Budweiser, YouTube, car production: 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.

UK car industry experiences longest stretch of decline since 2001

The UK’s car industry has experienced its longest period of decline since 2001, with the lacklustre stretch attributed to trade tensions and Brexit uncertainty.

Car production in Britain was down 10.6% year on year, according to new figures from the Society of Motor Manufactures and Traders (SMMT).

This marks the 14 consecutive months of declines, leapfrogging the 13 month stretch of falling sales recorded during the financial crisis, between October 2008 to October 2009. But the last time the UK saw such an extended slump was back between June 2000 to July 2001.

According to the figures from the SMMT, 774,760 cars have been made in Britain this year which is down 18.9% from 2018.

Sky News reports that the decline has been linked to a drop in export orders with overseas shipments fading by 20.2% since January, while production for the UK this year is also down by 13.5%.

In Britain alone about 168,000 people are directly employed in car manufacturing, while another 823,000 are employed in the wider automotive industry, according to the SMMT

Additionally, the car industry accounts for about 14.4% of all UK goods exports.

READ MORE: UK car industry in longest period of decline since 2001

YouTube expands kids offering to web

YouTube is gearing up to launch a standalone website for children which will be a subsidiary to its existing kids app.

Other than launching a dedicated website for children, the platform has also introduced new categories for YouTube Kids which is intended to allow young users to explore videos in a safer environment.

YouTube will start filtering content on its kids platforms to target three different age groups: four and younger, five to seven-year olds and eight to 12-year olds in a bid to give them more independence.

Despite the new measures, YouTube has once again reiterated that it doesn’t manually review all its videos.

“Our systems work hard to exclude content not suitable for each of these age categories, but not all videos have been manually reviewed,” the platform says.

The move comes after YouTube found itself under fire for the way it was collecting kids’ data and using it to serve them targeted ads.

READ MORE: YouTube kids is getting its own website

Budweiser Brewing Group unveils audio campaign for low-calorie beer

Budweiser Brewing Group has unveiled a new audio campaign that will run across Spotify and promote its low-calorie beer, Michelob Ultra, as well as a healthy lifestyle.

The campaign titled ‘The Michelob Marathon’, which was produced alongside Dentsu Aegis, is designed to showcase our ability to personalise advertiser content for users based on their streaming context.

It’s intended to reach runners on Spotify Free before their workout or while they hit the pavement or treadmill and during moments of recovery. The advert will also feature tailored messages from Michelob depending on the location of the user, the time of day and the weather.

The campaign is kicking off in the UK and Mexico before going global next year.

“We’re really excited to be the first brand to use this innovative technology on a global scale on Spotify. With Michelob Ultra, we want to inspire people to live an active lifestyle and the Michelob Marathon with Spotify is a great platform to do so,” Tim Deeks, marketing manager, Michelob Ultra, says.

Echoing his comments is Jeff Rossi, global head of industry and CPG at Spotify, who argues that audio is able to flex to the need states of listeners.

Huawei’s new flagship phone won’t have Google Apps

Huawei’s new flagship smartphone will be without Google apps such as Maps and YouTube, due to a US government ban on sales to the tech company which means it cannot license its apps to the smartphone giant.

As part of the ban, users with the new smartphone will not be able to access the Google Play app store, limiting access to popular apps.

According to the BBC, the US government implemented a restriction to stop companies selling products and services to Huawei earlier this year due to security concerns.

As a result analysts believe the Chinese company will struggle to sell the phone given the absence of Google apps.

Despite the fact that the Android operating system is an open-source software, companies need an agreement with Google to include its main flagship apps such as Maps, Photos, Play Store and YouTube.

Huawei said in a statement: “Huawei will continue to use the Android OS and ecosystem if the US government allows us to do so. Otherwise, we will continue to develop our own operating system and ecosystem.”

“Anyone who has already bought, or is about to buy a Huawei smartphone, can continue to access the world of apps as they have always done.”

When it comes to the Europe, analysts believe launching without Google’s apps in will be a major blow because consumers won’t be able to access the likes of BBC News, Facebook and Twitter.

READ MORE: Huawei’s next phone will not have Google apps

Goals Soccer up for sale despite fraud probe

Goals Soccer, a five-a-side pitch operator which is part-owned by Sports Directs Mike Ashley, has been put up for sale in the face on an accounting scandal.

Just this month, Goals confessed it had uncovered “improper behaviour” related to its accounts dating back to 2010, prompting an investigation of its executive and finance chiefs, Keith Rogers and Bill Gow, who are accused of mis-stating “historic financial statements” and owing £12m in unpaid tax.

Thus, the company is now taking bids for its business and assets. Although, despite the investigation, its sales in the UK are up 11% since the beginning of the year.

Meanwhile, Mike Ashley owns 19% of the struggling company but has problems of his own. Currently he faces a shareholder rebellion after the advisory firm Institutional Shareholder Services joined calls for Sports Direct investors to vote against him from continuing on as director, citing: “significant operational and governance concerns”.

Goals operates 45 centres across the UK and employs more than 700 people.

READ MORE: Mike Ashley-backed Goals soccer centres put up for sale

Thursday, 29 August

Sport England launches campaign to encourage people with health conditions to get active

Sport England is following up its hugely successful ‘This Girl Can’ campaign with a new marketing platform that aims to encourage people with long-term health conditions to get more active.

The campaign, ‘We are undefeatable’, features a cast of people with real health conditions including diabetes, cancer, arthritis and Parkinson’s. Created by FCB Inferno, a 60-second film shows what getting active looks like for people with health conditions. This will be amplified with activity across TV, radio, social media and sponsored search, linking to a new website www.weareundefeatable.co.uk that offers inspiration and ideas on how to get active.

The campaign comes after research found that those living with a long-term health condition are twice as likely to be inactive despite evidence that being active can help manage many conditions, and reduce the impact and severity of some symptoms. It is being funded by Sport England, in collaboration with 15 health and social care charities including Versus Arthritis, Macmillan Cancer Support, Age and the Stroke Association, with funding from The National Lottery.

Tim Hollingsworth, Sport England CEO, says: “This campaign forms part of a longer-term drive by Sport England to change cultural and social norms around long-term health conditions and physical activity. We will continue to work with everyone from healthcare professionals, coaches, governing bodies, gym operators and even town planners to ensure that people with long-term health conditions feel able and supported to get active or play sport in whatever way suits them.”

Thomas Cook brand safe as company agrees rescue deal

Thomas Cook has safeguarded the immediate future of its brand after agreeing a rescue deal with its major shareholder, Fosun Tourism, that will see the Chinese group take control of the travel operator at the expense of other shareholders.

Fosun is investing £450m in return for at least 75% of the tour business and 25% of its airline. Its lending banks and bondholders will also pay £450m in return for 25% of the tour business and 75% of the airline.

Thomas Cook has annual sales of more than £9bn, 19 million customers a year and 22,000 staff. However, it has struggled to reduce its debts and issued three profit warnings in a year, reporting a £1.5bn loss for the first half of its financial year.

Tough online competition, as well as factors including Brexit have impacted its recovery since the firm almost collapsed in 2011. It has also been impacted by rising hotel and jet fuel costs, as well as a heatwave last summer that convinced more consumers to holiday at home.

Pandora to relaunch its brand to position as ‘affordable luxury’

Pandora is relaunching its brand, overhauling the design of its shops, unveiling a new logo and increasing marketing spend, as it looks to reposition as “affordable luxury”.

The company, which is the biggest jewellery maker in the world, saw sales increase 10-fold in the decade to 2017. However, it has struggled over the past two years to clearly identify its market and issued several profit warnings.

“Customers tell us they used to think of Pandora as affordable but don’t any more. The brand has drifted away from its original position and now we’re trying to move it back to what made Pandora,” CEO Alexander Lacik tells Reuters.

“We have to strengthen our position as an affordable jewellery brand big time.”

READ MORE: Struggling Jewellery Maker Pandora to Relaunch Brand

Peloton’s marketing spend raises concerns as its preps to go public

Fitness brand Peloton has seen marketing spend spiral as it looks to attract new customers to its business as it prepared for an initial public offering (IPO).

Preliminary IPO paperwork shows that Peloton’s marketing spend has soared since 2017, when it spent just $86m, to $324m in the year to the end of June. In some quarters, marketing and sales are equal to 40% of its revenue.

‘We want to build a business and a brand’: Peloton launches £7m ad blitz to bring virtual spin classes to the masses

Peloton, which makes internet-connected fitness equipment including bikes and treadmills, has run several campaign in the US and internationally, including a £7m push in the UK, as it looks to raise awareness and build its brand. Its business model has two strands – selling expensive fitness equipment (its bikes cost around $2,000) and then topping that up with a monthly subscription that costs $39 and gives access to fitness classes from home.

Peloton claims it has more than 1.4 million users and an average retention rate for subscribers of more than 95%. But its push to sign up new users is currently causing it to post huge losses. While revenue came in at $915m for the 12 months to the end of June, up 110% year on year, losses widened to $195.6m.

Toyota extends sponsorship of Paralympic Sport on Channel 4

Toyota has extended its sponsorship of Paralympic Sport on Channel 4 to include live and highlights coverage of the Swimming World Championships in September and highlights of the World Para Athletics in November.

Toyota is an official partner of the International Paralympics Committee and has previously sponsored coverage on Channel 4. The deal comes as Paralympic Sport prepares for the Paralympics in Tokyo next year.

Andrew Cullis, director of communications and product at Toyota, says: “After a successful Winter Paralympic Games last year, we are thrilled to continue our support of Paralympic Sport on Channel 4 as momentum build towards Tokyo, which promises to be a hugely exciting time for our business”

Wednesday, 28 August

costa on piccadilly lightsCoca-Cola gives Costa Coffee iconic Piccadilly Circus ad space

Coca-Cola is giving away its iconic Piccadilly Circus ad space to another drinks brand for the first time.

Costa Coffee is taking over the iconic ad space for three days to promote its new ready-to-drink range – a first since the fizzy drinks giant started advertising there in 1954.

“It’s an extraordinary and historic moment for us as we take centre stage at this London landmark,” says Sarah Barron, chief growth officer at Costa Coffee.

“The bright lights of Piccadilly Circus have long been synonymous with Coca-Cola, and so it feels like perfect opportunity to commemorate our new partnership. We’re looking forward to lighting up this ionic part of the West End.”

The ad is the first stage of campaign that will include digital, PR and sampling activity. It includes a Costa Coffee Flavour Rooms pop-up store opening on Thursday 29 August at the Truman Brewery in east London.

Costa was bought by Coca-Cola in August last year. Its new ready-to-drink range is its first innovation under the new ownership.

Kris Robbens, marketing director at Coca-Cola Great Britain and Ireland, adds: “We’re constantly innovating, and Costa Coffee Ready-To-Drink is the latest exciting example. We’re looking to disrupt and define the Ready-To-Drink coffee category and continue to provide more choice for coffee lovers to enjoy, whatever the occasion.”

Which? calls on CMA to tackle ‘dodgy’ supermarket promotions

Shoppers are being misled with “dodgy discounts” and special offers in some supermarkets, an investigation has found.

Consumer group Which? analysed 459 “offers” to find multi-buys that cost more despite the alleged offer, and special offers in which goods are sold at the special price most of the year.

Which? tracked prices from May 2018 and June 2019 across seven of the UK’s biggest supermarkets: Asda, Iceland, Morrisons, Ocado, Sainsbury’s, Tesco and Waitrose. Six supermarkets were guilty of at least one offence, with only Sainsbury’s meeting the new criteria for offers.

At Iceland, researchers found Kellogg’s Crunchy Nut cereal on offer at two packs for £4, a week after they were on sale for £1.49 each. At Asda, Wall’s one litre tubs of Carte D’Or strawberry ice cream were labelled as “was £3.50, now £2”, but Asda had actually been selling the dessert at the lower price for longer than the higher price.

Which? say supermarkets are disregarding government pricing guidelines, which should ensure retailers always present information that is fair and does not waste time, cause annoyance or regret. The guidelines changed in 2015 after Which? filed a super complaint with the Competition and Markets Authority (CMA).

Natalie Hitchins, head of home products and services at Which?, says: “Four years on…many of the big supermarkets are clearly still in the wrong, with numerous examples of dodgy discounts and never-ending offers.

“These retailers must stop tricking shoppers with deceptive deals…if not, the CMA must intervene to ensure that pricing guidelines are followed.”

The findings will be reported to the CMA.

READ MORE: ‘Stop misleading special offers’ supermarkets told

Home Office ad banned for misleading EU citizens

The Advertising Standards Authority (ASA) has banned a Home Office radio ad for misleading listeners.

The advert for the EU settlement scheme, which aired on 13 April, claimed potential applicants only needed a passport or ID card to complete the online form.

The watchdog received a complaint that challenged the Home Office, arguing it was misleading as in some cases applicants also need to provide proof of address covering the previous five years.

The ASA upheld the complaint, ruling the advert was misleading and banning it from being broadcast again. The regulator ordered the Home Office to ensure it made it sufficiently clear that some applicants to the scheme would need to provide additional documents beyond their passport or ID card.

“Listeners would likely understand that an official application process of this nature would always require some applicants to provide further information in exceptional cases,” the ASA says in its ruling.

It found that in 27% of decided adult cases, applicants had been asked to provide documents as evidence of residence, with some applicants also asked for other documents, such as evidence of a family relationship.

The ASA adds: “While we acknowledged that applicants were not required specifically to submit ‘proof of address’ (as referenced by the complainant), some were required to submit further documents beyond those stated in the ad.

A Home Office spokesman says it completely disagrees with the ASA’s decision, claiming the campaign was factual and complied with all necessary clearance processes for radio advertising.

Primark pushes sustainability agenda

Primark is increasing its sustainability credentials as it promises to train more of its cotton farmers than ever before.

The budget fashion retailer will train 160,000 cotton farmers in India, Pakistan and China in environmentally friendly farming methods by 2022.

The target is part of the retailer’s sustainable cotton programme, which was launched in 2013, with the aim to use 100% sustainable cotton in its stores.

The new target sees it increase the number of farmers in the programme five-fold, with the brand already using sustainable cotton in women’s pyjamas, a range of denim, towels and bedding.

The programme is in partnership with sustainable cotton foundation, Cotton Connect, and the Self Employed Women’s Association trade union.

The methods being taught include introducing organic pesticides and fertilisers, such as cow dung, when possible, to reduce the use of chemicals.

Despite being praised for the move some campaigners are calling for more transparency about the process.

READ MORE: Primark to train 160,000 cotton farmers in sustainability drive

Tobacco giants Philip Morris and Altria in merger talks

Tobacco giants Philip Morris and Altria are in talks to re-unite, more than a decade after the two firms separated.

The two companies have confirmed they are discussing an all-stock merger but say there is no guarantee a deal will be reached. The news hit the share prices of cigarette competitors, with British American Tobacco down 3%.

Altria spun off the Philip Morris business in 2008 but a possible merger has been predicted by analysts for some time, with many speculating the two companies could get back together as they fight falling cigarette sales and the rise of vaping.

Both companies have been investing in alternatives to tobacco and last year Altria paid $12.8bn for a 35% stake in Juul Labs, maker of the popular electronic-cigarette.

READ MORE: Tobacco giants Altria and Philip Morris discuss $200bn merger

Tuesday 27 August

Johnson & Johnson fined $572m for ‘fuelling opioid crisis’

Pharmaceutical giant Johnson & Johnson has been ordered to pay $572m (£464m) for running a “false and dangerous” campaign that fuelled Oklahoma’s opioid crisis.

According to the landmark ruling, Johnson & Johnson is responsible for helping to create the worst drug epidemic in US history, which has resulted in the death of 6,000 people in Oklahoma since 2000.

The judge ruled the company aggressively pushed false claims about the safety of its narcotic painkillers, as well as altering medical practice by funding organisations and research to promote narcotics with “deceptive” claims intended to break down caution among doctors about prescribing opioids.

Johnson & Johnson, which will appeal the ruling, claims its painkillers have accounted for less than 1% of the US market since 2008.

“The decision in this case is flawed,” the company says. “The State failed to present evidence that the company’s products or actions caused a public nuisance in Oklahoma.

“The judgment is a misapplication of public nuisance law that has already been rejected by judges in other states.”

READ MORE: Johnson & Johnson to pay $572m for fueling Oklahoma opioid crisis, judge rules

Nestlé under fire over natural springs plans

Nestlé has sparked outcry over plans to draw 1.1 million gallons of water a day from Ginnie Springs, which is part of Florida’s Santa Fe River.

The food and drinks giant, which owns water brands Pure Life and Zephyrhills, is seeking permission to use the water to sell back to the public as bottled water.

In a letter, George Ring, natural resources manager for Nestlé Waters North America, says: “The facility is in the process of adding bottling capacity and expects significant increases in production volumes equal to the requested annual average daily withdrawal volume of approximately 1.152 million gallons.”

Opponents say the plan should be disqualified on environmental grounds alone and that it is impossible to withdraw millions of gallons of water and not have an impact.

The river is also home to 11 native turtle species and four non-native species, which rely on a strong water flow and river levels.

READ MORE: Nestlé plan to take 1.1 million gallons of water a day from natural springs sparks outcry

Dr. Oetker returns to TV for GBBO

Dr. Oetker is returning to TV sponsorship with a refreshed creative launching this evening during the first episode of Great British Bake Off.

The Fabulous Baker Boys, Siobhan the Unicorn and new character Bianca the soulful buttercream cake will star in the ads for the duration of the 10-week baking competition, which is entering the final year of its three-year deal with Channel 4.

“GBBO is one of the biggest events in the home baking calendar and we’re thrilled to announce we’ll be back on TV for this key period. Consumers are extremely receptive to baking inspiration during this period and we hope to bring even more excitement to the sector with our loveable cake characters,” says Jan McKee, executive head of marketing UK at Dr. Oetker.

“We’re looking forward to this year’s series and it’s exciting to see so many young contestants this time. We know from viewing figures that GBBO has a strong appeal with younger audiences and has helped drive the growing number of millennials engaging with the category.”

The seven-figure campaign includes TV and video-on-demand, as well as a digital campaign designed to drive traffic to the baking brand’s GBBO online hub.

Kerry Foods unveils new campaign for Strings & Things

Kerry Foods is launching a £3m marketing campaign to raise awareness of the expansion of its Strings & Things range and highlight the recent Cheeshapes product lunch.

The campaign will be formed of two adverts running across TV, video-on-demand, social and radio. One advert will focus on the entire Strings & Things product portfolio – Cheestrings, Cheeshapes and Yollies – while the second will focus solely on Cheeshapes.

We’re very excited to launch our first ad campaign under our new master brand – Strings & Things – and to highlight to consumers the full range of exciting products that come under this,” says Victoria Southern, marketing category director at Kerry Foods.

“The ad is light-hearted and playful to mimic the personality of the range and will launch just in time for children to return to school where we hope Strings & Things products will become lunchtime staples.”

Brands influence consumer health choices

Nearly two-thirds (62%) of British consumers say they care more about how ‘healthy’ their food and drinks are compared to five years ago, with a product’s brand the main source they turn to in order to determine how healthy products are.

When asked which sources inform consumer perceptions of healthy food and drink generally, 40% of respondents said they base it on the product’s brand.

Only 22% said they based it on government advice, or their friends and family. Only 13% said they used an app-based nutritionist and only 4% pointed to a social media influencer.

“Brands clearly have great influence over what consumers determine as healthy, and customers need to be clued up on the health claims around certain ingredients,” says Jason Parker, UK head of health at KPMG, which carried out the study.

“However, it’s great news that our population – and Generation Z in particular – is more engaged in taking responsibility for their own health. If consumers make informed decisions about healthy eating, we will slowly begin to see less demand on our health services for the vast range of issues that go hand-in-hand with an unhealthy diet.”

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