Facebook, John Lewis, Coca-Cola: 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.

Facebook launches dedicated Instagram messaging app Threads

Facebook has unveiled a new camera-first messaging app for Instagram in a bid to take on its rival Snapchat.

Threads is a private messaging app that allows Instagram users to connect with people on their ‘Close Friends’ list, meaning only people the user has selected to be on their list can send them a message.

Users can upload a status, share their location or battery status with their friends. If they opt for an ‘Auto Status’, Threads will request their location, movement, battery level and network connection in order to determine what context to share.

The company states that the way it uses data across Facebook and Instagram to deliver relevant ads will still apply to Threads, however the precise location information collected via the Auto Status feature, which is a new feature specific to Threads, will not be used to target ads.

The news of Thread’s launch, which plays into the same space as Snapchat with its focus on photos and connecting a small group of friends, knocked 5% off Snap Inc’s shares in afternoon trading yesterday.

John Lewis seeks discounts from landlords as cost cutting ramps up

John Lewis is seeking discounts from its landlords in a bid to cut costs, the same week the department store chain announced a significant restructure that will see the John Lewis Partnership and Waitrose run as one business from February 2020.

The BBC reports that the retailer is telling landlords in some locations it will withhold 20% of this quarter’s service charge, the fees paid on top of rent for services such as heating and security. John Lewis reportedly said the charges have become too high and urged landlords to help.

According to the BBC, John Lewis mainly wants these landlords to shoulder some of the service charge during the fourth quarter in the lead up to Christmas. However, the retailer is under contract to meet its service charge obligations and withholding the money could cause serious friction with its landlords.

In a statement to the BBC, John Lewis said that it was doing everything it could to reduce its cost base, but claimed it had been faced with “regular increases” to the service charges it pays for its shops located in shopping centres. The department store chain currently operates around 20 stores in covered shopping centres.

The retailer added: “Over the last three years we have seen an increase in service charges of 20% and these continued increases are simply not acceptable, particularly in the absence of strenuous efforts by landlords to work collaboratively with us to reduce these costs.

“We are investing more in our current shop estate than ever before to do everything we can to encourage customers to grow footfall to our shops and we hope that our landlords will support us in continuing to do this.”

On Tuesday the department store said that the decision to merge the management teams of the John Lewis Partnership and Waitrose & Partners would help the business to “break out” from the cycle of declining returns and create cost savings of £100m. However, this move will cut the senior management team by a third, putting marketing jobs at risk.

Coca-Cola unveils first Coke bottle made with plastic from the sea

Coca-Cola has introduced its first ever sample bottle made using recovered and recycled marine plastics.

The company said “breakthrough technology” had enabled it to transform low-quality plastic into high-quality food-grade packaging. Around 300 sample bottles have been produced using 25% recycled marine plastic, retrieved from the Mediterranean Sea and beaches.

Although Coca-Cola admitted the sample represents “a small step for now”, it said the technology behind it has “big potential”.

The ‘enhanced recycling’ process involves breaking down the components of plastic and stripping out impurities in lower-grade recyclables so they can be rebuilt as new. As a result, lower-grade plastics that were destined for incineration or landfill can be repurposed.

The sample bottle is the result of a partnership between The Coca-Cola Company and a number of conservation, technology and packaging companies including Mares Circulares (Circular Seas), Ioniqa Technologies and Indorama Ventures.

Coca-Cola said that in the immediate term enhanced recycling will be introduced at commercial scale using waste streams from existing recyclers, including previously unrecyclable plastics and lower-quality recyclables. From 2020, the company plans to roll out this enhanced recycled content in some of its bottles.

Global brands push for greater clarity on cross-media measurement

A host of high-profile brands including Proctor & Gamble (P&G), Unilever and Mastercard have teamed up on a global initiative pushing for greater clarity on cross-media measurement.

The Cross Media Working Group, which encompasses key brands from the World Federation of Advertisers’ (WFA) Global Media Board, as well as the likes of ISBA in the UK and the Association of National Advertisers (ANA), wants to find cross-industry consensus on key global principles for measurement, with broadcasters, digital platforms and measurement companies also involved in the initiative.

Having met over the course of several months to identify common ground between current cross-media measurement initiatives in markets such as France, Germany, Sweden, UK and the US, the group came together during Advertising Week in New York last week to identify four key areas of focus.

The Cross Media Working Group highlighted the need for data being provided by platforms, publishers, broadcasters and measurement companies to be shared in a manner that respects consumer privacy and privacy regulation.

The group also noted that cross-media measurement requires a complex infrastructure and therefore decisions need to be made around how best to connect and calibrate data sources.

Another key priority is to establish a way of making like-for-like comparisons between media, which could mean establishing a single definition by which to compare.

Finally, the Cross Media Working Group says there is a need for clear governance in order to protect privacy, ensure objectivity and enable fair decision-making, which means deciding where the measurement should ‘live’ and who should provide it. The next step is to build on these ideas and stress-test the principles developed.

“We’ve been talking about cross-platform media transparency through cross-platform media measurement for far too long,” said Marc Pritchard, P&G chief brand officer. “It’s time to get on with it and this is a positive step in the right direction.”

ISBA director general Phil Smith added: “ISBA and its members are not alone in striving for independent, accountable cross-media measurement. To succeed, we know that efforts from all parts of the globe must come together to provide a single set of principles and standards that can be applied in individual markets.

“Given the fragmented nature of the audience measurement landscape today, it is vital that advertisers take the lead.”

TikTok rules out political advertising

TikTok has ruled out the use of political ads on its platform ahead of the 2020 US presidential campaign.

The social media site said that paid political ads are not something it believes fits the “TikTok platform experience” and therefore it will not allow paid ads that promote or oppose a candidate, current leader, political party or group, including election-related ads, advocacy ads or ads around political issues.

TikTok is in the early days of introducing and experimenting with different ad formats, including the new TikTok Creator Marketplace, which enables brands to work with influencers on marketing campaigns.

According to Blake Chandlee, vice president of global business solutions, TikTok is seeing increased demand for more “collaborative opportunities” between brands and influencers on its platform.

He stated that brands are taking an “unconventional and modern marketing approach” to working with TikTok, which is focused primarily on native advertising formats, such as sponsored hashtags and in-feed ads that play on the “immersive, short-form TikTok style”.

Thursday, 3 October

Uber launches app for temporary workers

Uber is moving further into the gig economy with a staffing business aimed at workers looking for temporary positions.

The app, Uber Works, will connect people with jobs such as cooks and waiters and will launch in Chicago on Friday.

It will provide information such as gross pay, work location and required skills and attire, as well as work time and logging when people check in and out and take breaks.

Uber says it will make Uber Works available to drivers, which will give it “a more diverse workforce” than its rideshare client base and “open the platform up to people who want to earn money but don’t have cars”.

“We believe a new, technology-first approach can provide faster and easier means for people to get work, while offering greater insight into the many opportunities for work that are out there – improving the experience for workers and businesses alike,” the company says in a blog post.

Guardian’s David Pemsel to head up Premier League

The Premier League has hired Guardian Media Group’s (GMG) chief executive, David Pemsel, as its new CEO.

Pemsel, who has been at the helm of the parent company of the Guardian and the Observer since July 2015, will take on the new role early next year after a year-long search for a new CEO.

Chelsea chairman Bruce Buck, who was responsible for the hire, says Pemsel has been given the job for his “straightforward style and personal integrity”.

“At the Guardian he has shown strong leadership through a period of change and transformation,” Buck says. “Returning the group to profit is an impressive achievement and has demonstrated that he can develop and execute a transformational plan in an ever-changing business landscape.”

Pemsel first joined Guardian News & Media in 2011. Of his departure, he says: “I have enjoyed my eight years at Guardian Media Group and want to thank everyone for their support and friendship, but now is the perfect time for me to take on the next challenge.”

Leading UK businesswomen launch #MeTooPay campaign

One hundred of the UK’s top female business leaders have launched a campaign to accelerate efforts to close the gender pay gap.

The #MeTooPay campaign will allow women to share examples of good and bad corporate policies and keep track of key court cases.

The coalition is being led by Dame Moya Greene, who was chief executive of the Royal Mail until 2018. It includes women who have held leadership positions in some of Britain’s largest organisations including GlaxoSmithKline boss Emma Walmsley and Lady Dido Harding, the former boss of TalkTalk.

Greene says she wants it to be a “practical go-to site”.

“We want women to tell us their stories and come to us with their issues,” she tells the Independent. “We want negotiation experts to go online to our site and give us their insight. We want lawyers who have won cases to supply the most helpful insights from their dossiers. We want remuneration experts to share their expert views so that others can check their remuneration is fair. We want women to know they are going to be supported.”

The initiative has also gained the support of Clare Balding and Dame Minouche Shafik, the former deputy governor of the Bank of England and director of the London School of Economics.

Royal Shakespeare Company ends partnership with BP

The Royal Shakespeare Company (RSC) is to cut ties with BP after students threatened to boycott the company for its “sickening” links to a business that is “actively destroying our futures”.

RSC will end the eight-year partnership at the end of the year. It says it cannot ignore the “strength of feeling” against the sponsorship, which last week saw students write a letter to the RSC calling BP’s influence on the theatre company “nothing but a stain”.

“Young people are now saying clearly to us that the BP sponsorship is putting a barrier between them and their wish to engage with the RSC,” the company says.

BP says it is “disappointed and dismayed” that the deal has come to a “premature end”. It says it shares “many of the concerns that apparently contributed to the decision”, and “attempts to exclude companies committed to making real progress, is exactly what is not needed”.

Deliveroo’s profits continue to slide

Deliveroo made a loss of £232m in 2018. This is 16% higher than 2017’s £199m and comes in spite of a 72% rise in sales to £476m.

The London-based food delivery service’s sales growth comes after investing significantly in new markets including Taiwan and Kuwait, as well as opening in more than 250 new towns and cities across existing countries.

Deliveroo now works with 80,000 restaurants and 60,000 riders all over the world, with plans to expand to another 50 UK towns and cities this year.

“Deliveroo is growing from strength-to-strength and expanding across our markets as more and more people want amazing food delivered straight to their door,” says Deliveroo’s CEO Will Shu.

“We’re focused on our mission of becoming the definitive food company, and we’ve continued to invest heavily in expansion, technology and new products to meet this ambition.”

Wednesday, 2 October

Burger King milkshake tweet banned for being ‘irresponsible’

A tweet from Burger King telling customers to “have fun” as it was selling milkshakes all weekend has been banned for encouraging anti-social behaviour.

The tweet in question came after milkshakes were thrown over a number of political figures during European election campaigns in May, and a branch of McDonald’s stopped selling milkshakes and ice creams ahead of a political rally addressed by Nigel Farage.

The tweet read, “Dear people of Scotland. We’re selling milkshakes all weekend. Have fun. Love BK. #justsaying”, which 24 complainants suggested was “irresponsible and offensive” as it could encourage “violence ad anti-social behaviour”.

Burger King defended the post as being “tongue-in-cheek” and says it does not endorse violence. This was made clear, it says, in a follow-up tweet, which stated, “We’d never endorse violence – or wasting our delicious milkshakes! So enjoy the weekend and please drink responsibly people”.

However, the Advertising Standards Authority ruled it was “irresponsible” as the previous “milkshaking” incidents had been widely reported as was the fact McDonald’s had suspended selling ice cream products.

The ASA says: “Although we acknowledged that the tweet may have been intended as a humorous response to the suspension of milkshake sales by the advertiser’s competitor, in the context in which it appeared we considered it would be understood as suggesting that Burger King milkshakes could be used instead by people to “milkshake” Nigel Farage.

“We considered the ad therefore condoned the previous anti-social behaviour and encouraged further instances. We therefore concluded that the ad was irresponsible.”

The ad must not appear again in its current form and Burger King must ensure any future communication does not condone or encourage anti-social behaviour.

Ikea makes biggest investment for 20 years in smart home tech

Ikea is pinning its future on smart home technology after making its biggest investment for two decades in the area.

The group is looking at products such as air cleaners alongside smart speakers, blinds and lightbulbs as it drives ahead with its transformation plans, according to the Financial Times.

Torbjorn Loof, CEO of Inter Ikea, which owns the Ikea brand, says: “We see it as a very interesting area for us to embark on. We want to simplify it and make it affordable… I think Ikea could have a leading role in the smart home arena.”

The retailer says it is the biggest investment it has made since launching its child-focused range in 1997. It comes as it looks to take on players such as Google and Amazon in the smart home space and is part of the brand’s ongoing transformation plan. This has seen it focus on ecommerce and assembly services, as well as experiment with smaller city centre stores as it reacts to dramatic changes in the retail and looks to future-proof the business.

Greggs outlines plan for no-deal Brexit

Greggs is stockpiling key ingredients to ensure production is not affected in the event of a no-deal Brexit.

The bakery chain outlined its plan for the UK’s departure from the EU in a trading update, which shows total sales were up 12.4% over the past 13 weeks.

Trading in the third quarter has been “very strong”, according to the brand, but it has warned that Brexit could put pressure on food and labour costs.

“We are preparing for the potential impact of the UK’s departure from the EU by building stocks of key ingredients,” the firm says.

Like-for-like sales, excluding new store openings, increased by 7.4% in the three months to 28 September, but at a slower pace than earlier in the year.

The Newcastle-based chain also warned it would be opening fewer new stores than previously forecast, which caused its shares to fall by 12.5%. It now expects to have 90 net openings (taking closures into account) by the end of the year, down from the 100 previously forecast.

Made.com shifts marketing direction with UGC campaign

Online design brand Made.com is calling on customers for its latest campaign, as it looks to use “authentic advocates” rather than influencers to showcase its offer.

The use of user-generated content (UGC) marks a change in direction for the brand, which is also asking users to upload pictures of their Made products to Instagram for a chance to appear in future iterations the campaign.

The brand made the shift after seeing data from Nielsen’s Consumer Trust Index, showing 92% of customers trust organic, UGC more than they trust traditional advertising.

Made’s chief creative officer, Jo Jackson, who led the in-house team in the development of the campaign says: “We have a huge community of genuine fans who are sharing some amazing content on their channels daily using Made products.

“This campaign is all about celebrating the Made fans who have helped make the brand a success story. People are much more inspired by authentic advocates of a brand and we want to work with a variety of people, not just ‘influencers’.”

The campaign will run across the London Underground, digital and social media alongside a printed magazine available in all Made showrooms.

Shop prices take a hit in September as spending slows

Shop prices fell by 0.6% in September, the highest rate of decline since May 2018, according to the latest monthly data from the British Retail Consortium and Nielsen.

Non-food prices dropped by 1.7% last month, a greater decline than in August when prices fell by 1.5%.

Meanwhile, food inflation slowed to 1.1% in September from 1.6% in August. The rate of inflation on fresh food halved to 0.7% compared to 1.4% the previous month, while ambient food inflation slowed to 1.7% in September from 1.7% in August.

Mike Watkins, head of retailer and business insight at Nielsen, says: “With consumers feeling uncertain about spending, retailers continue to focus on limiting price increases coming through the supply chain. Prices have fallen in non-foods helped by seasonal reductions and many food retailers have introduced price cuts to help regain momentum after a challenging summer.

He warns that competition for discretionary spend will intensify across all channels as the end of the year approaches, adding “we anticipate more promotional savings for shoppers and inspiring media campaigns that help to drive incremental sales”.

Tuesday, 1 October

E-cigarette firms face ad investigation

E-cigarette companies are facing having more restrictions put on their advertising as the industry regulator launches an investigation into how vaping ads could appeal to children.

The Advertising Standards Authority (ASA) has received hundreds of complaints relating to TV, outdoor and social media ads for vaping companies in the UK. Complaints include concerns that the ads appear to target under-18s and that they “misinform” about the dangers of e-cigarettes.

In the UK, Public Health England has promoted e-cigarettes as a smoking cessation tool. But many other countries have banned them amid growing scientific evidence they cause health and respiratory problems.

The ASA tells The Times it has opened investigations into companies including Juul, Blu and Vype. Complaints include a cinema ad from Juul that features interviews with ex-smokers who have switched to its e-cigarettes, an outdoor campaign from Blu that people have complained encourages non-smokers to vape, and Instagram posts from Vype targeted at under-18s.

Instagram to let brands alert users about product launches

Instagram is testing a feature that lets brands alert users when upcoming products are available to buy.

The tool lets users set reminders for a launch date and preview product details. The notifications appear in Stories or via product tags in the Instagram news feed.

The feature is currently in closed beta in the US with brands including Adidas, H&M, Levi’s, Mac Cosmetics and Warby Parker.

Adidas’s senior vice-president of digital Scott Zalaznik says in a blog post: “The progress Instagram has made with checkout gives Adidas’ customers the power to go from inspiration to purchase in an instant. We see adoption improve month to month. With new features like product launch reminders, we expect to see engagement increase as we can create simple, immersive and user-obsessed experiences Adidas creators love.”

WeWork scraps IPO plans

WeWork has cancelled plans for an IPO, saying it will instead “focus on the core business” amid mounting concerns about its business model and valuation.

The move comes after the property company’s share offering, launched in August, saw little enthusiasm among investors who raised questions over its finances, governance and leadership. Its co-founder Adam Neumann resigned as CEO last week and the company continues to post significant losses.

“We have decided to postpone our IPO to focus on our core business, the fundamentals of which remain strong,” say the firm’s new joint chief executives Artie Minson and Sebastian Gunningham.

“We have every intention to operate WeWork as a public company and look forward to revisiting the public equity markets in the future.”

Reports suggest WeWork’s valuations has sunk from $47bn (£37bn) in its last investment round to between just $10bn and $12bn. That comes as the company’s financials show it posted a $1.6bn loss on revenues of $1.2bn.

UK economy sees first quarter boost but gloomy Q2

The UK economy performed better in the first three months of the year than originally expected as stockpiling for Brexit in March boosted growth.

The Office for National Statistics (ONS) has revised GDP growth upwards in the first quarter from 0.5% to 0.6%. However, it warns that the UK economy shrank in Q2 by 0.2% as an extension to the Brexit deadline saw stockpiling reduce.

Production output fell by 1.8%, the lowest since 2012, while only services saw growth, although this slowed 0.1% last quarter. Business investment is estimated to have fallen by 0.4% between the first and second quarters.

John Hawksworth, chief economist at PwC, says the figures show “no change to the big picture of a slowing economy being propped up by consumer spending as investment has fallen back”.

NHS England launches recruitment campaign to get more men into nursing

NHS England is launching a recruitment campaign to get more men into nursing after a study last year found that only one in 10 nurses were men.

The ‘Men in Nursing’ campaign, created by MullenLowe, aims to address some of the stigmas around the job for men and address the perceived link between nursing and femininity. After finding there aren’t enough male role models, the ad shows the work men do in nursing roles across the NHS.

It will run on social media and video-on-demand.

Ian Hampton, lead campaign manager for NHS England, says: “There’s a real misconception regarding men in nursing which this film aims to put right. The reality is they are passionate, strong and smart individuals who play a vital role in the NHS. It’s important that as part of our wider recruitment campaign we attract more male nurses to the NHS as they currently they make up just one in 10 nurses.”

Monday, 30 September

New chocolate cuts waste by using whole cacao fruit

Swiss chocolate maker Barry Callebaut is launching a new recipe that it claims is the first to use the entire cacao fruit.

The chocolate giant will be selling the brand named ‘Cacaofruit Experience’, through Mondelēz.

Most chocolate products on the market are made with cocoa beans, meaning 70% of the cacao fruit is discarded. The company says using the entire fruit, including beans, peels, pulp and juice, “results in a range of high-quality ingredients that can be used in … juices, smoothies, frozen desserts, bakery and pastry products, and snacks all the way to chocolate”.

The WholeFruit chocolate is the latest innovation from the Swiss chocolatier, which is facing pressure to innovate and experiment amid mounting competition and changing consumer habits.

The company develops and supplies chocolate to major brands such as Nestlé, Unilever and Mondelēz. The latter will make the first new products under a new CaPao brand. A new line for artisan chocolate-makers will also follow in May.

A Mondelēz spokesman says: “We’re excited about the launch of CaPao, which offers consumers a new range of plant-powered snacks by making greater use of the cacao fruit. The products have been launched to start with in the US, but we will be looking to roll them out to other countries, including the UK, in the future.”

Plans to launch in the UK and Europe are underway but are subject to regulatory approval

Miss Selfridge reports £17.5m loss in fresh blow to Arcadia

Sir Philip Green’s Miss Selfridge chain fell to a £17.5m loss last year in the latest blow to his struggling Arcadia empire.

Sales fell by more than 15% to £102m in the year to September 2018, while pre-tax losses quadrupled from £4.3m in 2017.

The firm took a £12.1m hit to get out of leases on loss-making stores as it transitions to mostly sell the youth fashion brand online The accounts also show the average number of staff working in UK stores fell by a fifth to 1,188.

In May, the company said it planned to put the property holding companies of Miss Selfridge and its sister brand Evans into administration, resulting in the closure of 25 stores. This action is yet to happen.

Arcadia fought off collapse in June by winning backing from creditors to close 50 stores, shed 1,000 staff and cut rents by up to 50%. The group’s failing brands have struggled to compete with rivals such as Asos, H&M and Primark after years of underinvestment.

Avon launches search for ‘tech solutions in low tech environments’

Avon is launching a £20,000 search for “tech solutions in low tech environments”.

The beauty giant is challenging agencies to create content for its app, Avon ON, to help its representatives in less developed countries create more personalised content.

Avon’s chief beauty officer James Thompson says: “Avon is undertaking a major marketing transformation right now that will build on our heritage and lead to us firmly establishing the brand as a digitally-enabled global beauty player.”

With 6 million representatives across the world, Avon is looking for technology that can drive more relevant, personalised marketing and support its fast growing e-commerce division.

Following an application process, five firms will be invited to pitch live on 13 November at MAD//Fest London to Thompson and others.

The winner of the pitch will receive £20,000 to develop a pilot for Avon (subject to regulatory approval). The pitch is available to all tech firms, content businesses and agencies.

Thompson adds: “There’s a huge opportunity to create more engaging, personalised and effective mobile marketing content for our global audiences but it requires the right technology, partners and approach.”

Forever 21 files for bankruptcy

Forever 21 has filed for bankruptcy. The American fast-fashion retailer, which has struggled in the era of online shopping, say it plans to close up to 350 of its more than 800 stores.

In a statement, the firm says it plans to “exit most international locations in Asia and Europe” but to continue to operate in Mexico and Latin America.

The brand has filed for chapter 11 bankruptcy protection, which postpones a US company’s obligations to its creditors, giving it time to reorganise its debts or sell parts of the business.

Forever 21’s executive vice-president Linda Chang says: “This was an important and necessary step to secure the future of our company, which will enable us to reorganise our business and reposition Forever 21.”

The fast-fashion brand offers cheap clothing to young women and was founded in 1984 but has been struggling to compete with rising competition from online retailers

EA Sports launches FIFA 20 game with new campaign

EA Sports is launching a campaign to coincide with the launch of its FIFA 20 game.

‘Break New Ground’, created by adam&eveDDB, focuses on innovators that play ‘wrong’ in the stadium, in the street and in the game.

The 90-second film highlights that no matter the location, football has always been pushed forward by people who defy conventional playing styles.

The ad features footballers including Eden Hazard, Raheem Sterling, Jadon Sancho, Vinícius Jr and Megan Rapinoe, alongside boxer Anthony Joshua.

It will be run across outdoor, social and TV, and will include a series of stories of innovators in football.