What you need to know:

• Arnott’s CMO Jenni Dill is looking to “re-energise” a 150-year-old brand, and is trying some new approaches to get it done. Tim Tam perfume, a revitalised in-house social and digital team, and a look back at historical ad campaigns are a start.
• She says she didn’t want to come in, redo everything and leave. Rather, it’s about reaching the 20 to 30 age groups with innovative campaigns and new, exciting products.
• Retailer media is a little under 10 per cent of their budget so far. It will “never” be everything, but Arnott’s is experimenting and looking at where it fits into the broader mix, says Dill.
• Growth areas are healthy foods and very indulgent foods – and Arnott’s needs to be in both.

Sweet smell of success

A 35mL bottle of Chanel’s 101-year-old N°5 fragrance costs about $125 in Australia. Not cheap, but hey – it’s Chanel N°5. A few weeks ago, Arnott’s Tim Tam brand released a smaller bottle of perfume for $90 each – almost the same price. It sold out immediately.

“It smells delicious, it smells like a Tim Tam,” chief marketer Jenni Dill says. “We were a little bit nervous about (it)… we were a bit nervous that people wouldn’t want to buy it.”

This isn’t the standard marketing campaign one would expect from a company that, two-and a-bit years ago, was bought for $3.2 billion by KKR, a global private equity firm. But Dill says KKR isn’t the stereotypical cost cutting, fast profit and exit sort of company. Rather, it’s investing heavily in product innovation, making clever acquisitions and, importantly, increasing marketing budgets.

A little over 18 months has passed since Dill moved from one iconic brand, McDonald's, to another, Arnott’s – with big plans. Arnott’s is in desperate need of “re-energisation”, she says, and she’s trawling the brand’s 150-year history for the most successful campaigns to inject with new life. The Tim Tam genie is back, for one. Dill says retailer media is making up more of the budget, but it will always be a limited part. There’s also a drive to healthier and more child-friendly snacks, plus brand partnerships and integrations on the horizon.

“I don't want to be the marketer that comes in and repositions and redoes all the packaging and then redoes all the advertising and says, 'my job is done', because that doesn't feel like what we need,” Dill says.

“When you think about our core portfolio, it probably has been ageing. The sweet biscuits and the cream biscuits have probably been ageing a little bit over the last few years. But the work we're doing with our biggest brands like Tim Tam and Shapes, is very much bringing it back into that 20- to 30-something age range, making it really relevant, making it fun, making it delicious, and converting consumers in that age range.”

More biscuit, less soup

Dill says she works with a saying in mind: “the fruit is in the roots”. It pays to look at a brand or business’s history to understand what made it successful or unique in the past. IAG CMO Brent Smart found success with NRMA’s classic HELP campaign, and looking at Arnott’s, Dill found Tim Tam was strongest when it had the genie in its ads. “It was three wishes, it was that moment of indulgence, there was a little bit of sass in the personality,” she says. “There was a little bit of cheek and irreverence, but it was very, very Australian at the same time… So we went back to it with a modern update, interpretation, and hopefully more big things to come on that front over the next year or so.”

Reaching a younger demographic with a Scotch Finger isn’t necessarily easy, but Dill says she’s plucked the specific brands, “a couple of little gems”, that worked – teeVee Snacks, for example. It was a brand many Australians had tried but was dated and tired.

“We rebooted it, we repositioned it, and we launched a partnership with Krispy Kreme,” Dill says.

“We just brought new people back into the biscuit aisle for the first time. We re-engaged with a group of consumers and teenagers that we weren't really talking too much.” It helped that KKR allowed more autonomy for Arnott’s than former owners, Campbell’s Soup Company. Previously, posts on social media needed to be cleared by HQ in the US, which could take weeks to be approved. “So it just didn’t happen, really. And that’s only two years ago today,” Dill says.

Baking-in engagement

Social has been a key plank in Arnott’s re-energisation. In lockdown, snack buying surged – Arnott’s sales rose six per cent to $1.3 billion in the 2019-20 financial year, well above the standard annual growth rate of one or two per cent. Building an in-house social team that shared recipe hacks and ideas on social media was a winner.

“A couple of great things the team did before my time, they released a couple of recipes through social media in the first phase of lockdown,” Dill says. “They were approximations of our recipes to allow consumers to try and bake at home where they could. And it drove a whole new level of engagement for us.” They’re now working to link engagement on social to product sales – but are measuring the media value of what they’re sharing and adding it into their overall marketing mix modelling.

Social doesn’t always move the needle, however. When UK Prime Minister Boris Johnson held up a packet of Tim Tams to spruik a free trade deal, Arnott’s saw a bump in international export requests. “We like half of that deal, which is selling Tim Tams to the UK,” Dill says. “We don’t so much like the other hand, which is bringing Penguins in.” There wasn’t a noticeable impact on local sales from the UK PM’s endorsement.

Retailer media rising

The vast majority of Arnott’s products are sold through the likes of Coles and Woolworths, so how are their growing media businesses impacting marketing spend? Retailers are forecast to take more than $1 billion from the Australian advertising market by 2025, and Coles is starting to ramp up its own ambitions.

“It’s a very interesting space,” says Dill. “When you’ve got a highly concentrated business in a couple of customers like ours is, we will lean into the retailer media space, and we have done a bit of work in the space already.” But, she adds, it is about keeping retailer media in perspective. Currently, Arnott's spend “just below 10 per cent" of its budget on retailer media. It wants to be sure of fair and reasonable return from retailer investments versus other channels.

“I would never see Arnott's moving everything into retail media, because that's not how you grow brands and businesses over time. That's how you might optimise the short-term conversion, which is important in any given year when you're trying to hit some numbers – totally,” she says. “But if you want to really step back and figure out the long-term growth plan for your brand and your business, you've got to have broad awareness building, broad emotional driving connection work … it's a constant balancing act.”

Like Arnott’s e-commerce ambitions, it’s a relative “fledgling” part of the business at the moment. But the company is testing and learning, and “we might choose to invest more”.

DTC cookies?

Coca Cola and Milo have experimented with personalised products, trying direct-to-consumer (DTC) strategies to boost data and engagement. Is Arnott’s looking at something similar? Dill says yes… and no.

“We have a much bigger ambition in the direct-to-consumer space, but we're trying to figure out what that means at the moment,” she says.

On 16 February it was Tim Tam Day (and also International Do A Grouch A Favour Day, apparently), and Arnott’s decided to experiment with unique DTC products: A Tim Tam mug, slippers, and the Chanel-rivalling perfume.

“Our instincts tell us that it's a great brand engagement tool and that we should do things there that are unique or we're trialling or we're not ready to commercialise in the supermarkets in a big way,” Dill says. “We could do personalised, customised, limited-edition flavours. More about the merch, though, I think is where we'll probably end up playing… I don't see us ever getting in to try to sell a packet of Tim Tams direct to a consumer. I don't think that's our game. I don't think that's what we do best.”

Partnering with other brands is also another tool to increase engagement. Shapes, Arnott’s biggest brand, has worked with Cotton On Group’s Typo to sell personalised boxes. There have been Tim Tam pyjamas sold through Peter Alexander. “We're going to continue to do that. We're also looking at a model where we might be able to do some of that direct to consumers ourselves,” Dill says.

Healthy outlook

In the immediate future, Arnott’s is working on premium biscuits and a lot of new products, like a Better For You division and a rapidly growing Gluten Free range with market growth being driven by healthier snack and more indulgent snack categories. Gluten free products are selling three times what was forecast each week, and a new range for children will have at least a three-and-a-half health star rating.

“We’re going to be anchored in the biscuit category for the next year or two,” Dill says. “But then, when you think about the broader macro snacks, there are some fairly close adjacencies… We’re working through what we should do and we’ve got some exciting ideas up our sleeve.”

KKR has been growing the marketing team, Dill says, and the business is growing as a result. “You need to understand the growth model and the investment model they've put behind the business and understand where the private equity firm is deriving their valuation,” she says.

“For us, luckily, it's growth – and that suits me perfectly. I don't think many marketers want to walk into a cost cutting businesses. So I'm very, very lucky to be working on Arnott's and working under KKR’s ownership.”