Google, P&G, John Lewis: Everything that matters this morning

Good morning and welcome to Marketing Week’s round-up of the news that matters in the marketing world today.

olay

Olay becomes first mass skincare brand to offer refillable packaging

Skincare brand Olay is testing refillable packaging with one of its moisturisers in a bid to reduce plastic waste.

It’s the first time a major skincare brand has taken on such an initiative, with owner Procter & Gamble hoping it will pave the way for a dramatic reduction in the amount of plastic used by the beauty industry.

From October, jars of Olay’s Regenerist Whip moisturiser will come with a recyclable refill pod that can be placed inside the container once the initial product has been used up.

Anita Marsh, P&G’s director of brand communications for skin and personal care, says: “The ultimate goal is to find and adopt many more sustainable packaging solutions, and the refillable Olay Regenerist Whip package is the first step of that journey.”

The pod will also be shipped in a 100% recycled paper container. It will be available in the US and UK as part of a three-month trial.

Marsh adds: “It’s really important for us to get it right because only then can we bring this concept to market at scale.”

The move follows the launch of P&G’s Ambition 2030 programme, in which the company outlined several goals to reduce the environmental impacts of its packaging, including 100% recyclable or reusable packaging by 2030.

John Lewis & Partners to trial virtual reality retail experience

John Lewis Partners

John Lewis & Partners will trial a virtual reality retail experience to help customers envision new products in their homes before they buy.

Visualise Your Space will be trialled in three stores from 26 June with the hope it will increase consumers’ confidence in buying homeware.

Via an iPad app, people can recreate their own home by putting in information such as exact dimensions, the location of doors and windows and change wall and floor colours.

John Lewis’s head of buying for furniture and flooring Caitlin Price says: “Customers tell us that uncertainty about what new products will look like in their home can make the decision making hard, and in many cases people revert to the safer tones of grey or beige furnishings.

“This new technology will enable customers to be braver in their choices, and test technology that architects and interior designers have been using to visualise their designs.”

Every redesigned room will be able to be viewed in a 3D augmented reality, either with an iPad or with a virtual reality headset.

Afterwards each customer will be emailed a copy of their redesigned room, with their links to purchase included.

Aviva to cut 1,800 jobs in cost-cutting drive

The UK’s largest insurer Aviva says it will cut 1,800 jobs over the next three years as part of a cost-cutting drive to save up to £300m a year.

The news comes just three months after the appointment of new chief executive Maurice Tulloch, who said the company was hoping the job cuts would be through natural turnover and voluntary redundancies.

The cuts will fall across its worldwide operations and Aviva says it has identified savings in areas including its central cost base and contractor and consultant spending.

Aviva is also shaking up the group’s structure. It will split its life and general insurance businesses and manage them separately. Tulloch says the insurer’s “complexity” has held back its performance “for too long”.

“Today is the first step in our plan to make Aviva simpler, more competitive and more commercial. We have strong foundations: excellent distribution, world class insurance expertise, and our balance sheet is robust,” he adds.

READ MORE: Aviva to cut 1,800 jobs worldwide

Google to launch game streaming service

Google has revealed details of its game-streaming service Stadia. Dubbed ‘Netflix for games’, it will in November with at least 31 games at an initial cost of £199.

It will be available in 14 countries including the UK, Ireland and the US. It will feature games from 21 different publishers for an initial “founder’s edition” price of £199. This includes a hardware starter kit, three months of premium service and a month of standard service. It costs £8.99 a month thereafter although a free tier is planned for launch in 2020.

Phil Harrison, the head of Google’s Stadia team, says: “We wanted to really celebrate our initial gamers who are coming to join us on Stadia with something special, something that they can’t get anywhere else, and also gives them the bragging rights of being one of the first gamers on the platform. They will forever have a badge on their platform that says that they were a founder.”

READ MORE: Google to launch Stadia game streaming service in November

More people than ever don’t use cash

More people are opting to live a largely cashless life than ever before as millions of adults prefer debit cards over any other payment method.

According to research from UK Finance, the trade association for the UK banking and financial services sector, 10% of the adult population – around 5.4 million people – made either one or no cash payments per month in 2018. This is a sharp increase from two years ago, when 3.4 million people hardly used cash.

This proportion is highest among 25- to 34-year-olds, where one in six (or 17%) don’t use cash.

The number of cashless payments is also up, with nearly 70% of adults across the UK now using contactless payments.

Stephen Jones, chief executive of UK Finance, says: “More and more customers are now opting for the speed and convenience of paying with their contactless cards. This rapid rate of technological change is set to continue over the coming decade.”

UK Finance forecasts that credit cards and charge cards will overtake notes and coins in around 2027. The news will spark questions over the future of banks as the industry is forced to adapt most likely through furthering measures such as closing branches and ATMs as well as increasing digital capabilities..

READ MORE: Millions choose a cashless lifestyle

Thursday, 6 June 

Amazon Advertising

Amazon poised to begin drone deliveries this year

Amazon says it will be ready to deliver packages to customers by drone “within months”.

The drone will be able to travel for 15 miles and carry packages weighing a maximum of 2.3kg. It will use six rotors and navigate its surroundings using a combination of data from visual, thermal and ultrasonic sensors.

If the drone’s flight environment changes, or the mission commands it to come into contact with an object that wasn’t there previously, Amazon says it will refuse to do so.

“It is independently safe,” the company says.

Addressing concerns about noise, Amazon says it “might not be that different from the noise from a delivery truck arriving at your home”, adding that the drone has been optimised to minimise “intrusive, high-frequency sounds”.

While it is unclear where Amazon will roll out these drones, it has been granted a permit by the US Federal Aviation Administration to operate in the US.

“The FAA issued a Special Airworthiness Certificate to Amazon Prime Air allowing the company to operate its MK27 unmanned aircraft for research and development and crew training in authorized flight areas,” the FFA says.

“Amazon Prime Air plans to use the aircraft to establish a package delivery operation in the United States. This certificate is valid for one year and is eligible for renewal.”

READ MORE: Amazon to deliver by drone ‘within months’

Sports Direct makes bid to buy Game

Sports Direct founder Mike Ashley has made a £52m offer to buy games retailer Game Digital.

Sports Direct already had a 29.9% stake in Game but yesterday increased that to 38.49%, which takes it is above the 38% minimum threshold required to launch a takeover bid.

The business will review Game’s 540 stores, focusing on whether the existing Game sites across the UK and Spain should be consolidated within the Sports Direct Group, including House of Fraser. This will also include whether there should be a reduction or relocation in employment of Game’s employees and management.

“The retail and gaming sectors are fast moving and currently subject to challenging conditions,” Sports Direct says. “Sports Direct does not believe that, as a standalone business, Game is able to weather the pressures that it is facing.

“Sports Direct’s aim is to ensure Game’s long-term sustainability and to escalate the evolution of the Belong [gaming arenas] business to accelerate the next stage of Game’s development.”

KFC launches cinema campaign

KFC has launched a Hollywood film-inspired cinema campaign in an effort to “reinforce” its position as the “original fried chicken brand”.

The campaign, which will be executed as five separate pieces of specially curated cinema content, will kick off in UK cinemas later this year, starting with the recently released Godzilla: King Of The Monsters.

Within these films, KFC will be running a 90-second piece of content. The first 60 seconds is KFC’s brand ad, created by Mother, which sees Colonel Sanders cruising past the familiar range of ‘fried chicken pretenders’.

The following 30 seconds will be a bespoke content series that has been produced by DCM’s creative division, DCM Studios, in partnership with production agency, Recipe, specifically for the big screen.

The cinema creatives will aim to trick audiences into thinking the film is about to start, mimicking the look and feel of the upcoming feature, before revealing it is a tongue-in-cheek imitation.

“Everyone knows we keep our recipe under lock and key, but the real secret behind the iconic taste of KFC is that we bread our chicken by hand – all day, every day – just as the Colonel did,” says KFC’s UK marketing boss, Meghan Farren.

“In each of our kitchens, our cooks invest their time, effort and skill into it… and that’s the reason you can only get KFC at KFC. We partnered with Blue449, DCM and Recipe to create content for the big screen that would cunningly engage viewers and reinforce our position as the original fried chicken brand.”

Hyundai and Chelsea FC partner for grassroots football programme

Hyundai Motor UK has teamed up with Chelsea FC to launch Hyundai FC, a nationwide grassroots football programme for junior teams.

Eleven girls’ and boys’ teams from Under-8s to Under-16s in partnership with local Hyundai dealerships will participate in the project that will offer them unique football experiences throughout their season.

Each team will receive top-level coaching sessions from Chelsea FC UEFA qualified foundation coaches, brand new playing and training kit and Chelsea FC benefits.

The aim is to inspire the next generation of aspiring footballers and forms part of Hyundai’s 2019 ‘For The Fans’ campaign.

“One of the key aims of For The Fans is to put fans first – supporting and enabling all fans from grassroots to elite level across the country,” explains David Pugh, marketing director at Hyundai Motor UK.

“With the help of our dealerships and Chelsea’s top-class Foundation coaches, we are committed to inspiring the next generation of players and fans through Hyundai FC. We are looking forward to giving the 11 teams involved a season they will never forget.”

The Marketing Society unveils new identity

The Marketing Society has had a brand refresh as part of its 60th anniversary this year.

This includes a new logo and evolved purpose, ‘empowering brave leaders’, as well as a new members-only website, a quarterly digital publication containing the latest think pieces and opinions from marketing leaders, and a new CRM system.

“As The Marketing Society has grown over the years, how we talk about and view ourselves has changed too. We wanted to reflect this in a new identity – building on where we’ve been but with a clear purpose for the future,” says chief executive Gemma Greaves.

“It’s been an absolute pleasure working with our design partners Bloom and together we have created a bold, vibrant identity that captures our personality and vision. It reflects the wealth of opportunities we offer bringing to life the key elements of the Society – having conversations that matter and building meaningful connections.”

The new identity will be rolled out across all of its seven hubs – England, Scotland, New York, Dubai, Singapore, Hong Kong and India – with immediate effect.

Wednesday, 5 June

Topshop wins key vote as CVA looms

The Pension Protection Fund (PPF) is backing Topshop boss Sir Philip Green’s plan to restructure Arcadia ahead of today’s crucial vote on the chain’s future.

Green agreed to a £385m deal to secure the fashion group’s pension schemes, including a £100m contribution over three years from his wife Lady Cristina Green, who is Arcadia’s largest shareholder. The company itself will make £75m worth of contributions to the pension schemes.

The BBC reports that under the agreement The Pensions Regulator, trustees of Arcadia’s pension schemes, will be granted security over £210m worth of assets by Arcadia, up from the previous offer of £185m.

“We are pleased that the company and shareholder have agreed a funding and security package for the scheme,” says Oliver Morley, chief executive of the PPF. “Based on this commitment, we will now vote in support of the Arcadia Group Limited CVA.”

Landlords and other creditors will today vote on whether to push through a company voluntary agreement (CVA), an insolvency process that will involve closing 50 stores across the group. Currently Arcadia – which includes the brands Topshop, Topman, Dorothy Perkins, Burton, Miss Selfridges and Evans – has more than 560 shops across the UK and Ireland, employing 22,000 people.

READ MORE: Philip Green wins key vote for rescue plan ahead of meeting

P&G names trans activist Paris Lees as new Pantene UK ambassador

Procter & Gamble (P&G) has recruited British journalist, broadcaster and transgender rights activist Paris Lees to become its new UK ambassador for Pantene.

The move came as P&G Beauty unveiled a new platform for the brand around “the transformative power of hair” during Fortune’s Most Powerful Women International Summit in London yesterday (4 June).

Speaking at the event, Alexandra Keith, CEO of P&G Beauty, said the aim was to bring Lees’ story to life, including the role her hair has played during her journey as a transgender woman.

“We’re really trying to bring back the mission and purpose of our brands, so for Pantene – which is all about giving women healthy, beautiful hair – we did a study with Yale University,” she added.

“Following studies with 8,000 women, in 11 countries, we found that across the world, hair is more important than almost anything else to the way a woman expresses herself.”

Lees argued there is an “emotional element to hair” that has the potential to be a powerful expression of femininity.

She added: “I never thought that trans people would be celebrated – I thought that we could maybe reduce the stigma, but I didn’t realise… we would be winning awards and appearing on the front of magazines. What a great message for kids that when they are turning on the TV or looking online, brands are celebrating [people like me].”

P&G Beauty will announce further information about Pantene’s partnership with Lees and the brand’s new global platform later this year.

Sainsbury’s boss nets £3.9m despite collapse of Asda merger

Sainsbury's

Sainsbury’s chief executive Mike Coupe has seen his pay increase to £3.9m, despite the collapse of the supermarket’s proposed merger with rival Asda.

Coupe’s pay rose by £251,000, including a 40% increase in his annual bonus to £593,000.
The chief executive’s pay hike comes despite the fact that Sainsbury’s splashed out £46m on professional advice regarding the Asda merger, which was then blocked by the Competition and Markets Authority in April on the grounds that it would reduce customer choice and cause price rises.

During the period, Sainsbury’s also reported a 42% drop in profits to £239m. Nevertheless, the supermarket’s remuneration committee said it was “comfortable with the bonus outcomes, particularly when the broader context of the retail market performance is considered”.

The rise of executive pay is in stark contrast to 9,000 shop-floor workers who, it was revealed in 2018, experienced an average annual pay cut of £400 following the removal of paid breaks, their annual bonus and Sunday and bank holiday pay.

The supermarket has since said it would make up the difference in their pay for 18 months and then review its policy in March 2020.

READ MORE: Sainsbury’s boss paid £3.9m despite collapse of Asda merger

Santander to cut 200 UK jobs

Santander is to cut 200 jobs in the UK, just days after the bank went live with a new campaign intended to make its brand purpose “more tangible”.

The Telegraph reports that the job cuts are an attempt to focus on cost savings in Europe and pursue higher profitability in Latin America. The restructure will reportedly affect Santander’s corporate and commercial banking division. Some 330 staff members are being consulted about redundancy, while the bank plans to create 130 new roles.

The decision to slash jobs in the UK comes as part of a wider drive to cut annual costs across the Santander business by €1.2bn (£1.1m) globally. The bank is on track to close around 1,150 branches in Spain, its domestic market, which would see the loss of more than 3,700 jobs.

READ MORE: Santander to cut 200 jobs in UK

Instagram rolls out branded content ads

Instagram is giving brands the chance to amplify posts in feed and stories via its new branded content feature.

Using the new technology creators will be able to turn on a toggle that allows their “business partner” to boost the post when using the “paid partnership with” tag. The branded content ad will include a label as part of the post and below the content showing followers that it is “sponsored”, and the ad will appear from both the creator and the advertiser.

The ability for brands to amplify posts in feed was made available to 50% of business yesterday and will reach 100% by 17 June. The tech will be rolled out to stories in the coming months.

Tuesday, 4 June

Apple to close iTunes

Apple is closing its iTunes service, replacing it with Apple Music, Apple Podcasts and Apple TV as it looks to better compete in the streaming market against competitors such as Netflix, Amazon and Spotify.

The move is part of a raft of announcements from Apple at its annual developers’ conference. It also revealed a number of new privacy measures, including a sign-in service that aims to act as an alternative to logging in using social media accounts and hides a user’s email address and data.

Other privacy updates include the option for apps that request location information to have to ask every time they want to use it, and blocking apps from using other location identifies such as WiFi or Bluetooh signals.

“Privacy is a fundamental human right,” said Apple’s software chief Craig Federighi, speaking at the conference last night.

There were also updates to the iPhone’s iOS operating system including improved search and language keyboards, a virtual tour experience in Apple Maps and a ‘dark mode’ that lets apps be viewed with a black background. Plus the Apple Watch and Macs were updated.

READ MORE: Apple dissolves iTunes into new apps

BT signs ‘groundbreaking’ five-year deal with The FA to sponsor all 28 England teams

BT has signed a five-year deal with the Football Association that will see it become the exclusive lead partner for all England teams – including the men’s, women’s, futsal and disability teams – as well as for Wembley Stadium.

The renewed deal kicks off with a new BT branded training kit that will be worn by the England women’s team ahead of the World Cup, which starts on Friday (7 June) and the men’s team as they prepare for the Nations League Finals. It will also be seen at the national football centre and St George’s Park and Wembley, although details are currently under wraps.

The deal marks the start of a broader sponsorship strategy by BT with the aim of making it a “national champion”.

Marc Allera, CEO of BT’s consumer division, says: “We’re committed to making BT a national champion, and what better way than backing the national game and the national teams. This partnership will reach all areas of football, including grassroots football and communities up and down the country. We look forward to revealing our plans in the coming months and we can’t wait to get started.”

Retail sales show ‘biggest decline on record’

Retail sales decreased by 2.7% year on year in May, the worst monthly decline since this record began in January 1995 if Easter distortions are excluded, according to data from the British Retail Consortium.

On a like-for-like basis, sales were down 3%, the steepest decline since December 2008 as the market struggled against comparisons to last year, when the World Cup, Royal Wedding and hot weather boosted sales. While both measures were impacted by strong sales growth in May 2018, the declines drag down the three- and 12-month averages to just 0.2% and 0.9% respectively.

For the three-months to the end of May, food sales increased by 0.8% on a like-for-like basis and 1.9% on a total basis. However, non-food sales were down 2.7% year on year. Online sales growth in non-food slowed to just 11.5%.

Paul Martin, UK head of retail at KPMG, which carries out the study, says: “April may have provided retailers with some light reprieve thanks to Easter, but May’s staggering fall of 3% like-for-like is a stark reminder of the industry’s ongoing issues, which for many require urgent attention.

“The extremely low growth online is real cause for concern, especially with almost a third of all non-food sales today being made online. This trend has continued to manifest itself over the last year and requires real focus from the retail community.”

WWF to work with Coca-Cola and P&G to tackle plastic waste

Coca-Cola and Procter & Gamble are among the companies partnering with the World Wildlife Fund (WWF) to come up with solutions to the issue of plastic waste.

A new platform, called ReSource: Plastic, will provide guidance, best practices and tools – including a measurement framework to help quantify reductions in plastic waste. The hope is the hub will inspire companies to act to reduce plastic consumption and improve recycling.

Other companies involved include McDonald’s, Starbucks and Tetra Park, while the Ellen MacArthur Foundation and Ocean Conservancy are acting as thought partners.

The move comes as companies respond to growing political and consumer pressure to reduce plastic waste and combatting its impacts. That includes bans on plastic straws, reducing use of plastic packaging and pledging to recycle more.

“While ambitious commitments are the jumping off point for any successful venture, we know that no single individual, organisation, company or government can tackle the root causes of plastic waste on their own,” says Sheila Bonini, senior vice-president of private sector engagement at WWF.

“When it comes to the private sector, commitments move companies in the right direction, but to actually fulfil those commitments, companies need a roadmap for navigating the broken plastics system, a collaborative environment that fosters innovation and aggressive goal-setting, and the right tools to make their bold visions a reality.”

Diageo partners with MTV on responsible drinking campaign

Diageo is partnering with MTV to launch a responsible drinking campaign aimed at its core audience of 18- to 24-year-olds.

The three-part series, called ‘Weekend not wasted’ features MTV presenters and will air on MTV’s website, YouTube and social channels. It will also be promoted on local TV channels in the UK, Spain, Germany and Denmark with an “aspirational” message around what becomes possible if people drink responsibly and seize the day.

Commenting on the launch of the campaign, John Kennedy, president of Europe, Turkey and India at Diageo, says: “It’s really important to us that young adults in Europe are informed and empowered to enjoy alcohol in a moderate and sensible way.

“In creating this campaign, we have married our unique marketing insight with the reach and influence of MTV to land the message that excessive consumption of alcohol can prevent you from achieving the most out of your day. This is a really exciting collaboration and we cannot wait to see the response.”

Monday, 3 June

UK ad spend accelerates but slowdown predicted

Despite uncertainties, UK ad spend was up 7.8% year on year in 2018 and is predicted to hold steady with a rise of 6.1% this year. However, growth will slow into 2020, with an increase of 4.6% forecast, according to Group M’s ‘This Year, Next Year’ ad forecast report.

Currently, digital remains dominate and is responsible for more than 60% of total advertising, of which more than half is search. It is still growing at double-digit pace – 11% is forecast for 2019.

TV ad spend is expected to remain stable at around £4.5bn through 2019 and 2020, still accounting for around 20% of media investment. Meanwhile, outdoor spend is expected to see growth of around 3% in 2019 and 2020 as digital formats drive up spend.

Radio also appears set to hold on to its revenue base this year, followed by a predicted 2% growth next year. However, newspapers and magazines now account for less than 10% of media investment on a combined basis in 2019 and beyond, down from more than 50% as recently as 2004.

Amazon to open pop-up stores on UK high street

Amazon will open a number of pop-up stores across the UK, giving more than 100 small online businesses the chance to sell their products on the high street.

The programme, called ‘Clicks and Mortar, will see 10 shops opened as part of a year-long pilot programme. They will items including homeware, health and beauty, food and drink and electronics, with thefirst set to open in Manchester today.

Amazon is working alongside small business support group Enterprise Nation and has promised to offer research into the success of the pilots stores in a bid to help grow the government’s Future High Street strategy.

“Small businesses are one of our most important customer groups, and we’re thrilled to work with Enterprise Nation to design a comprehensive package to help entrepreneurs across the UK grow their businesses, both in-store and online,” Doug Gurr, UK country manager at Amazon says.

The online retail giant is also pledging £1m to train more than 150 full-time apprentices to help small businesses increase their productivity and lift online sales.

Fate of Philip Green’s Arcadia to be sealed this week

The fate of Sir Philip Green’s Arcadia group will be sealed on Wednesday with creditors set to vote on his proposed restructuring plans, but if the Pensions Regulator and landlords don’t back his plans the retail giant could go into administration.

If supported, Green’s rescue plan would see a number of Topshop, Dorothy Perkins, Miss Selfridge and Burton stores close, while rents will be cut across another 194 stores at the Arcadia group. However, MPs want him to use his own wealth to fund the firm’s pension scheme, the BBC reports.

Originally, Arcadia confirmed 23 stores would close as part of the rescue deal, known as a company voluntary arrangement (CVA) but it was later revealed that another 25 stores would shut, under separate liquidation procedures.

Sir Philip’s wife, Lady Tina Green, who is Arcadia’s main shareholder, offered to inject £100m into the scheme during the next three years to bridge a shortfall in pension contributions. But the pensions regulator has doubts the plans will “adequately protect” the pensions of employees.

Arcadia has more than 566 locations in the UK and Ireland, employing 18,000 people.

READ MORE: Sir Philip Green’s Arcadia facing crucial week

Budweiser launches new campaign supporting LGBT+ community

Budweiser is launching its new ‘Fly the Flag’ campaign to support Pride’s mission on championing each group within the LGBT+ community.

The campaign is designed to celebrate diversity within the LGBT+ community, and to support the diverse groups under the LGBT+ banner, such as the asexual and pansexual communities.

The beer brand acknowledges there is great awareness of the rainbow flag – a universal symbol of Pride – but flags of other communities under the Pride umbrella don’t generally have the same recognition.

As part of the campaign, Budweiser has created a collection of limited-edition cups that feature designs of flags from nine individual communities, giving people within those groups the chance to celebrate at Pride during its 50th anniversary.

Budweiser will be handing out 200,000 of these cups for free along the Pride parade route in London on 6 July.

Martina Isella, senior brand manager at Budweiser, says: “Pride is a time for people to be proud and have freedom of expression, and this is what Budweiser as a brand is all about. We wanted to create a campaign in partnership with all the people that make up the wider LGBT+ community in mind, and we worked closely with our friends at Pride in London to ensure that this campaign was as relevant to as many as possible.”

ITV’s Love Island partners with Swizzles for season five

ITV’s Love Island has partnered with sweets brand Swizzles to create bespoke love hearts with recognisable sayings from the television programme such as ‘crack on’, ‘hun’ and ‘pied’, marking the first time Swizzels changed the messages on its love hearts.

More than 90,000 exclusive love hearts will be distributed to the public at key stations across London, Manchester and Cardiff today.

“Love Island is focused on finding love with someone special, as are our Love Hearts so it’s the perfect partnership. We’ve been making Love Hearts for over 60 years and this is the first time we’ve changed the messaging on our traditional Love Hearts to introduce well-loved phrases from a TV show,” says Sarah-Louise Heslop, marketing manager at Swizzels.

Echoing Heslop’s message is Paul Ridsdale, director of viewer marketing at ITV who says the broadcaster is always looking for innovative ways to help promote its key shows, “particularly when targeting younger audiences”.

“Partnering with Swizzels and their iconic Love Hearts sweets by adding our own distinctive Love Island phrases, was simply too good an opportunity to turn down,” he adds.

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