News Exchange: Health, wealth and online happiness
- 15 March 2019
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A weekly update on the latest headlines and highlights from the marketing sector
Boots tries a new look
Another week, another retailer trying to stem the flow of shoppers moving away from the high street. On Monday, the British Retail Consortium reported that footfall dropped 2% in the four weeks to 23 February – its 15th monthly decline in a row. Anticipating that news, health and beauty giant Boots announced last Friday that it would be overhauling the beauty halls in around 25 of its biggest stores. Traditional beauty counters are out; live demonstration areas are in. The firm will also launch 20 new beauty brands over the next six months, with 805 products going live in stores in April and May alone.
As Boots MD Seb James said, “We want customers to never have any reason to go anywhere else.” Although Boots considers itself the market leader in beauty – it boasts of 800 million people using its stores each year – it has been feeling the squeeze. On one side, the pressure has come from upstart, online businesses like Glossier; on the other, Sainsbury’s has given itself a beauty makeover in a bid to steal market share away from the likes of Boots and Superdrug. The result has been a disappointing set of figures from Boots’ American parent company, which reported a 1.9% sales drop for its international retail pharmacy division in Q4 2018.
Boots itself has admitted its 170-year brand heritage is “not enough for today’s customer”. As CIM marketing director Gemma Butler explains, “There has been a surge in competitors looking to take their piece of the UK beauty market, which is estimated to be worth £26.7bn by 2022 and has undoubtedly been bolstered by the rise of beauty influencers on YouTube and Instagram.” To maintain their share, existing players such as Boots must also confront the threat from subscription services such as Glossybox and Birchbox, which offer consumers the latest beauty products from just £10 a month.
For Butler, Boots’ response to challenging conditions makes commercial sense. “If many of the products it is preparing to launch will be exclusive to Boots, the firm will be changing its value proposition and going down the route of offering new and original products. Consumers who want those products simply won’t be able to purchase them anywhere else, so value and loyalty will grow.”
An emphasis on discovery will also capture consumers who want to know more, but Boots will have to work hard to ensure its purchasing journeys, both online and in-store, are as seamless as possible. It should probably also make those exclusive new products absolutely unmissable.
Let’s talk about money
Lloyds Bank has launched The M-Word, a national ad campaign to remove the taboo from talking about money. If you haven’t seen it already, the tagline ‘It’s good to talk about money’ will be appearing on a billboard, newspaper, radio or online device near you soon.
According to YouGov research commissioned by Lloyds, half of adults in the UK think talking about their personal finances is taboo and a quarter have lied to family and friends about money matters. More than 60% said they feel better when they do open up about any financial concerns.
In light of these findings, Lloyds is narrowing the focus of its previous Get the Inside Out campaign, which encouraged people to talk about their mental health in general. The bank’s marketing director, Richard Warren, hopes its latest campaign will “help start the conversation in families and make people more comfortable talking about money matters”.
CIM marketing director Gemma Butler is not sure a campaign alone will do that. Neither, presumably, is Lloyds because it has also partnered with relationship counselling charity Relate to lay on a series of M-Word courses. Starting in the summer, these will offer practical advice about having important, but potentially awkward, money conversations. “There’s a noticeable gap between the campaign launch and the presence of these courses. For the campaign to have any sort of impact, Lloyds has really got to build the M-Word philosophy into its business, its policies and its procedures, so it’s going to be interesting to see how they bridge that gap.”
As well as seeing a possible issue around its disjointed schedule, Butler has further questions about the campaign. “Should Lloyds really be the lead partner on this? Or should it be playing a support role for Relate?” As it is, Lloyds has chosen to take the spotlight itself, but to what end? “It’s not clear if this is a customer acquisition or retention campaign, or if it’s just about awareness,” says Butler.
Whether Lloyds wants to add customers or to add value for existing customers, one thing is clear: it will only succeed if it backs up its ad campaign with tangibly improved customer support services. Bring on the M-Word courses.
Take your time with TikTok
Finally this week, a warning to the curious.
After a big Christmas marketing campaign, Chinese video-sharing app TikTok is belatedly creeping into the consciousness of adults across the UK. This week, the firm made headlines amid rumours that its Beijing-based owner Bytedance, which has been valued at $75 billion, is preparing to float on the stock market.
The big valuation is based on its big audience. As well as 500 million regular users of its Chinese app, Douying, the firm has attracted 200 million international users to TikTok, including 3.7 million from the UK. Last year, it generated $7 billion in advertising revenues. Its users are predominantly 13 to 24 years old – a segment of society that marketers have traditionally struggled to reach.
However, a couple of weeks ago, Bytedance made a whole different set of headlines. That’s when it was fined a record $5.7 million by the US Federal Trade Commission, which identified “disturbing practices” around the Musical.ly video-sharing app that Bytedance bought in 2017 and merged with TikTok last year. Those practices included collecting personal data and revealing the locations of children aged 13 and under.
There’s more. Last month, Barnardo’s name-checked Tik Tok when it issued a warning that live streaming services were enabling the sexual exploitation of children as young as eight. Although Tik Tok does not officially admit under-13s, it does not verify the dates of birth entered by British users. Its app store age rating is 12+, but UK government agency CEOP Command puts it at 16+. Concerns have also been raised about a single-click button within the app that lets users buy 10,000 ‘coins’ for the real-world sum of £99.99.
“I would advise any brand considering using this potentially alluring new channel to do a lot of research. There would need to be a very precise reason for engaging with TikTok because there is a risk of doing serious brand damage,” says CIM marketing director Gemma Butler.
For now, proceed with caution.
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