Kantar Media Newsroom: Nestlé Looks to Starbucks to Rev up its Coffee Game
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Surge in digital ads can’t offset decline in print
Publisher Gannett posted its first quarter earnings, illustrating what many are seeing – digital is growing, but doesn’t yet deliver the financial punch of the print advertising of yesteryear. This resulted in a breakeven reporting for Gannett. “Digital advertising rose 7.3% to $101.5 million, compared to $94.6 million the year before. Total digital revenue increased 9% to $255.5 million, or about 35% of total revenue. Digital-only subscribers increased 51% to about 382,000.”
To infinity and beyond!
If you haven’t heard yet, there’s a huge comic book movie out – Avengers: Infinity War – which has delivered more than just buzz about a pile of super heroes fighting villains, saving the world, or whatever else they do in tight spandex. This movie is projected to become part of a super exclusive club – the $2B club – which is huge considering the time of year it was released (as typically high-grossing films are during the year-end holiday season). “To date, Universal's Jurassic World is the top-grossing summer title of all time ($1.672 billion), not adjusted for inflation. However, the dinos are now in serious danger of losing the crown to Avengers: Infinity War, the record-breaking Disney and Marvel superhero mashup that is the first summer pic in history to have a shot at nearing $2 billion in global ticket sales after hitting $1.164 billion in its first dozen days. Analysts believe the movie will ultimately gross $1.8 billion-$2 billion.”
That’s one expensive cup o’ Joe
Nestlé just spent a pretty coin on their coffee business, writing a $7.15 billion check to Starbucks for the right to sell and market Starbucks-branded coffee products. “Nestlé won’t get any physical assets in the deal. Instead, Chief Executive Officer Mark Schneider is harnessing the name recognition of Starbucks, with its 28,000 outlets around the globe and massive draw in the U.S. Nestlé has struggled there for years with its own products like Nespresso and Dolce Gusto. Nestlé could use a jolt -- sales rose at their weakest pace in more than two decades last year. By entering a marketing pact with Starbucks, the Swiss company is revealing the limits to growing with Nescafe and Nespresso.” If this doesn’t prove that the world is running on caffeine, I’m not sure what more evidence I’ll need. Apparently this transaction is the third-largest investment made in Nestlé’s over 150-year history, making it a hail-Mary pass of sorts to try and rev up this category.
I know you’re shocked to hear that Cambridge Analytica has shuttered operations. Now it is going through the painstaking process of insolvency hearings in the UK as well as bankruptcy filing in the US. “The company, which did work for U.S. President Donald Trump’s 2016 campaign, said it lost ‘virtually all’ customers and suppliers as a result of reports that it improperly obtained information from tens of millions of Facebook Inc. users. Cambridge Analytica has denied any wrongdoing.” In a statement, CA said, “’Over the past several months, Cambridge Analytica has been the subject of numerous unfounded accusations and, despite the company’s efforts to correct the record, has been vilified for activities that are not only legal, but also widely accepted as a standard component of online advertising in both the political and commercial arenas,’” and continued, “’It has been determined that it is no longer viable to continue operating the business, which left Cambridge Analytica with no realistic alternative to placing the company into administration.’”
What’s new in ‘fake news’
As a follow up to the viral post featuring director Jordan Peele impersonating former president Obama as a PSA to research news before coming to conclusions, the technology used in that post is here, wide available and easy to use. “Rapidly advancing tools allowing users to manipulate audio and video have a growing number of lawmakers, technology experts and campaign consultants sounding the alarm about what the future of ‘fake news’ could soon look like. And it doesn’t take much imagination to see the disruptive impact an authentic looking or sounding piece of media could have on politics, diplomacy, the economy and beyond.” So, basically, it means we – the regular John Q. Publics of the world – might not ever really be able to trust if what we see or hear is legit. Saw the speech? Yeah, that was fake. Read the blog post focused on a controversial topic? Yeah, that was written in a warehouse halfway across the globe by someone trying to rile you up. This is going to be a fun election year, right?!
Google is upping its game for the midterm elections
Rules, rules, rules! Not meant for fun, but for the protection of these highly-coveted elections. It’s not like we’ve ever had results tampered with before, right? So why care now? Ha! I digress. Google is trying to do its part by implementing new political ad buying rules. “On Friday, senior vice president Kent Walker published a blog post that outlined Google's new efforts, including verification of political ad buyers and transparency reports. According to Walker, for those wishing to publish political ads, Google will ‘require that advertisers confirm they are a U.S. citizen or lawful permanent resident, as required by law.’ Ad buyers can do so with a government-issued ID and the more vague ‘other key information.’ What that exact information is — tax ID number? social security number? — is unclear at the moment. Walker also says Google is working on Transparency Reports that will detail who bought ads on Google and how much money they spent. It'll be published and stored in a database that will allow anyone to search for the same information. It's not the only thing Google has done with regards to safe-guarding its role in elections. Walker touted the recent Jigsaw Protect Your Elections toolkit that seems like a direct response to Russia's interference in several elections across the globe.”
Trump no likey Blankenship
A trending word on Monday morning was Blankenship, for Don Blankenship who just so happens to be running for the US Senate out of West Virginia in the Republican primary. President Trump is not a fan, and took to Twitter, his favorite, to implore the Republican voters to vote for either of the two other GOP candidates, who just so happen to be much more aligned with mainstream Republican ideals. Blankenship isn’t without controversy on his own, “Blankenship, who has called himself ‘Trumpier than Trump,’ spent a year in jail following the 2010 explosion at his Upper Big Branch Mine that killed 29 workers, and has referred to Transportation Secretary Elaine Chao’s father — the Shanghai-born chairman of a global shipping company — as a “wealthy China-person.” Tuesday’s primary should be interesting!
One More Thing
How geolocation is changing marketing
With things like augmented-reality events, predictive analysis based on location, geolocation to move e-commerce to brick-and-mortar to name a few, you can start to see how knowing exactly where your customers are could help make things like guerilla marketing and event promotions that much more effective. With the advent of social influencers, location can help make these influencers much more targeted to those in a predetermined space. Retail also sees many opportunities, including, “Beacons, which are small sensors placed throughout retail locations, can provide outlets with a detailed picture of how customers shop by tracking to tracking things such as foot traffic. Retailers can use beacons to better understand precisely where a customer is located within the store at any given moment, enabling advertisers to push timely messages and offers to customers and providing invaluable data about that customer’s behavior.” If you didn’t feel like someone was already following you around online, just wait, now these brands can follow you in “real life” too.
Kantar Media’s Dimension 2018 is out!
DIMENSION 2018 explores four of the largest issues facing the media industry from improving creative standards and relevance online and achieving greater channel integration. Explore and download here!
Who's on Top? April 16 - 22, 2018
Superheroes go head-to-head on the small screen before hitting the silver screen
With the NBA playoffs kicking off, advertisers invested the most heavily in professional basketball games last week. NBA games brought in $16 million on new ad expenditures, 12 percent of the total $132 million spent on new advertising
20th Century Fox and Walt Disney Pictures went head-to-head this week promoting the latest installments of their respective hit movie franchises. This week it was all about superheroes for the two film studios.
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