January cheer. Proof (sort of) that advertising works

16 Jan 2017  |  Dominic Mills 
January cheer. Proof (sort of) that advertising works

Solid Christmas retail figures will help hard-pressed CMOs make the case to their boards for maintaining spend, writes Dominic Mills - but watch out for the caveats

Back in December I promised to try to be more cheerful. It was an offer I made with all the conviction of a reforming alcoholic (i.e. hope over expectation) and knowing that good intentions pave the road to hell.

It wasn't a great start last week. But, propped up by contrition, I have renewed purpose and vigour and, this week, a set of stats to lift the heart of any adland curmudgeon.

The last few days have seen the big retailers and - crucially - most of the biggest Christmas advertisers report sales figures that cover the Christmas period with, for a few, Black Friday thrown in also.

And bloody hell, Christmas advertising works.

In fact, I should point out, there's a pattern here. Three of the winners at last year's bi-annual IPA Effectiveness awards were Christmas campaigns - John Lewis, Lidl and Sainsbury's.

The latest figures are almost universally good, painting a very different picture from the year before when, among others, Morrison's, Tesco and M&S all reported poor figures despite throwing millions of pounds of ad budget at Christmas.

Starting with last year's losers, Morrison's reported sales up 2.9% like for like for the nine weeks to January 1; Tesco 0.7% for the six weeks to January 7; and M&S, after years of sliding backwards, 0.8% in general merchandise (i.e. its perennially lack-lustre clothing department) and 0.4% in food, like for like, for the 13 weeks to December 31.

Other figures were, broadly, just as impressive. The Co-op reported sales up 3.5% for the three weeks to December 24; Sainsbury's 0.1% like for like in food for the 15 weeks to January 7 (with a steeper, if unquantified lift for Christmas) and 4% at new subsidiary Argos, also a heavy Christmas advertiser.

Debenhams and House of Fraser similarly performed well (3.5% and 2.7% respectively) with the big disappointment coming from Next (down 0.4%). The former two produced special Christmas efforts, while Next - as usual - seems to make no special effort with its seasonal ads. Draw your own conclusions.

The usual winners continued to do well: Buster the boxer, sorry, John Lewis, up 4.9% (but - small alarm - a little off 2015) and Waitrose up 2.8% like for like for the six weeks to December 31; Aldi up 15% (Kevin the carrot giving a bionic performance for December); and Lidl up 10% for the same period thanks to its turkeys ad which, it says, boosted sales of the bird by 40%.

Good old Mrs Claus, eh. She’s done the business. The first time in many years that M&S has a decent Christmas ad (see below), and the results show. Shame M&S has dumped Rainey Kelly.

And Tesco gets plaudits for sticking with and developing Ben Miller and Ruth Jones as put-upon Mum and Dad. Having ditched the useless teenage son, the ads are now watchable and credible. As for Morrison's...er, well, its ads passed me by completely (catch one, below), so I suspect its revitalised performance had less to do with advertising and everything to do with new management.

As for the others, most produced creditable advertising with fewer of the clunkers we've had in the past.

But before anyone thinks I've gone soft in the head, let me add the caveats. First, for many retailers, the gains are against weak comparatives; second, it helps retailers when Christmas falls on a Sunday because their trading statements benefit from extra days; third, we are seeing small increases in price inflation (partly helped by the post-Brexit slump in the pound) that lift absolute returns.

I should also point out that, especially for retailers, ads are not the be-all and end-all - they work best when the chain has got everything else right.

Nevertheless, at a time when budgets will be under review as never before, these figures will help hard-pressed CMOs make the case to their boards for maintaining spend. Even Iceland, going nowhere for years with Kerry Katona and Peter Andre, lifted its sales by 9.6% between October and January by throwing some proper money at TV.

What we can't really do yet is break out the trading by market share for the Christmas period alone. In the meantime, these Kantar Worldpanel stats are the best available. Its figures cover the 12 weeks to January 1, which is why the figures will differ in some cases from mine.

But what is evidently true is that growth is back, apart from poor old Asda which is going backwards (cue alert for Saatchi and Saatchi, which took on the business last year). This should encourage supermarkets to be even more ambitious, something we are seeing with both Tesco and Lidl upping the ante in the food wars.

So there we are. January cheer.

Specsavers back on form

More January cheer comes from the latest Specsavers ad. For me it's a marked improvement on last year's 'blockbuster' featuring John Cleese, reprising his role as Basil Fawlty, which I found sad.

But what do I know? I assume it worked because Specsavers ran it all year (although that may be because paying John Cleese, who in turn uses the money to pay his alimony, used all the budget) and it was Adwatch's second most-liked ad of the year.

This time round we have an epic reminiscent of Jean de Florette (beautifully captured in the 90s for ad purposes by Stella): set in Provence, glorious countryside, a dilapidated 2CV and wheezing accordions. A chateau owner summons a handyman to drain his boiler. The visually impaired repairman drains his wine vats instead.

Just lovely. Bang on brief, no histrionics, gently amusing, a heart-warmer. And so simple. Even before the punchline, you know it's for Specsavers.

It'll never win a creative award because, well, adland juries don't hand out prizes to in-house creative departments like that at Specsavers, and because it's not ground-breaking. But why should it be? I bet it'll shift a ton of two-for-one specs so there's no need to go all radical.

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Thank you for your comment - a copy has now been sent to the Newsline team who will review it shortly. Please note that the editor may edit your comment before publication.

Paul Lawson, CEO, Leo Burnett on 16 Jan 2017
“Somehow, I'm not sure Dominic is the sort of person who would respond well to the salutation 'Hey Dominic'!
Stay grumpy, Dominic - you say the things we can only think...”
James Robinson, Managing Director, Hello Starling on 16 Jan 2017
“Hey Dominic,

Contrary to your comment about adland juries not handing out prizes to in-house creative departments like that at Specsavers, may I direct you to the Cream Awards 2016 site: http://www.creamawards.co.uk/cream-awards/cream-awards-2016#49358 where Specsavers (in-house team) did indeed pick up several awards (incidentally, one of them was for the John Cleese advert).

Just wanted to dispel any myths ;-)

James”

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