front of the faces of distracted consumers. For instance, Mondelez might be able to use geo-targeting to serve an ad for Trident to a consumer who has just visited a coffee shop and might need a breath freshener, Ms. Reilly said, giving one example.
While the Google deal is not exclusive -- there is nothing stopping Mondelez from working with Twitter or Facebook, for instance -- it is unique in its geographic scope, covering markets in regions such as Asia Pacific, Latin America, Europe, North America and the Middle East. "Google was the first logical partner to work with because they truly are global and they have coverage in every region that we need to be in," Ms. Reilly said, calling out Google's China presence as one factor that set it apart.
Indeed, the arrangement will put a particular emphasis on emerging markets, which in 2012 accounted for roughly 40% of Mondelez's $35 billion in net revenues. For instance, Google might help train Mondelez marketers in emerging markets on mobile advertising techniques. A lot of emerging markets "actually have higher mobile penetration than internet penetration," Ms. Reilly said. So "mobile is the best way to reach people in those markets."