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M&S boss: shift to product marketing ‘the right decision’ but wider business must catch up

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Marks & Spencer overhauled its marketing strategy last year to focus more on product and investment into digital and social channels, rather than “blockbuster” TV ads. It's a decision that was the right one, says chief executive Steve Rowe, but availability and supply chain issues plagued its success over the festive period.

A trading update for the third quarter revealed a like-for-like food sales decline of 2.1% and a clothing & home sales fall of 2.4%, leading to a drop-in group revenue of 3.9% to £3bn. While the numbers were not positive, the response to the marketing shift from consumers was as Rowe talked up the “unashamedly commercial approach” to its Christmas advertising and subsequent record sales on lines that featured in the creative.

“The consumer is seeing through some of these big blockbuster campaigns,” said Rowe on a call with analysts today (10 January). “We thought focusing on the product was absolutely the right thing to do, both for clothing and home and food. That transfer into digital marketing has been the right thing.”

The catalyst for a shake-up was the overhaul of its marketing division last year. It ditched the top-down structure that had been led by now-departed group chief marketing officer Patrick Bousquet-Chavanne in favour of separate clothing and food functions, led by Nathan Ansell and Sharry Cramond respectively, who report into divisional managing directors.

Ansell brought in Holly Willoughby who starred in the product heavy Christmas TV ad and created ‘Must Have’ lists of her favourite items which were shared across social media channels.

The marketer told The Drum that at its peak it had “3 million customers in four hours find out about the ‘Must Haves’ campaign just through Instagram.”

Meanwhile, for Food, Crammond also funnelled budget into digital including an online video series featuring celebrities trying its new products.

However, ahead of Christmas both were acutely aware of the challenge of ensuring that the hero-products in these ads were available in-store.

At the time, Ansell said they were having “hourly calls” with merchandise teams and store managers to ensure they had availability.

But, the popularity exceeded expectations and Rowe stressed it plans to “do more” to ensure it’s taking advantage of sales spikes.

“Availability is still one of the key challenges in the business,” he said. “We’ve got a lot of work to do to improve the supply chain. In both areas of the advertised lines we didn’t fulfill the potential we had.

“I’m delighted with the reaction to both advertising campaigns – particularly the 'Must Haves' – but we’ve got to do more and make sure we’ve got enough of the merchandise [in-store] when we’re advertising it.”

Difficult market conditions

Aside from supply chain problems, Rowe said that a number of “well publicised difficult market conditions” affected its performance, including reduced consumer confidence, mild weather, Black Friday, and widespread discounting by competitors in November.

M&S stepped back from Black Friday promotions and reduced promotional activity in December by 37% and put 25% less stock into the sale.

“If you want to have trust and value in your business you cannot have one day of promotions. We think it’s the right thing things to do,” he said of the decision, despite competitors like John Lewis hailing events such as Black Friday beneficial to the business’ bottom line.

Rowe said it will continue to accelerate its store closure programme in the coming year as it pushes ahead with a plan to move a third of its business online within the next five years.

He surmised: “There are early signs of volume growth and we expect to see more momentum under a strong new management team as the year progresses.”

John Lewis also reported its Christmas trading figures today, revealing a 1% like-for-like sales increase on the previous year in a "positive" festive period where it saw a Christmas Eve sales record.

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10 questions with… Anna Watkins, UK managing director of Verizon Media

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In an attempt to showcase the personalities of the people behind the media and marketing sector, The Drum speaks to individuals who are bringing something a little different to the industry and talks to them about what insights and life experience they can offer the rest of us. This week's 10 Questions are put to Verizon Media's UK managing director Anna Watkins.

What was your first ever job?
It would have been washing my dad's car to earn my £1 pocket money each week. Smart man.

Which industry buzzword annoys you most?
Relatable.

Who do you find most interesting to follow on social media?
@POTUS is truly mind-boggling.

what is the highlight of your career (so far?)
Working with such a creative, inspiring and intelligent bunch of people every step of the way.

What piece of tech can you not live without?
It's baffling that I was born in London yet still seem to use Citymapper every day.

Who or what did you have posters of on your bedroom wall as a teenager?
Adam Ant and Count Dracula (aged 7). I'm not quite sure what that says about me.

In advertising, what needs to change soon?
We need a truly diverse workforce.

If you could change anything about a social media platform you use, which one and what would you choose to do?
It’s more a question of changing myself – I need to flex my creative muscles if I’m ever to make more than one friend on Tumblr…

What is (in your opinion) the greatest film/album/book of your life?
Scarface / Sign of the Times / War and Peace – delusions of grandeur, mine and theirs.

Which industry event can you not afford to miss each year and why?
The big awards bashes – it's like going to a series of weddings where you know half the guests.

The Drum's 10 Questions With… runs each week with previous entries available to view here.

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Mobile carriers end data sharing with location aggregators; should marketers worry?

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The collection and use of real-time mobile-location data has emerged as a critical piece of the larger data-privacy debate. A recent run of negative stories have conveyed the impression that location data usage by marketers is tantamount to spying on consumers.

We’re also starting to see lawsuits, like one recently filed by the Los Angeles City Attorney against the Weather Company, for allegedly misleading consumers about how their location data would be used. More suits will likely follow.

Carriers cut off data sharing. The negative coverage and exposure of some high-profile abuses have motivated major U.S. mobile carriers to cut off location data sharing with third party “location aggregators.” The latest to do so is AT&T, following a story by Motherboard that indicated carrier data was getting into the hands of unauthorized third parties — bounty hunters, in this case — and being used for legally dubious purposes.

As a practical matter, these moves are unlikely to significantly impact use of location data by advertisers on major platforms or in the programmatic ecosystem. AT&T owns AppNexus; Verizon owns Verizon Media Group (the rebranded Oath). Location data will probably still be available to advertisers on these platforms — they’re not “third parties.” (We’ve asked Verizon for clarification on this point and will update the story if they respond.)

Calls for more regulation or legislation. Location data are so valuable and widely available that abuses are inevitable. Some of these increasingly frequent reports are adding momentum to calls for federal data privacy legislation. The carriers’ decision to cut off location aggregators is at least partly an effort to preempt investigations and potentially forestall regulation.

Some location data companies embrace the proposition of clear regulatory or legislative guidelines, however.

For example, PlaceIQ CEO Duncan McCall recently told me in email: “I think that the California Consumer Privacy Act and hopefully a similar federal law (as a state-by-state patchwork of different laws would be good for no one) will not only give consumers protection and confidence, but will finally give the digital data and location data ecosystem a well-thought out set of rules and guidelines to adhere to. This will bring stability and predictability to the industry, and help weed out some of the “wild west” players that have had no interest in investing for the long term good of the ecosystem.”

Most location-data companies also say they adhere to ethical data-collection practices and are scrupulous about being “good actors” in the ecosystem. Some are vocal about the responsible and/or socially beneficial use of location technology. And some organizations (e.g., NAI) are seeking to enforce transparent and ethical data collection standards. Foursquare told me in email that their apps and partners seek opt-in consent for use of location data.

Why you should care. Location data is available from a wide range of sources in the market, including app developers and the programmatic bid stream. The loss of carrier location is not a significant blow to the ecosystem.

However it is reflective of a trend toward the tightening of access to location information more generally. While it remains to be seen whether federal privacy legislation passes in 2019 (multiple bills have been proposed), California’s Consumer Privacy Act will go into effect January 1, 2020. Other states may enact similar or more strict laws, which would lend further impetus to comprehensive federal legislation.

The post Mobile carriers end data sharing with location aggregators; should marketers worry? appeared first on Marketing Land.

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Catalina adds first attribution tracking service

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Best known as a provider of retail marketing intelligence based around loyalty cards and in-store printed coupons, Catalina this week released its first attribution service.

Called Catalina Multi-touch AttributR, it traces a path from digital advertising — in various channels on various devices — to a purchase made in a store with a loyalty card. The company is able to track purchases down to the UPC bar code level.

At the level of the Diet Coke flavor. Coca-Cola, for instance, can now track how a web site ad shown on a computer affects the purchase of a Diet Coke, as well as whether the flavor chosen is Twisted Mango versus Ginger Lime. Additionally, the attribution service can report if it’s the first time this consumer bought Twisted Mango.

Previously, Catalina measured how its printed in-store coupons affected buyer behavior, but it didn’t track the impact of ads. The new attribution solution is the company’s first effort to link digital ads to buyer behavior, and it plans to add addressable TV ads to the system.

Catalina tags the digital ad with its own attribution pixel, which is called when the ad is shown and provides data on the specific campaign deployments.

But the connection between the ads shown, the various devices used by a single individual, and the in-store purchases are actually made by consumer data firm Experian on Catalina’s behalf, through such persistent identifiers as phone numbers or email addresses.

“Not in the business of knowing who you are.” In the new attribution service, the retailer sends the loyalty card ID to Experian, which matches it with the digital cross-device profile of a given individual and with the ads shown to the user on those devices. Experiam then returns a report to Catalina that uses an anonymized ID.

Catalina CMO Marta Cyhan told me the company deals only with anonymized IDs because “we’re not in the business of knowing who you are,” although Experian does have PII.

The data is updated daily to a self-service dashboard for brands (see below) and, since Experian tracks profiles, the attribution can also include the effect of ads on repeat purchases, new buyers of a product category and other consumer behaviors.

Difference from NCS. Catalina, which filed for bankruptcy protection last month, is also known as a partner in Nielsen Catalina Solutions (NCS), which employs data from the in-store coupons and loyalty cards. But, Cyhan said, Catalina’s new attribution measures individuals across multiple channels deterministically, since the actual people are known through the Experian matching, while NCS is focused on measuring single channels through probabilistic modeled data.

Additionally, she said, Catalina’s new solution is updated daily, includes buyer behavior changes and provides granularity down to the UPC level, while NCS provides post-campaign reports on overall sales lifts.

Why you should care. Catalina’s shopper data is used widely by marketers, and this first attribution service will help brands determine the impact of their paid media spend.

Additionally, Catalina is providing a very fine level of granularity, down to the individual product bar code, with a very high level of certainty. This approach could provide the kind of accurate, return-on-spending results that major consumer brands have clamored for.

The post Catalina adds first attribution tracking service appeared first on Marketing Land.

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