The Drum's New Year Honors: Nike, Lego, Formula One, WeChat, Brandless and KFC

For Nike, 2018 will be summed up in two words: Colin Kaepernick.

However, it could have gone a very different way for the sportswear brand. At the beginning of the year, it was hit with a slew of scandals. At the height of the #MeToo movement, it was forced to launch an investigation into workplace behavior following widespread allegations of harassment, discrimination, bullying, and other ‘abusive’ workplace conduct.

“I’m committed to ensuring that we have an environment where every Nike employee can have a positive experience and reach their full potential,” chief executive Mark Parker promised wary analysts. In the end, more than a dozen top executives were dismissed and it was left not only battling stagnating global sales but a brand perception problem that threatened to return Nike to lows last seen during the 90s when its ‘tolerance’ of sweatshops was exposed.

Amid the crisis-communications, however, it also produced what will arguably go down in history as one of the most powerful advertising campaigns ever made.

In a series celebrating the 30-year anniversary of then-80-year old Walt Stack slowly jogging across the Golden Gate Bridge for Nike’s first ‘Just Do It’ ad, Nike enlisted Colin Kaepernick. NFL star Kaepernick had divided public opinion when he kneeled during the national anthem at a game in the hopes of bringing attention to racial inequality. He wasn’t re-signed to his team, something he blamed squarely on the protest.

Months later, a now-iconic black and white shot of his face was plastered on billboards across America with the line ‘Believe in something, even if it means sacrificing everything’ alongside an equally powerful film from Wieden+Kennedy. Some criticized Nike for meddling in politics, others praised its bravery for standing up for social injustices.

Regardless of the debates that ensued, it was clear the move worked for Nike. Some estimates suggest it earned the sports giant somewhere in the region of $165m in media exposure while its share price hit a 52-week high within two weeks of the ad airing, adding approximately $6bn to the value of its brand.

“We’ve seen record engagement with the brand as part of the campaign,” said Parker in September, on a call with many of the same analysts he had tried to appease just six months earlier. And it’s managed to maintain that growth thanks to equally challenging campaigns featuring tennis star Serena Williams and runner Caster Semenya.

While the year began with a crisis that might have taken out a weaker brand, its Just Do It work– in addition to the Nothing Beats a Londoner campaign, successfully ambushing rival Adidas’ World Cup marketing plans and opening a state-of-the-art retail store in New York – 2018 will go down in history as a triumph for Nike.

Apple

Apple soared to new heights by becoming the first trillion-dollar company in early August. The company didn’t seem to take time off to celebrate. In June, before the tech giant made history, it inked Oprah to a TV deal as part of the company’s $1bn original content push. Post-benchmark, Apple closed on a $400m deal to buy Shazam and revealed a new line of products including the iPhone XS, iPhone XS Max, iPhone XR and Apple Watch Series 4. Apple also ran a smattering of visually captivating ads, from the ‘Unleash’ campaign that showed off the iPhone’s processing power, to a HomePod spot directed by Spike Jonze. Apple chief executive Tim Cook also had time to fire some shots at Google and Facebook over their data privacy policies, while touting his company’s own privacy-first stance.

Brandless

Brandless launched to raised eyebrows a little over a year ago. The online retailer’s 400+ items – think everything from toothpaste and face wipes to bags of crisps and tins of tune – are minimally branded, save for the packaging’s bold color, are cheaper as a result (everything is $3) and claim to the ‘better’ than some branded alternatives because it ops for non-GMO, and/or organic snacks, fair-trade coffee, clean beauty products, and tree-free paper etc. However, dismissing the naysayers, the concept took off and the company secured $240m in funding from SoftBank’s Vision Fund in 2018. It is now valued at more than $500m.

After launching its first brick-and-mortar store in LA it saw a “double-digit” growth in traffic to the site. It’s now plotting more and chief executive officer Tina Sharkey is quoted as saying the company’s greatest challenge is “we can’t go fast enough”.

The ‘traditional’ retailers have responded to the popularity of this affordable, purpose-led, back-to basics (but still stylish) brand. Target, for example, launched a range of home goods called ‘Smartly’ all priced at $2.

While it might not have irrevocably shaken up the retail sector just yet, it’s certainly got many branded companies thinking carefully about what the value of a heavy ‘branding’ spend is and if it’s what consumers really want.

Formula One

In just one-year Formula One created its first marketing department and global campaign (‘Engineered Insanity’), delivered a bold rebrand and launched an over-the-top (OTT) streaming service to service digital natives. After US conglomerate Liberty Media bought it in 2017, the sport has been upgraded in the pits and put on a modernization fast track to insulate it against disruptive sports like Formula E and drone racing.

This legacy brand secured its future with a bold shake-up that secures new audiences. Among those driving the change was former Virgin Media ad and sponsorship boss Ellie Norman. Promoted to director of marketing and comms in February, she embarked on a mission to learn what draws people to the F1. An integral part of this was the launch of the OTT service F1 TV. Norman told The Drum that it need only attract 1% of the sport’s 503 million global fans to run a substantial income from the service. She described this as an “incredible opportunity” to fill the gaps left by its global broadcast partners.

In 2017, Global saw F1 as an “underutilized opportunity” and set about improving the sport and digitizing it. From the Kent headquarters, staff were intent on surfacing an endless trove of data generated by its racers while also creating technology that could improve the broadcast experience with in-car microphones and pinhead 360 cameras.

KFC

By all accounts, KFC should have had a very bad year. The fast-food franchise found itself in the depths of brand disaster in February when a distribution cock-up meant it ran out of chicken in the UK. Outlets were closed for days, irate customers called the police and soon #ChickenCrisis was trending internationally.

Beyond the facetious reaction, however, its franchise owners began to fear for their livelihoods and central office went into lock-down.

Meghan Farren, KFC’s chief marketing officer, instructed her team to stop everything. In-house marketers were preparing campaigns that wouldn’t be able to run without its main ingredient to sell so were redeployed to an area of the business they were likely never expected to encounter: the warehouses.

“I had a third of the marketing team literally at the distribution center working in fridges and freezers,” she recalled. “Everyone wanted to help. No one wanted to be sitting there not helping the business. We were all asking, ‘how do we get ourselves out of this?’”

Once the distribution issue had been fixed, it was the simplest of print ads that saved the brand. When Brits opened their morning papers on 23 February they saw an empty chicken bucket emblazoned with the word ‘FCK’. It was a genius move from Mother London, the agency’s creative agency of only 11 months. The subverted swearword grabbed attention, while the copy beneath spelled out a complete and utter apology to both customers and franchise owners.

Hermeti Balarin, Mother’s creative partner, was confident Brits’ love of wit would override any outrage they might have felt over a vowel-less curse. “The F-word is used in so many different contexts in the UK,” he explains. “Everyone understood the tone. And in Britain especially, they value you if you create something that is witty and smart – even if it’s technically a swear word.”

The industry loved it as much as the public and honored the apology creative with an armful of Lions in Cannes. And then, with their relationship firmly cemented, Mother and KFC went on to create more headline-grabbing work, including a Christmas ad that doubles as a chicken v turkey western and a campaign subverting criticism of its own recipe for fries.

The brand has zero fear of irreverence outside of the UK too. It created a four-hour live stream of cats exploring the fabric model of the brand’s mascot Colonel Sanders, for instance, and turned its founder into a plastic bear-shaped figure – complete with a mustache – to promote its Hot Honey menu. 2018 also brought us scratch ‘n’ sniff fried chicken cards, a female Colonel Sanders, meaty cocktails and a Canadian bitcoin trading scheme. What it has in store for 2019 is anybody’s guess.

WeChat

With a billion monthly active users worldwide, WeChat is the messaging app of all messaging apps. In 2018 it has grown beyond messaging and become a ‘superapp’, as one can do literally everything on WeChat from sharing your social life to cashless payments, hailing a cab, buying movie tickets, ordering food delivery, paying utility bills or sending money to friends without leaving the platform.

Its Mini Programs, similar to apps, have been downloaded one million times since launch in early 2017 — just less than half the size of the Apple App Store. Mini Programs, as well as Moments which allow users to post images, post text, post comments, share music, share articles and post ‘likes’, have become a key part of digital marketing strategies for many brands in China as they can open an account and gain a following on WeChat and use these features for free, unlike with Facebook. Brands use these two features to develop their relationships with users through promotions on their official accounts and provide true app-like experiences without traditional native apps as they seamlessly link offline and online experiences together.

Lego

Three years ago, Lego announced it was upping the ante on its sustainability plans with a commitment to use 100% sustainable materials in both its bricks and its packaging by 2030, investing a billion Danish krone ($150m) in a new sustainable materials center and recruiting over 100 materials specialists to work on this challenge.

In 2018, the 85-year-old Danish toymaker then said it would be fast-tracking this process to have 100% sustainable packaging by 2025, announcing several steps taken so far, such as introducing recycled plastic and recyclable paper-pulp and reducing the average size of its boxes. Brick-by-brick it has also moved a minifig step closer to improving the sustainability of its blocks, releasing 25 plant-shaped Lego pieces including leaves, bushes and trees made from 98% sugarcane-based polyethylene rather than oil-based plastic, in line with guidelines laid down by the World Wildlife Fund. The conservation organization calls it an “incredible opportunity to reduce dependence on finite resources”.

While still not biodegradable, the reformulated bricks can be recycled. And while only 2% of bricks are so far made from this material, the company sells 75bn elements a year so it is by all considerations a sizeable achievement. Whether the remaining 98% of its output will fall in line by its self-imposed deadline remains to be seen – it is certainly a daunting task. But the fact it also makes business sense due to EU carbon taxes levies give it will no doubt help keep it on track.

The Drum's New Year Honors were first published in the January issue of The Drum magazine, which looks back at the year in marketing and advertising and mulls over some of the lessons learned in 2018. Buy your copy here.