Wholesalers need to be reminded of the Government’s forthcoming tightening of the restrictions on the marketing of High Fat, Sugar, and Salt (HFSS) which covers a huge number of products in a number of categories. Not just the obvious ones of sweets and soft drinks, but biscuits, bakery, snacks, cereals and a whole host of other products.
Whilst the proposed ban on the advertising of these products in children’s media and during children’s programming may not represent a direct threat to wholesalers or their retail customers, other aspects of the new laws most certainly do and are already in place. For example, there is now a ban on the placement of HFSS products at checkouts (within 2 metres) and in high-traffic areas such as end-of-aisle or storefront locations (not within 15 metres). This will have an impact on ‘impulse’ sales, especially of confectionery and soft drinks, writes Jeremy Stern, CEO of PromoVeritas, the global prize promotion specialists.
The industry is trying to deal with these new laws in a number of ways that wholesalers should be aware of.
Firstly, brands are looking to reformulate and take themselves out of the reach of the HFSS regulations by removing excess fat, sugar and salt, ideally without affecting the taste. Weetabix and Tyrells are two brands that have done this in recent months in an effort to get out of the HFSS trap zone. So look out for other brands doing the same. Similarly, Coca-Cola has redesigned its packaging of Coke Zero to be virtually identical to its main Coca-Cola branding.
Others are reducing pack sizes to get below calorie thresholds, or creating totally new products that meet the criteria, such as Cadbury and their Fruitier & Nuttier range – this is basically Trail Mix, nuts and raisins with a small percentage of Dairy Milk Chocolate. Just enough chocolate to stay outside of the HFSS rules, but carry the famous purple branding, associated with the main chocolate brand.
Secondly, it is crucial to know the specifics of the rules. The devil is in the detail. Businesses that employ less than 50 people – across all sites are exempt from the location display rules. This could impact how you reach most of your customers! However, it’s still vital that all businesses are mindful of the intent of the rules.
Thirdly, anticipate a change in marketing of brands. You can expect a shift from TV adverts, moving away from the vast amount of money being spent on TV advertising as many brands will not be allowed to advertise in peak times. However, direct marketing – such as through the post or email – will be unaffected and you can anticipate an increase in these areas as brands try to overcome ad restrictions and increase sales indirectly.
There is also likely to be an increase in the use of prize promotions, via on pack and social media. Not only can they have immediate impact on sales, but they also act as valuable data collection devices, and enable the brands to build up massive databases from which they can glean a lot of information and also run more direct marketing campaigns that unlike TV and radio advertising, are not restricted and are permissible for promoting HFSS goods (to over 16’s).
But even prize promotions and similar marketing tactics need to be run right. The potential legal, financial and reputational repercussions could be severe. For example, a recent ASA ruling against Burger King demonstrated the challenges for brands as they try to increase their sales through marketing whilst not falling foul of compliance. In this example, the regulator found that Burger King’s reward scheme YourBurgerKing had not taken reasonable steps to exclude under-16s from the audience. The ruling sent ripples across the industry, signalling a shift towards a stricter crackdown on HFSS products.
To thrive in this ever-changing regulatory environment, retailers must be nimble. By staying informed of the evolving regulatory and consumer landscape, you, as a wholesaler, can ensure that you and your customers are correctly navigating the new regulations and adopt responsible, watertight marketing and sales strategies in response.
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