If there was ever a time for a reminder that effective communications can raise the performance of a whole business and not just its advertising, that time is now.
The combination of inflationary pressures and weak customer confidence will challenge all parts of companies in coming months.
So the publication of Advertising Works 26 with its analyses of 2022 IPA Effectiveness Award-winning cases from the likes of KFC, Tesco and McDonalds UK could not be more opportune. Each provides a real world example of how effective marketing created a shared story and principles to bring together different stakeholders to promote business growth in the toughest of market conditions.
In 2017, KFC’s UK sales were flat and its market share was declining. There had been no improvement across consumers’ perceptions of the brand, food or restaurant experience for the preceding five years.
What was needed was a new strategic platform to guide the KFC marketing team and agencies, but also the behaviour of the entire business, including franchise owners, restaurant managers, and front line employees.
After reaffirming that its core values included authenticity, hospitality and hard work, KFC and its agencies framed these into a cohesive view that there was a ‘Right Way’ for KFC to do all things.
This covered everything from how it presented and talked about its food to designing restaurants, menus and packaging, and handling PR crises, (such as the supply chain debacle that left KFC restaurants without any chicken for a month in 2018). It also successfully made the case for increased media investment.
I would recommend you read the full case study for all the evidence it presents of how improvements in brand perceptions were followed by shifts in consumer behaviour and stronger commercial performance. As headline numbers, KFC estimated that average annual same store sales growth increased by 23% during the period and that advertising drove a total of £730m of incremental sales between 2018 and 2021
As the case summarises, ‘To make a real change to a company’s fortunes, you don’t need a clever end line. You need to change behaviour across many departments and specialist disciplines….The ‘Right Way’ to rebuild a business is from the inside out.’
Tesco’s 2022 case sets out how the business retained a pre-existing strategy of communicating trust, quality, value for money, but shifted from ‘Serving Shoppers’ to ‘Serving the Nation’ by ensuring its brand showed ‘leadership qualities’ when COVID-19 struck in the UK.
Almost overnight, Tesco staff were classified as essential workers and shopping habits changed. The paper proposes that it was the myriad responses of its approximately 300,000 workforce that shaped Tesco’s results during the COVID-19 impacted years of 2020 and 2021. These responses ranged from making thousands of stores safe and stocked to prioritising shopping by NHS workers and the elderly, and increasing capacity to fulfill online orders. In line with its leadership role, Tesco quickly produced advertising in the first lockdown to communicate the new realities of socially distancing, later cited by YouGov as a highly effective campaign. It continued to create ads showing Britons coping with their new context.
Tesco did not cut its adspend despite fluctuating consumer confidence and a UK economic recession. While the supermarket category reduced adspend by an average of 12% between March 2020 and January 2022, Tesco increased investment by 20% and grew its Share of Voice.
Read the full case study to see how it arrives at its estimate that marketing investment drove an additional £644m profit for Tesco over the COVID-19 period. The case also includes an intriguing new approach to quantifying the residual benefits, known as BrandStock, from sustained investment in brand building.
Covering the 15 years from 2006 to 2021, the McDonald’s UK paper describes how improving brand trust and love were added as pillar goals for McDonald’s UK advertising at the beginning of this period when it needed to grow customer visits and sales generated per restaurant.
Over successive waves, its advertising style evolved to feature a warmer, funnier and more relatable tone that the paper describes as ‘confident humility’.
Eventually, the new model was embedded into the McDonald’s business, with a fundamental restructuring of the marketing department to give each pillar its own dedicated team and budget. Spend was also increased.
During the period covered by the case, the strategy has helped the business overcome negative PR and scepticism about food provenance, and enter new segments such as coffee and food delivery.
While the category was awash with promotions to lure customers back after COVID-related closures, McDonald’s sought what it describes as ‘emotional leadership’ in its category with an uplifting ‘Welcome Back’ campaign and 94% of spend invested in above the line brand building.
Over the entire 15 years it is estimated that advertising has driven £4.7bn of incremental sales, with almost 40% of these sales coming over the long-term. Rather than attribute the consistent growth of McDonald’s solely to its long-term plan for brand building, the authors write that ‘what really ensures the continued growth of the McDonald’s brand and business is a shared hunger for the doing of this plan’ demonstrated in countless decisions, small and large.
These three cases illustrate how effective marketing can provide the shared story and focus to lead positive transformations across organisations.
They quantify the financial payback that accrues from ‘marketing marketing’ internally within businesses by convincingly demonstrating the causal link between improving brand metrics and better commercial outcomes. They show how marketers can successfully make the case to increase expenditure on brand building when others are cutting budgets, and provide evidence that these investments can make goods return over both short and long timeframes.
This is a good time to remind your teams and clients of this evidence.
This is a shortened version of one of several chapters in Advertising Works 26 analysing insights from the 2022 IPA Effectiveness Award-winning cases. The book also contains full versions of the Gold-winning case studies, and summaries of Silver and Bronze winners.Purchase Advertising Works 26, £45 for IPA members, £65 for non-members