Blockbuster ads fight product promotions for shrinking Christmas spend

Retailers are taking very different approaches to their 2017 festive advertising as each bid to persuade cash-strapped Brits to spend big this Christmas.

Rising inflation, interest rates and credit card use, balanced with the falling value of the pound, means it hasn’t been the brightest year for Britain’s economy. And at the start of the fourth quarter, the retail environment couldn’t be more uninspiring.

Last week, the Office for National Statistics (ONS) reported UK retail sales fell by 0.3% in October from a year earlier – this marks the first annual fall since March 2013. And it claims all the signs point to consumers “adopting a more cautious mindset” that will bleed into Christmas.

This taps into similar comments from John Lewis, which has predicted the appetite for big ticket items – such as toys and electricals – will be reduced “for quite some time”. The suggestion appears to be that the typical mindset of consumers being prepared to trade up at Christmas is fading and it will be an uphill battle to change this. This means this year’s Christmas advertising battle has a lot more riding on it than usual.

Conflicting Christmas strategies

We’re now well into November, which means all the major Christmas ads from the retailers have now aired. However, their approaches to combat such a difficult trading environment couldn’t be more different.

While John Lewis and Marks & Spencer have opted for big budget ads that tug on the heart strings, the likes of Amazon and Curry’s PC World (which tellingly embraces a “buy now, pay later” slogan to its TV messaging) have prioritised talking about the very electricals Brits seem hesitant to spend out on. Brands such as Sainsbury’s, meanwhile, have abandoned a standalone cinematic approach to Christmas advertising altogether, with its festive sing-a-long campaign carrying on in the same style it has used across the rest of the year. So, who has the right approach?

“The news hasn’t been very inspiring this year, has it?” answers Garry Kibble, the marketing director of Argos. His brand’s campaign takes a comedic, high-energy approach, with elves that talk up the speed of delivery at Argos. “Therefore, lightness of touch and a message of fun and hope is what British consumers really want. We have a message internally of playing on people’s heart beats rather than their heart strings – I think that’s more important than ever.”

The creatives sometimes lose sight of the fact the whole point of Christmas advertising is to sell more stuff.

Bryan Roberts, TCC Global

Aldi’s UK marketing director Adam Zavalis – who has brought back Kevin the Carrot for a campaign that talks up the brand’s price-conscious value – admits the mood has shifted quite dramatically from Christmas 2016.

“Christmas is going to be very different this year and because of interest rates rising, people realise they now have to be extra careful. People want to have a special Christmas that doesn’t break the bank, so that’s a message that will resonate.”

Kibble agrees with Zavalis’s assessment. And he believes Black Friday, which saw Argos receive 43 million visitors to its website last year, could be more important than any shopping week in December. “It will be the best time Brits can grab a bargain and as you know that’s very important right now,” he adds.

Which approach is working best?

The numbers suggest both Kibble and Zavalis could be onto something, with a poll of over 1,000 UK consumers by Toluna on behalf of Marketing Week showing both brands’ approach to festive ads are among the best received by the British public.

When asked various questions on whether a Christmas ad had positively changed their perception of a brand, Argos (28% said the ad improved their opinion of its brand), Amazon (40%) and Aldi (22%) make up the top three. And with 46% of consumers expressing an inability to remember how the ad made them feel, John Lewis is second to bottom (only behind Lidl) on this list of 13 retailers.

And it’s Amazon’s ad that came out on top when consumers were asked which ad they enjoyed the most, with 44% of those polled saying they ‘loved it’ – more than double the 21% who said the same for the John Lewis ad. Amazon’s ad focuses on a dad hiding a delivery box filled packed with high-ticket electricals (such as a Nintendo Switch console) from his children – the fact this product-focused ad is popular doesn’t surprise Bryan Roberts, global insights director at TCC Global.

“We sometimes lose sight of the fact the whole point of Christmas advertising is to sell more stuff,” he explains. “It’s great making an Oscar standard piece of cinema [like John Lewis] but at the same time we must remember advertising is about providing the benefits of becoming or remaining one of your customers. Creatives often lose sight of this and think more about views on YouTube than shifting more packets of stuffing!”

Moving away from the John Lewis model

He says John Lewis has “dug a big hole” for itself, with the expectations for its ad now so high they are almost impossible to meet. This, he says, has in some respects created a backlash where more basic Christmas campaigns, which talk up the functional benefits of a brand, now feel more relevant to consumers.

This mentality is perhaps best summarised by Sainsbury’s stripped down ad, which simply shows colleagues and shoppers singing along to a festive song. And Sainsbury’s head of broadcast communications Laura Boothby believes the idea of Christmas advertising hype isn’t enough for brands to bank on anymore.

John Lewis Christmas ad campaign

She explains: “The Christmas ad hype is pretty much done in about two weeks’ time. Everyone is launching them now, there’s lots of noise on social, but by about the 20 November people are over it.

READ MORE: Mixed reviews: Marketers react to the 2017 John Lewis Christmas ad

“One of the great things about our campaign is we can adapt and be flexible to what other people are doing. We know if some of the characters become hero characters we can create new edits with them. It isn’t just reliant on one blockbuster ad like we have been in the past.”

Jane Bloomfield, head of marketing at Kantar Millward Brown, has been most impressed by the move towards inclusivity and diversity in ads from the likes of Tesco, which has been criticised in some quarters for featuring a Muslim family celebrating Christmas.

But unlike Roberts and Sainsbury’s Boothby, she believes the cinematic approach still reigns supreme. She counters: “The analysis we’ve done by testing over 140,000 ads shows emotional response is far more important to driving short-term and long-term sales than more functional product-based messaging.

“A Christmas ad’s aim must be about leaving a lasting impression and a blockbuster ad is still the best way to do that.”

Ultimately, Bloomfield “wouldn’t be surprised” if discount brands were “once again the biggest winners this Christmas,” pointing to Aldi’s positive performance last year, where it added an extra million customers and £1bn in extra sales.

If Brits do indeed opt for a more budget Christmas, don’t be surprised if it is the Sainsbury’s, rather than the John Lewis, approach that dominates marketer’s thinking for Christmas 2018.

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