Cadillac takes the long view

If you're a luxury car owner, then chances are you read the business pages of one of Canada's national dailies. Such is the reasoning that led General Motors of Canada to put its entire media budget for Cadillac into newspaper last...

If you’re a luxury car owner, then chances are you read the business pages of one of Canada’s national dailies.

Such is the reasoning that led General Motors of Canada to put its entire media budget for Cadillac into newspaper last year. Specifically, the automaker executed a 52-week buy in both The Globe and Mail’s Report on Business and The Financial Post.

Approximately 80% of luxury car buyers read one of these products, says Doug Turney, director of client services with GM’s Toronto-based agency, MacLaren McCann. Some read both – and they read them in depth, like magazines.

Communicating with the target audience on an ongoing basis through a single medium made more sense in this case than a short-term effort in multiple media, Turney says. And it allowed the creative team to develop its message over time. ‘It was using the frequency of the medium creatively by telling a different story every week,’ he explains.

The approach also had the advantage of being unusual for the category, Turney adds. ‘It allowed us to do something that we’ve never seen done in newspaper before.’

All of the ads in the series were full-page black and white. The first featured the Cadillac logo, and some copy outlining the brand’s illustrious history. The Cadillac name, it pointed out, has entered our everyday lexicon, as a means of denoting superior quality. (How often have you heard something referred to as ‘the Cadillac of -’?)

After that, each weekly ad highlighted a different aspect of Cadillac – from the overall design to technological features such as the OnStar tracking and concierge system.

The campaign tagline – ‘That’s right. Cadillac’ – wasn’t intended as a positioning statement for the brand, Turney says. Rather, the goal was to drive consumer response. ‘What we needed to do was take people on a journey,’ he explains. ‘We needed to get their attention, gain awareness for Cadillac and ultimately persuade them that Cadillac has changed.’

Why the urgency? In a word, imports.

As in most other automotive categories, Japanese and European vehicles – in this case, the likes of Infiniti, Lexus and Audi – have become a powerful presence in the luxury market, forcing domestic automakers to put pedal to the metal in order to maintain market share.

Cadillac had to prove itself to be at least on par with the imports – if not actually more prestigious. And it had to make the point often, Turney says. ‘We wanted to be seen regularly and create a presence.’

The marketing team (which includes MacLaren’s media management unit, Initiative Media) locked in the same placement every week. The ad in Report on Business appeared on Tuesdays, while the one in the Post ran on weekends. ‘It bridged the week really well,’ Turney says.

Because the target audience is highly educated, he adds, the creative needed to eschew bold declarations, and give due credit to the reader’s intelligence. ‘Otherwise the B.S. meter goes off,’ he says.

Mike Speranzini, brand manager for Cadillac with Oshawa, Ont.-based General Motors, says the newspaper buy proved a highly effective means of reaching the brand’s target audience. ‘We are delighted with the results from a brand-building and sales point of view.’

Perceptions of Cadillac have improved markedly, he says, and sales of those vehicles spotlighted in the campaign – the Deville, Seville and Escalade – have all climbed.

Also in this report:

- Launch of Post good news for advertisers: Upstart daily has jump-started the industry, prompting offers of better rates, bonus ads and new loyalty programs p.NP3

- Stop the presses: Dailies are changing: No longer acting as simple order-takers p.NP4

- Picture perfect: It’s obvious that visually driven creative works well in newspaper. So why don’t more advertisers use it? NP5

- Telcos reward readers with a laugh: MTT and Bell Mobility employ unusual formats to nab attention p.NP6

- builds awareness offline: Coupon portal uses newspapers as linchpin of media strategy p.NP7

- Edmonton Journal: Time for a change: Daily goes for a facelift p.NP10

- Whistler taps fast turnaround times: Newspaper lets ski resort react quickly to changing circumstances p.NP13

- Talvest co-brands funds with FP Index: Helped Montreal financial services provider to crack Ontario market p.NP14

Kraft Heinz beats the street, but reports slight sales slide

The company's Q2 net sales, while down slightly, reveal continued demand for snacks and pre-packaged meals.
Kraft Heinz

Kraft Heinz is reporting earnings of 78 cents a share, beating Wall Street’s estimate of 72 cents a share, thanks to continued demand for snacks and pre-packaged meals. However, the company also reported a net sales decline of 0.5% compared with the same period last year, to $6.6 billion, according to its latest Q2 earnings report, released Tuesday.

The company experienced a favourable 2.3 percentage point impact from currency and a negative 0.7 percentage point impact from its February divestiture of Hormel Foods – including the Planters peanut brand – which closed in the second quarter of 2021.

Its cheese divestiture – which included the sale of its natural cheese division to Lactalis – is expected to close in the second half of 2021, says Kraft Heinz Global CEO Miguel Patricio in this morning’s conference call.

Adjusted EBITDA slumped 5.2% versus the year-ago period to $1.7 billion and increased 6.6% versus the comparable 2019 period. Higher transportation and inflation-related goods costs continue to affect the company’s bottom line.

Kraft Heinz’ organic net sales declined 3.6% in Canada over the last three months compared with a comparable period last year, this as total net sales rose 8.8% year over year. 

However, its overall organic net sales slipped 2.1% compared with 2020 figures. This includes the negative impact stemming from exiting its McCafé licensing agreement. However, this decline was partly offset, Kraft Heinz reports, by “partial recovery in foodservice channels and retail consumption trends.”

“Food service is recovering, and recovering fast,” Patricio stressed in today’s earnings call. He said “the bet to support QSR” early in the pandemic, with individual packets of ketchups and sauces, is paying off.

Channel trends are still normalizing, he warns, and it’s too early to see how at home or away from home, will net out. “We have big ambitions for away from home business,” he said. Consumers continue to evolve how they eat, with Patricio saying that Kraft Heinz is collaborating with a popular DTC brand for its Philadelphia cream cheese.

Accrued marketing costs, the company reports, rose to $968 million from $946 million in December 2020.

“We are investing more in our brands, and better as well, building a much more creative company,” Patricio reported.

Kraft Heinz is also strengthening and diversifying its media presence, he said, driving repeat rates for those discovering and rediscovering the brand. Patricio added that the company is continuing to drive its transformation program forward, modernizing its brands and better connecting with its consumers.