These are changing times for the FMCG industry. With the news of the HFSS Junk Food Advertising Ban all over the web at the moment – it’s clear that the impact of this marketing restriction will be huge!
This will be one of the toughest marketing restrictions in the world! With an incredible £600m currently being spent on online food advertising and TV advertisements, it will affect all paid forms of digital advertising: adverts on Facebook, paid searches, text messages, etc. The marketing of food & drink products will completely shift.
Biggest UK diet intervention since WW2
Interestingly, this will be the biggest diet intervention in the UK since rationing during World War II. The difference being – this new law is being enforced to tackle the apparent obesity “crisis”, one of the biggest health problems in the UK at the moment. Boris Johnson feels that this is critical when referring to the health complications surrounding COVID-19 and health issues.
The High Fat, Salt and Sugar (HFSS) law means that advertisements of “junk food” online and before 9pm on TV, will be banned – The government’s plans suggest that the law will be passed in April 2022, with the ban coming into fruition in 2023.
The implication of the proposed HFSS (High Fat, Salt & Sugar) Legislation will mean huge shifts in the way that both retailers and suppliers market their products, and will mean shifts in marketing strategies. In addition to that, it could cost broadcasters more than £200m in annual revenue.
Opportunity for SME Brands?
It’s worth noting that this legislation will not immediately apply to SME (Small and Medium-sized Enterprises) brands as they will not be affected by this ban, and will still be able to advertise their products. Arguably, this could be a great opportunity for those smaller businesses, as they will have the space and leverage over bigger competitors – however, who’s to say how long this option will be available? At some point the law will come into play for them too.
You can expect the ban to affect these HFSS foods: cakes, confectionery, pizzas, ready meals, crisps and pastries, though items thought to be “staple” like butter and oils, will be exempt. It will also apply to drinks in the Out-of-home sector, restaurants, or coffee shops – one example being the free-refill sugary drinks.
The entire Impulse category, and large parts of bakery, chilled, processed meats, and frozen food, will have to learn to operate differently. At least with the staggered time-frame of events, brands have a window to get prepared for the upcoming change and shift their focus where necessary!
Described as “Draconian” Measures
Despite the obvious delights from health campaigners, the Food and Advertising industries have said that they are disappointed at the “Draconian” measures – but this isn’t the first step in trying to make Britain “healthier”, or at least conscious of the sugar that we consume.
The Sugar Tax that was introduced in 2018, did pave the way for this kind of reformation and innovation. Paying extra for a full-sugar coke seemed outrageous at the time, but now feels a normal part of the industry. Will the same thing happen with the advertising ban?
The HFSS ban will affect how FMCG brands communicate with their customer base, but it is an opportunity for the industry to embrace innovation, learning to remodel, and reinvest budgets.
How will the sector respond to this?
The IRI shared their 5 possible sector responses:
- Accept the ban and ditch post-watershed and online advertising, with a predicted total loss for manufacturers and retailers of £192m.
- Move advertising spend to post-watershed, with a predicted loss of £112m in sales.
- Move ad spend to channels not covered by the restrictions, which would regardless lead to a predicted loss of £96m in sales.
- Advertise a low FSS product within their roster. This is doable for most brands: 78% of manufacturers have a non-HFSS product. “But, by shifting advertising to products with lower penetration, we would expect lower returns and a lower halo impact,” says IRI marketing strategy director Carl Carter. IRI predicts an impact on overall sales of £80m-100m.
- Reformulate HFSS products to be compliant. “This could be the best option for manufacturers, with a lower impact on sales, but also the most difficult,” Carter says. “It is incredibly complex and could face consumer pushback, while some products cannot be reformulated.”
Matt Hancock (Health Secretary):
“I am determined to help parents, children and families in the UK make healthier choices about what they eat. We know children spend more time online. Parents want to be reassured they are not being exposed to adverts promoting unhealthy foods, which can affect habits for life.”
How do you think the FMCG industry should respond to the ban? And what skills will be most needed from a marketing perspective? Comment below…
