M&S, Asda, Amazon: 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.

Man City launches eight-part documentary on Amazon Prime

Manchester City is launching an eight-part documentary series on Amazon Prime taking fans behind the scenes of the club’s record breaking journey to become Premier League Champions in the 2017/18 season.

Featuring exclusive footage with manager Pep Guardiola and his squad including midfielder Kevin de Bruyne and striker Sergio Aguero, all eight episodes of the All or Nothing: Manchester City documentary series are being released on Amazon Prime from today.

Tom Glick, City Football Group chief commercial officer and managing director of City Football Marketing, tells Marketing Week that Amazon was a good fit as a streaming partner because of its credibility in the video space and wide global distribution, allowing the club to communicate with its fan base around the world. Glick describes the documentary series as an effort to bring its fans closer to the club and offer them unprecedented access and insight.

“It’s an exercise in challenging ourselves to do more for the fans and to do it with a premium video production,” he explains.

“This was a huge undertaking and we’re so happy that Pep and the players came to it in the way that they did and they learnt to live with the cameras and the crews embedded in their day-to-day life. We were also very fortunate that the story became as compelling as it did.”

While the club has a “real thirst” to produce more premium long-form content, Glick explains that it will continue to focus on its shorter form, “grittier” and more of-the-moment content shared via its social channels.

Whereas the focus this time was on the men’s journey to 100 Premier League points, Glick does not rule out working on similar premium content projects with Manchester City’s Women in a bid to strengthen the bond between the fans and players.

M&S to replace switchboard staff with AI

Marks and Spencer (M&S) is replacing call centre staff with artificial intelligence (AI) that understands human speech, with the aim of increasing the speed at which it deals with customer issues.

Previously, customers would have spoken to a human to be redirected to the right department but now when a customer phones any M&S store the AI system will establish what they need before re-routing them to the right place. M&S plans to use software from tech company Twilio, with its platform driving communications for the company across its 640 locations.

M&S says the 100 switchboard employees who work across the its 13 UK-based call centres will be given in-store roles.

Chris McGrath, IT programme manager at M&S, says: “The new solution has given us an improved ability to have more direct and meaningful conversations with our customers, which also helps us reallocate valuable staff time. We’re excited to see where the platform takes us as we continue the roll out across our contact centres.”

Asda notches another sales boost

Asda has clocked a 0.4% rise in life-for-like sales in the three months to June, marking a fifth consecutive quarter of climbing sales while also beating its rivals for the first time in four years. However, the figure does highlight a slowdown from the 3.4% recorded in the first three months of the year.

The supermarket chain attributes the rise to a 13.2% climb in online grocery sales; its clothing and homeware brand, George, also experienced 24.9% sales increase.

Chief executive Roger Burnley says Asda must remain focused on delivering its strategic priorities and investing in the areas that matter most to its customers.

“Innovation in our own brand, lowering prices and in continuously improving our shopping experience both in store and online,” he adds.

The results come as the Walmart-owned group prepares to merge with Sainsbury’s, which recently reported like-for-like sales were up 0.2% in the three months to the end of June

House of Fraser cancels all online orders

House of Fraser has abruptly cancelled all online orders and temporarily taken its website down following a dispute with its warehouse operator, triggering uproar from customers who claim they have not received products ordered online.

It is understood the struggling retailer’s warehouse operator, XPO Logistics, halted the processing of orders following a payment dispute. House of Fraser reportedly told its 1,000 suppliers it will not pay the money owed before 10 August, when Sports Direct revealed it wold by the department store chain, rescuing it from administration.

XPO, which operates in Northamptonshire and Buckinghamshire, is reportedly among a number of suppliers to have taken action as negotiations over payment continue.

However, reports suggest Sports Direct, which bought the chain just hours before it went under, is not legally obliged to pay suppliers money owed before its £90m buyout.

House of Fraser apologised on Twitter, stating all customers who place an online order will be refunded.

“Due to delays with delivering online orders, we have taken the decision to cancel and refund all orders that have not already been sent to customers. All customers affected will receive an email in the next couple of days. Please accept our apologies for any inconvenience caused,” the department store wrote in a tweet.

Debenhams to axe head office jobs in cost-cutting scheme

Almost half of Debenhams’s head office staff are at risk of losing their jobs as the department store chain attempts to cut costs at its fashion and homewares division.

It is believed Debenhams is in talks with up to 200 buyers, merchandisers and other members of head office staff about potential cuts that could see between 80 to 90 staff lose their jobs.

Reports suggest this isn’t the first time the department store chain has axed staff, with a number of jobs recently lost in its food and beauty division. The move is likely triggered by reduced cover for suppliers by credit insurers which means suppliers will demand payment upfront.

A spokesman for Debenhams says: “Our work to create a simplified and consistent structure across these units, reducing complexity and driving efficiency in order to deliver our Debenhams Redesigned strategy, is continuing.”

The company has also issued three profit warnings this year, but insists it plans to “remain profitable and cash-generative.”

Thursday, 16 August

Amazon shows interest in UK insurance price comparison site launch

Amazon could be set to take on the likes of Comparethemarket.com and GoCompare with the launch of an insurance comparison site in the UK.

The US giant is reportedly in talks with some of Europe’s leading insurance firms, with three separate industry sources telling Reuters they’ve been having discussions with Amazon about the possible launch of a site and contributing products.

One industry executive said there are no imminent launch plans, while another explained the talks were part of several conversations Amazon is having with insurers.

If it goes ahead it will be Amazon’s first major foray into the UK financial services market.

Uber’s losses narrow but growth slows

Uber reported a net loss of $891m (£702m) for the three months to 30 June, a far smaller loss than during the same period last year, but it is still a long way from making a profit, according to its latest trading statement.

The ride-hailing firm, which posted a $1.1bn loss for the same quarter last year, continues to face issues around regulation in key markets, while London major Sadiq Khan said yesterday he wants to limit the number of Uber drivers operating in the capital.

Uber, which is under pressure to become more profitable ahead of its planned IPO next year, saw net revenue reach $2.7bn in the quarter, which is up by more than 50% since last year but down from the 67% seen in the first quarter.

Expedia kicks off UEFA Champions League sponsorship

Expedia Group has signed a three-season deal to become the official travel partner of the UEFA Champions League.

The travel firm’s Expedia and Hotels.com brands will lead activity, with plans to deliver a series of brand-focused campaigns and consumer activations. The deal will also include pitch-side advertising and TV spots during match broadcasts.

Mark Okerstrom, Expedia Group president and CEO, says: “There is no better sport than football to bring fans together around the world to follow their dreams of UEFA Champions League glory, and no better way to make that happen than through the power of travel.”

RBS looks to up service after ranking bottom in consumer survey

Customers of Royal Bank of Scotland (RBS) and Clydesdale Bank have scored it worst for customer service, according to a new ranking based on customer recommendations by the Competition and Markets Authority (CMA).

With fewer than half (49%) of their respective customers likely to recommend the overall experience, both banks have pledged to up their game and improve the service they offer.

It comes as lenders must now publish the bi-annual ranking online and in branches in a move the competition watchdog hopes will raise service standards and encourage consumers to shop around.

An RBS spokesman says: “We are aware we have more work to do in order to improve our service standards and deliver a better experience for our customers.”

First Direct, which often ranks highly on customer service, tops the table, with 85% of customers likely to recommend it.

Deliveroo stunt looks to recreate iconic photo

As part of its summer campaign, Deliveroo is looking to recreate the famous image of New York workers sitting on a crane eating their lunch during the construction of the Rockefeller Center in 1932.

It is inviting people to eat their breakfast, lunch or dinner on a specially-built rig suspended over London, 450ft in the air.

Diners at the Eat UP ⬆ restaurant will be able to order from local restaurants including Tortilla, Bleecker, Coco di Mama and Lola’s Cupcakes, among others.

Emily Kraftman, head of marketing at Deliveroo UK, says” “When thinking about infamous lunches, the photograph from Rockefeller Center is hard to beat, but we thought we might as well give it a go.”

Wednesday, 15 August

Bud Light to sponsor England Men’s football team

Bud Light is replacing Carlsberg as the official beer sponsor of the England Senior Men’s football Team as it looks to boost awareness of the brand in the UK.

The deal will see Bud Light increase its presence at Wembley Stadium with brand advertising and a takeover of the bars on the Club Wembley level. It is part of a wider deal between Budweiser and the FA that includes sponsorship of Wembley Stadium and the FA Cup.

Bud Light is the best-selling beer in the US but only relaunched in the UK last year. It is now promoted through a campaign by Wieden & Kennedy called ‘Dilly Dilly’ and is tapping into a trend for people to drink beer with lower alcohol content – its ABV is 3.5%.

Coca-Cola takes stake in BodyArmor as it looks to challenge Pepsi’s Gatorade

Coca-Cola has taken a stake in energy drink Body Armor as it looks to move further into the market and challenge Pepsi’s Gatorade, the market leader in the US.

The deal will see Coca-Cola take a minority stake in BodyArmor but the agreement signed gives it a path to full ownership. The main benefit to BodyArmor is access to Coca-Cola’s bottling system, meaning it will be able to increase production. Financial terms have not been disclosed.

BodyArmor has been seen sales double every year for the past four years and is backed by US sports star including Kobe Bryant. It differentiates in the market because its products use coconut water and do not use artificial colours. It has been marketed as a healthier alternative to Gatorade and Powerade.

Homebase to shut 42 stores as struggling chain looks to halt slide

Homebase is to shut 42 of its 241 stores over the next 16 months, putting 1,500 jobs at risk, as new owner Hilco attempts to restructure the company.

Hilco paid £1 for the chain in May after Australian DIY chain Wesfarmers disastrous acquisition. It tried to rebrand Homebase under its Bunnings brand but admitted to “self-induced” errors such as underestimating winter demand for heaters and dropping popular kitchen and bathroom ranges.

Hilco is now planning a company voluntary arrangement (CVA), an insolvency procedure used by struggling retailers to allow them to close underperforming shops. It has already been used by New Look, Mothercare and Carpetright this year.

Elsewhere in retail, House of Fraser’s new owner Mike Ashley says he plans to keep 80% of its stores open. Ashley saved the business from administration earlier this week and wants to take it upmarket with more concessions from luxury brands such as Gucci and Prada.

Diageo introduces edible straws in eco push

Diageo is introducing a range of flavoured and edible straws as part of its commitment to phasing out the use of plastic straws and stirrers and reducing the environmental impact of its brands.

The range includes strawberry, chocolate, and lemon and lime flavours, which were all selected to complement Diageo’s range of premix drinks – Pimm’s & Lemonade, Gordon’s Gin & Tonic, and Baileys & Iced Coffee Latte.

Diageo’s premix range is available at supermarkets and convenience shops, but the straws are, at the moment, only available from www.31dover.com/tinning.

Asda, M&S and Sainsbury’s join move to make shopping more inclusive

Asda, Marks & Spencer and Sainsbury’s are among the retail brands that have signed up for ‘Purple Tuesday’, an initiative that aims to make shopping more inclusive.

It will take place on Tuesday, 13 November, and will see retailers across the country and online introduce new measures to make shopping easier for people with both physical and hidden disabilities. It is being coordinated by the disability organisation Purple with the back of the government.

Shopping centres including Bluewater in Kent, Birmingham’s Bullring and Regents Street in London will also take part.

Research by the Department for Work and Pensions puts both shopping, and eating and drinking out in the top three most difficult experiences for disabled people due to accessibility challenges.

WPP to quit London HQ to break from Sorrell era

WPP is reportedly leaving its central London office in order to break from the era of former chief executive Sir Martin Sorrell.

The office, located in Mayfair, has been used since Sorrell bought JWT in 1987 and has remained its central hub despite expansions. According to Bloomberg, only 30 of 130,000 employees will be affected, with the company spanning 3,000 offices in 112 countries.

In a joint memo, Mark Read and Andrew Scott, the group’s joint chief operating officers, told staff they feel the company needs a change. The head office is expected to temporarily be based at Sea Containers where two of its agencies, Ogilvy and Wavemaker, are.

The memo states: “As WPP evolves, so does the role of the parent company… We are reviewing our working environment to make it fit for purpose and ready for our new requirements and, specifically, to create a more modern and attractive office that is better suited to more collaborative ways of working.”

Pension regulator launches TV campaign to warn of scammers

The Financial Conduct Authority (FCA) and the Pensions Regulator have joined forces to launch a campaign to raise awareness of pension scammers.

The campaign comes alongside the release of new figures that show victims are losing an average of £91,000. Victims are regularly targeted by unsolicited phone calls and emails often in the form of persuasive requests to invest in lucrative ‘investments’.

The ScamSmart advertising campaign will run across TV, radio and online and will juxtapose victims and the lavish lifestyles of the criminals who scammed them. It is aimed at pension holders aged 45 to 65 – the group judged to be most at risk of scams.

There has been a significant spike in pension fraud since April 2015, when the government introduced reforms giving over-55s more freedom with their retirement cash.

EasyJet sues airlines over use of ‘easy’

EasyJet is suing two Latin American airlines over the use of the word “easy”, accusing them of brand theft and arguing that customers assume they are part of the Easygroup brand.

Easygroup was granted a High Court order last month for Honduran airline Easy Sky to stop using the brand both on its aircrafts and online, and will follow similar court action against Columbian airline Easyfly.

The order calls for the company to “change . . . to a name that does not commence with the word ‘easy’.”

A spokesman for Easygroup tells The Times: “As you would expect, it has caused some customers to presume that it is associated with easyJet. This company is nothing to do with the Easy family of brands and is regarded as a ‘brand thief’.” The case is due to come to the High Court in October.

EasyJet billionaire Sir Stelios Haji-Ioannou has pursued similar cases before, including a Bangladeshi cargo operation called Easyfly-express. Stelios Haji-Ioannou said Easygroup was spending £1 million a year taking on alleged “brand thieves”.

VF Corp is ditching denim to focus on activewear

The owner of two of America’s most historic denim brands is ditching jeans to focus on activewear.

VF Corp, which owns a large variety of denim brands including Lee and Wrangler, is spinning off its denim division into a separate, publicly traded company. The company’s plan is to focus on “activity-based lifestyle brands” including Vans and The North Face.

The transaction will be structured as a tax-free spin-off to VF’s shareholders.

Though VF Corp said that its denim business is successful, it is the weakest segment. In July, when it gave its sales forecast for the year, it expected its denim business to show no growth while outdoor wear is rising.

The company says: “Through these actions, the company has sharpened its focus on activity-based outdoor, active and work lifestyles.”

Royal Mail fined £50m for abusing dominance

Communications regulator Ofcom has fined Royal Mail £50m for breaching competition law.

Ofcom says the company abused its dominant position by discriminating against its only major competitor after a complaint made by Whistl, which is one of Royal Mail’s wholesale customers.

The complaint regarded changes to Royal Mail’s wholesale prices in 2014. The rise meant that any of its wholesale customers would have to pay higher prices in the remaining areas where it used Royal Mail for delivery.

Jonathan Oxley, Ofcom’s competition director, says: “Royal Mail broke the law by abusing its dominant position in bulk mail delivery… All companies must play by the rules. Royal Mail’s behaviour was unacceptable and it denied postal users the potential benefits that come from effective competition.”

Royal Mail will challenge the fine. In its response to Ofcom’s statement, Royal Mail says it believes Ofcom’s claim that the notification of price changes had an anti-competitive effect is “fundamentally flawed” and that it doesn’t believe either that the relevant prices were actually paid or that the party paying the prices was placed at at competitive disadvantage.

Monday, 13 August

Amazon in trouble for ‘misleading’ people about next-day delivery

Amazon is set to be told to scrap its ‘guaranteed next-day delivery’ claim for its Prime service for “misleading” consumers in the run-up to Christmas.

According to a report in The Times, an ad promoting Amazon Prime’s ‘unlimited one-day delivery’ service will be banned by the UK’s advertising regulator, the Advertising Standards Authority (ASA), this week, after around 270 people reported they had not received their delivery by the following day.

The ASA is expected to say: “[A] significant proportion of Prime-labelled items were not available for delivery the next day…because consumers were likely to understand that, so long as they did not order too late, all Prime items would be available for delivery the next day…we concluded that the ad was misleading.”

In response to the ruling, an Amazon spokesperson says: “Amazon Prime offers fantastic benefits to members including One-Day Delivery on millions of eligible items at no extra cost.

“The expected delivery date is shown before an order is placed and throughout the shopping journey and we work relentlessly to meet this date. The overwhelming majority of One-Day Delivery orders are delivered when promised.

“A small proportion of orders missed the delivery promise last year during a period of extreme weather that impacted all carriers across the UK, and we provided support to impacted customers at the time.”

SpareRoom launches new campaign and partners with Crisis

SpareRoom has unveiled its first major update to its brand strategy in over seven years, alongside a new partnership with homeless charity Crisis in a bid to help end homelessness for good.

In addition to a new logo and visual identity, the UK flat and house share site has created a series of out-of-home London Underground ads that will run for two weeks in 4,400 tube carriages across the network.

The ads will look to showcase the ‘great experiences’ that come with living with the right people, built on the brand idea ‘Find Home Together’, which SpareRoom says reinforces its founder’s belief that “living with the right people is better than living alone”.

“The technology landscape has also shifted dramatically in the last 7 years, so we’ve been working on making bigger changes to our digital infrastructure, user experience and how we present ourselves as a brand across our platforms,” explains founder and CEO Rupert Hunt.

Alongside launching Live Rent Free For a Year – a competition where one flatsharer will win their rent for the whole year – SpareRoom has joined forces with Crisis, the UK’s national charity for single homeless people, to support its ‘Everybody In’ campaign to try and end homelessness for good.

SpareRoom will match the year’s rent given to the winner and donate an equal amount to Crisis, as well as giving away a month’s rent every month and matching it with a donation to the charity throughout the year.

Jon Sparkes, chief executive of Crisis says: “This will be an incredible opportunity not only to raise money for the work we do, but to join forces with SpareRoom and their users – many of whom are young people looking to make a difference in our country and support causes close to their hearts. It is young people like these who will help us truly tackle this issue, and ultimately, help bring an end to homelessness once and for all.”

Trump encourages Harley-Davidson boycott

Donald Trump has tweeted his support of Harley-Davidson owners that say they will boycott the brand if it goes ahead with moving some of its production out of the US to avoid retaliatory tariffs from the EU.

On Sunday, Trump wrote: “Many @harleydavidson owners plan to boycott the company if manufacturing moves overseas. Great! Most other companies are coming in our direction, including Harley competitors. A really bad move! U.S. will soon have a level playing field, or better.”

Harley-Davidson declined to comment; however, in an earlier interview, chief executive Matthew Levatich said: “Our preference in all cases is to supply the world from the United States. And most of our customers around the world, they value that in the brand.

“We’ve invested in international manufacturing over the last 20 years, really, for the single reason that there are trade and tariff situations in certain markets that make it prohibitive of– prohibitive of us to be relevant in those markets without that investment.

“We’re only doing that because these are important growth markets for the company that without those investments we wouldn’t have access to those customers, at any kind of reasonable price.”

Consumer spending down in July

Despite hopes that the heatwave could boost retailers, high street spending fell 0.9% in July compared with the previous month.

According to credit company Visa, the biggest fall was in ‘face to face’ spending in retail outlets, which was down -1.2%, while the amount people spent online declined by -0.5%.

Only restaurants and hotels gained from the hot weather, World Cup and Wimbledon – although not enough to offset the fall in spending on transport and household goods.

“Household budgets are stretched,” says Mark Antipof, chief commercial officer at Visa. “Retailers had a difficult time in early 2018, and while there was some respite in May and June, July’s fall in spending is concerning, particularly as we look ahead when the impact of the interest rate rise and back-to-school costs will likely put further pressure on Britons’ wallets.”

Mozilla calling on consumers to help evolve the brand

Mozilla is asking people for feedback on two new branding designs for browsers, services and apps in a bid to make Firefox products “recognisable out in the world even if a fox is nowhere in sight”.

In a blog post, Firefox says the current icon doesn’t offer enough design tools to represent the entire product family – and so a team made up of product and brand designers have come up with two ideas that consumers will have their say on.

The brand architecture for both systems will be made up of four levels under the umbrella of a new Firefox masterbrand icon, which will show up in marketing, at events, in co-branding with partners, and in places like the Google Play store.

“Still in the works are explorations of typography, graphic patterns, motion, naming, events, partnerships, and other elements of the system that, used together with consistency in the product, will form the total brand experience,” says creative director Tim Murray.

“What we roll out will be based on the feedback we receive here, insights we’re gathering from formal user testing, and our product knowledge and design sensibilities…And we’ll deliver a consistent experience from an advertisement to a button on a web page.”