Businesses spend thousands and sometimes millions of pounds developing and making adverts, yet few ads actually do what they are supposed to – namely persuade people to part with cash to buy the product in question. So its interesting to see some research carried out by Mercury, an arm of TNS WorldPanel which names the top 10 most motivating ads of 2009 so far.
The top 10 are:
1. Dettol Antibacterial Spray
2. Walkers Crisps with Gary Lineker and Cat Deeley on the bike
3. Kelloggs free cornflakes
4. iPhone new version
5. Tesco where Fay Ripley is picked up by her husband in a hot air balloon
6. Premier Inn’s take off of classic film Psycho, starring Lenny Henry
7. Morrisons supermarket fresh fish
8. Compare the Market with the meerkats Alexander and Sergei
9. Currys fridge freezer recycling
10. Jacob’s Cream Crackers
Now why would these adverts work better than the other 190 tested?
The company who did the research say that the top 10 adverts work because “It’s one thing to have an ad that people enjoy, but if you are not addressing a need or feeling it is less likely that they will turn that enjoyment into a purchase”. Or, in other words, there has to be a strong reason in the ad for people to part with their cash. This is particularly true for a business which has limited money to spend on promoting their products.
After a happy half hour watching these ads, I’d offer some more thoughts about why they are especially effective.
Dettol heads the list. It’s an example of “problem/solution” advertising, and in Dettol’s case the problem is both big and topical, namely how to protect your family against swine flu. The advert not only solves a problem, it does so in a very vivid way, showing brightly coloured germs lurking in unexpected places, waiting to pounce on the vulnerable.
Curry’s advert for their fridge freezer disposal service uses problem/solution advertising too, illustrating the sheer hassle of carting the old appliance to the recycling centre, as does Premier Inns who remind viewers of the nasty surprises that can be found in some cheap hotels. Which leads to the next reason why these adverts work – both Currys and Premier Inns commercials get attention because they are funny. Very funny, in the Premier Inn case where Lenny Henry acts out all the parts with enormous enthusiasm.
Walkers Crisps raises a smile as Gary Lineker (a smug but seemingly likeable character) gets his come uppance at showing off. The Tesco advert also raises a smile and is a clever twist, but both of these, alongside Morrisons fish, and Compare the Market .com probably succeed through the sheer amount of money spent showing them on our screens.
It helps to have a big name. Lenny, Gary, Fay Ripley in the Tesco ad and Nick Hancock in the Morrisons ad are all very well known stars. Stars don't come cheap though - Richard Hammond of Top Gear is reportedly being paid £750,000 for his appearance in Morrison’s Xmas advertising. Fortunately stars are not mandatory, as Dettol have shown, and too often are used by advertising agencies as a lazy substitute for good creative thinking.
The last type of advertising represented in the top 10 is informational. This works best when the message is simple. Kelloggs is telling the world that just by collecting three tokens they can get free cornflakes forever, and iPhone is announcing the launch of its new version.
All businesses have to consider how they will tell customers about their products, and not many can afford multi million pound TV campaigns. Whether putting up a flyer in the local newsagents, advertising in the parish magazine, getting a mention in the town newspaper, or deciding what to say on a website, the rules are the same. Grab peoples’ attention, give them a concrete reason why they should buy, and make it as easy as possible to purchase the product.
Wednesday, 11 November 2009
Tuesday, 27 October 2009
My Shameful Secret - I'm a Meat Eater
So the hoo-ha about meat eaters destroying the planet has surfaced again, this time via a Times interview with Lord Stern, noted scientist and author of the 2006 review of the cost of tackling climate change. The Times front page headline announced "Climate Chief: give up meat to save the planet", and in the body of the interview Stern reckoned that people's attitudes would evolve until meat eating became unacceptable.
So, is meat eating about to become a shameful secret, admitted, like listening to Country and Western music, only to one's most trusted friends,and undertaken behind closed doors. Will meat eaters, driven underground by public opinion suddenly feel the need to burst out of the closet, shout about their meat eating, and join "Meat Pride" marches through the streets of London? Will, heaven's above, the nanny state actually ban meat eating?
To be fair, on BBC's Today programme Lord Stern started by saying that the Times headline was "unfortunate", and that his message is about global leaders needing to take climate change seriously with meat eating being just one of many factors which need consideration. Too late. The headline writers have roared into action.
The voice of reason needs to speak up.
For starters, sheep and cattle are vital to preserving the character and biodiversity of the British countryside. They graze on moors, hills and coastlines, keeping land that cannot be cultivated for grains or vegetables from becoming brown stretches of dead bracken incapable of supporting plants or wildlife. The National Trust understand this, as does Natural England. Both have been active in reintroducing cattle to ungrazed stretches of the countryside, resulting in more rare plants and bird life. Perhaps they could speak up.
Meat, as the Food Standards Agency on its website and Times nutritionist Amanda Ursell both point out, contains essential nutrients in an easily absorbable form. The FSA says " Meat is a good source of protein and vitamins and minerals such as iron, selenium, zinc and B vitamins".
There's also the very practical issue that if there are no cows then there are no milk and dairy products.
And farming is a voice which needs to shout very much louder, communicating their plan (assuming there is one) to minimise farming's environmental impact.
So, is meat eating about to become a shameful secret, admitted, like listening to Country and Western music, only to one's most trusted friends,and undertaken behind closed doors. Will meat eaters, driven underground by public opinion suddenly feel the need to burst out of the closet, shout about their meat eating, and join "Meat Pride" marches through the streets of London? Will, heaven's above, the nanny state actually ban meat eating?
To be fair, on BBC's Today programme Lord Stern started by saying that the Times headline was "unfortunate", and that his message is about global leaders needing to take climate change seriously with meat eating being just one of many factors which need consideration. Too late. The headline writers have roared into action.
The voice of reason needs to speak up.
For starters, sheep and cattle are vital to preserving the character and biodiversity of the British countryside. They graze on moors, hills and coastlines, keeping land that cannot be cultivated for grains or vegetables from becoming brown stretches of dead bracken incapable of supporting plants or wildlife. The National Trust understand this, as does Natural England. Both have been active in reintroducing cattle to ungrazed stretches of the countryside, resulting in more rare plants and bird life. Perhaps they could speak up.
Meat, as the Food Standards Agency on its website and Times nutritionist Amanda Ursell both point out, contains essential nutrients in an easily absorbable form. The FSA says " Meat is a good source of protein and vitamins and minerals such as iron, selenium, zinc and B vitamins".
There's also the very practical issue that if there are no cows then there are no milk and dairy products.
And farming is a voice which needs to shout very much louder, communicating their plan (assuming there is one) to minimise farming's environmental impact.
Tuesday, 20 October 2009
Tough Times for Butchers
It’s a hard time to be a butcher. TNS* figures for the 52 weeks to August show butchers sales down by 5.2%, which compares to an increase of 5.7% for meat sales through all shops. Whilst the turnover figures are bad, tonnage sales are horrific. Butchers are selling 20% less pork than last year, 18% less lamb, 12% less beef, and 15% less sausages. And year on year declines are getting worse. Tonnage sales in the last 12 weeks show a 24% drop in sausage sales, 18% drop in beef, 16% in lamb and 18% in pork.
Meat sales generally have been struggling, but butchers seem to be suffering especially badly. The comparable numbers for the total meat market in the last twelve weeks are sausages +2%, beef -2%, pork -1%, and lamb -16%.
Price is likely to one of the problems, with many people thinking that butchers are expensive. The price difference between the average butcher and the top 4 multiples is about £1 per kilo dearer on lamb, 54p per kilo on pork, and 26p a kilo on beef.
Another issue might be that you never know when buying from the butcher quite what the bill will be. And it’s a brave person who, confronted with more cost than expected, asks for the piece to be cut smaller. Contrast this with supermarkets where everything is price marked, you know exactly what the cost will be, and can be confident of sticking to your budget.
The meat trade needs strong butchers as they are a way to avoid total domination by supermarkets, and some butchers are a beacon of hope in a generally gloomy picture. The reasons seem to be firstly, a refusal to compromise on quality, secondly a willingness to embrace consumer trends such as selling locally produced fully traceable meat, and thirdly, being prepared to experiment with supermarket type tactics like prepriced joints and promotional offers, all of which helps keep their customers loyal in difficult economic times.
*TNS is Taylor Nelson Sofres.
Meat sales generally have been struggling, but butchers seem to be suffering especially badly. The comparable numbers for the total meat market in the last twelve weeks are sausages +2%, beef -2%, pork -1%, and lamb -16%.
Price is likely to one of the problems, with many people thinking that butchers are expensive. The price difference between the average butcher and the top 4 multiples is about £1 per kilo dearer on lamb, 54p per kilo on pork, and 26p a kilo on beef.
Another issue might be that you never know when buying from the butcher quite what the bill will be. And it’s a brave person who, confronted with more cost than expected, asks for the piece to be cut smaller. Contrast this with supermarkets where everything is price marked, you know exactly what the cost will be, and can be confident of sticking to your budget.
The meat trade needs strong butchers as they are a way to avoid total domination by supermarkets, and some butchers are a beacon of hope in a generally gloomy picture. The reasons seem to be firstly, a refusal to compromise on quality, secondly a willingness to embrace consumer trends such as selling locally produced fully traceable meat, and thirdly, being prepared to experiment with supermarket type tactics like prepriced joints and promotional offers, all of which helps keep their customers loyal in difficult economic times.
*TNS is Taylor Nelson Sofres.
Thursday, 8 October 2009
What Do Recent Results and Comments From the Big Four Supermarkets Tell Us About the Consumer?
Few know more about consumers than bosses of the big four supermarkets. Each day they scan data from the checkouts to see what is selling and what isn’t. Those with loyalty cards analyse how different types of consumer are spending their money. Tesco alone tracks the shopping behaviour of 16 million Clubcard holders. So, when the bosses speak its worth listening to how they see consumer trends.
The last twelve weeks saw Morrisons grow fastest at + 7.4%, hotly followed by ASDA at +7.2%. Sainsbury grew by 5.4%, and Tesco by 3.1%. However Tesco reckons that in recent weeks it has grown faster than the others due to offering double points on its Clubcard. (A point dismissed by Sainsbury as a “throwaway remark” not backed by figures.)
Where all four supermarket bosses are agreed is that food inflation has receded, growth rates are slowing, the battle for market share will intensify, and the focus will be on building customer loyalty.
There is agreement too that consumers are loosening their purse strings, albeit slightly. Both Tesco and Sainsbury reported higher sales of organic food and premium produce like Sainsbury’s Taste The Difference range and Tesco’s Finest. They said sales of ready meals are up after a long period of decline. Sainsbury said that sales of welfare friendly Freedom Foods have grown by 130%. At the other end of the scale, both said their lower price ranges were doing well, with Tesco very pleased with sales of their discount range, and Sainsbury’s Basics range having grown by 30%.
There is less concensus among the bosses about consumer confidence over the next few months. Terry Leahy of Tesco has called the bottom of the recession “We are past the low point and things are getting better in the UK. People feel their finances are under control”.
Justin King of Sainsbury is more gloomy. He sees increased VAT, increased taxes, interest rate rises and continued fear of unemployment as likely to put a damper on consumer spending, and that the current rate of promotions, which account for a third of sales compared with around a quarter historically, will need to continue. Andy bond of ASDA agrees - “Many of our customers are still cautious”, and will continue to search for the everyday low prices offered by ASDA.
King and Bond may be closer to the truth than Leahy. The National Consumer Confidence Index, published monthly by TNS (the market research company) does indeed confirm that consumers are a bit more positive about the economy. The improvement is marginal though. Whilst 72% of those interviewed think their household income next year will stay about the same as now, 71% think there will be less jobs available over the next 6 months, and 72% feel bad about the economy generally. Only 34% think the economy will be better in 6 months.
Its encouraging to see even tiny tips of green shoots. But there is no sign yet of a wholesale abandonment of thrift from the majority of consumers.
The last twelve weeks saw Morrisons grow fastest at + 7.4%, hotly followed by ASDA at +7.2%. Sainsbury grew by 5.4%, and Tesco by 3.1%. However Tesco reckons that in recent weeks it has grown faster than the others due to offering double points on its Clubcard. (A point dismissed by Sainsbury as a “throwaway remark” not backed by figures.)
Where all four supermarket bosses are agreed is that food inflation has receded, growth rates are slowing, the battle for market share will intensify, and the focus will be on building customer loyalty.
There is agreement too that consumers are loosening their purse strings, albeit slightly. Both Tesco and Sainsbury reported higher sales of organic food and premium produce like Sainsbury’s Taste The Difference range and Tesco’s Finest. They said sales of ready meals are up after a long period of decline. Sainsbury said that sales of welfare friendly Freedom Foods have grown by 130%. At the other end of the scale, both said their lower price ranges were doing well, with Tesco very pleased with sales of their discount range, and Sainsbury’s Basics range having grown by 30%.
There is less concensus among the bosses about consumer confidence over the next few months. Terry Leahy of Tesco has called the bottom of the recession “We are past the low point and things are getting better in the UK. People feel their finances are under control”.
Justin King of Sainsbury is more gloomy. He sees increased VAT, increased taxes, interest rate rises and continued fear of unemployment as likely to put a damper on consumer spending, and that the current rate of promotions, which account for a third of sales compared with around a quarter historically, will need to continue. Andy bond of ASDA agrees - “Many of our customers are still cautious”, and will continue to search for the everyday low prices offered by ASDA.
King and Bond may be closer to the truth than Leahy. The National Consumer Confidence Index, published monthly by TNS (the market research company) does indeed confirm that consumers are a bit more positive about the economy. The improvement is marginal though. Whilst 72% of those interviewed think their household income next year will stay about the same as now, 71% think there will be less jobs available over the next 6 months, and 72% feel bad about the economy generally. Only 34% think the economy will be better in 6 months.
Its encouraging to see even tiny tips of green shoots. But there is no sign yet of a wholesale abandonment of thrift from the majority of consumers.
Friday, 2 October 2009
Why is ASDA Putting Webcams into Food Factories?
Andy Bond of ASDA was in the media yesterday talking about his new strategy, which he calls “Democratic consumerism”. The idea is to let consumers see for themselves via webcams where ASDA’s food comes from. Already there is a camera in a carrot factory, and in a milking parlour somewhere in Scotland.
According to Bond, the move taps into a growing trend. More and more consumers want to be reassured about the practices behind the food they eat, and Bond is saying that cows and carrots are just the start - “The ambition is to reach a point where customers can trace the journey of each ASDA product, from farm to fork or warehouse to wardrobe”.
It is true that consumers want to know more about the products they buy, but there is more to the move than that. It signals a recognition that price promotions and a value message alone are not enough to keep customers loyal to a store. After all anybody can cut prices – and they all do. TNS (Taylor Nelson Sofres the research company) has found that the amount of store turnover from promotions has gone up from 28% in 2007 to 32% in 2009. More worryingly for retailers, the economic squeeze has meant consumers doing much more shopping around to get the best deals, and it seems that this is not so much a chore as a rewarding adventure. As one shopper in a piece of IGD (Institute of Grocery Distribution) research put it “I quite like shopping for less using promotions. It’s a challenge, and I feel quite chuffed having saved some money.”
Which leaves each retailer searching for reasons over and above price based offers to secure loyal customers. Tesco offers extra points on their Clubcard. Sainsbury combines value and quality by advertising their own label products – apparently just as good as the branded equivalent but at least 20% cheaper. Morrisons talks about fresh food available from their “Market Street”. And now ASDA is being reassuring on where their food comes from.
The general feeling among those who study the grocery industry is that ASDA’s initiative will give them an edge over competition. But they and their suppliers have some thinking to do. In this search to understand the origins of their food, will consumers expect webcams in abattoirs, and on farms which rear animals intensively. How will ASDA deal with difficult issues such as lameness in dairy cows? Or will they be selective in what they show, and expose a worthy idea as mere PR fluff.
Tuesday, 15 September 2009
Does Waitrose Sales Growth and Deal with Duchy Signal Return to Premium Food Buying?
Market research company Taylor Nelson Sofres tells us that in the last three months, Waitrose sales grew by 10.2% versus 5.6% for the whole grocery market.
So what prompted the spurt?
Contrary to popular belief the powerhouse has not been Essential Waitrose. This range was never meant to a budget offer competing with value ranges from other supermarkets. In fact most of the products in the range remained as they always had been, and were sold at the same price as previously. The difference was that the range was pulled together under one distinctive brand name.
Essential Waitrose was a rebranding of mostly existing lines, but the vast publicity surrounding its launch seems to have encouraged shoppers back into the stores to re-evaluate what Waitrose had to offer. Once back inside, and helped many more price promotions than hitherto, shoppers liked what they saw and started buying again across the whole Waitrose range. Indeed, Richard Hodgson Commercial Director told the Grocer “Essential Waitrose has played a role at the bottom end but most of our growth is coming at the top end”.
The other factor behind growth may well have been the froth coming off discount shopping. Many of the shoppers who were lured to Aldi and Lidl tried them once, and never came back. The discounters have not converted triers into regular shoppers and growth has slowed from north of 20% per annum to a still respectable but not earth shattering 8% for Aldi and 6% for Lidl.
So does the growth in Waitrose sales and the bloom coming off the discount rose signal the end of the recession and a return to premium food shopping? Well in truth, premium food shopping never went away provided the product in question justified the price charged. What shoppers were not prepared to do was buy premium merely because the label said premium. This is where many organic foods struggled.
Which leads to the Duchy deal. This does seem to be a good thing for both parties. Duchy Originals is a well known and respected brand which should benefit from Waitrose support, and Waitrose commitment to donate to the Prince of Wales Charities can only be beneficial.
It will be interesting to see what Waitrose does with Duchy. The brand is apparently being positioned as super premium, and Mark Price Waitrose Managing Director reckons that it will grow to about 2.5% of Waitrose sales, equating to a turnover of some £100million. The challenge will be to ensure that shoppers are given a clear justification of the super premium positioning. We know that just saying organic on its own will not be enough. One thing is certain. Unless the quality of Duchy products is absolutely superb, and better than anything else available for a similar price, the brand will not blossom.
Finally, can we say that the growth in Waitrose sales, their optimism about Duchy, and the slow down in growth for discounters means a return to pre credit crunch ways of shopping?
Not completely. Shoppers now have a much better handle on what is and is not worth paying for. They have got the taste for chasing bargains. And lurking at the back of most people’s minds is a worry about what the economic climate will be like over the next few years. They won’t be throwing their money away in a hurry.
Thursday, 3 September 2009
UK Lamb Market - Farmgate Prices Strong, Yet Amount Eaten Plummeting. Should We Be Worried?
To the relief of farmers across the land, farmgate prices for lamb remain firm. Eblex (the English Beef and Lamb Executive) attributes this to the strong euro boosting exports, and a reduction in UK sheep numbers. Eblex forecasts that the euro will continue relatively strong, lamb numbers will fall in the UK, Ireland and France, and good prices will probably continue.
The one cloud on this bright horizon is the effect high lamb prices are having on the amount people eat. Farmgate prices for lamb over the twelve weeks to end July rose by around 12% compared with last year, the average price in the shops rose by 17% and the amount that people bought fell by 15%. This compares with a fall of 5% for beef and level sales for pork, both of which have been hit by higher prices and consumer cutbacks because of the recession, although not nearly to the same extent.
The drop in lamb sales is startling, although not surprising. The shopper is now paying an average of £7.15p per kilo for lamb versus £6.22p for beef, £5.10p for pork and £4.02p for chicken. No wonder that fewer people are choosing lamb. All cuts are affected particularly roasting joints.
The question is where it will all end? What happens if the euro falls back, flock numbers increase as farmers, attracted by higher prices dip a toe in the water again, yet consumers lose the lamb buying habit, and there is little demand for lamb either at home or abroad.
The obvious solution is for supermarkets to slash the price when farmgate prices fall, and get people buying again. History would say though, that prices in supermarkets do not come down nearly as quickly as they go up, as we saw during the foot and mouth crisis.
If supermarkets don’t support the market who might? This could be an opportunity for butchers to become very price competitive, and attract customers with a banner comparing their prices to the local supermarket. It’s also an opportunity for the catering trade who sell disproportionately more lamb than supermarkets, and for direct sellers. The trouble as always is that supermarkets are so big they do dictate market trends.
The easy conclusion is that we should be worried about people eating much less lamb, as it is bound to have an effect on prices, perhaps not next year but soon enough. The harder bit will be working out how to reignite the lamb buying habit.
The one cloud on this bright horizon is the effect high lamb prices are having on the amount people eat. Farmgate prices for lamb over the twelve weeks to end July rose by around 12% compared with last year, the average price in the shops rose by 17% and the amount that people bought fell by 15%. This compares with a fall of 5% for beef and level sales for pork, both of which have been hit by higher prices and consumer cutbacks because of the recession, although not nearly to the same extent.
The drop in lamb sales is startling, although not surprising. The shopper is now paying an average of £7.15p per kilo for lamb versus £6.22p for beef, £5.10p for pork and £4.02p for chicken. No wonder that fewer people are choosing lamb. All cuts are affected particularly roasting joints.
The question is where it will all end? What happens if the euro falls back, flock numbers increase as farmers, attracted by higher prices dip a toe in the water again, yet consumers lose the lamb buying habit, and there is little demand for lamb either at home or abroad.
The obvious solution is for supermarkets to slash the price when farmgate prices fall, and get people buying again. History would say though, that prices in supermarkets do not come down nearly as quickly as they go up, as we saw during the foot and mouth crisis.
If supermarkets don’t support the market who might? This could be an opportunity for butchers to become very price competitive, and attract customers with a banner comparing their prices to the local supermarket. It’s also an opportunity for the catering trade who sell disproportionately more lamb than supermarkets, and for direct sellers. The trouble as always is that supermarkets are so big they do dictate market trends.
The easy conclusion is that we should be worried about people eating much less lamb, as it is bound to have an effect on prices, perhaps not next year but soon enough. The harder bit will be working out how to reignite the lamb buying habit.
Note: Farm gate prices based on Farmers Weekly data, and consumption on Taylor Nelson Sofres data, published by BPEX.
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