Welcome to our ‘weekly news in brief’, covering the latest from UK retailers and manufacturers.
RETAIL NEWS
THG Ingenuity signs beauty partnership worth more than £100 million
The Hut Group’s tech arm, THG Ingenuity, has announced that it has signed a series of major partnership agreements with global beauty brands, including PZ Cussons, Burt’s Bees, Nuxe, By Terry and Elemis, valued at more than £100 million. Through the partnerships, THG Ingenuity will accelerate each brand’s transition a DTC model to meet the growing online consumer demand. Each brand will access THG Ingenuity’s full range of e-commerce solutions, from its end-to-end proprietary DTC technology platform to its international fulfilment and payments infrastructure.
“The consumer shift to online continues at pace and a resilient, world class, DTC operation has become a necessity for brands to generate sustainable long-term growth. Through THG Ingenuity’s proprietary technology, brands can leverage our end-to-end capabilities to launch, market and fulfil their product offering at pace and accelerate their international expansion,” said Matthew Moulding, Founder and Chief Executive Officer of THG.
“The latest partnership agreements with some of the leading international beauty brands are a testament to the strength of THG Ingenuity’s proven technology services.”
With the global pandemic closing bricks and mortar stores for months on end and therefore accelerating the shift to digital, it’s more important than ever that brands have a commanding online presence and DTC capability.
Source: Global Cosmetic News 26th June 2020
Tesco mulls price war campaign against Aldi & Lidl
Tesco is reportedly planning to launch a major new price war against the discounters as it prepares for the increasing likelihood that the UK will face a coronavirus-driven recession. According to The Grocer, the Big 4 grocer has told suppliers it would not allow Aldi or Lidl to gain the price advantage that led to their skyrocketing growth after the global financial crisis in 2008 and 2009.
Tesco has also reportedly told suppliers that is plans to roll out an everyday low pricing campaign involving both branded and own-label products. In addition, the grocery giant is reportedly planning to ramp up its price-matching campaign against Aldi, which was first launched just before the UK went into lockdown in March.
The retailer’s promotional activity is also expected to be driven through its Clubcard loyalty card, which has 19 million members.
“We are always working hard to give customers great value. In March, we launched Aldi Price Match, a commitment to match hundreds of Tesco products to Aldi prices,” a Tesco spokeswoman said. Tesco is slated to deliver its first quarter results on Friday.
Source: Retail Gazette 24th June 2020
Morrisons launches hot food-to-go takeaway service from cafés
Morrisons has started offering a hot food-to-go takeaway service from all of its 402 in-stores cafés that have been closed since the start of the coronavirus outbreak. The retailer will offer breakfast, lunch, afternoon tea and dinner options from the cafés, with all items packaged in new cardboard takeaway boxes.
Morrisons highlighted that the launch effectively makes it the nation’s largest fish and chip takeaway, as its cafés usually sell two million portions a year.
Marianne Jones, Head of Café Operations at Morrisons, said: “Our customers love our cafes. Some dine with us a number of times a week and many have told us they’ve been waiting for their return. So we’ve been working behind the scenes to bring back some of our most popular dishes at great prices as we continue to feed the nation.”
Due to current social distancing measures in the cafés, customers have to order their takeaway by calling a national takeaway hotline. All meals will be ready for collection half an hour after the order is placed. Deliveroo is also available in some locations.
Source: Namnews 22nd June 2020
Waitrose will “never sell chlorinated chicken” says CEO
British supermarket brand Waitrose has announced that it will never sell chlorinated chicken and hormone-injected beef, firing a warning to the UK government over alleged talks of a post-Brexit trade deal with the US.
The new boss of Waitrose, James Bailey, said in the latest issue of Waitrose Weekend magazine that the supermarket would never stock such products, backing calls to prevent the loosening of food standards under the potential trade agreement.
Bailey, who has been Waitrose’s executive director since April, said that the move to import chlorinated chicken and hormone-injected beef would be an “unacceptable backward step” and that it was “simply wrong” to import food from overseas that had been produced to a lower standard than currently allowed in the UK.
In the magazine, Bailey also backed the National Farmer’s Union (NFU), stating that a million people had signed their petition to ensure that food imported from countries such as the US to a lower welfare standard should not be allowed.
“We will never sell any Waitrose product that does not meet our own high standards,” he said, adding that “any regression from the standards we have pioneered for the last 30 years would be an unacceptable backwards step.
“It would be simply wrong to maintain high standards at home yet import food from overseas that has been produced to lower standards. We would be closing our eyes to a problem that exists in another part of the world and to animals who are out of our sight and our minds,” he continued.
Source: FoodBev Media 26th June 2020
MANUFACTURING NEWS
Daz returns to television screens
Laundry brand Daz is launching its biggest campaign in a decade as it looks to target younger consumers. The marketing push, ‘#DazItUp’, targets 18- to 35-year olds. The campaign covers television and social channels, with the brand more than doubling its media spend in 2020 to build awareness and engagement with an audience that may not remember the ‘Daz Doorstep Challenge’ era.
With a voiceover from comedian and actor Paddy McGuiness, the ad encourages people to show off their bright holiday clothes from their home or garden, nodding to the benefits of the Daz All-in-One pods which have in-built brightness boosters.
“Our brand is all about bright cleaning so naturally we had planned to launch a summer campaign to get people showing off their summer brights even if the British summer can be unpredictable,” says Laura Mcilwaine, Daz brand manager. “We just didn’t know how unpredictable this year would be.
“We’re returning to screens via TV and social, supporting the TV campaign with a social media strategy using influencer partners and new social media platforms like TikTok for the first time ever for Daz. Making our brands appealing to a younger audience is an important step-change for Daz and for the laundry category.”
Source: Marketing Week 25th June 2020
Quorn teams up with Liverpool football club
Meat-free brand Quorn has unveiled a global partnership with Liverpool Football Club. The multi-year tie-up will see Quorn become the club’s Official Sustainable Protein Partner, which aims to help LFC contribute to greater food sustainability as part of its ‘Reds Go Green’ initiative.
Quorn will work in collaboration with the football club to provide new opportunities for supporters to choose from vegetarian and vegan foods on matchdays, while also working with the club’s nutrition team to extend the choice of healthy protein amongst its playing staff. Some 14.5% of global greenhouse gas emissions currently come from the livestock supply chain. However, the environmental impact of the mycoprotein used in all Quorn products is 90% lower than beef.
Gill Riley, Marketing Director at Quorn, said: “Our partnership with Liverpool FC is very important to our Quorn vision, which is to provide food that is healthy for our families and the planet.
“We also want to understand the positive impact Quorn’s super-protein can have on elite sports performers, so working with LFC and its world- renowned nutritional experts will be fundamental in the next phase of our sports science research.”
Billy Hogan, Managing Director and Chief Commercial Officer at Liverpool FC, added: “As a leading provider of sustainable meat-free products in the UK, Quorn will be a key partner in the club’s sustainability efforts. In this case, Quorn will help us provide our supporters with more sustainable food alternatives on matchdays.”
Source: NamNews 25th June 2020
Red Bull employees signed a letter expressing 'concern' about the company's response to Black Lives Matter
More than 300 Red Bull employees signed a June 1 letter titled "Representation Matters at Red Bull" asking the company to go further in recognising the Black Lives Matter movement and have a conversation about race.
The letter from employees was sent to North American CEO Stefan Kozak and president and CMO Amy Taylor. It expressed concern about Red Bull's "public silence" regarding the protests and a May 31 staff email that was reviewed by Business Insider and referred to "tremendous heartbreak, pain, and anger across our country" and announced a pause in company meetings and social media activity but did not include the word "Black" or mention George Floyd.
The employees' letter said that Red Bull has drawn heavily from various aspects of Black culture, including hip-hop, breakdancing, and basketball, to promote its products. "As we say nothing, we are abandoning the communities we claim to support and foster in their time of greatest need," the letter read. "Absence during a time that demands action, reveals purported support as nothing more than exploitation."
The developments come as many companies have made statements of solidarity with the Black Lives Matter movement and are being held accountable for their records of diversity and inclusion.
On June 2, staff received another email written by Kozak that mentioned "the murder of George Floyd and countless others.” Regarding "the current uprising," Kozak wrote, "I share these views and I applaud those who peacefully and courageously have made their voices heard."
Then on June 14, Red Bull's head of communications, Carly Loder, sent an internal memo saying the company stood against racism but did not state that it would publicly support the movement. "I'm not American. I'm not Black. I cannot even begin to understand for one moment what the last few weeks has been like for our team," Loder wrote. "I want you to know where I personally stand — Black Lives Matter."
The memo then summarized the company's talking points to use with business partners, writing that Red Bull "stands directly and actively against racism" and "supports the Black community and the movement" and that Red Bull "will reinforce Black representation in everything we do" and "direct resources to the efforts of existing and new partners focused on equality in cities across the US."
It stated that executives understood why staff were frustrated with the delayed response and promised "action in short term solutions for Black representation in our organisation and in the stories and content we amplify in the market."
Source: Business Insider 19th June 2020
Asahi UK launches ‘super-premium’ online bottle shop
Asahi UK has launched a direct-to-consumer delivery service that will allow people to order its beers online for next-day delivery.
The platform, called Beer Pronto, will sell Asahi UK brands including Peroni Nastro Azzuro, Asahi Super Dry, London Pride, Meantime and Cornish Orchards.
Asahi UK hopes it will give it a “super-premium point of difference” and help it connect with consumers in a new channel and expose them to new product offerings. It will be supported by a social campaign to drive awareness.
“With hard to come by home delivery slots and surge in popularity of online shopping – we wanted to ensure fans of our most popular brands weren’t kept waiting and could still enjoy their favourite premium larger and cider, at home, delivered with speed,” says Asahi UK’s marketing director, Sam Rhodes.
“By offering next working day deli very, we believe BeerPronto.co.uk will be popular with shoppers.”
Source: Marketing Week 23rd June 2020
WIDER INDUSTRY NEWS
Covid-19 has led to a pandemic of plastic pollution
In February, Gary Stokes docked his boat on Hong Kong’s isolated Soko Island. Soko’s beaches are where OceansAsia, the conservation organisation he runs, sporadically records levels of plastic pollution. Mr Stokes says he is all too accustomed to finding the jetsam the modern world throws up, such as plastic drinks bottles and supermarket carrier-bags. But what he documented that day made news across Hong Kong: 70 surgical facemasks on a 100-metre stretch of beach. Having cleaned it up, he went back four days later. Like a stubborn weed, the masks had returned.
Whether on the foreshore of the Thames or the deserted beaches of Soko, the planet is awash with pandemic plastic. Data are hard to come by but, for example, consumption of single-use plastic may have grown by 250-300% in America since the coronavirus took hold, says Antonis Mavropoulos of the International Solid Waste Association (ISWA), which represents recycling bodies in 102 countries. Much of that increase is down to demand for products designed to keep covid-19 at bay, including masks, visors and gloves. According to a forecast from Grand View Research, the global disposable-mask market will grow from an estimated $800m in 2019 to $166bn in 2020.
Staggering though such figures are, personal protection is only part of the story. Lockdowns have also led to a boom in e-commerce. In March, as parts of America and Europe shut up shop, some 2.5bn customers are reckoned to have visited Amazon’s website, a 65% increase on last year. In China, more than 25% of physical goods were bought online during the first quarter of the year, according to the Peterson Institute for International Economics, a think-tank in Washington, DC.
Much of what is bought online comes wrapped in plastic—and the bad kind at that. Goods are often packaged in plastic comprising several layers. That keeps the contents safe in aeroplane holds and on delivery lorries. It also makes it nearly impossible to recycle the plastic. At the same time, the locked-down masses have been consuming home deliveries from restaurants in record numbers. First-quarter sales at Uber Eats, one of America’s biggest restaurant-delivery apps, for example, rose by 54% year on year. Every extra portion of curry, or pot of garlic dip, means more plastic waste.
If the public’s increasing appetite for single-use plastic worries environmentalists, then so too does its diminishing inclination to recycle materials that can be reused. In Athens, for example, there has been a 150% increase in the amount of plastic found in the general-waste stream, says Mr Mavropoulos. Anecdotal evidence from ISWA members suggests this is a worldwide trend.
An unwillingness to recycle might be explained by people’s nervousness about venturing out to put waste in recycling bins. Or it might just be that lockdowns have put more pressing matters into their minds, prompting a slip in their diligence.
Covid-19 has led to a glut in plastic waste in other ways. For one, the pandemic caused a crash in the oil price. Because petroleum is a major constituent of most plastics, they became cheaper to produce, says David Xi of the University of Warwick. That in turn gave firms less incentive to use the recycled stuff. But the growth of plastic rubbish is mainly caused by the fact that municipalities around the world have curtailed their recycling schemes. Collections have been cut back and plants have been shut over fears about spreading the contagion. Worries about contaminated rubbish have also made some refuse collectors and sorters nervous about going into work (the virus can survive for about 72 hours on plastic).
All of which means that much of the plastic produced this year is ending up either in landfill sites or being incinerated. Both could store up future problems. Landfills, especially in poor countries, are often little more than open dumps. They are responsible for some of the biggest leakages of plastics into oceans, says Mr Mavropoulos. Because the material is light, it is easily swept by rain or wind into waterways.
Incineration is not much better. Again, particularly in the developing world where facilities can be shoddy, not only can burning plastics create toxins, but it also often fails to obliterate the plastic, leaving considerable levels of nano- and micro-particles. These can both be emitted into the atmosphere, where they can cause cancers, or leach into groundwater and eventually into oceans.
Indeed, like the virus itself, pandemic-era plastic pollution is hitting the poor hardest, says Inger Andersen, executive director of the United Nations Environment Programme. In low-income countries, 93% of waste goes into open dumps, she says. And where there are incinerators, they tend to be of low quality. Even in rich countries, the poor are more likely to live closer to facilities that deal with rubbish, says Ms Andersen.
There are good reasons why the public has turned to plastics, says Mr Parsons: “People know that it protects them” from the coronavirus. Not only that, points out Ms Andersen, it is hardly fair to blame manufacturers for producing environmentally unfriendly protective equipment—or consumers for buying it—given the global scramble to obtain the materials needed to make the masks and visors that keep health workers and others safe. And a world in which less plastic is produced would not necessarily be a greener one. Because the material is light, it often causes lower emissions when it is transported than alternatives do.
But what worries Mr Parsons is that years spent trying to change the public’s attitude towards single-use plastic might now be lost. Preliminary findings from research his team has conducted suggest that the public has reverted to its earlier insouciance about plastic waste. The pandemic has already encouraged the rolling back of anti-plastic legislation, such as taxes on single-use grocery bags in some American states, or a ban on plastic straws in Britain. Ironically, that may even help the climate. But just as covid-19 has scarred families and harmed livelihoods across the world, its effect on the planet will linger, too, in the world’s landfills and oceans.
Source: The Economist 22rd June 2020
Why have there been so many outbreaks in meat processing plants?
Hundreds of workers have tested positive for coronavirus at meat processing plants and abattoirs. They include a chicken processing site in Anglesey, where more than 150 workers have become infected with Covid-19, and plants in Wrexham and West Yorkshire. There have also been major outbreaks in Germany, France, Spain and the US.
Bev Clarkson from the union Unite, says: "Unite has warned time and again that coronavirus outbreaks at meat processing factories throughout the UK were likely".
"Factories and, in particular, indoor areas which are cold and damp, are perfect environments for coronavirus to linger and spread," according to Lawrence Young, Professor of Molecular Oncology at the University of Warwick."Virus-containing droplets from infected individuals are more likely to spread, settle and stay viable."
Another possible factor in these refrigerated workplaces is noisy machinery, which requires people to talk more loudly or shout, which can increase the spread of infected droplets.
It is difficult to keep workers two metres apart when they are working on fast-moving production lines, and the absence of daylight may also help the virus to survive.
"When you have people standing right next to each other working heavily - because of course this is a difficult job - and breathing heavily, you have a chance for spreading virus from just one infected individual to many that are in close proximity," said Tara Smith, professor of epidemiology at Kent State University in Ohio.
There is no evidence that the meat products themselves could be a source of Covid-19 infection at the plants. The Food Standards Agency said it was very unlikely that you could catch coronavirus from food because that is not how it is known to be transmitted. It's not just conditions inside the plant that may be increasing the risk of coronavirus.
Source: BBC News 23rd June 2020
TikTok launches business platform
TikTok is launching a platform for businesses that it hopes will encourage more brands to use the platform to reach their consumers.
Created as a way to give brands opportunities for creative storytelling, TikTok For Business aims to give marketers the tools to be discovered and connect with the broader communities around them. And the company has some advice for brands: make TikToks, not ads. It advises that creative, light-hearted and fun content is seen as the best way to connect with the young audience that uses the app.
TikTok’s head of Europe, global business solutions, Stuart Flint says: “We’ve seen more and more brands embrace the unique and creative ways the TikTok community expresses themselves through video.
“The experience is real, light-hearted and fun, and as we’ve seen over the course of these dynamic times, users and brands have the ability to make a meaningful and positive impact on their communities. We’re excited to officially introduce TikTok For Business and continue building products, services and resources for marketers to engage their communities in a new and innovative way, and show them how TikTok is a creative and valuable marketing platform.”
Businesses reassessing supply chain strategy following challenges of pandemic.
The coronavirus crisis has transformed businesses approach to supply chain strategy, with many now looking for new ways to future-proof their operations, according to an industry survey from supply chain and logistics consultancy SCALA.
The survey of 43 leading grocery and home appliance businesses, conducted ahead of SCALA’s 2020 Annual Supply Chain Debate, revealed that more than nine in 10 businesses (95%) are looking to re-evaluate their supply chain strategies. This is in response to the experiences of the pandemic and possibilities of how the “new normal” may look, which includes expectations of ongoing increases in e-commerce sales.
Supply chain resilience and agility were identified as the highest priority in future considerations, with companies aware of the need to build additional robustness into their supply chains to cope with potential future disruptions such as further pandemic disorder, political uncertainty or environmental disasters.
Most notably, two-thirds of all businesses surveyed saw a greater need to increase focus on managing their suppliers, working in closer collaboration with their suppliers and partners, as well as re-assessing the diversity of their supplier base. Better understanding and closer collaboration between suppliers and customers are seen as essential in building robust supply chains that can withstand current and future disruption.
Respondents also cited the need to re-evaluate their processes and number of stock and distribution points across their supply chains, as well as increased adoption of automation, robotics and AI, as being some of the key changes expected to support the future of their supply chain strategy.
Commenting on the survey, John Perry, Managing Director at SCALA, said: “Following the challenges of COVID-19 for many businesses’ supply chains, it is clear from our research and working with our clients that future-proofing supply chains is a top priority across the grocery and home appliance sectors.
“Learning from the strategic issues raised by COVID-19, suppliers and retailers are already re-assessing their supply chain strategy to effectively prepare for the “new normal” and possible other future disruptions, whatever those might be. SCALA has a number of senior-level industry experts discussing in more detail the issues supply chains are facing at our Annual Debate at the end of June.”
Source: NamNews 23rd June 2020
MERGERS & ACQUISITIONS
Lidl acquires German ecommerce giant
Lidl’s owner Schwarz Group has acquired one of Germany’s largest online marketplaces suggesting the retailer could be eyeing an expansion into e-commerce. The Schwarz Group acquired Real.de, an online marketplace which sells everything from clothing, to groceries and even mopeds, for an undisclosed sum earlier this month.
Source: Charged Retail 26th June 2020
Constellation to divest Paul Masson Brandy, Nobilo Wine brands
Constellation Brands has agreed to offload its Paul Masson Grande Amber Brandy and Nobilo Wine brands in two separate transactions, for a combined price of approximately $385m.
Constellation has signed an agreement with Sazerac Company to divest its Paul Masson Grande Amber Brandy brand for $255 million and a separate agreement with E & J Gallo Winery to sell the Nobilo Wine brand and certain related assets and liabilities for $130m.
Source: Foodbev Media 26th June 2020
Faze Clan acquires stake in meal replacement start-up CTRL
Gaming and eSports firm Faze Clan has acquired an ownership stake in meal replacement start- up CTRL for an undisclosed sum.
A joint statement from the companies claims that Faze Clan will put its marketing prowess and 230 million followers behind CTRL to grow the brand globally. In the future, CTRL will also collaborate with Faze Clan on new flavours for its meal replacement shakes.
Source: Foodbev Media 22nd June 2020
