Kraft Heinz, diversity, broken programmatic supply chains: 5 things that mattered this week and why

From the 50% of programmatic ad spend that isn’t reaching publishers to Kraft Heinz’s approach to marketing during the pandemic, catch up on all this week’s major marketing news.

By Marketing Week Reporters 7 May 2020 1:18 pm

Where is half the money going?

A new study by ISBA reveals half of the money advertisers invest in programmatic advertising never reaches online publishers and 15% of spend is completely unattributable to any players in the supply chain.

Although this is a best-case scenario, given the study was undertaken with only premium brands and publishers. Who knows what might happen to the numbers the further down the long-tail of publishers and adtech vendors you get, although it is probably safe to assume they wouldn’t improve.

This is the first time that programmatic advertising supply chains have been mapped from end-to-end. It reveals an increasingly complex online ad ecosystem that still lacks transparency and organisation, with data access and formatting at the heart of this.

It took advertisers and publishers nine months to retrieve the data from tech vendors. It’s not that brands and publishers are reluctant to share their data, rather the adtech middlemen are making it very difficult to do.

If there is one key takeout from this, it’s that brands and publishers need to regain control of their supply chain. This report highlights how difficult that is going to be, and without total collaboration that is going to be even more challenging.

ISBA has 3,000 members yet only 15 chose to take part. This leaves one big question: where were all the other brands?

Marketers brace themselves for 50% slump in demand

With news of a future plan for easing the UK out of lockdown set to be unveiled by Boris Johnson on Sunday, marketers are naturally turning their attention to what happens next. With the UK economy in effective shutdown, expectations are the nation will hit a period of deep recession as businesses struggle to get back on track following the coronavirus crisis.

With that in mind, more than a third of UK marketers (34%) expect to see demand for their brand’s products and services slump by more than 50% over the next two quarters.

According to an exclusive survey of 477 UK brand marketers conducted by Marketing Week and its sister title Econsultancy, just 3% of marketers expect a drop in demand for their brand’s products or services of 10% or less.

Marketers in smaller organisations expect to be hardest hit over the next two quarters, with 38% predicting a fall in demand of more than 50%, compared to 23% of larger businesses.

In total, 75% of UK marketers expect to see some form of lowered demand for their brand’s services during the next two quarters of 2020.

However, while the expectations for falling demand are dire, marketers are attempting to look forward and learn the lessons of enforced lockdown. Some 83% say they have developed new ways of working they will implement once the pandemic abates, while 61% expect to introduce new processes post-outbreak.

Some 48% of marketers expect to introduce a product or service innovation in response to the outbreak, while 43% are looking to innovate their marketing messaging and branding, and a further 42% will make changes to their customer communications.

Demand may well decline, but it will be the brands that take forward the good things learnt during the crisis, and evolve their business models, that look the most likely to succeed once the lockdown eventually lifts.

The Marketing Academy reveals its 2020 Scholars

The Marketing Academy is celebrating its 10th anniversary this year

It was nice this week to be able to take a step away from coronavirus-related news and celebrate some exciting up-and-coming marketers. Having celebrated its 10th anniversary earlier this year, The Marketing Academy is now welcoming its 11th intake of Scholars onto a programme that aims to equip them with the skills and knowledge they need to take the next step in their careers.

Coronavirus has stopped the usual Scholar meet-up and has meant the programme this year is extended to 12 months – rather than the usual nine – to ensure parts such as the Boot Camp can still go ahead. But it’s great to see that despite cost-cutting by brands and agencies, support for The Marketing Academy has not taken a hit.

Amid furloughing and redundancies, investing in the next generation of CMOs is more important than ever. Hopefully The Marketing Academy’s scheme can be of even more benefit during testing times for the industry.

Ad industry creates yet another diversity and inclusion programme

Another week, another diversity initiative. This time, ISBA, the IPA and the Advertising Association have joined forces for an ‘Advertising Needs You’ hub that includes a showcase of industry organisations such as Creative Equals.

The ad industry has been making noises about improving the diversity of its workforce for years. And while there have undoubtedly been improvements, progress is glacial.

For example, the latest figures from the IPA show a marginal improvement in the representation of women in C-suite positions in agencies, but also an increase in the gender pay gap. Elsewhere, ethnic diversity actually fell fractionally between its 2018 and 2019 census, despite all the talk of opening up the industry to people from different backgrounds.

A quick glance at the websites of ISBA, the IPA and the AA show none have a particularly diverse workforce and all are led by white males.

There are concerns the coronavirus crisis could only make matters worse and so any scheme that tries to help the industry make progress is welcome. But much more than a hub is going to be needed to ensure the marketing industry is a reflection of the people it is trying to sell to.

Kraft Heinz looks to capitalise on stockpiling boost

As lockdowns began and fear swept across the globe about food shortages, many consumers stockpiled foods such as ketchup, baked beans, and other long-lasting goods.

Kraft Heinz is one brand that has benefited from this surge in stockpiling. Not only has it seen a boost in purchases, but also an introduction of new customers that the FMCG giant is now looking to capitalise on.

While others such as Coca-Cola halt or scale back marketing, Kraft Heinz is hoping to “build momentum” and perhaps invest more. It is also honing in on what channels it believes will work best. Unsurprisingly, out of home is seeing less investment but the company wants to double down and look more specifically at what channels are more worth its time.

Kraft Heinz is insistent it will continue its pledge of growing media spend by 30%, which was laid out as part of the company’s strategy prior to the pandemic. CEO Miguel Patricio is a veteran marketer and former Anheuser-Busch InBev global chief marketing officer; he knows all too well the benefits marketing can bring to a business, even in times of crisis and economic uncertainty.

However, despite this optimistic news for marketers, the coronavirus has prompted Kraft Heinz to stop nearly all of its innovation until the end of the year.