Follow Up: Iceland’s Sales Performance After Their Christmas Ad Publicity

Back in November, I wrote an article about Iceland’s banned Christmas advert and the debate that surrounded it. The 90 second animated film ‘Rang-tan’ featured a baby orangutan telling a little girl about how his home, the rainforest, has been destroyed by humans harvesting palm oil, highlighting the global deforestation caused by the palm oil trade. The point of this was to signal that Iceland would be removing palm oil from all its own label products, making them the first major UK retailer to do so.

The advert was supposed to air around the Christmas period on television but claims it was “banned by advertising regulations on grounds of political advertising.” It came to light that the advert was originally made by Greenpeace, and despite all the branding being removed the watchdog organisation Clearcast said that the advert breached very well-known rules of the UK Code of Broadcasting Advertising because it was originally created by an organisation has been unable to prove it is not a “political advertiser”.

However, most people assumed it was banned because of the content or message of the ad. The news caused a surge of publicity; it received a lot of media coverage, it was talked about a lot on social media and at the time of writing the video has 5.8 million views. Iceland was almost certainly aware of these regulations and as such, there is a strong indication that this was a calculated marketing strategy intended to bolster publicity and brand awareness.

Despite the level of coverage, it appears not to have translated into sales. Over the festive period, Iceland’s sales reportedly weakened. The Times published a report that was intended for bondholders, which showed that underlying sales fell by 1% over the 16 weeks to 4th January, despite new store openings.

Total sales, which includes profits from all the new shops opened in the last year, grew by only 3.5%. The frozen food retailer hasn’t released an official statement, but before Christmas founder, chairman and chief exec of Iceland Foods Ltd Sir Malcolm Walker warned that trading had been slow.

It’s all well and good creating noise to start conversations online and drive overall brand awareness, but if this doesn’t convert into sales it’s completely pointless and a waste of money.

Iceland is a down market chain selling frozen meat and vegetables; the reason people shop at Iceland is because their food products are cheap, convenient and quick to make, not because they are of exceptionally high quality or responsibly sourced.  The message of the advert, therefore, is not well aligned with their USP, and whilst it’s a nice sentiment and an ethical approach to running their business, it is not targeted specifically enough to their audience. With every marketing decision you make, you need to ask ‘why?’ ‘does this have a reason to live?’. This advert is great for their brand image and it will appeal to the mass market – but do their actual customers really care? I’m not so sure. There is a good chance that they failed to resonate with a large segment of their customers, which would explain their poor sales performance.

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