The marketing industry reacts as the UK votes to leave the EU
Perhaps unsurprisingly the most talked about story this week week was the nation deciding the UK should leave the EU.
Despite London, Scotland and Northern Ireland all backing staying in the EU, Remain only secured 48% of British votes, as the Leave campaign won with a dominant 52%.
The pound fell to its lowest level against the dollar since 1985, while Prime Minister David Cameron confirmed he would resign, with new leadership expected by the time of the Conservative party conference in October.
Marketers soon got involved to input their own opinion on the decision. Richard Robinson, managing partner at Oystercatchers, said brands significantly scaled back their ad budgets during the first quarter as caution set in. And now the Brexit outcome is clear, he expects this caution to continue.
“That caution will certainly continue for the near future. While the trade agreements are being worked out with the EU, it will be a difficult 18 months or so for marketers and the current £88bn value of the creative industries could be vulnerable. But this is different to the 2008 recession where we were unprepared, with no financial buffers. The storm will likely calm.”
However, Aviva CMO Jan Gooding believes that marketers should treat consumers cautiously post-Brexit. “Our focus today is in ensuring our customers are as protected as possible from the market volatility and continue to have a good experience when they deal with us,” she said. “Until political negotiations are underway we cannot understand what the changes there may be.”
Virgin talks “taking risks” and how it aims to unify its UK businesses through a new loyalty app
After considering the move for some time, this week Virgin finally revealed that it is uniting all of its UK businesses under one loyalty scheme, Virgin Red, in a bid to boost engagement with its customers and give them a compelling reason to pick Virgin above its competitors.
The loyalty app which launched June 20 will reward members with offers and discounts for using Virgin services. Users are able to earn points by connecting their virgin accounts and engaging with content. The more Virgin businesses the customer is signed up to, the more “vaults” they will be able to unlock in order to reveal their prize.
Speaking exclusively to Marketing Week, Virgin Group founder Richard Branson followed up the news by expressing his excitement for making people “more Virgin”.“Virgin Red is designed to bring together the whole Virgin family and rewards people for living a life more Virgin.”
He went on to express his belief on why marketers make good entrepreneurs and the need to take risks.
“Don’t be afraid of risk. Most people immediately have negative thoughts when they hear that word. When somebody is talking to me about risk, I hear “opportunity.”
Jaguar says VR is no gimmick as VR pushes its car sales
Following the launch of its #FeelWimbledon VR campaign, allowing members of the Wimbledon audience to “hit the winning shot as Andy Murray,” the car brand said this week that virtual reality (VR) is providing it with improved car sales.
Robert Herd, head of communications at Jaguar Land Rover UK said there is now a “lack of fear” among consumers to try VR experiences – with Jaguar having previewed models including the F Type, F Face and Discovery Sport through the technology – and that the car brand will continue to “evolve” its role within the retail experience.
Herd saidL “Yes, initially consumers think it is gimmick but they quickly convert and it is driving a lot of additional car sales for us.”
Google says “too many brands are doing VR just to say they are doing VR”
Although virtual reality (VR) is set to become a $1bn (£710m) industry by the end of 2016, not all brands are jumping on the bandwagon.
Despite a thirst for VR from brands such as Jaguar, Google believes that too many brands are attempting VR just for the sake of it. Clay Bavor, Google’s VP of virtual reality said that currently “0% of the world” is fully aware of the technology. He said there is no need to rush and that “right now it is about building scale and educating people.”
Aaron Luber, head of VR partnerships at Google, also says more time is needed to consider the quality of VR as a marketing tool. “Lots of brands think they need to do [a video] in VR just to say they are doing it in VR. They need to think about why they are making a VR video in the first place,” he added.
M&S on how native advertising can help revive its flagging fashion division
Marks & Spencer’s global director of loyalty, insight and customer analytics Nathan Ansell told Marketing Week at Cannes Lions that native advertising has “changed its business model” and is helping to revive its struggling fashion division.
Ansell said the brand predominantly uses native advertising to promote ranges that it “could not afford to put £2m behind” and that it allows the brand to adopt a different and fun tone of voice.
Marks & Spencer also hopes that native advertising could help revive GM sales. For the 13 weeks to 26 March, M&S reported a 2.7% decline in like-for-like sales for clothing.
Ansell said native advertising is “increasingly important” to returning its general merchandise division to growth, and has even led to the brand tweaking its business model. “Having a top celebrity pictured wearing one of our outfits is a great way of getting that story across to customers which wouldn’t be credible in traditional advertising – native is key,” he explained.