Retail bright spots as Fortnum & Mason and JD sales up over Christmas
While 2019 was the toughest Christmas for retail in years, there were some bright spots.
Fortnum & Masons experienced sales growth of 15% (13% on a like-for-like basis), with online driving that increase. While online grew 22% and represented 39% of its sales, up three percentage points on last year, in-store were also up 9% like-for-like.
JD also says it had a good Christmas trading period and now expects profit to be at the upper end of analyst estimates. However it did not give further details of its performance, simply saying like-for-like trends were “positive”.
“Against a backdrop of widely reported retail challenges in the group’s core UK market, it is encouraging to report positive like-for-like trends in the group’s global Sports Fashion fascias, particularly overseas,” the company says.
Discounter B&M also experienced a sales boost despite the “difficult” retail environment although its performance was “slower than anticipated”. Fashion retailers Joules and Superdry, meanwhile, have issued profit warnings, while Game has warned it will need to close stores.
Carlsberg launches new alcohol-free beer brand
Carlsberg is launching a new alcohol-free beer brand as it taps into the growing popularity of lower alcohol drinks.
Carlsberg Nordic will replace the existing Carlsberg 0.0 brand. It has been specifically brewed as an alcohol-free beer and will be available in 170 Tesco stores, ahead of wider rollout planned for later this year.
To accompany the launch, Carlsberg is running a campaign that will run across Instagram, Twitter and Facebook. The low and alcohol-free beer market was worth £118m last year, up 32.3% year on year.
Carlsberg UK’s vice-president of marketing, Liam Newton, says: “The alcohol-free category has seen huge growth in the last few years as consumers seek to moderate their consumption without comprising on the taste of their beer. As a result, more people are opting for alcohol-free drinks, but they don’t want their choices to be limited. That’s why we are delighted to bring them a new choice for 2020 that is uncompromising on taste, quality and enjoyment.”
“Carlsberg Nordic has already been a great success in Denmark, with a great selection of alcohol-free beers within the portfolio, so we are confident it will be equally successful in the UK.”
Boden’s marketing boss Gav Thompson steps down
Boden’s chief customer officer Gav Thompson has left the fashion retailer a little more than a year after he joined in the newly created role.
His decision follows the departure of CEO Jill Easterbrook, who hired Thompson, at the end of last years after three years in the top role. Boden does not plan to replace Thompson, instead sharing his responsibilities in marketing and customer experience among other staff.
Thompson has previously held senior marketing roles at companies including Paddy Power, O2 and Yopa. He also founded mobile network Giffgaff.
IAB UK responds to ICO’s real-time bidding concerns
IAB UK is committing to a six-point action plan that it believes will help advertisers that use real-time bidding (RTB) comply with data protection regulations as the ICO, the UK’s data watchdog, investigates the industry.
The plan includes commitments in areas including data security, special category data, reliance on legitimate interest for cookies, legitimate interest and data protection impact assessments and the transparency and fairness of information provided to consumers.
The ICO is expected to update on its probe into RTB soon after it gave the industry until the end of this month to comply with GDPR. It has warned that it believes advertisers are breaching data regulations because personal data about consumers could be broadcast through bid requests without consent.
However, the ICO says it has had “constructive discussions” with the IAB and the industry and is “optimistic an industry-led solution is possible”. The IAB UK is now calling on the industry to come together to address the issues.
IAB UK’s head of policy and regulatory affairs, Christie Dennehy-Neil, says: “It’s now critical that we work together with our members to implement change. This needs everyone – advertisers, intermediaries and media owners – to work with us, and to be willing to take action and invest in making changes where necessary.”
Ad regulator clamps down on botox ads
The ad regulator is clamping down on botox ads that are increasingly appearing on social media despite the fact the service is not allowed to be advertised to the public.
The Committees of Advertising Practice (CAP) together with the Medicines and Healthcare products Regulatory Agency (MHRA) has issued an enforcement notice to the beauty and cosmetics industry on the issue. The notice compels businesses to review their adverts – including paid-for ads, non-paid-for posts and influencer marketing – and make immediate changes.
CAP will also be running a targeted ad campaign on Facebook to raise awareness of the issue.
To check if companies are complying, from the end of January CAP will use monitoring technology to root out problem ads on social media and flag them for removal with Facebook. Advertisers that do not follow the rules run the risk of being referred to their professional regulatory body, the MHRA.
CAP director, Shahriar Coupal, says: “This is an example of how CAP is exploring new, proactive ways of ensuring ads stick to the rules and rising to the challenges presented by the online environment.”
Thursday, 9 January
2019 the worst year for retail on record
2019 was the worst year for retail on record, according to the BRC-KPMG Retail Sales Monitor.
Total sales for the year dropped by 0.1%, compared with a 1.2% increase in 2018. It marks the first year retail sales have shrunk, rather than grown.
December figures suggest that there was an uptick in fortunes as the year headed to a close, with a 1.9% increase in sales, but the timing of Black Friday is seen as a disruptive factor.
Combined sales for November and December were down 0.9%.
British Retail Consortium CEO Helen Dickinson says that an uncertain Brexit-shaped future could continue to have a detrimental effect on sales.
“The public’s confidence in Britain’s trade negotiations will have a big impact on spending over the coming year,” she says.
“There are many ongoing challenges for retailers: to drive up productivity, continue to raise wages, improve recyclability of products and cut waste.
“However, this takes resources, so it is essential the new government makes good on its promise to review, and then reform the broken business rates system which sees retail pay 25% of all business rates, while accounting for 5% of the economy.”
ICO begins public consultation on direct marketing
The Information Commissioner’s Office (ICO) has launched a public consultation on a draft direct marketing code of practice.
The code will look to help direct marketers comply with various data protection initiatives, including those of the General Data Protection Regulation, Data Protection Act 2018 and the Privacy and Electronic Communications Regulations 2003.
The ICO is the UK’s independent regulator for data protection and information rights law, and the code will take a “practical life-cycle” approach to direct marketing.
Areas covered include planning marketing, collecting data, delivering marketing messages and individuals rights.
The code is out for consultation until 4 March and the final version is expected later this year.
Twitter to test blocking replies
Twitter is to test new features that will allow users to block replies to posts.
The features, revealed during a presentation at the Consumer Electronic Show, will allow users to select one of four settings: global (allowing anyone to respond), group (allowing anyone that the user follows to respond), panel (allowing anyone mentioned in the tweet to respond) and statement (not allowing any responses).
“We want to help people feel safe participating in the conversation on Twitter,” a spokesperson says.
P&G to acquire female body care brand Billie
Procter & Gamble (P&G) is acquiring female body care company Billie.
The direct-to-consumer brand supplies women with shaving supplies and premium body care products as part of a subscription service.
Billie, which donates 1% of all revenue to women’s causes around the world, will continue to be led by its co-founders, Georgina Gooley and Jason Bravman.
“We’re thrilled by the prospect of joining P&G to bring high-quality products at affordable prices to women around the world,” says Gooley.
“Its ability to create global household brands that have stood the test of time is a testament to their brand-building expertise; together, we’ll be able to create an even stronger brand for womankind.”
Dating app Hinge launches limited-edition merchandise
Dating app Hinge is launching a limited-edition merchandise store, with a range of products featuring the Hingie mascot.
The Hingie Shop has been created for couples who have taken the next step in their relationship and deleted the app (quite a milestone moment, apparently), as well as newcomers to the service.
Customers can either choose to proudly show the Hingie mascot on their merchandise or totally destroy it, as part of the company’s ongoing ‘Designed to be Deleted’ campaign, with a piñata, bath bomb, or a Hingie stuffed animal.
The shop will be hosted on a standalone website until all the products sell out.
DMA brings in new chair
Stephen Maher, CEO of digital agency MBA, is taking on a new role as the chair of the Data and Marketing Association (DMA) Board.
Maher will be joined by VerveIQ founder and MD Pipa Unsworth, who has been named as deputy chair.
“I am so delighted to be taking up this new role at such a vital time for the DMA and our 1,000 members who represent the UK’s leading brands and their marketing services partners,” says Maher.
“We will look to further extend and raise the profile of our industry expertise and training around data ethics and MarTech, as well as foster even greater industry diversity and inclusion from the classroom to the boardroom.”
There are also two newly elected additions to the DMA Board: Cordell Burke, creative managing partner at Up There, Everywhere, and Firas Khnaisser, head of decisioning at Standard Life.
Wednesday, 8 January
ASA cracks down on gender stereotyping
The Advertising Standards Authority has cracked down on another set of ads that don’t meet the standards of new rules around gender stereotyping.
The watchdog upheld complaints about ads from PeoplePerHour and PC Specialist after finding their ads broke rules that dictate brands should not perpetuate harmful stereotypes.
PC Specialist’s TV ad saw three men performing different activities on computers, with a male voiceover stating: “For the players, the gamers, the ‘I’ll sleep laters’, the creators, the editors, the music makers. The techies, the coders, the illustrators.”
Eight people contacted the regulator to complain, claiming that the ad implied only men were interested in technology. Plus it depicted men in stereotypically male roles, they said.
PC Specialist told the ASA that the vast majority of its customers were male and that it had not considered the ad to be offensive. However, the company said it had pulled it and was carrying out training internally.
Recruitment company PeoplePerHour’s outdoor ad also fell foul of the rules after it featured an image of a woman alongside: “You do the girl boss thing. We’ll do the SEO thing.”
The ASA said it received 19 complaints about the ad, created by George & Dragon, which appeared on the London Underground in November. Complainants challenged whether it depicted a woman running a business in a patronising way and implied women were not technologically skilled.
PeoplePerHour acknowledged that the ad might unintentionally come across as sexist and demeaning to women and said it has since removed the word “girl” from the ad and issued an apology on its site.
Meanwhile Pretty Little Thing also fell foul of rules after the Love Island star, Molly Mae, promoted the brand on social media but did not make clear post was advertising.
A complaint claimed that a post on Mae’s Instagram of an outfit from online retailer Pretty Little Thing (PLT) was not identifiable as an advert. PLT claimed the post had been “organically” shared by Mae but he ASA has ruled the post should not appear in its current form again
Argos drags down Sainsbury’s Christmas sales
Sainsbury’s like-for-like sales, excluding fuel, fell by 0.7% in the third quarter in part due to a drop in Argos sales.
The supermarket group said like-for-like trade in groceries rose by 0.4% in the 15 weeks to 4 January, while clothing sales rose by 4.4%.
However, it recorded a sharp fall in general merchandise that it blamed on toys and gaming. Sainsbury’s, which owns Argos, said like-for-like sales for general merchandise dropped by 3.9%
Chief executive Mike Coupe says: “Argos outperformed the market in consumer electronics, but the toy and gaming markets declined year on year.”
Despite this, Argos had its biggest digital Black Friday to date and record sales through mobile and via Argos click-and-collect.
It was not only Argos that saw digital improvements, with more than 20% of Sainsbury’s business online in the quarter – growth of 5%; Online grocery grew by 7.3%.
Coupe adds: “We have a real sense of momentum in Sainsbury’s and investment in our stores and improvements to service and availability have led to our highest customer satisfaction scores of the year.
EasyHotels hires new CEO
EasyHotels has appointed former EasyJet director Francois Bacchetta as its new CEO.
The budget brand is currently being led by interim CEO Scott Christie following the resignation last year of Guy Parsons.
Bacchetta is currently EasyJet director for France and Italy but will taking over the hotel company in the spring.
Prior to EasyJet, Bacchetta held a number of senior marketing positions at global cosmetics group L’Oréal, including being responsible for territories in South East Asia, as well as Europe.
Bacchetta says: “EasyHotel is a business I greatly admire and I am thrilled to be appointed. With a strong hotel network established in the UK, I believe this is a very exciting time for the brand and I look forward to leading the expansion in Europe as the Group seeks to become a leader in the budget hotel space.”
Mastercard releases a single
Mastercard is dropping its first record as it builds on its ‘sonic logo’.
Last year, the firm unveiled its own ‘sonic logo’ in the form of a unique melody that plays when customers interact with the brand online or in-store via point of sale sounds.
It has launched an ad campaign to highlight the sound but the brand have now incorporated it into a single with Swedish singer Nadine Randl. The song, titled Merry Go Round, will debut today at the Consumer Electronics Show and tells the story of a new beginning and fresh start enabled with Priceless possibility.
Mastercard chief marketing and communications officer Raja Rajamannar says:“Sound is our next frontier for brand expression and a powerful way for us to reach consumers through the passions that connect us all. We’re thrilled to be partnering with Nadine on ‘Merry Go Round’ to integrate the recognizable sonic melody – underscoring the many ways that the branding can be used beyond traditional means.”
Speaking to Marketing Week in February last year, Rajamannar admitted that “people asked if I was smoking something” when he first revealed the bank’s sonic branding.
Shareholders urge Barclays to end oil and gas investment in industry first
Shareholders are urging the Barclays to stop offering loans to fossil fuel companies.
A group of 11 pension and investment funds managing more than £130bn in assets have produced the first ever shareholder climate resolution aimed at a UK bank
The group of institutional investors are joined by over 100 individual investors who are all demanding that the bank divest from fossil fuel companies and stop funding coal mines and controversial tar sands exploration.
The resolution will be voted on at its annual general meeting in May.
Barclays is the largest financer of fossil fuels in Europe, and the sixth largest globally. Since the Paris Agreement was signed in 2015, the bank has provided over £65bn of finance to fossil fuel firms and high-carbon projects, according to investment charity Share Action, which coordinated the resolution.
Tuesday, 7 January
Facebook bans ‘deepfake’ videos as US election looms
Facebook is banning the use of “misleading manipulated videos” on its platform ahead of the 2020 US presidential election.
The social media giant says it will remove ‘deepfakes’ – videos that distort reality by using sophisticated artificial intelligence – if they have been edited or synthesised in ways that “are not apparent to an average person and would likely mislead someone” into thinking the subject said words they did not say.
Facebook will also remove videos if they are the product of AI or machine learning that merges, replaces or superimposes content onto a video, making it appear to be authentic.
The new policy does not, however, extend to content that is considered to be parody or satire, or a video edited “solely to omit or change the order of words”.
Facebook has worked with more than 50 global experts from technical, policy, media, legal, civic and academic backgrounds to improve its detection of manipulated media.
Videos that do not meet the standard for being considered a deepfake can still be removed by Facebook’s independent third-party fact checkers. If a photo or video is rated false, or partly false, its distribution will be significantly reduced on the news feed and can be rejected if it is running as an advert. Users who try to share the image or video, or have already shared it, will see warnings alerting them the content is false.
Morrisons sales drop amid ‘challenging’ Christmas trading
Challenging conditions and “customer uncertainty” have hit Christmas trading at Morrisons, which saw group like-for-like sales (excluding fuel) drop by 1.7% during the 22 weeks to 5 January.
The supermarket’s group like-for-like sales (including fuel) also fell, declining by 2.8% over the period.
Morrisons remains upbeat, however, stating that it has remained focused on its priorities and its customers, while continuing to invest in managing costs. Claiming that its basket of key Christmas items was “very competitive”, with most prices the same or lower than last year, the supermarket admits that its fuel business was affected by a “highly promotional market”.
The retailer did, however, see growth of its Free From gluten, wheat, dairy and lactose brand, with sales up 34% over Christmas and New Year.
“It was encouraging that during an unusually challenging period for sales, our execution was strong and our profitability robust, demonstrating the broad-based progress we have made during the turnaround,” says chief executive David Potts.
“This was again down to the hard work of Morrisons exceptional team of food makers and shopkeepers. As always, we will take some learnings into the new year, and look forward to 2020 with a strong plan and solid foundations on which to continue to grow.”
The company’s wholesale business was impacted by lower total sales across the McColl’s chain, although the retailer reports that sales at the first 10 conversions from McColl’s to Morrisons Daily convenience stores have been strong. Morrisons plans to extend the trial to around another 20 stores during January and February to further test the proposition.
During the period, the supermarket retailer also opened four new stores (including two replacements), closed four under-performing stores and launched a further 25 Fresh Look stores bringing the total to 44.
These new stores include Canning Town, Morrisons’ first store with a Market Kitchen food-to-go offer, and Bolsover, its first smaller, community store format which includes 1,000 local products sourced from 27 local food maker events nationwide.
McDonald’s CEO launches personal Instagram in a bid to move on from Easterbrook scandal
McDonald’s new CEO Chris Kempczinski has launched a personal Instagram account aimed at moving the company forward amid fresh allegations regarding the conduct of his predecessor Steve Easterbook.
In November, Easterbrook stepped down with immediate effect after admitting he violated company policy by having a consensual relationship with an employee.
In a memo to staff on Monday (6 January), seen by Business Insider, Kempczinski emphasised the “core values” underpinning the business, before asking employees to follow him on Instagram. His first post talked about “opportunity, community and solutions”- the three things that make him proud of the “McDonald’s System”.
Kempczinski’s first foray into the world of Instagram comes a day after a Wall Street Journal (WSJ) article claimed that McDonald’s “tolerated partying and fraternising between some senior managers and rank-and-file employees” under the leadership of Easterbrook and former chief people officer David Fairhurst, who also left the fast food chain in November.
The WSJ alleges that Easterbrook and Fairhurst drank with employees after hours and that Easterbrook was known for flirting with employees. McDonald’s is yet to react to the claims.
Impossible Foods branches out with plant-based pork
Impossible Foods is extending its collaboration with Burger King with the launch of a new range of plant-based pork.
On show at the Consumer Electronics Show (CES) in Las Vegas, the Impossible Sausage will be available next week in 67 Burger King restaurants across the US in a sandwich-based dish called the Croissan’wich.
The Impossible Sausage and ground pork substitute are made using heme – a molecule derived from plants that contains iron and resembles blood – and are both kosher and halal.
Impossible Foods is hoping the product will help it crack the Chinese market, where pork is a highly popular product, as well as enable the brand to go global given that pork is the most widely consumed meat worldwide.
Impossible Foods’ founder and chief executive, Patrick Brown, told the BBC that the company is accelerating the expansion of its product portfolio and will not stop until it eliminates “the need for animals in the food chain” and makes the “global food system sustainable.”
B&Q owner Kingfisher appoints chief customer and digital officer
Kingfisher, the parent company behind B&Q and Screwfix, has appointed former Lego chief digital officer Jean-Jacques Van Oosten as its new chief customer and digital officer.
Van Oosten previously served as group IT director at the home improvement group from 2005 to 2008, before leaving to join Tesco.com as chief information officer and non-food change director. He then took on the role of chief information officer at builders’ merchant Travis Perkins and later became chief technology officer at luxury goods company Richemont.
Most recently at Lego, Van Oosten led the company’s ambition to make ecommerce the largest part of its business.
He joins the group executive team, based at Kingfisher’s head office in Paddington, London.
CEO Thierry Garnier said Van Oosten has a key role to play in accelerating Kingfisher’s digital and data capabilities, as well as growing its ecommerce sales.
Monday, 6 January
Lidl removes cartoon characters from own-brand cereal boxes
Lidl is removing cartoon characters from its own-brand cereals in a move it says will help parents resist pester power and tackle childhood obesity.
Lidl says it will remove cartoon characters from eight of its cereal brands by the spring (see pictures above). It will not be changing the brand names – which include Choco Rice, Cereal Cookie and Frosted Flakes – however.
The supermarket chain says it was prompted to take action after nearly three-quarters of parents said they felt pressure to buy certain items in the supermarket. More than half believe cartoon characters on packaging encourage this.
Lidl’s head of corporate social responsibility Georgina Hall says: “We want to help parents across Britain make healthy and informed choices about the food they buy for their children. We know pester power can cause difficult battles on the shop floor and we’re hoping that removing cartoon characters from cereal packaging will alleviate some of the pressure parents are under.”
P&G overlays ordinary products with AI and sensors
Procter & Gamble is marking its second year at the Consumer Electronics Show with a series of launches that bring technology such as artificial intelligence to ordinary products.
The products on show include an Oral-B toothbrush that feeds back on brushing in real-time, a Pampers internet-connected baby care system and a smart fragrance diffuser. There is also a razor that is designed for shaving someone else and a robot that can deliver toilet paper so consumers “won’t be left in a bind ever again”.
“We strive to make life easier and more enjoyable with the superior products and services our brands offer,” says P&G CEO David Taylor.
“CES gives us the chance to show how we are constructively disrupting our business to deliver irresistibly superior experiences that reinvent what people expect of everyday products.”
Other FMCG brands have also been showing off their tech credentials at CES. L’Oreal, for example, introduced Perso – a system that uses AI to offer personalised skincare and cosmetics.
Outdoor advertising to overtake newspapers for first time
Investment in outdoor advertising is expected to overtake newspaper ad sales this year for the first time as outdoor spend grows while newspapers decline.
The out-of-home segment accounts for around 6.5% of the $600bn global ad market and is one of the few so-called ‘traditional’ media to still see growth. Newspapers ads, on the other hand, are in decline.
In 2020, advertisers are expected to spend $40.6bn on outdoor ads, about $4bn more than on newspapers, according to figures from media buying agency GroupM seen by the Financial Times. And by 2024, outdoor advertising is expected to exceed spending on both newspapers and magazines.
“Outdoor advertising has been resilient because it retains unique characteristics for advertisers,” says GroupM global president of business intelligence Brian Wieser. “It helps that the medium has continued to evolve.”
Google algorithm shows users searching for help to quit gambling ads for online casinos
Google’s algorithm is serving up ads for online casinos to users searching for help to quit gambling, according to an investigation by The Independent.
Ads appearing alongside Google searches for Gamstop – a programme that lets people ban themselves from gambling online – send users to a list of casinos that are based offshore and therefore do not have to follow UK’s regulations. Some even boast of being able to circumvent software designed to protect problem gamblers.
Some of the adverts continued to be displayed even after The Independent brought the issue to Google’s attention despite Google saying offending accounts had been suspended from its ad platform, AdWords.
A Google spokesperson says: “We support responsible gambling advertising and it’s important to us that people see useful and relevant ads in this area.
“As such, we have strict policies around gambling ads, which we enforce rigorously. We have suspended the accounts in question.”
Weight Watchers courts controversy with new campaign
Weight Watchers has been criticised for running a campaign that was unfortunately timed to coincide with the airstrike against Iran by the US military.
Anxious Twitters users expressed concerns that the killing of Major General Qassem Soleimani might lead to World War III, prompting hashtags such as #WWIII and #worldwar3 to trend on the social network. However, at the same time Weight Watchers – which rebranded as WW last year – was running a social media campaign with the hashtag #thisismyWW.
The campaign was meant to encourage Twitters users to visit WW’s site to browse customised food and exercise plans. But many Twitters users questioned the decision to keep running the campaign given the other trending topics on the social network.