Alibaba, Netflix, global ad spend: 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.

Alibaba launches influencer platform

Alibaba’s online consumer retail platform AliExpress has launched a platform dedicated to influencer content campaigns.

AliExpress Connect will reward influencers for creating original content that helps brands sell their products and brings new customers to the marketplace.

Once they are signed up, new influencers will be welcomed with a task that will allow them to start earning money straight away by sharing platform generated content and promo codes on their social channels.

After they complete their initial task, they can take on more tasks to ‘level up’ within the programme, gaining access to campaigns that offer higher remuneration.

Tasks and campaigns include creating original content for brands and sharing favourite products from AliExpress.

“As e-commerce continues to grow and ‘shoppertainment’ reshapes the landscape and changes the way people shop online, influencers and content creators are playing a more important role in driving retail transformation and e-commerce success,” says Wang Mingqiang, general manager of AliExpress.

“AliExpress Connect is designed to create opportunity for both brands and influencers, as the world moves increasingly toward online shopping. It offers new income sources and job opportunities for influencers and content creators, helping them to scale and digitalize their business. While for brands, it opens up the opportunity to attract new customers.”

Kappa to sponsor Rugby League World Cup 2021

Sportswear brand Kappa will sponsor the Rugby League World Cup (RLWC2021) next year, which will include supplying the kit for all RLWC2021 match officials, volunteers and staff.

As part of the partnership, Kappa will also create a range of clothing merchandise that will be available to purchase online and at RLWC2021 matches, which is expected to be available to fans later this year.

“Kappa share our vision in delivering the biggest and best Rugby League World Cup ever, and will play a hugely important role in doing so,” says RLWC2021’s commercial director, Jonathan Neill.

“The Kappa ‘Omini’ logo is symbolic with gender equality and community and aligns with our inclusive values and approach at RLWC2021, which will see the men’s, women’s and wheelchair tournaments run concurrently for the first time.

“With a heritage and expertise in sports apparel and lifestyle fashion, and a commitment to being innovative and digitally led, Kappa will help increase the profile of RLWC2021 by transcending the sport of rugby league and driving wider fan engagement.”

Brands to cut $50bn from global adspend this year

Global advertising spend is set to fall by 8.1% ($49.6bn) to $563bn this year, led by severe cuts in investment among major product sectors as a result of the COVID-19 outbreak, according to WARC.

The new projections, based on data from 96 markets worldwide, represent an absolute downgrade of $96.4bn compared to WARC’s previous global forecast of 7.1% growth made in February 2020.

Traditional media will fare worse than online, with ad investment set to fall $51.4bn (-16.3%) this year. Declines will be recorded across cinema (-31.6%), OOH (-21.7%), magazines (-21.5%), newspapers (-19.5%), radio (-16.2%) and TV (-13.8%).

Online advertising is not shielded from the downturn; internet growth will almost grind to a halt (+0.6%) in 2020 following a $36.5bn cut compared to WARC’s February forecast to $298.9bn. Social media (+9.8%), online video (+5.0%) and online search (+0.9%) are expected to record growth but at far lower rates than were previously projected, while online classified – particularly recruitment advertising – is set to fall by 10.3%.

Facebook’s full year prospects have been downgraded by $5.3bn to 11.5% growth this year, to a total of $77.6bn, while Alphabet’s revenue is expected to grow 1.6% to $137.1bn – $12.9bn lower than the pre-outbreak forecast of 10.4% growth.

Despite heavy downgrades across the board, the global decline in 2020 will be softer than that recorded in 2009, when the ad market contracted by 12.7% (-$60.5bn).

UK SVOD subscriptions up by more than 50% in Q1

The proportion of UK homes with a subscription to at least one of Netflix, Amazon Prime Video or Now TV increased to 53% in Q1 2020.

According to Barb data, 15 million UK homes access at least one of these services, a quarter-on-quarter increase of over 700,000 homes (+5.2%) since Q4 2019.

Compared to Q1 2019, the number of UK homes with at least one subscription to these providers has grown by +12.6%.

Netflix remains the largest service with just over 13 million homes subscribed, a year-on-year growth of +13.4%.

In the same period, Amazon Prime Video has grown by 32% to almost 7.9 million homes. Now TV is stable year-on-year at just over 1.6 million homes.

6.67m UK homes (24% of homes) subscribed to two or more SVOD services during the period, up 1.6 million year-on-year.

BoohooMan launches first in-app video game

Online retailer BoohooMan has launched its first in-app video game, allowing players to score points to unlock promotions and prizes.

Go All The Way – the retailer’s second collaboration with rapper Quavo – is based on an ‘endless runner’ format where players can control Quavo’s character, running over the rooftops of LA to collect coins and items from the BoohooMan and Quavo collection.

“We’ve been working on gaming for a while and now seemed the perfect time to release whilst people are at home in need of entertainment,” says BoohooMan’s e-commerce manager Victoria Pearson.

“It was also important to release the right quality of game that our users get value from and enjoy.”

Thursday, 28 May

AllbirdsAdidas and Allbirds collaborate to create the low carbon footprint shoe

Adidas and Allbirds are joining forces to tackle the footwear industry’s carbon footprint.

The sector emits 700 million metric tonnes of CO2 every year and the two shoe brands have launched a partnership to tackle this problem.

The collaboration aims to innovate on manufacturing and supply chain processes in addition to exploring renewable material resources. The end goal is to create the lowest carbon footprint ever recorded for a sport performance shoe.

“Our brands don’t want to just participate in the sustainability conversation, we want to continue being catalysts and creators of substantial improvement,” says James Carnes, vice-president of Adidas brand strategy.

Co-CEO of Allbirds, Tim Brown, adds: “This mission is bigger than just Allbirds or adidas,Whether we realise it or not this is a race that we are all running together as a planet and it is one that trumps the day-to-day competition of individual companies. I am hopeful that this partnership will be an example for others to follow as we pursue a more sustainable, net zero carbon future.”

Travel industry urges government to rethink 14-day quarantine

Dozens of travel companies have called on the Home Secretary to scrap plans to impose a mandatory 14-day quarantine on people arriving in the UK.

From 8 June, people entering the UK from abroad will be told to isolate for 14 days or face a £1,000 fine but the more than 70 travel bosses argue it will reduce the number of visitors.

In a letter to Priti Patel, they accuse the government of being “woefully slow” in its support for the travel industry. Signatories have urged the government to switch from protection mode to economic recovery.

It says: “The very last thing the travel industry needs is a mandatory quarantine imposed on all arriving passengers which will deter foreign visitors from coming here, deter UK visitors from travelling abroad and, most likely, cause other countries to impose reciprocal quarantine requirements on British visitors, as France has already announced.”

Those who signed the letter include the heads of firms including the Ritz, Dorchester and Hyatt Regency London hotels, as well as tourism groups including Cookson Adventures and Original Travel.

The group pointed out their companies employed “thousands of people in the UK” and that the tourism and travel sector accounted for almost 4 million jobs, or 11% of the country’s work force.

The letter continues: “Covid-19 is now under control and we commend the government for its handling of what was an extraordinary and unprecedented situation.

“However, the economic cost of the government’s action is yet to be seen, apart from the early indicators which paint a grim picture.”

READ MORE: Travel firms say quarantine plan must be scrapped

Estée Lauder launches skincare experience on Whatsapp

Estée Lauder is launching a skincare experience on Whatsapp to help and connect with consumers during coronavirus.

It will allow consumers to speak with ‘Liv’, an AI-based chatbot that helps users build and stick to a personalised skincare regime. The innovation, created with agency Rehab, aims to focus on educating and supporting consumers while over-the-counter skincare advice is not possible.

Estée Lauder UK & Ireland general manager Emmanuelle Noyer says: “The forward-thinking nature of this digital experience goes beyond traditional communication to provide personalised 1:2:1 beauty advice in a natural conversational way. This innovative approach will allow the Estée Lauder brand to instantly connect with consumers with value and meaning while staying true to the brands high touch identity.”

More than eight in 10 Ryanair passengers still waiting for refunds

More than eight in 10 Ryanair passengers are still waiting for refunds from cancelled flights.

Under EU laws, airlines are supposed to issue refunds within a week but a survey from Which? found that budget airlines have been struggling after coronavirus.

Just 5% of Ryanair customers have had their money returned to them within this time frame, according to the survey. Customers claimed Ryanair provided refund forms that didn’t work, before pushing them into accepting credit note vouchers with little consumer protection.

Earlier this month, Ryanair boss Michael O’Leary warned it will take up to six months for the airline to process 25 million refunds. He said the backlog is due to the sheer scale of demand and issues with staffing during Covid-19.

Other airlines have performed slightly better, although they still have a high number of customers waiting for refunds.

In the survey of 2,800 travellers, 63% of easyJet customers said they are still waiting for their money back and just one in seven said they had received a refund within seven days. A quarter (23%) of British Airways passengers and one in five (19%) Jet2 customers are also still awaiting refunds.

£ READ MORE: Budget airline customers still waiting for money back

McDonald’s reopens all  its UK restaurants

McDonald’s is reopening all its 1,000 restaurants in the UK and Ireland for drive-through or delivery by 4 June.

The fast food chain reopened 33 of its drive-throughs in south-east England last week as a trial and it is now expanding the programme to every drive-through branch, alongside an expansion of its delivery service at sites that do not serve drivers.

McDonald’s says all remaining branches will reopen between Tuesday and Thursday next week. It will announce which branches are reopening only on the morning that service is resuming in order to manage demand.

The burger chain is trying to avoid a repeat of its experience in France and Switzerland, where advance notice of drive-through reopenings led to queues of up to seven hours in some locations.

McDonald’s is working with local authorities and police in the run-up to reopening after almost two months’ closure.

McDonald’s, along with Burger King, KFC and Nando’s, has been trialling phased reopenings of their restaurants with increased safety measures.

Staff at McDonald’s are protected from customers by perspex screens installed at the drive-through windows, and from their colleagues inside the restaurant’s kitchens. Each worker has their temperature checked with a contactless thermometer when they arrive for a shift and is given protective equipment including masks and gloves.

Once reopened, the McDonald’s branches will continue to offer a limited menu, which does not include breakfast, owing to smaller teams working in each location.

READ MORE: Coronavirus: McDonald’s to reopen all drive-throughs and expand delivery

Wednesday, 27 May

Online grocery sales more than double

Online accounted for a record 13% of grocery spend in the UK in the four weeks ending 16 May, up from 7% in the same period a year ago, according to Nielsen. Online sales more than doubled year on year to £1.2bn as 7.9 million households placed an online grocery order – up from 4.8 million a year ago. Some 1.1 million of them were new online shoppers in the past month.

Overall, grocery sales were up 13% boosted by alcohol (up 32%), frozen food (31%), packaged grocery (24%) and meat, fish and poultry (19%). Store visits were down by 24% but spend was up 45%, with an average basket value of £21.60 – higher than at Christmas.

Nielsen expects online shopping to continue to be popular and basket sizes to increase still further until pubs and restaurants reopen.

Mike Watkins, Nielsen’s UK head of retailer and business insight, says: “Following over eight weeks in lockdown, UK shoppers are more accustomed to restricted living, and have adapted their grocery shopping habits to match. The extreme category growth experienced at the beginning of lockdown has started to ease as consumers become more confident in product availability. Online has been a clear winner over the lockdown period, as shoppers take advantage of retailers’ increased delivery capacity.”

Government mulls end to furlough scheme

The government is reportedly mulling an end to the furlough and self-employment support programme that is keeping millions of people in their jobs.

According to the Financial Times, the Treasury is preparing to stop accepting new applications to the furlough programme. It is also expected to lay out the contributions the government will require from employers for the extension of the scheme, which begins at the start of August.

The most recent figures show 8 million people had been furloughed, roughly a quarter of total jobs in the UK. Under the current scheme, employees receive 80% of their normal pay up to a cap of £2,500 a month. The changes could mean employers having to contribute 20% of pay, reducing the government’s contribution to 60%, and see them paying national insurance contributions.

The self-employed scheme also pays people up to £2,500 a month but is currently set to end at the end of the month.

READ MORE: Rishi Sunak set to announce ban on new entrants to UK furlough scheme

John Lewis plans ‘phased’ re-opening

John Lewis is planning a “phased” re-opening of its department stores after the government said non-essential retail should be able to open its doors again from 15 June.

John Lewis has 50 stores across the UK but has not said how many will re-open on the first day they are allowed. It wants to test changes to cleaning, caps on visit numbers, reduced entrances and prominent social distancing signage to reassure staff and customers.

“Our plan sees us open our shops on a phased basis, to enable us to test the changes we are introducing and ensure the best and safest customer and partner (employee) experience,” the company says.

It also plans to limit the customer services, such as beauty services, it offers while catering and fitting rooms will not be open. Returned stock will be kept separate from other stock for 72 hours in line with government guidance.

High street retailer Next is also planned a phased re-opening, with larger out-of-town stores first on the list. It is also planning a sale as it looks to clear unsold stock.

Aston Martin replaces CEO in bid to resuscitate the brand

Aston Martin has ousted its CEO in a renewed bid to resuscitate a brand made famous by James Bond.

Any Palmer is being replaced by the boss of Daimler’s AMG performance brand Tobias Moers. He will take over at the start of August, with chief operating officer Keith Stanton taking over in the interim.

Under Palmer’s leadership, Aston Martin had seen its share price slump by 94% following a lacklustre public offering in October 2018. Sales in the first three months of the year halved to just 578 vehicles, in part due to coronavirus.

Palmer said it had been a “privilege” to work at Aston Martin for almost six years and thanking management and staff.

“The board has determined that now is the time for new leadership to deliver our plans,” says Aston Martin.

READ MORE: Aston Martin chief leaves after 94% share price collapse

Britvic sales hit by coronavirus pandemic

Britvic’s sales increased by 1.4% year on year in the six months to the end of March but government restrictions on movement have since impacted trading.

The soft drinks company says since mid-March it has seen on-trade activity and on-the-go consumption hit, while at-home consumption has increased. However, it expects the next effect to be a hit to revenues.

Britvic CEO Simon Litherland says: We entered the Covid-19 crisis with strong momentum, having delivered a robust first half performance, which continues our track record of consistent delivery since 2013. As a business and as a team, we have repeatedly demonstrated our agility as well as our ability to successfully navigate tough headwinds. 

“While these times are clearly unparalleled, soft drinks has proven itself to be a resilient category time and time again. As consumers increasingly turn to trusted brands, we are confident that our long-term strategy will continue to create value for all our stakeholders.”

Tuesday, 26 May

Nike

Nike aims to provide sporting inspiration

The latest Nike campaign ‘You Can’t Stop Us’ now includes a just-released short, ‘Never Too Far Down’, narrated by NBA star LeBron James.

The film tells the tale of various Nike athletes who have famously come back from seemingly lost situations to triumph against adversity.

Featuring James, Serena Williams, Tiger Woods, Cristiano Ronaldo, Rafael Nadal and others, the film aims to provide inspiration away from the sporting arena, inspiring everyone in challenging times.

“Even if basketball looks different for a while, I’m excited about the possibility of getting back in the game, because I know how inspiring and powerful sports can be,” said James.

Talking about the campaign, Wood stressed the positive force that sport can provide, thoughts echoed by Williams.

“Sport is the one thing that’s true, it doesn’t matter what you look like, where you’re from,” the six-times Wimbledon champion said.

“Everything is left out in the arena. For me, I put it all out there on the court as a player, but it also feels that way as a fan.

“You feel that joy when someone you’re rooting for wins. That’s because of the unity that sports bring us.”

CEO Palmer to leave Aston Martin

Aston Martin CEO Andy Palmer is reportedly stepping down from the luxury carmaker, to be replaced by the current CEO of Mercedes-AMG, Tobias Moers.

The troubled British marque has seen its share price drop dramatically since floating on the Stock Exchange in October 2018.

Recent sales figures for the first quarter gave little relief for Palmer, who attempted to raise funds earlier this year after Canadian billionaire Lawrence Stroll bought a 20% stake in the company.

“We were obviously fairly significantly hit by Covid-19, starting with China in January but more clearly in what we saw as it came across towards Europe and the US,” Palmer told Reuters earlier in May.

READ MORE: Aston Martin chief to leave, Mercedes-AMG CEO to replace him – source

Gucci to cut down on annual fashion shows

GucciGucci creative director Alessandro Michele says the Italian luxury fashion brand will be going seasonless.

Michele wants to break with the sector’s long-held tradition of five annual collection fashion shows and instead stick to just two a year.

It’s the biggest move yet as the troubled industry looks to cope with both the ongoing retail downturn caused by the coronavirus pandemic, looming recession and concerns about sustainability and climate change.

“This crisis represents a fundamental test for us all,” Michele wrote in an Instagram post.

“Above all, we understand we went too far. Our reckless actions have burned the house we live in.

“We conceived of ourselves as separated from nature. We usurped nature, we dominated and wounded it.”

READ MORE: Gucci plans “new path” with catwalk schedule reduced to twice a year

CMA to investigate misleading reviews online

The Competition and Markets Authority (CMA) is launching an investigation into a number of websites amid concerns that they are failing to protect consumers from fake and misleading reviews.

The authority will look into suspicious reviews (where, for example, a single user has reviewed an unlikely range of products or services) and whether businesses are manipulating the presentation of reviews about their products and services by, for example, combining positive reviews for one product with the reviews for another.

CMA chief executive Andrea Coscelli says: “Most of us read online reviews to help decide which products or services to buy.

“During lockdown, we’re more dependent than ever on online shopping, so it’s really important that the online reviews we read are genuine opinions.

“If someone is persuaded to buy something after reading a fake or misleading review, they could end up wasting their money on a product or service that wasn’t what they wanted.

“Our investigation will examine whether several major websites are doing enough to crack down on fake reviews.

“And we will not hesitate to take further action if we find evidence that they aren’t doing what’s required under the law.”

Government plans for non-essential shops to reopen from 15 June

The prime minister Boris Johnson has revealed dates for the second phase of lifting lockdown restrictions.

It is hoped that non-essential shops will be able to reopen from 15 June, subject to a formal assessment.

Car showrooms and open markets will be allowed to open up again from next Monday (1 June).

Department stores and other retail outlets could then follow two weeks later.

“This is contingent on progress against the five tests and will only be permitted for premises that are Covid-secure,” Johnson said.

READ MORE: Boris Johnson sets out plans for shops and markets to reopen

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