M&S, Uniqlo, Bumble: 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.

M&SNew leadership team at Marks & Spencer

M&S chief executive Steve Rowe will stand down from his role at the company’s preliminary results presentation on 25 May.

Having joined the retailer from school at the age of 15, Rowe rose through the ranks before taking over as chief executive in 2016. He has overseen the brand’s online food debut with its Ocado joint venture and the doubling of online sales of clothing and home ranges, and also the closure of more than 60 physical stores from the M&S estate.

Rowe’s departure is part of a planned succession programme. He will remain as an adviser to the business for up to 12 months.

“It has been an enormous privilege to lead the business I love and have spent almost all my career working for. Leaving will be in many ways very difficult for me but I feel that after six hard years it is the right time to pass on the baton,” he says.

“I am enormously grateful for the support I have had in driving through the extraordinary transformation programme of the last few years from shareholders, the board, but most of all the many thousands of colleagues in the business. A piece of my heart will always remain with the M&S family, and I feel that we have done many of the hard yards to restore the business to what it should be. I’m proud that I am leaving a very strong team who will lead it into the next growth phase. I wish them every success.”

M&S chairman Archie Norman described Rowe as “a magnificent servant of M&S, putting his heart and soul into the job”.

The retailer has named current joint chief operating officers Stuart Machin and Katie Bickerstaffe as co-CEOs. Machin will continue to have oversight of his current portfolio, which includes the retailer’s food business, as well as operations, property, store development and technology.

Bickerstaffe will focus on driving the global omnichannel, digital and data future of the company. Eoin Tonge becomes chief strategy and finance officer.

“The appointments we are making today bring together a very strong leadership team to take the business into the next stage of its transformation,” says Norman.

“Given the very strong recent progress we have made, keeping up the pace and momentum is critical. We are delighted to have brought together three exceptional individuals who, with the support of the executive committee, will provide vision, energy and pace for this next phase.”

Uniqlo U-turns on keeping Russian stores open

Source: Shutterstock

Japanese fashion retailer Uniqlo has made a U-turn on its commitment to continue trading in Russia. Earlier this week it had defended a decision to keep its 49 Russian stores open.

However, it has back-tracked, saying: “It has become clear to us that we can no longer proceed due to a number of difficulties. Therefore, we have decided today to temporarily suspend our operations.”

The group had previously planned to keep its stores in Russia open because it considered clothing to be a basic necessity for the civilian population.

“Fast Retailing [Uniqlo’s parent company] is strongly against any acts of hostility. We condemn all forms of aggression that violate human rights and threaten the peaceful existence of individuals,” the company adds.

Last week the company made a $10m donation, plus clothing, to those afflicted by the conflict, while employees in Europe have been helping to deliver clothing to people fleeing Ukraine.

Older UK consumers leading boycott of brands that trade in Russia

Nearly three fifths of UK consumers are less likely to buy from a brand that continues to do business with Russia following its invasion of Ukraine, according to new research from YouGov.

The study finds 41% of consumers would boycott, or have already boycotted, brands that still do business in Russia, 68% say it is important for brands to take a public stance on the conflict, and 51% are more likely to buy from a brand that stops doing business with Russia.

Overall, 56% of Britons say they are less likely to buy from a brand that continues doing business in Russia, though that figure rises among older consumers with 65% of those aged 50 to 64 and 67% of those aged over 65 ready to cut out companies which don’t pull out of Russia. Among those aged 18 to 24 only a third (33%) say they are less likely to buy from brands that do business in Russia.

Initiatives such as donating a portion of income to humanitarian projects in Ukraine also land well with UK consumers, with 51% saying they would be more likely to buy from a company taking such a position. Meanwhile 26% say it would make no difference, 14% weren’t sure and 5% would be less likely to buy.

The list of companies which are closing down operations in Russia is growing by the day. Tobacco companies Imperial Brands and Philip Morris, retailer Mothercare and confectionery group Nestle have recently joined companies such as BP, Shell, McDonald’s, Coca-Cola, Pepsi and Apple in pulling out of the Russian market.

Bumble seeks to bridge the ‘Romance Gap’ with new campaign

Women-first dating app Bumble is seeking to challenge the ‘Romance Gap’ created by different expectations of romance based on gender identity.

According to Bumble’s research 74% of people perceived different expectations of behaviour according to gender identity. More than half (52%) say society expects men to take the lead in relationships, while a third of women say they have changed their behaviour to make someone else feel more powerful or comfortable.

Its latest campaign centres around a 90-second film of women from around the world delivering a rousing speech on inequalities in dating and relationships.

“The Romance Gap is a new term, but many of us will know the feeling. Those moments of questioning if sending that text makes you appear too keen, waiting for them to take the lead, or worrying if you are being judged for being too direct, too inexperienced, too old. At Bumble, we are focused on creating an app that empowers women to make the first move and date on their own terms from the beginning. But we alone cannot change societal expectations,” says Bumble VP for Europe Naomi Walkland.

“An unexamined Romance Gap limits us, with almost 1 in 2 people agreeing that it makes it difficult to build equal relationships. The only way to reduce the Romance Gap is to acknowledge it exists and start an open conversation about how it impacts how we see ourselves, our partners, and relationships. This new campaign, created with 72andSunny, aims to raise awareness and establish a vocabulary for the Romance Gap. Only when we are aware of it can we challenge each other to do away with gendered expectations of who should do what.”

Marketers named for SkyShowtime launch

Subscription video on-demand platform SkyShowtime, which is due to launch across more than 20 European markets during 2022, has appointed senior marketers as part of its key management team.

Richard Howard has been named as CMO. Joining from NBCUniversal, where he was senior vice-president of marketing for Hayu, he will build and lead a performance marketing team and scale the direct-to-consumer business,

Jen McAleer, SkyShowtime’s new chief brand officer, was previously group brand director at Sky and was group own brand director at Tesco.

SkyShowtime CEO Monty Sarhan says: “In building a team, my goal has been to bring together leaders who share my vision of creating an exciting, dynamic, inclusive, and empowered organisation. These talented individuals bring a wealth of expertise from across the industry and will play a critical role in the success of SkyShowtime. I know all of them will work passionately and enthusiastically to drive our business forward as we gear up for our upcoming launches across Europe.”

SkyShowtime will offer more than 10,000 hours of content including the TV premieres of first-run films from Paramount and Universal and new scripted series from Showtime, Paramount+, Sky Studios and Peacock, as well as local origin programmes from individual markets.

Thursday, 10 March

Oatly oat milk

Oatly to focus on ‘growth over profitability’ as losses rise

Oatly has posted an adjusted EBITDA loss of $65.6m (£49.8m) for the fourth quarter of 2021, up from a loss of $25.1m (£19m) in the same period in 2020.

However, revenue grew by 46.3% to $185.9m (£141.1m) over the quarter compared to $127.1m (£96.4m), despite Covid-19 related impacts.

Revenue for the year to 31 December therefore totalled $643.2m (£488m), a 52.6% increase compared to $421.4m (£319.8m) in the prior year, which the company says is “above expectations”. EMEA continues to be the company’s largest market, with revenue of $336.5m (£255.3m), followed by the Americas at $179.8m (£136.4m) and Asia at $126.9m (£96.3m).

Last year therefore marked a “record year” for the business, according to CEO Toni Petersson, who said growth over profit will continue to be Oatly’s priority moving forward.

“We continue to focus on prioritising growth investments over profitability to increasingly scale our operations to best position Oatly to serve customers and consumers, with the understanding that this creates some near-term margin headwinds,” he said.

“We have a proven, disciplined and thoughtful multi-channel strategy for growth that we believe sets us apart from the competition based on our success thus far in building our brand across three continents, with a significant amount of whitespace to add new markets.”

Branding and marketing expenses over the fourth quarter increased by an additional $9.3m (£7.1m).

Speaking on a call with investors, chief financial officer Christian Hanke said Oatly will “maintain” its investments in branding and marketing activities across all markets in the year ahead.

Marketing and branding expenses have typically been in the range of 8-10% as a share of revenue, he said, and that is expected to remain in the medium term.

“Growth continues to be our priority, and that’s what we’re investing behind,” he said. However, he added the company has hit the level of sales, general and administrative (SG&A) expenses it needs to grow the business, and expects to see it reduce as a share of revenues “over time”.

For the year ahead, Oatly expects to reach revenues up to $920m (£698m), with strong growth across all regions.

Petersson said the business is “well positioned” for growth across retail, food service and ecommerce, and will be looking into future opportunities for new distribution, innovation and new market development.

“ We are consistently taking steps to position ourselves for an increased rate of growth as these macro headwinds subside,” he said. “What remains clear is the significant opportunity still ahead of us to continue converting dairy users into Oatly consumers.”

Three in four brands have reduced or cut Russian ad spend, says WFA

Of 31 global brand owners representing $43bn in global ad spend, three in four have reallocated, reduced or cut advertising investment in Russia since the invasion of the Ukraine, according to a poll conducted among members of the World Federation of Advertisers (WFA).

The WFA is now calling on all advertisers to “carefully review and reconsider” their current media and marketing investments in the country.

In particular, the organisation suggests brands reconsider spend with media outlets that are close to or effectively part of the Russian administration. RT, for example, is a Russian television network funded and controlled by the state.

“In light of the horrifying events in Ukraine, the global marketing industry must speak out,” says WFA CEO Stephan Loerke.

“Every company will have to make its own decision but our recommendation is that media investment and marketing in Russia should end for now.”

The WFA says it will continue to work with members and partners in the Global Alliance for Responsible Media (GARM) to ensure advertising investment does not support or monetise misinformation at this time.

FMCG giants P&G and Unilever have already said they will halt all media and advertising spend in Russia across their portfolios of brands.

Earlier this week Unilever released a statement condemning the war in Ukraine as a “brutal and senseless act by the Russian state”.

Uniqlo defends decision to keep Russian shops open

Source: Shutterstock

The owner of fashion retailer Uniqlo has said clothing is a “necessity of life”, as the business defends its decision not to close its 49 Russian stores.

Speaking to Japanese newspaper Nikkei, Fast Retailing’s founder Tadashi Yana said Russian citizens “have the same right to live as we do”.

He continued: “There should never be war. Every country should oppose it… [But] clothing is a necessity of life.”

A number of other fashion retailers, including Zara, H&M, Boohoo and Asos, have all halted operations in Russia due to the war with Ukraine.

However, Uniqlo isn’t the only company to continue business in the country. British American Tobacco is to continue to operate in Russia, which it identifies as of its key growth markets for cigarettes.

Danone and Unilever have both promised not to commit to new investment in Russia, but are continuing to supply everyday essential food and hygiene products made in Russia to people in the country.

Meanwhile, Cadbury owner Mondelez has been under pressure to join the exodus.

READ MORE: Uniqlo keeps Russian shops open as clothes a ‘necessity’

KFC, Pizza Hut, and Heineken among latest brands to halt Russian business

KFC and Pizza Hut owner Yum! Brands has suspended its operations in Russia in response to the Ukraine invasion, alongside Heineken, Mothercare, Universal Music Group, and tobacco firm Imperial Brands.

Yum! is suspending 70 company-owned KFC restaurants in Russia and is finalising an agreement to suspend all 50 Pizza Hut outlets in partnership with its master franchisee.

Yum! has 1,000 KFC restaurants in Russia, most of which are run by franchisees. The company had already suspended all investment and restaurant development.

The business follows McDonald’s decision on Tuesday to close Russian restaurants in response to the “needless human suffering” taking place in Ukraine, and following consumer pressure.

Burger King owner Restaurant Brands International (RBI) is continuing to operate in Russia, but is redirecting all profits to humanitarian efforts, with an immediate donation of $1m to the United Nations refugee agency.

Ukrainian refugees are also being offered free Whopper meal vouchers in more than 25 European countries. There are approximately 800 franchised Burger King restaurants in Russia, managed by independent local operators.

Meanwhile, Heineken has stopped the production and sale of its own-brand beer in Russia, while British babywear chain Mothercare has suspended all business in the country, including 120 stores and online. Russia accounts for 20-25% of Mothercare’s worldwide retail sales and was expected to contribute around £500,000 a month to group profit.

Plenish unveils new packaging and brand refresh

Source: Plenish/Baccus

Plant-based drinks brand Plenish is refreshing its brand with the launch of a new “premium” packaging across its range of milks, juices and shots, as it looks to accelerate growth.

To drive wider appeal, Plenish has evolved its identity and packaging to showcase its hero ingredients through on-pack imagery, while introducing a “warm colour brand world” to improve standout on shelf.

The brand refresh is driven from consumer research and evolving category trends. Almost 50% of 25- to 44-year-olds are now interested in plant-based drinks, either as a milk substitute or a flavour preference, according to research by Mintel.

The refresh will be supported with the launch of a new website and a marketing campaign across broadcast video-on-demand (BVOD), YouTube, PR, social media and in store activation. The rebranded drinks will be available in supermarkets from 15 March.

“The business has grown beyond my wildest dreams, from cold-pressing juices in my kitchen all those years ago to a range of juices, milks & shots sold in thousands of stores across the country,” says founder Karen Rosen.

“One thing has always united every product we’ve ever made – an obsession with using only the finest natural ingredients and nothing else. Nature is our number one supplier and with our new look we wanted to hero those amazing ingredients in all their natural glory. We’ve always believed that Less is Moreish, and now it’s there for all to see.”

Wednesday, 9 March


McDonald’s closes Russian restaurants in recognition of suffering in Ukraine

McDonald’s has decided to temporarily close its restaurants in Russia in response to the “needless human suffering” taking place in Ukraine.

The fast food chain, which has come under increasing pressure to pull out of Russia following the invasion of Ukraine, says it is “impossible to predict” when its restaurants will reopen. The business expects supply chain disruption to continue while it “closely monitors” the humanitarian situation.

CEO Chris Kempczinski says the company’s values mean it “cannot ignore the needless human suffering unfolding in Ukraine” and the business condemns the “aggression and violence” being perpetrated against the Ukrainian people.

The McDonald’s CEO says the situation is “extraordinarily challenging” for a global brand and there have been many considerations to take into account. The chain employs 62,000 people in Russia, who McDonald’s says have “poured their heart and souls” into the brand, alongside hundreds of local suppliers and partners. The chain has operated in the country for more than 30 years, across 850 locations.

McDonald’s will continue to pay full salaries for its Ukrainian and Russian employees, and has donated $5m (£3.8m) to its employee assistance fund. The company owns most of its stores in Russia and combined with Ukraine, these outlets account for around 9% of revenue and about 2% of global sales, the BBC reports. Currently all the chain’s 108 Ukrainian restaurants are temporarily closed.

“Across the rest of Europe, we will stay focused on how McDonald’s can best help those in need, both now and in the future,” Kempczinski adds.

“We have already seen extraordinary leadership by our Ukrainian and Russian teams, and I know the rest of the McDonald’s System stands ready to support the large number of refugees who have been displaced by this conflict.”

Coca-Cola, Pepsi and Starbucks pull out of Russia amid mounting pressure

Coca-ColaCoca-Cola is suspending business in Russia amid growing pressure to boycott the brand following its silence over the war in Ukraine.

In a statement Coke says its “hearts are with the people who are enduring unconscionable effects from these tragic events in Ukraine.”

The drinks giant will continue to monitor and assess the situation as circumstances evolve.

Coca-Cola was under mounting pressure to take a stand after previously refusing to pull out of Russia, while global brands such as Netflix, Levi’s and Apple had already paused operations. The hashtags #BoycottCocaCola and #BoycottMcDonalds, another company which until yesterday had stayed silent on the issue of Russia, had been trending on Twitter.

Rival PepsiCo says that due to the “horrific events occurring in Ukraine”, it is suspending the sale of Pepsi and its wider drinks portfolio in Russia. The company also plans to suspend all capital investments, advertising and promotional activities in the country.

However, CEO Ramon Laguarta believes PepsiCo has a “humanitarian” responsibility to continue to sell other products in Russia, such as milk, dairy, baby formula and baby food.

“By continuing to operate, we will also continue to support the livelihoods of our 20,000 Russian associates and the 40,000 Russian agricultural workers in our supply chain as they face significant challenges and uncertainty ahead,” he explains.

Starbucks announced yesterday it was suspending all business activity in Russia, including shipments of its products and cafes run by a licensee. The Alshaya Group, which operates at least 100 Starbucks cafes in Russia, will support the company’s 2,000 employees in the country.

Yesterday Unilever also released a statement, condemning the war in Ukraine as a “brutal and senseless act by the Russian state.”

CEO Alan Jope confirmed the FMCG giant has suspended all imports and exports of its products in and out of Russia, and will halt all media and advertising spend.

“We will not invest any further capital into the country nor will we profit from our presence in Russia,” Jope added. “We will continue to supply our everyday essential food and hygiene products made in Russia to people in the country. We will keep this under close review.”

Unilever had already paused operations in Ukraine to focus on the safety of its employees and their families, donating €5m (£4.1m) of essential products to the humanitarian relief effort.

However, one company standing by its decision to remain trading in Russia is fashion brand Uniqlo. Despite rivals Zara and H&M pulling out of the country, founder of Uniqlo’s parent company Fast Retailing, Tadashi Yanai, told Japan’s Nikkei newspaper that while there should “never be war”, clothing is a “necessity of life.” He added: “The people of Russia have the same right to live as we do.”

The fashion chain, which operates 49 stores across Russia, says it will “monitor the situation” but as yet shows no signs of pausing trading in the country.

READ MORE: War in Ukraine: McDonald’s, Coca-Cola and Starbucks halt Russian sales

Government goes after scam ads in tweak to Online Safety Bill

Social media sites and search engines could have to stop paid-for scam adverts appearing on their platforms as part of an updated proposal to the government’s Online Safety Bill.

Under the current draft, search engines and social platforms must protect users from fraud committed by other users, such as ‘catfishing’ romance scams and fake stock market tips. The update to the bill relates to fraudulent paid-for – rather than user generated – adverts, whether controlled by the platform itself or an advertising intermediary.

Search engines and social media sites will be required to introduce “proportionate systems and processes” to prevent the publication and/or hosting of fraudulent advertising, and remove such ads when made aware. This includes ‘boosted’ social media posts by users paid to be promoted more widely.

The change is designed to improve protections from the “potentially devastating impact” of fake ads, including where fraudsters impersonate celebrities or companies to steal personal data, “peddle dodgy financial investments”, or hack bank accounts.

Separately, the government is launching a consultation on proposals to tighten the rules for online advertising, with a view to increasing regulation and creating what the state describes as a “more transparent, accountable and safer ad market.”

The consultation will consider the whole supply chain and whether those within it should do more to combat harmful advertising, including ad-funded platforms such as Meta, Snap, Twitter and TikTok and intermediaries such as Google, TheTradeDesk and AppNexus.

Options include strengthening the current self-regulation or creating a new statutory regulator with tough enforcement powers. Under the new proposals harmful or misleading ads, such as those promoting negative body images or illegal activities, could be subject to tougher rules, while influencers failing to declare they are being paid to promote products could also face stronger penalties.

Culture Secretary Nadine Dorries says the government is responding to calls to strengthen the UK’s internet safety laws.

“As technology revolutionises more and more of our lives the law must keep up. Today we are also announcing a review of the wider rules around online advertising to make sure industry practices are accountable, transparent and ethical – so people can trust what they see advertised and know fact from fiction,” Dorries adds.

Founder of MoneySavingExpert.com Martin Lewis, whose face is among the most used by scammers in the UK, welcomed the update to the Online Safety Bill. He believes the UK is in the midst of an “epidemic of scam adverts” and calls for firms publishing the ads to be held accountable.

“Scams don’t just destroy people’s finances – they hit their self-esteem, mental health and even leave some considering taking their own lives,” he adds.

M&S makes ‘strategic investment’ in The Sports Edit

Marks & Spencer (M&S) is making a “strategic investment” in activewear platform The Sports Edit, in an extension of the retailer’s third-party brand focus.

Founded in 2015, The Sports Edit offers a range of curated activewear collections alongside emerging boutique brands, with a focus on premium sportswear, athleisure wear and yoga clothes. With the backing of M&S, The Sports Edit intends to add an own brand activewear offering to the mix.

The platform’s founder Nick Paulson-Ellis will continue to run the company independently as CEO, with support to grow via M&S’s investment and access to infrastructure and capabilities. The terms of the deal mean M&S will eventually own 100% of the brand.

The retailer describes The Sports Edit as a complementary ecommerce platform with a highly engaged customer base, which ties in with its strategic focus on activewear. Own brand Goodmove, for example, has become the biggest in-house womenswear brand at M&S in the space of two years.

The retailer claims The Sports Edit’s “proven capability” in brand curation and emerging brand identification will provide valuable learning opportunities as it grows the ‘Brands at M&S’ platform.

As part of its third-party brands strategy, M&S says it is utilising a range of models from wholesale agreements, exclusive collaborations and investments – such as its minority stake in Nobody’s Child – and seed funding for small brands via the True Fund. There have also been “selected acquisitions” such as Jaeger and now The Sports Edit.

“Developing the Brands at M&S platform is just one example of how we’re shaping the future of M&S,” says COO Katie Bickerstaffe.

“Investing in digital and growing brands is an important way to explore growth categories and ultimately build our offer so we’re relevant for our broad customer base in the future. Nick has created a brilliant activewear business and will continue to operate The Sports Edit independently supported by this investment to scale and grow.”

Lego credits ‘most diverse portfolio’ for sales surge

Lego hails the impact of “strong execution” and its “most diverse portfolio” for helping grow revenue by 27% to DKK 55.3bn (£6.2bn) for the 2021 full year.

Consumer sales rose by 22% over the period, outpacing the toy industry and driving market share growth globally, as well as in Lego’s largest markets.

The company’s operating profit over the full year period grew 32% to DKK 17bn (£1.9bn), which was achieved despite “ambitious strategic investments” and increased freight and raw materials costs. Net profit reached DKK 13.3bn (£1.5bn) in 2021, versus DKK 9.9bn (£1.1bn) in 2020.

The business also points to Net Promoter Score and people engagement metrics being at “record high levels.”

In 2022, the group’s 90th anniversary year, growth rates are expected to “normalise to long-term sustainable single-digit growth”, driven by a continued focus on product innovation, and growth in established and newer markets.

Lego Group CEO Niels B. Christiansen says the company’s strong financial performance allows it to further accelerate strategic investments in product innovation, retail channels, production capacity, digitalisation and sustainability to drive in-year and long-term growth.

“In 2021 we saw the benefits of strategic investments made over the past three years to innovate our portfolio, expand and evolve our retail experiences and increase capacity within our global supply chain network,” Christiansen adds. “I am excited about our ability to continue to invest against these priorities due to our strong financial results.”

The business claims its decision to expand, innovate and transform its digital retail channels and brick-and-mortar stores paid off in 2021. Online sales grew “strong double digits”, while the business opened 165 new Lego branded physical stores, including more than 90 in China. This brings the total number of stores globally to 832 as of 31 December.

Last year Lego also introduced of a new retail store platform designed to create immersive brand experiences for shoppers, which will roll out to more stores in 2022.

Online the brand’s digital building instructions received 9.6 million downloads over the year, while the Lego Life app has been downloaded by more than 33 million users since its launch in 2018. In a bid to ramp up its digital capabilities, Lego recruited new staff for its digital hubs in Denmark, London and Shanghai in 2021.

From a sustainability perspective, last year the group completed a trial to replace single-use plastic bags in boxes with sustainable packaging, which will be phased-in from mid-2022. This puts Lego on track to achieve its goal of having sustainable packaging by 2025.

Tuesday, 8 March

McDonald’s and Coca-Cola urged to boycott Russia

Coca-Cola and McDonald’s are facing growing criticism for not pulling out of Russia in light of its attack on Ukraine.

The hashtags #BoycottMcDonalds and #BoycottCocaCola have been trending on Twitter, with many urging the global brands to stop operating in the country.

McDonald’s has 847 stores in Russia, according to information published on its website recently, the majority of which it owns rather than them being franchises.

Other western brands including KFC, Pepsi, Starbucks and Burger King are also facing criticism for failing to close their outlets and stop sales in Russia.

The BBC says it requested comment from all these firms, but none have responded.

Meanwhile, Procter & Gamble has discontinued all capital investments in Russia and is suspending all media, advertising and promotional activity in the country.

Jon Moeller, P&G’s president and CEO says: “We are significantly reducing our product portfolio to focus on basic health, hygiene and personal care items needed by the many Russian families who depend on them in their daily lives. As we proceed with the reduced scale of our Russian operations, we will continue to adjust as necessary.”

P&G has also suspended its operations in Ukraine to help protect its people locally. It is offering evacuation assistance, and financial and logistical support, we well as providing food, shelter and essential products to P&G staff in the country.

Moeller adds: “Our hearts go out to all people who endure the unspeakable human toll of war, and we condemn aggression in any circumstance. We join the world in praying for peace.”

Greggs returns to profit, saying it is emerging from the pandemic a ‘better’ business

GreggsGreggs says it has emerged from the pandemic as a “stronger and better” business as it posts a 34% increase in pre-tax profit compared to 2019.

The bakery chain made a profit of £145.6m in 2021 versus a loss of £13.7m in 2020 and ahead of the £108.3m profit it recorded in 2019.

Total sales for the company are up 5.3% on 2019 to £1.2bn, and far higher than the £811.3m it took in 2020 as it contended with store closures and the impact of the pandemic.

After trialling evening opening hours in 100 stores during 2021, Greggs now plans to roll out late opening hours to a total of 500 shops, which will be supported by marketing activity.

The brand sees the move as a “strategic opportunity” to compete in the food-on-the-go market in the evening, given market research shows that sales after 4pm accounted for 35% of food-to-go sales in 2021, which is the largest proportion of the market by time of day.

Given Greggs stores typically close around 6pm it says it currently accounts for just 1% by value for this ‘dinner time’ market, compared to nearly 8% of the lunchtime market and 11% for breakfast.

Further research shows 86% of demand during the evening is for take away food, according to the bakery chain, which believes it is therefore well positioned to compete. Currently 30% of customers surveyed say its existing menu options are suited to evening consumption, so it believes it can grow the evening trade to 17% of daily sales.

Digital expansion has also been a focus. Greggs extended its partnership with Just Eat from 600 to 1,000 shops nationwide and it plans to extend to a further 300 outlets this year. The brand says that while there was some slowdown in digital sales when stores reopened in 2021 following lockdown, delivery sales remained “strong and accretive” when walk-in sales increased again, extending the reach of its shops beyond people passing by.

Greggs says delivery also has the added benefit of a single order serving multiple customers, meaning basket size is an average of three times that of walk-in consumers.

The bakery chain has warned that inflation is “more significant” than its initial expectations and is impacting on raw material, energy and people costs.

Greggs CEO Roger Whiteside has said the business is working to mitigate the impact this has on customers to protect the company’s reputation for value. As a result it does not expect material profit to grow in the year ahead.

“Our results and achievements in 2021 show that we have emerged from the pandemic both stronger and better as a business,” says Whiteside.

“We have started 2022 well, helped by the easing of restrictions. Cost pressures are currently more significant than our initial expectations and, as ever, we will work to mitigate the impact of this on customers, however given this dynamic we do not currently expect material profit progression in the year ahead.

“Despite these near-term pressures, we continue to believe that the opportunities for Greggs have never been more exciting. Our investment over recent years has left the business well-placed to move quickly as the economy recovers and we drive our ambitious plans to become a larger, multi-channel business.”

Greggs opened 131 new shops in 2021, as well as closing 28, taking its total across the county to 2,181. It plans to open 150 new shops annually going forward, as it aims to hit its target of 3,000 shops in the UK over time.

Sainsbury’s to sponsor Great British Bake Off

Sainsbury’s has signed a multi-year deal with Channel 4 to become the exclusive broadcast sponsor of the Great British Bake Off franchise.

The supermarket has cited the show’s “mass appeal” as the driving force behind the partnership, which is the biggest in the show’s history.

Sainsbury’s Taste The Difference range will be the broadcast sponsor for the 13th series of Bake Off, as well as all spin-off shows, including Bake Off: An Extra Slice, Bake Off: The Professionals, Junior Bake Off and any specials.

The spots, which will be created by Wieden + Kennedy, will feature Taste The Difference products with a twist that links them to Bake Off.

Mark Given, Sainsbury’s CMO describes Bake Off as “an iconic show with mass appeal” that will allow the brand to “celebrate and showcase the quality and innovation that Sainsbury’s is known and loved for”.

Rupinder Downie, brand partnerships leader at Channel 4, adds: “Partnering with such a quintessentially British show plays perfectly into Sainsbury’s longstanding heritage as one of the nation’s most loved brands.”

The 12th series of Bake Off drew in an average audience of 8.8 million viewers per episode on Channel 4, while the final reached 9.3 million.

The deal was brokered by Channel 4’s commercial arm 4Sales and Sainsbury’s media agency PHD.

M&S launches marketing push for Sparks

Marks & Spencer (M&S) has kicked off a marketing campaign for Sparks, highlighting the digital shopping experience it offers as part of a wider push for its loyalty scheme.

The ‘Yes you can’ campaign, features the first TV ad for Sparks, which showcases the benefits of being a member and using the M&S app.

The ad kicks off by highlighting the Scan & Shop feature, which allows M&S Food customers to pay via the app rather than queuing at the check-out, before showing other aspects such as click and collect in-store and the treats customers can earn.

The ad, which features singing cabbages and a rapping box of fromage frais pouches, is set to a reworking of Can I Kick It? by A Tribe Called Quest, with lines including ‘Can I scan it? Yes you can. Can I bag it? Yes you can.’

M&S Food and masterbrand marketing director, Sharry Cramond, says: “Customers get the best of M&S when they shop through our app – including free treats and personalised rewards from Sparks. The ‘Yes you can’ campaign brings to life how seamless using the app is for both clothing and food and showcases what is made possible – from queue-less shopping to easier Click & Collect. The campaign messages are delivered in such an engaging way – simple, repetitive, and catchy. And who can forget the singing cabbage (my personal favourite).”

Sparks now has more than 14 million members since relaunching in July 2020.

As part of the wider push for Sparks, M&S has also launched The Big Sparks Giveaway, through which one customers at every M&S store will win their shopping basket every day between now and next Wednesday. There is also £1.5m worth of M&S gift cards to be won, alongside 4.5 million free giveaways on customers’ favourite product.

Throughout March, M&S is also doubling the donations made to all Sparks charities.

Müller and Waitrose to scrap coloured milk caps

Müller and Waitrose have joined forces to scrap the coloured caps used on milk bottles as they cannot be recycled.

The blue, green and red caps, which indicate whole, semi-skimmed and skimmed milk, will be replaced with clear caps.

The coloured plastic currently used cannot be recycled back into food grade packaging, which could remove 1,560 tonnes of recycled high density polyethylene from the market.

Müller, which buys a fifth of all milk produced on Britain’s farms, says its research shows consumers support the change if it further improves the availability of food grade recycled plastic material.

Just over half of all shoppers look for the colour of milk caps when selecting milk in-store, while others look at the label or remember the location on shelf. But eight in 10 shoppers say they would choose a bottle of milk using a clear milk cap if it could be recycled into food grade material, over a coloured one that could not.

Müller and Waitrose will be trialling the switch in 331 shops from 4 to 30 April.

Monday, 7 March

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UK supermarkets pull Russian products from shelves

Tesco has become the latest UK supermarket to promise the removal of Russian products from its stores as the war in the Ukraine intensifies.

Yesterday (6 March), a Tesco spokesperson said the UK’s biggest supermarket would no longer be “buying products from businesses that are wholly Russian owned”.

Tesco joins rivals Sainsbury’s, Waitrose, Morrisons, Co-op and Asda in withdrawing Russian products from sale. Sainsbury’s, Waitrose, Morrisons and Co-op have all promised to remove Russian-made vodka from their shelves, with Sainsbury’s also to remove Karpayskiye black sunflower seeds.

A spokesperson for Sainsbury’s said the supermarket will “stand united with Ukraine”, and has therefore decided to remove from sale all products that are 100% sourced from Russia.

The grocer will continue to sell JJ Whitley vodka products, however, as the manufacturer has said it will be moving all production away from St Petersburg to Chorley in Lancashire.

Asda will also be removing products that originate from Russia from its shelves, impacting an estimated 100 products across spirits, fish and some sweets.

Meanwhile, Waitrose’s sister retailer John Lewis is removing a line of Russian-made pizza oven pellets from sale in its department stores.

To offer additional support, Sainsbury’s will also be renaming its chicken kievs to chicken Kyiv, matching the Ukrainian spelling of its capital city. Packaging for the dish is expected to change in the next few weeks.

Asda, meanwhile, has announced a £1m package to support displaced Ukrainian families in Europe and the UK.

The package includes £100,000 to support national UK-based refugee support groups, a £250,000 donation to Unicef to support the setup of an emergency Blue Dot centre in the Ukraine, and making Asda Foundation grants of up to £580,000 available to support local and grass-roots refugee groups across the UK.

Asda will also send essential supplies, including George-branded clothing, nappies, toiletries, period products and food, to a supplier site in Poland for onward distribution in Ukraine.

“We stand with our customers and colleagues who are shocked by the Russian invasion of Ukraine – and our thoughts are with those people whose lives are affected by this crisis,” said Asda co-owner Mohsin Issa.

Zara, Samsung, Mastercard join brands withdrawing from Russia

A number of brands across the fashion, finance and technology industries suspended their Russian operations over the weekend, joining a rapidly growing list of firms withdrawing their business in response to the Ukraine invasion.

The owner of fashion retailer Zara, Inditex, has shut all 502 stores in the country across its eight brands, including Bershka, Stradivarius and Oysho. The closures are expected to impact over 9,000 Russian employees, but Inditex has said it is drawing up plans to support them, according to the BBC.

The business joins fashion brands H&M, Boohoo and M&S in its decision. Meanwhile, a number of luxury fashion giants have also elected to temporarily close their Russian stores, including LVMH, Hermes, Kering, Chanel and Burberry.

In a LinkedIn post, Chanel said: “Given our increasing concerns about the current situation, the growing uncertainty and the complexity to operate, Chanel decided to temporarily pause its business in Russia.”

In the financial sector, Visa, Mastercard and PayPal have all suspended operations in Russia, with PayPal citing “violent military aggression in Ukraine”.

Visa and Mastercard bank cards issued by Russian banks will continue to operate normally within Russia until they reach their expiry dates. However, cards issued abroad will no longer work at businesses or ATMs in Russia. The two businesses control around 90% of credit and debit payments globally outside of China.

Elsewhere, Russia’s biggest smartphone supplier, Samsung, is suspending shipments to the country, while Activision Blizzard is suspending sales of and within its games.

Other brands to have already halted business within the country include Apple, Ikea, Netflix, General Motors and Jaguar Land Rover, among others.

On the other hand, some international businesses are struggling to cut Russian ties. Oil giant Shell has had to defend its decision to purchase Russian crude oil at a discounted price, stating there was “no alternative”, while telecoms business BT has had to continue its relationship with Russia’s state-backed operator so people in the UK can continue making calls to the country.

Waitrose backtracks on digital-first loyalty overhaul

waitrose onlineWaitrose is to make a significant change to its newly relaunched loyalty scheme, as customers complain the programme is “discriminating” against those without access to the digital app.

As such, the supermarket is reintroducing a printed vouchers system, the Grocer reports.

“Thousands” of customers have reportedly complained since the relaunch, particularly those of an older age group, as they were told their physical MyWaitrose card could no longer redeem rewards.

“We know this is a big change for our customers,” a Waitrose spokesperson said.

“Digital first does not mean digital only and, now that we have a better idea of which customers are engaging using smartphones, we’ll be identifying customers’ preferred ways to receive their offers, including print at home, vouchers in the post and coupons printed at till.”

The changes are expected to roll out within the next two weeks, alongside a simplification of the app and increased training for store staff.

Waitrose relaunched its MyWaitrose loyalty scheme last month to increase the personalisation of its offers, while scrapping its free newspaper and coffee offer.

The new scheme will see the supermarket double its investment in offers and discounts, with members to receive offers on a weekly and monthly basis. Customer savings are to increase by 112%, Waitrose claimed.

READ MORE: Waitrose forced to make u-turn on loyalty scheme following flood of customer complaints

Bullring owner to shift shopping centres away from fashion

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Hammerson, the owner of shopping centres including Birmingham’s Bullring and London’s Brent Cross, is planning to move its properties away from fashion retailers and towards healthcare, hospitality and flexible workspaces.

The announcement came as the business reported a £429m loss for 2021. It follows a difficult few years for the group and other retail landlords amid pandemic lockdowns, which forced some retailers to close business and others to delay rent payments.

Fashion will drop from occupying more than a third of Hammerson’s portfolio to around a sixth in future, while as much as a fifth could switch to becoming homes, hotels and offices. Last year, only around 30% of the group’s deals were in fashion.

Redundant department stores and other unwanted retail space may also be repurposed for private clinics and NHS spaces, educational operators and leisure operators.

“The pandemic has accelerated trends in our operating environment, with people engaging with physical space in new ways,” explained CEO Rita-Rose Gagné.

“Our new strategy recognises the unique position that Hammerson has in urban locations and the opportunities to leverage our experience and capabilities to create appealing destinations, serving occupiers, customers and communities.”

READ MORE: Bullring owner seeks to reinvent its shopping centres after £429m loss

Iceland boss admits supermarket will not hit sustainability targets

The managing director of Iceland Foods Group, Richard Walker, has said the supermarket will not achieve its pledge to become plastic-free in its own-label products by 2023.

Iceland made the promise in 2018, but Walker said the supermarket has been waylaid by the pandemic, the move towards online shopping, and other retailers being “slower in coming over to our way of thinking” than he had initially thought.

In interview with the Observer, he said: “Our initial pledge was to be plastic-free in own-label by 2023. We won’t get there. We are trying day and night as hard as we can but it is clear it’s going to be a very, very big ask.”

Walker admitted he knew the target would be likely impossible to achieve from the very beginning, but went ahead anyway.

“I would much rather have 30,000 colleagues pointed to the north star and resolute in that we are trying to do the right thing,” he said.

Walker also said critics asking how a business selling packaged ready meals and fizzy drinks in plastic bottles could ever be seen as green were missing the point, even as he admitted to being a “hypocrite”.

“Our business is not sustainable. We are a high-volume, mass-market retailer, full of contradictions. What we are trying to do is use ourselves as a platform to drive a bit of change and share with everyone else, including our competitors,” he said.

“I am a hypocrite. The business is not sustainable but we are trying to do good where we can and I don’t think that is a bad plan.”

He also questioned the choice of other supermarkets to charge higher prices for sustainable alternatives, stating that making green choices “only for the rich” would make climate solutions impossible to scale.

Nevertheless, Walker said he is optimistic about Iceland’s plans to become a more sustainable business in future.

Meanwhile, Walker revealed Iceland will be extending its new convenience store format, Swift, into four London locations over the next few months, following a trial in Newcastle last year.

READ MORE: Iceland boss Richard Walker on the retailer’s struggle to go green

‘Should’ve Gone to Specsavers’ returns with brand purpose focus

After two years off-screen during the pandemic, ‘Should’ve Gone to Specsavers’ has returned to TV as part of a £4m campaign.

‘Should’ve 2.0’ aims to evolve Specsavers’ famous strapline into a platform which communicates the brand’s purpose of changing lives through better sight and hearing, while spotlighting its growing range of services.

Created in-house by the Agency, the campaign is led by a 30-second TV ad, in which a delivery driver lugs a large package to the top of a tower block of flats, before being told he has the wrong address.

Four supporting 10- and 15-second shorts are running on YouTube, with Specsavers’ audiology service brought under the Should’ve umbrella for the first time with a film in which one block resident receives a pizza delivery for 200 people.

The campaign will reach a broader audience than ever before, with activity across TV, cinema, digital, out-of-home, print, radio and in-game. Media was planned and bought by MGOMD, and will run throughout March and April.

In a media first, Channel 4 and ITV have their own Should’ve Gone to Specsavers moments as their continuity announcers get their scripts mixed up, announcing shows for the wrong channel. Specsavers has also made its first foray into gaming, with in-game billboards across sports, motorbiking, fashion and lifestyle games.

“Should’ve took a break during the last two years as we focused on delivering urgent care online and in the communities we serve,” says Chris Carter, marketing and ecommerce director of Specsavers UK, Ireland and Spain.

“This gave us time to take stock and develop Should’ve into a brand platform that better reflects who we are today, but without losing any of its magic. I think the Agency has achieved this brilliantly, showing how it can take us into the future as we continue to grow and meet customers’ needs wherever they are.”



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