One of the great direct-to-consumer (D2C) success stories of the past year is the McCormick launch of Old Bay Hot Sauce. In advance of the Super Bowl, the food and spice manufacturer announced the new product designed to "warm-up comfort foods like chilis, soups, and stews."
Sold through the McCormick site, Old Bay Hot Sauce sold out within hours. It became a viral sensation, with the company making headlines on CNBC, USA Today, Delish, and other publications, while resellers were charging upwards of $50 for a single bottle on eBay.
The Digital Shelf Institute (DSI) presents the D2C Strategy Playbook Series, a virtual program of expert-led sessions outlining how to navigate a D2C program in this "new normal." Ecommerce expert James Seidl, vice president of digital commerce and alternative channels at McCormick, hosted the most recent session, “McCormick Shows Brands How to Make Every Moment Shoppable.”
Seidl highlights what differentiates McCormick’s D2C program, highlighting how his company can invest in programs like launching a new product only through its D2C site. According to Seidl, the key to success comes down to internal communications, how the company thinks of commerce as a whole, and a culture that places a premium on innovation.
Reframe the D2C Opportunity for Internal Stakeholders
It was important for Seidl to ensure that he had buy-in from other parts of the McCormicks business — particularly those in sales and commerce — before making a D2C investment. To best convey the “why,” McCormick developed the internal motto: “Make every moment shoppable.”
According to McCormick, consumers today expect a frictionless experience when it comes to finding and purchasing products. Therefore, they expect to be able to buy on McCormick’s own online properties in addition to third-party (3P) sellers.
When evangelizing D2C internally, Seidl also emphasized the benefits that come in opening a direct one-to-one relationship with consumers — including the fact that McCormick would have better data on how consumers interact with the brand, which could influence items ranging from content improvements to new product lines.
This reframing of D2C as part of the overall branded experience “shifted our conversations to be more about how this platform supports our broader digital ecosystem,” according to Seidl.
D2C Joins Overall Channel Strategy
McCormick’s digital commerce department is segmented into three different teams: D2C, marketplaces, and omnichannel. Seidl attributes the relative success of the teams working together due to their internal philosophy of it “not being a zero-sum game, where the teams focus on finding strategies that grow all three channels at the same time.”
McCormick notes that to bring the teams further together, they share a standard set of key performance indicators (KPIs), including top-line sales, conversion rates, and customer loyalty.
By measuring success using the same data points, the teams have found that they can more easily share learnings across the organization and communicate successes and failures for others to use as inspiration.
Innovation at McCormick: ‘A Beta Mode Mindset’
"We needed to shift the mindset internally to be much more of a beta mode mindset," notes McCormick about their investment in D2C programs. For larger companies, being comfortable with uncertainty — and perhaps launching programs before they're fully baked — can be a nerve-wracking experience.
Seidl's response to initial pushback from others at McCormick was the development of what he terms "the smallest executable step: Don't think about multimillion-dollar platforms that you want to launch, but what you can test today that will give you learnings that you can apply to build a multimillion-dollar platform."
Emulating the approach more associated with startups than with large public companies, Seidl's team prioritizes the development of testable hypotheses that can be executed within a matter of weeks — allowing his team to continually focus on small improvements and learnings that can be applied quickly.
These smaller steps result in an "eventual scale on the horizon," as Seidl puts it.
When Hot Sauce Goes Viral
The Old Bay Hot Sauce sensation may have seemed to come out of nowhere to casual followers of the McCormick brand, but it was actually the result of an incredible investment Seidl and his team have made, both in D2C programs but also in the willingness to test new approaches to innovation and how they communicate internally with the rest of the organization.
The results, as they say, are a recipe for success.
Watch the full session to learn more about how Seidl and his team successfully executed their D2C strategy.