Things That Mattered This Week and Why

Kraft Heinz, Diversity, Programmed Supply Chain

From 50% of automated advertising spend that does not reach publishers to the Kraft Heinz approach to epidemic marketing, follow all the major marketing news this week.

Where does half the money go?

A new ISBA study revealed that half of the money advertisers invest in automated advertising never reaches online publishers and 15% of spending is not entirely attributable to any player in the supply chain.

Although this is the best scenario, given the study is only done with premium brands and publishers. Who knows what might happen to numbers as the long tail of publishers and adtech suppliers recedes, although it is safe to assume they will not improve.

This is the first time that end-to-end automated ad supply chains have been assigned. Reveal a growing ecosystem for online advertising that still lacks transparency and organization, with data access and coordination at the heart of it.

It took advertisers and publishers nine months to retrieve data from technology vendors. Not that brands and publishers are reluctant to share their data, but rather adtech brokers make it very difficult to do so.

If there is a major way out of this, it's that brands and publishers need to take back control of their supply chain. This report highlights how difficult this is, and without full cooperation it will be more difficult.

ISBA has 3000 members but only 15 participants choose to participate. This leaves one big question: Where were all the other brands?

Marketers prepare for themselves due to a 50% drop in demand

With news of a future plan to ease the UK from the shutdown due to be revealed by Boris Johnson on Sunday, marketers are naturally directing their attention to what will happen next. With the British economy effectively closed, forecasts indicate that the country will experience a period of deep recession as companies struggle to get back on track after the Corona Virus crisis.

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

According to an exclusive survey of 477 UK brand marketers conducted by Marketing Week by its surname Econsultancy, only 3% of marketers expect demand for their brand products or services to drop by 10% or less.

Marketers in smaller firms expect to be hit hardest in the next two quarters, with 38% expecting demand to drop by more than 50%, compared to 23% for big companies.

Overall, 75% of UK marketers expect to see some form of reduced demand for their brand services during the next two quarters of 2020.

However, while expectations of lower demand are dire, marketers are trying to look to the future and learn the lessons of forced closures. About 83% say they have developed new ways of working that they will implement once the epidemic subsides, while 61% expect to introduce new operations after an outbreak.

About 48% of marketers expect to introduce innovation in the product or service in response to an outbreak, while 43% are looking to innovate their marketing and branding messages, and another 42% will make changes to their customers ’communications.

Demand may drop well, but brands will deliver the good things learned during the crisis, and will develop their business models, which are likely to succeed once insurance is eventually lifted.

Marketing Academy reveals its scientists 2020

It was nice this week to be able to get away from the news on coronavirus and celebrate some interesting marketers coming. After celebrating its tenth anniversary earlier this year, the Marketing Academy now welcomes its eleventh reception from scientists on a program designed to equip them with the skills and knowledge they need to take the next step in their careers.

Coronavirus has stopped meeting the usual scholar, meaning that the program has been extended this year to 12 months - instead of the usual nine - to ensure parts like Boot Camp continues to progress. But it's great to see that despite the cost reduction by brands and agencies, marketing academy support has not been successful.

Amid the inconvenience and repetition, investing in the next generation of CMOs is more important than ever. We hope that the Marketing Academy scheme is more helpful during test times for this industry.

The advertising industry creates another program for diversity and inclusion

Another week, another diversification initiative. This time, ISBA, IPA and the Advertising Association teamed up for the Advertising Needs Center, which includes an offer for industrial organizations like Creative Equals.

The advertising industry has been making noise about improving the diversity of the workforce for years. While there have undoubtedly been improvements, progress is ice.

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

A quick look at the websites of ISBA, IPA, and AA shows that none of the workforce is particularly diverse and they are all led by white males.

There are concerns that the coronavirus crisis can make matters worse, so any scheme that tries to help industry make progress is welcome. But more than just a hub will be needed to ensure that the marketing industry reflects the people you are trying to sell to.

Kraft Heinz is looking to benefit from increased stocks

With closures and fear starting around the world around food shortages, many consumers have stocked foods like ketchup, baked beans and other long-term goods.

Kraft Heinz is a brand that has benefited from this surge in storage. Not only has it seen an increase in purchases, but also an introduction to new customers that the FMCG giant is now looking to take advantage of.

While other companies such as Coca-Cola have stopped or curtailed marketing, Kraft Heinz hopes to "build momentum" and possibly invest more. It also improves channels that you think will work best. Not surprisingly, investments outside the home saw less investment, but the company wanted to double and look more specifically at channels that were worth their time.

Kraft Haynes insists that it will continue to pledge to increase media spending by 30%, which was developed as part of the company's strategy before the outbreak. CEO Miguel Patricio is a veteran marketer and former head of global marketing for Anheuser-Busch InBev; he knows well the benefits that marketing can bring to business, even in times of crisis and economic uncertainty.

However, despite this upbeat news for marketers, the coronavirus prompted Kraft Heinz to shut down nearly all of its innovations until the end of the year.

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