The world of advertising is changing. This presents a range of challenges, as well as a range of opportunities, for food companies.
While the changing legislative landscape can restrict what food companies can advertise, their abundance of first-hand consumer data also gives them a key advantage in a digital advertising world increasingly focused on privacy.
At the Advertising Week Europe event in London last week, companies such as Tesco, Coca-Cola, Deliveroo and Mondelēz International spoke about how they are responding to these new developments.
How is Tesco advertising in-store?
Advertising is migrating in-store. In UK supermarket retailer Tesco, for example, the company has six times as many in-store screens for advertising as it did at the same time last year, according to Nick Ashley, client development director at Tesco Media and Insight Platform.
Tesco is providing data from its loyalty cards to companies such as PepsiCo, Danone and Mondelēz International, providing them with insights into UK shopping behaviours which they use to develop their advertising.
Shops are the next ‘major media channel’ for advertising, according to Ashley. Despite a widespread shift to online shopping, he said, 85% of purchases are still made in-store, and up to 85% of these in-store consumers are making on-the-spot decisions. Because of these factors, said Ashley, in-store marketing drives sales.
The data from its loyalty card allows Tesco to track the success or failure of this marketing. “We can very clearly tell you whether there’s been a sales uplift for that particular piece of activity on the stores that you run digital screens or digital activity versus (those) you haven’t.”
The data allows advertisers to get ‘better and better over time,’ added James Hay, managing director of marketing firm Barrows, which develops a lot of the advertising in Tesco’s shops.
Crucially, suggested Hayley Hough, category director for Mondelēz, the upcoming HFSS legislation in the UK will prevent HFSS products being advertised on TV before 9pm. This makes in-store advertising very important, as it gives the company a chance to advertise to consumers during the day.
HFSS ad ban
In October 2025, the UK HFSS ad ban will come into force. The ban, which was announced in July 2020, will introduce a 9pm watershed for marketing of HFSS products, and introduce restrictions for HFSS advertising online.
“Now our understanding is it won’t impact retail media. If it does materialise, you can see why this would take a real lion’s share of our spend, because this will be our number one way of talking to shoppers during the day, particularly when they’re thinking about snacking products.”
How are food companies responding to changes in data tracking?
With 912 million adblocker users worldwide according to Statista, consumers are going out of their way to avoid advertising.
Google recently announced the phase out of ‘third party cookies’, cookies that can be placed on a website by a third party to track the data of users. Thus, the importance of ‘first party data,’ data collected from consumers directly, is even more profound for advertisers.
“That is going to put organisations that have the privilege of first party data in a really strong place,” said Tash Whitmey, MD for Tesco UK Retail Media.
The data collected from Tesco’s loyalty card, as well as contributing to in-store advertising, is useful because it is first-party data. “We’ve always used the club card data in our retail media offering to build audiences, to analyse customers hopping behaviour, to be able to work with our brands to say, ‘if we build an audience, we are going to be talking to the right people about things they want us to talk about in the right moment, and then we’re going to be able to analyse not just digital attribution, but also what they bought and what they continue to buy.’”
She stressed what she saw as the importance of companies to ‘work with’ those who hold first-party data, after the demise of third-party cookies.
Deliveroo also holds a lot of first-party data. Its data allows it to ‘deliver some deep insight to our advertising partners’ said Adam Bishop, the company’s chief global marketing and product officer.
Deliveroo focuses on ‘moments’ during which its consumers may use the platform, for example if a family wants food but does not want to interrupt the playing of a board game. “I think you have to connect that data with those moments and play the advertisers in,” said Bishop.
Deliveroo’s data is interesting to advertisers because its consumers have ‘high intent’ when purchasing from their platform, suggested Bishop. They are also ‘high potentials.’
“When we think about the kind of cohorts of our users that we interact with, they look pretty interesting to advertisers in the sense of: a lot of families, a lot of professionals . . . students, and people starting out their career journeys.”
The data available to companies such as Tesco and Microsoft, suggested Kim Ludlow, head of international retail media sales (EMEA and APAC) at Microsoft Advertising, is a ‘rich pool’ of data for companies who, because of the third party cookie, haven’t yet needed to access it.
How does Coca-Cola market to a global audience?
Coca-Cola is one of the most truly global companies in the world. Its marketing strategy must, therefore, both respond to local conditions and tie into a coherent brand identity.
“In our business, the scale is very important, but we do know that at the end of the day, the purchase decision happens at a local level,” said Javier Meza, president of marketing and Europe CMO at the Coca-Cola Company.
“So we speak about the global consistency with the local relevance, or the global scale with the local intimacy.”
Marketing company WPP works in partnership Coca-Cola with the localisation of its marketing strategy. Before this partnership, Coca-Cola was working with around 6,000 agencies globally. “We recognised that going with fragmented partners was not going to work,” said Meza.
One example is the Euro cup. The event takes place in Germany. Thus, according to Meza, Coca-Cola had decided to focus its marketing for the event around Germany. “We create content specifically for those live activations in Germany, fan faced with Coca-Cola, experiences within the stadiums.”
Digital campaigns are more scalable, which means that more countries can be taken into consideration. Marketing campaigns, he suggested, can either ‘scale up or achieve local intimacy.’
In order to develop further consumer insights, Coca-Cola is using generative AI, in partnership with Microsoft.
