Google, The Guardian and Amazon: Everything that matters this morning

We round up all the latest and most important marketing news.

The Guardian, L’Oreal and Cabinet Office among brands pulling ads from Google

The Guardian, L’Oreal and the Cabinet Office are among brands to pull their advertising from Google and YouTube after their ads were place alongside extremist content.

The Guardian says an agency acting on its behalf used Google’s AdX ad exchange to place the ads, which appeared alongside content including YouTube videos of American white nationalists, a hate preacher banned in the UK and a controversial Islamist preacher.

The Guardian’s chief executive, David Pemsel, says the company will remove its advertising until the media giant can “provide guarantees that this ad misplacement via Google and YouTube will not happen in the future”.

The Cabinet Office has done the same. And the government is now summoning Google to explain why this is happening and why it is not meeting quality demands.

Google’s new boss for the UK and Ireland Ronan Harris faced a direct challenge over ad safety from WPP CEO Sir Martin Sorrell just last week. Sorrell claimed that Google was being evasive about how its algorithms and advertising technology works, despite long-held and vocal concerns from the marketing community.

Harris has defended the company’s record on ad viewability and transparency and insisted that other stakeholders in the digital economy must play their part in improving standards.

FTSE 100 hits new record high

The London market closed at a record high on Thursday as investors reacted to Wednesday’s interest rate rise by the US Federal Reserve and, according to analysts, there was relief in the market at the defeat of the anti-immigration Freedom party in the Dutch election.

The benchmark FTSE 100 rose 47.31 points to a record closing high of 7,415.57. Earlier on Thursday it hit a record intraday high of 7,440.4 points before falling back and in mid-afternoon trading the index was 38 points higher at 7,406 points.

Amazon’s AI assistant is being integrated into the app

Amazon’s Alexa is coming to the iPhone via the Amazon mobile app, and while third parties have already been introducing the technology, it marks the first time that Amazon is making it available itself.

A microphone icon in the app will be appear to enable users to call Alexa and ask similar things to if you are using the Amazon Echo device, including asking Alexa to make purchases, look up facts, or control smart home products. At the moment the feature is being rolled out to users in the US.

Eurostar revenues dip following Paris and Brussels attacks

Eurostar made an operating loss of €28 million (£25 million) in 2016 as consumers that were deterred by the major terror attacks in Paris in November 2015 and Brussels in March 2016, causing the passenger numbers to fall by 4% to 10 million – revenues were down 3% at £794 million.

Eurostar’s new marketing campaign sees a move away from the focus on Paris, returning to TV for the first time in three years with a campaign that aims encourage a ‘travel state of mind’.

The brand’s UK marketing boss, Guillemette Jacob, is keen to show that the brand is much more a than trip from London to Paris. She says Eurostar is in a “very key moment in its history” after recent investments in its customer experience, including a £1bn revamp of its fleet.

Google says ad served on its Home device “isn’t an ad”

When you ask Google Home the day’s events it plays a short ad for Beauty and The Beast, which Google says is not an ad.

Reddit users found that following information about news and weather, the device added a line to say that the latest Disney’s live animation remake has opened in cinema’s, whether those users registered an interest in seeing the film or not.

In a statement Google said the audio is an example of how its working with partners. Google said: ”This isn’t an ad; the beauty in the Assistant is that it invites our partners to be our guest and share their tales.”

Regulators to investigate Lloyds’ acquisition of credit card provider MBNA

Lloyds Banking Group’s £1.9 billion acquisition of credit card provider MBNA from Bank of America is being probed by the Competition and Markets Authority (CMA). The deal would boost its share of the credit card market from around 15% to 26%, causing concerns that it could hurt competition in the industry.

The CMA will examine whether the purchase “may be expected to result in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services.”

Thursday 16th March

Sainsbury’s sales fall at start of year

Sales have fallen at Sainsbury’s in the first nine weeks of the year. Like-for-like sales were down by by 0.5% in the period to 11 March.

However, newly-acquired Argos reported strong growth, as its sales rose 4.3%, resulting in a 0.3% increase across Sainsbury’s group as a whole.

The supermarket’s chief executive, Mike Coupe, said the impact of rising cost pressures “remains uncertain”.

Apple found guilty of Russian price-fixing

Apple has been found guilty of fixing the prices of certain iPhone models sold in Russia.

The Federal Anti-Monopoly Service said Apple told 16 retailers to maintain the recommended prices of phones in the iPhone 5 and 6 families. Models include the 5c, 5s, 6, 6 Plus, 6s and 6s Plus.

Non-compliance with the pricing guidelines may have led to the termination of contracts. Though Apple has not yet responded, the regulator said that Apple has now ended its price-fixing.

GoPro expects top-end revenue but says it will cut jobs

GoPro has estimated its first-quarter revenue will come in at the top end of its previous forecast.

However, it said it will cut around 270 jobs to reduce expenses in a bid to return to profitability in 2017.

GoPro had previously forecast its revenue to be between $190m and $210m for the quarter ended 31 March.

Google launches new effort to flag upsetting or offensive content in search

Google is using data from human “quality raters” to spot offensive and “factually incorrect” information.

The tech giant hopes this will better identify content that is potentially upsetting or offensive to searchers and also prevent such content from crowding out factual and trustworthy information in its top search results.

“We’re explicitly avoiding the term ‘fake news’ because we think it is too vague,” says Paul Haahr, one of Google’s senior engineers who is involved with search quality.

Nike apologises for misleading marketing in China

Nike has admitted that some of its trainers sold in China were inaccurately marketed, after state television accused the company of making false claims.

The claims were aired on CCTV’s annual 315 broadcast, which coincides with World Consumer Rights Day.

The broadcaster said that a model of Nike’s Kobe basketball shoes was inaccurately advertised as containing its signature “zoom air” cushion.

The company said it apologised to affected consumers and offered refunds.

Wednesday 15th March

Unilever set to make more aggressive cost cuts

Unilever is considering making medium-sized acquisitions and more aggressive cost cuts as part of a sweeping review. The assessment was done following the attempted Kraft Heinz’s $143bn (£117bn) takeover bid, which could have seen the Anglo-Dutch company swallowed up by the US group.

Graeme Pitkethly, Unilever’s CFO, told an industry conference a week after the approach: “This has certainly been a trigger moment for Unilever. And we will not waste it.”

According to the FT, division heads at the consumer goods group’s businesses, which range from Hellmann’s mayonnaise and Magnum ice cream to Sunsilk shampoo and Axe deodorants, have been told to review their operations with the aim of boosting shareholder returns.

M&S focuses on mental health with ‘talk-in’ sessions

Marks & Spencer has partnered with author, comedian and mental health campaigner Ruby Wax to launch ‘Frazzled Café’ in its stores.

Announced yesterday (14 March) at the London Book Fair, M&S Cafés will host fortnightly ‘talk-in’ sessions where people who are feeling ‘frazzled’ can meet to talk and share their personal stories in a safe, anonymous and non-judgmental environment.

Eleven M&S stores will be hosting Frazzled Cafe meetings over the next few months – three in London, as well as Brighton, Newcastle-under-Lyme, Cambridge, Nottingham, Leeds, Newcastle, Canterbury and Norwich. More locations are set to be added throughout the year.

The sessions will take place in M&S Cafés after hours and be led by trained volunteer facilitators. The meetings are not therapy, their purpose is to provide a space where people can talk openly with others who understand how they are feeling – “a place where it’s ok, to not be ok”.

Ikea drivers ‘living in trucks for months’

Lorry drivers moving goods in Western Europe for Ikea and other retailers are living out of their cabs for months at a time, a BBC investigation has found.

Some drivers – brought over from poorer countries by lorry firms based in Eastern Europe – say their salary is less than £3 an hour. They say they cannot afford to live in the countries where they work. One said he felt “like a prisoner” in his cab.

The drivers the BBC spoke to were employed by haulage companies based in Eastern Europe, which are paid to transport Ikea goods.

Ikea said it was “saddened by the testimonies” of the drivers.

MPs urge Facebook and Google to tackle hate speech

Social media giants should “do a better job” to protect users from online hate speech, MPs have said.

Executives from Facebook, Twitter and Google were asked by the Home Affairs select committee why they did not police their content more effectively, given the billions they made.

They were told they had a “terrible reputation” for dealing with problems. The firms said they worked hard to make sure freedom of expression was protected within the law.

The MPs also touched on the recent Times exposé, which revealed that brands could inadvertently be funding extremist groups.

Peter Barron, vice president of communications and public affairs at Google Europe, told the committee the cash made from the videos in question was “very small amounts”, but added that the firm was “working very hard in this area” to stop it happening again.

Pernod Ricard to show nutritional information on its brands’ bottles

Pernod Ricard, which owns brands such as Malibu, Absolut and Ballentine, will start to include nutritional information on some of its spirits and wines this year in a bid to educate consumers on how many calories are in its drinks.

A website, linked to a QR code and providing access to nutritional information, is, or will be, included on the label of all bottles. Group-wide, 85% of these web pages are already online; the remaining 15% will be available before the end of 2017.

“Digital technology is an extraordinary tool that enhances our interaction with consumers”, explains CEO Alexandre Ricard. “An increasing number of consumers want clear, useful information about the products they consume. They can now access information concerning all our strategic products any time, anywhere”.

The initiative echoes the European Commission’s report, which came out earlier this week, inviting industry producers to ensure appropriate nutritional information messages are displayed on all alcoholic beverages.

Tuesday 14 March

Facebook clamps down on developers using it for surveillance

Facebook says it will ban developers from using its user data for surveillance purposes.

According to the social media giant, a series of new updates, which also apply to other Facebook-owned platforms such as Instagram, will “more clearly explain” its policies against surveillance tools developed for law enforcement purposes.

In a post on Facebook, its deputy chief privacy officer Rob Sherman cited the likes of the ACLU, Color of Change and the Center for Media Justice for helping it to better understand the need for changes to its privacy policies.

“We are committed to building a community where people can feel safe making their voices heard,” he wrote.

M&S prepares to pull out of China

British retailer Marks & Spencer will pull out of the Chinese high street this month. And according to the Daily Telegraph, the exit is primarily due to “low brand awareness”.

The retailer has also failed to open stores in compelling locations, with critics blaming M&S for not taking enough time to understand Chinese customers due to the English names of products often poorly translated into Chinese.

And despite China’s growing middle classes, one local retail expert believes M&S positioned itself with the wrong price points. Yang Dazhong, a retail expert from Zhongtian Yuanguang consultancy in Beijing, explains: “One can understand Marks and Spencer needing a presence in first tier cities such as Beijing and Shanghai.

“However, elsewhere in China, I don’t think people are going to spend a lot of money on things like dresses, which they can find in a nearby store at a far cheaper price.”

Heinz turns a Don Draper pitch into a real ad

There’s an episode in the sixth series of Mad Men where ad exec Don Draper unsuccessfully pitches to Heinz a series of ads that show mouthwatering pictures of food rather than the ketchup itself.

Yet even though the fictional 60s Heinz execs turn down his “Pass the Heinz” campaign proposal, Draper’s vision has had more luck in the real world.

Starting this week, Heinz will run all three of Don’s ads on billboards across New York City. They’ve even been credited to Draper’s fictional Sterling Cooper Draper Pryce agency — alongside the real-life ad agency David Miami.

UK car sales set to be 5% lower in 2017

According to the GfK’s Auto Forecaster, new UK car sales will be 5% lower in 2017 than 2016.

It claims purchase intent for cars over the next 12 months has fallen 11 percentage points among consumers who earn more than £50,000 a year.

One of the biggest reasons is a general feeling that prices are getting too high. According to the GfK, 79% of consumers believe consumer prices have risen over the past 12 months.

“With the rising cost of fuel pushing inflation to its highest level since June 2014, drivers are faced with an additional triple whammy of increased Vehicle Excise Duty (VED) affecting most new cars registered after April 1st, new personal injury compensation rules contributing to soaring insurance premiums, and the continued rise in new car prices driven by Sterling depreciation that is now feeding through to the factory gate,” explains Joe Staton, head of market dynamics at GfK.

Verizon sued by New York City for failing to meet key brand pledge

Verizon is being sued by the city of New York after the internet provider failed to provide fibre optic internet to millions of its residents. In 2008, the telecoms brand signed a contract pledging to provide its high-speed Fios broadband to every household in the city, but it has fallen “well short” of this pledge.

The lawsuit, filed in the New York Supreme Court, states that Verizon is in breach of its original 2008 agreement. However, Verizon claims the city has its priorities in the wrong place.

“On a day where the city is preparing for the biggest blizzard of the season, it’s sad that the mayor’s focus is on pursuing a frivolous lawsuit,” a Verizon spokesperson said, specifying that the carrier would fight the city’s allegations.

Monday, 13 March

Web inventor targets fake news

Tim Berners-Lee has issued a stark warning about the future of the world wide web in an open letter to mark the 28th anniversary of his invention.

His three main concerns centre on the control of personal data, the rise of ‘fake news’ and the need for tighter regulation around political advertising.

He said: “We must push back against misinformation by encouraging gatekeepers such as Google and Facebook to continue their efforts to combat the problem, while avoiding the creation of any central bodies to decide what is ‘true’ or not.”

He added: “We need more algorithmic transparency to understand how important decisions that affect our lives are being made, and perhaps a set of common principles to be followed. We urgently need to close the ‘internet blind spot’ in the regulation of political campaigning.”

Costa kicks off major growth bid

Coffee chain Costa is set to expand its business dramatically after opening Europe’s largest roastery in Essex today (13 March).

The £38m site will more than quadruple the chain’s roasting capacity, from 11,000 tonnes to 45,000 tonnes per year, enabling it to produce more than 2 billion cups of coffee a year.

Construction at the site began in November 2015, just before Alison Brittain took over as CEO of parent company Whitbread, which also owns hotel chain Premier Inn.

Brits prefer Costa, Stella and Tesco

The expansion of Costa’s roasting capacity comes at a good time as it is revealed as the nation’s favourite coffee outlet, in a new study by HSBC, which also suggests consumers are yet to make the connection that Brexit will increase their cost of living.

The report, called Anatomy of the Consumer, looks at the spending habits of 2,000 people across travel, leisure, food and retail, with the key finding being that consumers in Britain remain “unfazed by current uncertainty” about the economy.

Relatively few are concerned about job security or the value of their house falling, but nearly half said they are worried about rising living costs. Those looking to cut back are more likely to stop going out for meals than ditch their annual holiday, the survey found.

Costa is by far the most popular high street coffee chain, with three times more people visiting it than nearest rival Starbucks, mainly as consumers prefer the taste of its coffee. Caffé Nero came below both Greggs and McDonald’s in terms of visits.

Stella Artois is the nation’s preferred beer, with 12% of people choosing it over Budweiser (7%) and Foster’s (6.6%).

When it comes to supermarkets, Tesco is the most popular choice, with 62% of consumers putting it in their top three, followed by Sainsbury’s, Asda and Aldi.

The hotel industry can breathe a sigh of relief as the study also shows 62% of people have either never used or have no desire to use Airbnb. Premier Inn, also owned by Whitbread, is the most popular choice for budget hotels, with 30% choosing it compared to 14% for Travelodge.

Call for businesses to invest in university R&D

A group of MPs have urged the government to make it easier for businesses to invest in technology being created by universities in the UK.

Britain reportedly falls woefully behind other countries when it comes to funding university research due to a lack of private sector investment, according to the Science and Technology Committee.

MPs have said that while Oxford and Cambridge are incredibly highly regarded on the world stage when it comes to science and technology, much of the work they do never leaves the lab.

Businesses in the UK spend just 1.12% of GDP on research and development, a third less than the average across other OECD countries.

In order to rectify the situation and boost investment, the committee says R&D tax credits should be simplified.

Former cosmetics boss makes a bid for The Body Shop

The former boss of French cosmetics business L’Occitane is readying a £850m bid for The Body Shop, which was put up for sale by L’Oreal last month.

Emmanuel Osti is working with CVC Capital Partners, the former owner of Formula One.

The Body Shop was founded by Dame Anita Roddick in 1976 and has more than 3,000 stores across the world. It was bought by L’Oreal in 2006 for £652m.