Next dumps TV and print for digital
Next is cutting TV, print and direct mail marketing spend for digital, claiming it is seeing “impressive” results from the latter, while ROI from the former isn’t what it used to be.
The retailer’s digital marketing spend is set to rise by 125% year on year for the 12 months to the end of January 2019, from £12m to £28m. Meanwhile, its budget for direct mail, print and TV will be cut by 51% from £23m to £11m.
Next has an interesting way of working out return on investment, which it calls internal rate of return (IRR) and basically involves balancing the cost of running marketing campaigns with the profit it gets from incremental sales. It claims that for some digital campaign it has seen IRRs in excess of 75%, when an uptick in sales over the following two years is included.
What this all sounds like is Next is putting the focus on driving sales (performance marketing) over building its brand. That strategy is a decision taken by Next’s management as it attempts to boost revenues (and profits) in a highly competitive and difficult retail environment.
Whether it’s a strategy that can work in the long term is another matter. Even a cursory understanding of the work Les Binet and Peter Field have done shows Next has swung too far down the short-term sales route to the detriment of long-term brand building.
The retail environment at the moment might require a hit from performance marketing. But it’s unlikely Next will be hold onto that balance of spend in the long run.
Cadbury Roses return to TV screens for the first time in 20 years
Cadbury has widened its “kindness and generosity” message to Roses as it celebrates the product’s 80th anniversary.
A new campaign, created by VCCP, will see Roses return to TV for the first time in 20 years and play into its positioning as a thank you gift. The aim is to make people realise the importance of saying thank you face-to-face and the difference a gift can make.
While the campaign shifts Roses’ positioning to align it with the Cadbury master brand message, this campaign sticks to what the product is known for – gifting. There are no major surprises there, but the creative is sweet and it’s effectively produced.
No doubt sales over Christmas will benefit. And that’s what counts.
Nike ‘Dream Crazy’ ad drives ‘record engagement’