Snap blames ‘decelerating’ ad business for sales slip
Snap is blaming a “steady deceleration” in its advertising business for missing market expectations, as revenue rose 13% to $1.11bn (£926m) in the second quarter.
The owner of social media giant Snapchat saw shares slide by more than 25% after posting a net loss of $422m (£353m), exceeding the loss of $152m (£127m) reported in the same period last year. The business spent $311.4m (£260m) on sales and marketing during the second quarter, up from $179.8m (£150m) the previous year.
Daily active users rose 18% year on year during the second quarter to 347 million, while time spent watching Snapchat Spotlight content grew 59% compared to the previous year. The company also reports the daily average number of users aged 25 and older engaging with shows and publisher content increased by more than 40% year on year.
During the period, the brand rolled out paid subscription service Snapchat+ to users in the US, UK and Canada, offering exclusive pre-release features such as Snapchat for Web.
Yet, despite the “continued growth” of the Snapchat community, CEO Evan Spiegel admitted the second quarter results “do not reflect” the company’s ambition.
“We are evolving our business and strategy to reaccelerate revenue growth, including innovating on our products, investing heavily in our direct response advertising business and cultivating new sources of revenue to help diversify our topline growth,” said Spiegel.
Speaking to analysts, CFO Derek Andersen highlighted the steady deceleration in advertising demand over the past year, which he claimed began with new Apple app tracking privacy changes. Andersen argued Apple had “upended a decade of advertising industry standards”, affecting the model used to drive the ad business and measure returns.
The CFO also pointed to the impact on brands of macroeconomic challenges, from supply chain and labour supply issues to “persistently high inflation”, rising interest rates and the “geopolitical risks” associated with the war in Ukraine. He admitted it is very easy for brands to turn ad spend off when times are tight, which “intensifies” overall competition.
“We’re seeing these various headwinds put pressure on the earnings of a wide variety of companies and this is directly impacting the demand for advertising,” said Andersen.
“Specifically, advertising spending, in particular, auction-driven direct response advertising is among the very few line items in a company’s cost structure that they can reduce immediately in response to pressure on their top line or their input costs.”
Going forward, Andersen says the goal is to “deepen” Snapchat’s engagement in the “world’s most attractive advertising markets”, invest in its direct response ad business, improve first- and third-party measurement, and “cultivate new sources of revenue”.
Amazon cements healthcare ambitions with $3.9bn One Medical deal
Amazon is to acquire primary care organisation One Medical in $3.9bn (£3.3bn) deal, which sees the ecommerce giant ramp up its presence in the healthcare sector.
One Medical is a US membership-based service mixing virtual care with in-person visits, which also offers healthcare benefits to the employees of more than 8,000 companies.
The One Medical deal follows Amazon’s $750m (£627m) acquisition of online pharmacy PillPack in 2018, which fuelled the creation of the company’s online pharmacy that enables customers to order medication and prescription refills online. Last year the business also began the rollout of its telemedicine scheme Amazon Care.
Senior vice-president of Amazon Health Services, Neil Lindsay, says healthcare is “high on the list of experiences” in need of reinvention.
“We love inventing to make what should be easy easier and we want to be one of the companies that helps dramatically improve the healthcare experience over the next several years,” he adds.
The Guardian reports that as of March, One Medical had around 767,000 members and 188 medical offices in 25 markets. During the first quarter, the business posted a net loss of $90.9m (£76m) and revenue of $254.1m (£212m).
The takeover of One Medical is up there with some of Amazon’s biggest acquisitions, which include the $13.7bn (£11.4bn) purchase of retailer Whole Foods in 2017 and the $8.5bn (£7.1bn) takeover of Hollywood studio MGM, which was completed this year.
Asda and Morrisons sign up to government discount scheme
Asda and Morrisons are among the brands offering consumers discounts as part of the government’s ‘Help for Households’ campaign.
Initiated by cost of living tsar and former Just Eat boss David Buttress, the campaign aims to offer “bespoke cost of living deals” for consumers struggling with the record rate of inflation. However, some deals are a continuation of existing schemes and the government is not compensating the businesses involved to help fund the discounts.
Deals include the extension until the end of the year of Asda’s ‘Kids eat for £1’ scheme, whereby children aged 16 and under can order a hot or cold meal for £1 in the supermarket’s cafes nationwide. Morrisons is also providing a free meal for every child at in-store cafes when a parent buys an adult meal.
Sainsbury’s will continue to promote its campaign to feed a family of four for less than £5, while Vodafone is offering a mobile social tariff of £10 a month.
Theatres in London will join forces for Kids Week, an initiative giving children the chance to see a West End show for free throughout August with a full paying adult. The deal includes half price tickets for two additional children in the same group.
In addition, Amazon’s new Help for Households webpage will provide access to free entertainment such as Freevee and Amazon Music, as well as educational resources for school-aged children and low-price essential groceries.
These deals are reportedly the first phase of the Help for Household retail campaign, which aims to support families during the summer holidays, back to school period, amid autumn pressures and Christmas retail. The discounts will be available to view on the government Help for Households website.
The campaign has made a “good start”, says Buttress, who promises more deals will be announced in the coming weeks.
Describing Sainsbury’s as “delighted” to be part of the campaign, CEO Simon Roberts claims the supermarket is “keeping inflation lower” than its rivals after investing £500m since March 2021 in keeping prices low. Likewise, Asda chief corporate affairs and people officer Hayley Tatum said the retailer is pleased to join the initiative, having yesterday launched its Essential Living Hub to help families cope on a budget.
The campaign has, however, come in for criticism, with Labour shadow minister Shaun Davies questioning how free West End theatre tickets will help families struggling across the UK.
Domino’s admits it is a ‘work in progress brand’ as global sales stall
US pizza giant Domino’s admits it is a “work in progress brand”, after revealing global retail sales fell 3% in the second quarter of 2022.
Claiming nobody in the business is happy with the recent performance, CEO Russell Weiner highlighted the impact of a “difficult labour market” in the US – particularly for delivery drivers – combined with the pressures of Covid and inflation. He classed these issues as “short-term obstacles”.
The brand’s same store US sales fell 2.9% over the period, while the decline in international same store sales was blamed partly on a VAT holiday in the UK during the second quarter of 2021, which was scrapped in 2022.
Revenues did, however, increase 3.2% to $32.7m (£27.3m), due primarily to higher supply chain revenues attributable to what Domino’s describes as “increases in market basket pricing to stores”.
Weiner said the business would focus on making “disciplined decisions” and doing what’s right for customers to make the business “stronger than ever.”
From a marketing perspective, the Domino’s CEO pointed to the impact of a tie-up with Netflix to promote the launch of Stranger Things season four, the first time the pizza chain had embarked on a major brand partnership since the release of Batman: The Dark Knight in 2008.
Weiner explained it had taken so long to explore a brand tie-up again because Domino’s has no interest in “getting lost in a laundry list” of brands associated with sport or film deals.
“I think that was one of the reasons why this promotion was so strong, because we don’t do it a lot. And Netflix, and particularly the Stranger Things property, they don’t do that a lot. And so when two brands that are really strong brands in and of itself, without being borrowed equities, come together and do something like this is so powerful,” he stated.
“And so, yes, an opportunity like this comes around, again, you can see us do this, but our logo will not be paved at the bottom of a dozen others in a partnership.”
Meta claims its apps drive ‘52% higher total ROI’ than other channels
Meta claims platforms like Facebook and Instagram drive 52% higher total ROI than “the average channel”, as the social media giant pushes the role of digital advertising in driving long-term brand growth.
New research by Nielsen, Nepa and GfK – commissioned by Meta – claims to show digital advertising “and Meta apps” contribute to long-term return on investment.
Using marketing mix modelling, five studies were conducted across different European countries and categories over 3,500 campaigns to calculate the short-and long-term ROI of advertising across different media channels.
The research found long-term ROI made up almost 60% of total ROI, with digital channels like Facebook, Instagram, online video and digital display having a “significant long-term revenue impact for brands.”
According to Meta, Facebook and Instagram “outperformed TV” in terms of total ROI (which the research defines as a combination of short- and long-term ROI) in four out of five studies. Indeed, the study claims Meta’s apps deliver 52% higher total ROI than the average channel.
The research cites the example of beer giant Heineken, which reportedly saw its ad spend ROI on Facebook and Instagram increase by 71% when long-term effects were taken into account. The study also suggests brands are “undervaluing the contribution” digital advertising makes by only looking at its short-term effects.
Meta is now advising brands to target broad audiences via its platforms, use multiple formats (including video) and aim for an average of two or more times per week a person is exposed to an ad campaign. The social media giant is also calling on advertisers to run campaigns for longer periods of time, claiming campaigns with longevity are more effective at driving long-term sales through brand building.
Thursday, 21 July
UK inflation reaches new 40-year high
The UK inflation rate has once again increased, up from 9.1% in the 12 months to May to 9.4% in June, according to the latest figures from the Office for National Statistics (ONS).
With the cost of fuel and food spiralling, prices in the UK are continuing to rise at their fastest rate for more than 40 years.
Driven by the war in Ukraine and the European Union’s reliance on Russian oil, petrol prices jumped by 18.1p per litre in June. In food, milk, cheese and eggs saw the biggest price rises over the month, with ready meals, vegetables and meat also becoming more expensive.
Data from Kantar this week revealed grocery price inflation hit 9.9% last month, the second highest level on record, meaning people are now facing a £454 increase to their annual shopping bill.
Meanwhile, ONS figures show pay is failing to keep up with rising prices, as real pay falls at the fastest rate since records began. Pay excluding bonuses was down 2.8% between March and May compared to a year earlier when adjusted for inflation, the fastest decline since 2001. Pay including bonuses was down 0.9%.
Ocado Retail revenues drop despite active customer growth
Ocado Retail reached a new high in active customers over the first half of its 2022 financial year, up 12% over the last 12 months to 867,000.
Active customer numbers are therefore 9% higher than Ocado’s pre-Covid high, while the online supermarket claims its net promoter score is now outperforming other online grocery offerings in the UK by 25 percentage points.
However, revenue declined 8% to £1.1bn over the period, with new customer acquisition offset by changing customer shopping behaviours, including an increasing trend towards shopping smaller baskets amid the growing cost of living crisis.
Average basket in the period was down 13% year-on-year to £120, with customers shopping 15% fewer items per basket on average. A 3% increase in average selling price only partially offset the impact of this change, the company says.
Ocado Retail is a 50:50 joint venture between Ocado Group and Marks & Spencer. The business’s EBITDA profit dropped from £104m in H1 2021 to £31m this year, and margin is expected to be in the low single digits for the full year.
Revenue growth is also expected to be in the low single digits for the year, the business says.
Superdrug signs more than 200 brands to new online marketplace
Superdrug has signed up more than 200 brands for the upcoming launch of Superdrug’s Marketplace, a new online platform which will enable the health and beauty retailer to offer hundreds of partner brands to customers.
Due to launch in September, the marketplace will be integrated into Superdrug’s existing website and ecommerce platform and will offer brands across the luxury end of the market through to startups.
Beauty brands already signed up include Wonderskin, sustainable brand Truthbrush and inclusive ethical brand OPV Beauty. Female-owned, sustainable and inclusive brands are to be prioritised.
Superdrug is also looking to tap into wellness trends with the marketplace, signing up reusable nappy brand TotsBots and wearable accessories brand Popmask to “broaden” its customer offering.
Speaking to Marketing Week earlier this year, Superdrug’s marketing, ecommerce and customer director Matt Walburn explained that the platform will allow brands without the infrastructure for a national retail listing a way to reach customers at scale, while also letting Superdrug move into new, niche categories.
The retailer will take a percentage of each sale, with orders fulfilled through independent brands, salons and third-party retailers. The brands are expected to meet the same levels of customer experience that Superdrug offers.
“[The marketplace] is chiefly a way of expanding our range to our customers very quickly,” Walburn said. “[The brands] fulfil the product directly to the customer, but it’s a way of Superdrug curating that range, saying we believe in this product, we believe you’ll like it, we’ve selected this seller and we think they give really good service.”
He added that Superdrug expects to see “rapid” growth in the marketplace.
Essity hails long-term marketing investments as market share grows
Essity, the company behind brands including Bodyform, Tena, Cushelle and Plenty, grew its net sales by 31% to approximately SEK 38bn (£3.1bn) during the second quarter of 2022.
Despite implementing “significant” price increases, the company achieved sales volume growth in all three of its business areas, including health and medical, consumer goods and professional hygiene. CEO and president Magnus Groth explains that price elasticity in Essity’s categories is “low”, while its brands are “strong”.
Groth also credits long-term investments in marketing, innovation and digitalisation with driving market share growth for approximately 50% of branded sales in the retail trade over the past 12 months.
Sales and marketing costs continued to increase over the quarter, but decreased as a share of net sales, Groth adds.
Adjusted EBITDA profit did decrease by 7% to SEK 3.2bn (£258m) compared with the same period in 2021, but increased 12% compared with the first quarter of 2022. Rising material, energy and distribution costs were offset by price rises, a “better” mix and higher volumes.
Further price increases are to be carried out in the second half of the year, Groth says.
Nationwide and Innocent join The Conscious Advertising Network
Nationwide Building Society and natural drinks brand Innocent have become new members of the Conscious Advertising Network (CAN), with a commitment to consider ethical issues when making advertising decisions.
Launched in 2019, CAN is a UK-based voluntary coalition of more than 150 brands, agencies, technology providers and civil society groups, which aims to tackle the inadvertent funding of divisive and harmful content by advertising.
By joining, brands commit to CAN’s manifestos tackling seven key challenges in media: hate speech, disinformation or misinformation, diversity and inclusion, children’s wellbeing, climate and sustainability, informed consent, and advertising fraud.
Nationwide Building Society is the first financial brand to sign up, joining the likes of GSK, SSE and Virgin Media O2. Head of media Chris Ladd says he hopes other financial institutions will come forward and support the initiative.
Meanwhile, Innocent has joined CAN to support its efforts to drive more sustainability messages in advertising.
“At Innocent we might make little drinks, but we have big dreams to make the world a better, healthier place to live in, continuously improving our media buying and advertising as part of this,” says force for good lead Emilie Stephenson.
CAN co-founders Harriet Kingaby and Jake Dubbins add: “For too long the industry has looked the other way as brands of all shapes and sizes have inadvertently funded divisive and harmful content. We know there is a problem, but we also know how to fix it.
“We are looking forward to working in partnership with the wonderful teams at both Nationwide and Innocent to co-create a safe, inclusive and commercially viable information ecosystem for advertisers and society that supports quality journalism, diversity of media and scientific consensus.”
Wednesday, 20 July
Netflix loses 1 million subscribers in its second quarter
Netflix has reported a loss of 1 million subscribers between April and the end of June this year.
This is the second quarter in a row Netflix has seen its subscribers drop. However, this figure is significantly better than the loss of 2 million subscribers it had projected last quarter.
Speaking to investors yesterday evening (19 July), co-CEO Reed Hastings attributed the better-than-expected subscriber figures partly to the success of the new Stranger Things series.
“If there was a single thing, we might say Stranger Things,” he said.
Co-CEO Ted Sarandos added new Netflix CMO Marian Lee had carried out Netflix’s “best campaign to date” with its marketing around the series. Netflix is focusing its marketing spend on titles that will create excitement and entertainment, he said.
Netflix’s total revenue for the first quarter of 2022 was $7.97bn (£6.6bn), missing analysts’ expectations of $8.04bn (£6.7bn). In its letter to shareholders, the streaming service said it would seek “to better monetise [its] big audience”.
The streaming company has seen its shares fall around 67% this year. It has blamed its slowdown on headwinds including password sharing, competition and a troubled economic backdrop.
The service claims to be cracking down on password sharing between users in different homes. Yesterday, it confirmed it would trial charging subscribers in five countries in central and South America an extra $2.99 (£2.50) per month to add a “second home” to their accounts.
AA ‘number one breakdown service’ ad banned
The AA has had ads claiming it’s the “largest” and “number one” breakdown service provider in the UK banned by the Advertising Standards Authority (ASA).
The claims, made in ads on its website and on posters, were challenged by rival breakdown service provider RAC Motoring Services. It challenged whether the AA could substantiate and provide evidence for the claims that it was the largest in the UK.
The CAP Code requires that comparisons with competitors must objectively compare one or more verifiable features. This means that an ad which features a comparison with an identifiable competitor needs to include, or direct consumers to, sufficient information to allow them to understand the objective comparison and be able to check the claims are accurate.
In its response to the challenge, the AA said the number of customers who had chosen an AA breakdown product and purchased it directly from the AA, known as direct members, was considerably higher than the number of RAC members. The company also said it attended more breakdowns than its rival.
However, the ASA upheld the complaints against the ad, saying the evidence the AA had provided was not enough to verify the claims, and that they were therefore misleading. It told the AA to ensure these ads did not appear again and that it could substantiate any claims made in its advertising.
Premier Foods sees sales rise by 6%
Premier Foods, the group which owns brands including Mr Kipling, Sharwoods and Oxo, has reported a 6% sales rise in its first quarter of 2022.
In the 13 weeks to 2 July 2022, total sales reached £197m across the group, compared with £185.9m over the same period last year. Sales of its branded products also rose 4.2%.
The group says it continued to grow its market share for its products during the quarter, both in-store and online. However, it noted that in its grocery products “volumes were slightly lower, in part due to tougher comparatives reflecting pandemic restrictions in the prior year”.
In a letter to shareholders, CEO Alex Whitehouse expressed confidence that Premier Foods’ brands would do well during the cost of living crisis.
“Consumers are increasingly looking to cook tasty, affordable meals at home; this fits well with our broad portfolio of brands and was illustrated by the strong performance of Batchelors and Nissin in the quarter,” he said.
He also highlighted new product launches at Mr Kipling and Sharwood, as well the “benefit” to the Mr Kipling brand of its TV advertising campaign launched during the quarter. Whitehouse said the company was continuing to pursue its “branded growth” model.
The group’s expectations for the full year remain unchanged as it “expects to continue to realise further shareholder value through the ongoing delivery of its five pillar growth strategy”.
Former Dunhelm marketer Angela Porter appointed ProCook’s CMO
Direct-to-consumer cookware brand ProCook has appointed former Dunelm marketing director Angela Porter as its CMO.
Porter has over 15 years of experience across consumer, retail and ecommerce sectors. Her most recent role was as marketing director of the Ladbrokes and Coral gambling brands at GVC Group, which she held between 2020 and 2021.
At GVC, Porter was focused on creating a “step change” in the way the brands communicated with customers, moving the messaging “beyond the bet”.
She also held the role of marketing director at Dunelm between 2018 and 2020. She joined Dunelm two years prior from Tesco, where she had been head of agency and media integration. Porter has also held roles at brands such as Diageo, Hovis and Vodafone.
Taking on the role of CMO at ProCook, Porter says she is “delighted” to join the brand at an “exciting” stage in its journey.
“My true passion lies in helping brands cut through the noise to reach their customer in creative and inspiring ways, and there is no better place to execute this approach than at a direct-to-consumer brand like ProCook,” she says.
CEO Daniel O’Neill says the time is right for the business to hire an experienced CMO.
“It’s easy to understand why Angela has had the success in her career to date – she’s a very dynamic personality, passionate about customers and someone I’m really looking forward to working with,” he says.
AO ends ‘store-in-store’ partnership with Tesco
Online electrical retailer AO has brought to an end its partnership with Tesco, which saw it bring its own shops into the supermarket.
The ‘shop-in-shop’ initiative was introduced into a handful of Tesco supermarkets in 2020. The introduction was disrupted by Covid lockdowns, which saw the AO concessions closed off to the public as the electrical retailer was classed as non-essential shopping.
The stores within Tesco supermarkets allowed consumers to browse products such as kitchen appliances and TVs from AO in person. The end of the initiative marks the end of AO’s physical retail presence.
AO has said it is struggling amid the cost of living crisis. In April of this year the electrical retailer lowered its sales outlook for the year, warning that “volatile market conditions, inflationary cost pressures and logistical challenges in the supply chain, together with the escalating cost of living for consumers” will affect its performance.
Earlier this month the business saw its credit insurance for suppliers cut. It then said it would raise £40m, aimed at increasing liquidity and providing “flexibility to capitalise on market opportunities”.
Tuesday, 19 July
Deliveroo promises to make marketing ‘more efficient’ as demand drops
Deliveroo has cut its annual sales forecast after revealing a drop in consumer demand for takeaways as the cost of living spirals. In response, the firm has pledged to make marketing spend “more efficient”, as well as improving margins and costs.
Total sales by gross transaction value (GTV) fell to 2% in the second quarter, down from 12% in the first three months of the year, according to the food delivery firm. In the UK and Ireland alone, GTV dropped from 12% to 4% from quarter to quarter, with Deliveroo blaming “the impact of increased consumer headwinds during Q2”.
As a result of the fall in demand and a “more cautious economic outlook”, the company has revised its sales forecast and now expects full year GTV growth to be between 4% and 12%. This is down from its previous guidance of 15% to 25%.
However, Deliveroo still expects its earnings before interest and tax (EBITDA) to fall between 1.5% and 1.8%, a slight improvement on 2021 went it slipped 2%.
The company says its balance sheet remains “strong” and the business is “confident” in its ability to “adapt financially to a rapidly changing macroeconomic environment, through gross margin improvements, more efficient marketing expenditure and tight cost control”.
Deliveroo will reveal its first half results for 2022 on 10 August.
H&M to permanently exit Russia over ‘impossible’ situation
H&M plans to wind down its business in Russia, suggesting the invasion of Ukraine has made it “impossible” for it to continue trading there.
The retailer initially paused sales in Russia on 2 March but says it now plans to fully exit the country.
As part of the winding down process H&M plans to temporarily reopen its physical store for a “limited period” to sell off remaining inventory in Russia.
The Swedish business, which first opened stores in Russia in 2009, expects its withdrawal to cost the group around 2 billion SEK (£161.2m). The full amount will be included as a one time cost in the retailer’s third quarter 2022 results.
H&M says it plans to ensure the wind down is done responsibly and has promised to support all employees affected by the move in “the best possible way”.
Helena Helmersson, CEO H&M Group, says: “After careful consideration, we see it as impossible given the current situation to continue our business in Russia. We are deeply saddened about the impact this will have on our colleagues and very grateful for all their hard work and dedication. Furthermore, we wish to thank our customers for their support throughout the years.”
Pay falls at fastest rate since records began
Pay is failing to keep up with rising prices as real pay falls at the fastest rate since records began, according to the Office for National Statistics.
Pay excluding bonuses was down 2.8% between March and May compared to a year earlier when adjusted for inflation, the fastest decline since 2001. Pay including bonuses was down 0.9%.
It comes as the cost of food and fuel rocket, with inflation hitting 9.1% in May, the highest level in 40 years.
Job vacancies are also continuing to rise, although the rate is slowing, with the accommodation and food service sectors worst affected.
“Following recent increases in inflation, pay is now clearly falling in real terms both including and excluding bonuses,” says ONS head of labour market and household statistics, David Freeman.
“Excluding bonuses, real pay is now dropping faster than at any time since records began in 2001.”
Shoppers face a £454 rise to annual grocery bills
Grocery price inflation hit 9.9% last month, the second highest level on record, meaning people are now facing a £454 increase to their annual shopping bill.
As an example, Kantar highlights the cost of buying burgers, halloumi and coleslaw has risen 13%, 17% and 14%, respectively, compared to last year.
The latest data from Kantar, which covers the past four weeks, suggests grocery inflation will hit new heights come August.
As a result people are adjusting their behaviour, with shoppers “increasingly” switching to own-label products to keep costs down. Supermarket own brands grew by 4.1% over the latest period, while the sale of branded goods dropped 2.4%.
Lidl was again the fastest growing supermarket over the latest 12-week period to 10 July, with sales up 13.9%. Aldi also saw a boost, with sales climbing 11.3% compared to the same period in 2021. Tesco also returned to growth for the first time since October, increasing sales by 0.1%, the only major supermarket to do so, meaning it retains a market share of 27.1%. Ocado (0.7%) was the only other retailer to increase sales.
Fraser McKevitt, head of retail and consumer insight at Kantar, says: “Over 67% of people in Britain shopped in either an Aldi or a Lidl in the past 12 weeks, with 1.4 million additional households visiting at least one of the discounters in the latest three months compared with last year. Both retailers reached a new market share high over the past three months. Lidl now holds 7.0% of the market while Aldi climbed to a 9.1% share.”
Amazon targets Facebook fake review groups
Amazon is taking legal action against “bad actors” running Facebook groups offering free goods or money in exchange for reviews.
According to the BBC, Amazon has identified more than 10,000 such groups, which are generating fake reviews on Amazon marketplaces across the UK, US, Germany, France, Italy, Spain and Japan.
While it isn’t illegal for sellers to pay for services that can boost their ratings online, many don’t realise this will happen as a result of fake reviews.
Large numbers of reviews help to push up visibility of sellers on Amazon and mean they rank nearer the top of searches.
Many groups have several thousand members, with Meta removing one group called Amazon Product Review with 43,000 members earlier this year. Its administrators would refund people in the group who had purchased specific products, such as car stereos and camera tripods, after they had left a review.
Amazon says Meta has taken down around half of the groups it reported but some are using techniques to disguise rule-breaking from automated detection tools, such as removing letters from key words and phrases. Rather than offering ‘refund after review’, a common phrase used on these groups, one post offered “R*fnd After R*vew”.
“Pro-active legal action targeting bad actors is one of many ways we protect customers by holding bad actors accountable,” Dharmesh Mehta, Amazon’s vice-president of selling partner services, told the BBC.
Monday, 18 July
Amazon Fresh price matches Tesco amid cost of living crisis
Amazon Fresh, the retail giant’s online grocery shop, will be price matching hundreds of Tesco products as it looks to attract customers amid the cost of living crisis.
The retailer will today start matching Tesco Clubcard prices on items such as fruit, vegetables, meat and fish, as Amazon Fresh director Russell Jones tells the PA news agency that improving the shopping experience “and giving Amazon Fresh customers even more for their money are key priorities” for the company.
The move will see Amazon Fresh become the latest retailer to implement price match marketing, while Tesco itself already currently price matches against discount retailer Aldi.
“When customers see the comparison against our competitors it is obvious quite how strong our value is,” he adds. “We recognise that this is the most important thing to customers right now.”
Products customers will find price matched at Amazon include 46% off its own-brand margherita pizzas, 32% off Tropicana orange juice and 19% of Cathedral City extra mature cheddar cheese.
Marks & Spencer to cut ‘best before’ labels from fruit and veg items
Marks & Spencer will be removing ‘best before’ labels from fruit and veg items to help prevent food waste.
Some 85% of M&S’s fresh products will see their labels removed, as customers will have to make their own minds up about whether products are edible.
M&S will also allow consumers to buy three bananas together, rather than a classic bunch, to cut waste on the product.
Other supermarkets with similar offerings include Tesco, which removed best before tags on its own-brand fruit and veg in 2018, and Lidl. Morrisons got rid of use by dates in January this year.
M&S wants to halve its food waste by 2030, and wants to redistribute 100% of edible surplus food by 2025, in line with the UK’s commitment to reaching the United Nations goal of halving food waste by 2030, compared to 2007 figures.
The retailer wants to do “all we can”, says director of food technology Andrew Clappen. “To do that, we need to be innovative and ambitious – removing best before dates where safe to do so, trialling new ways to sell our products and galvanising our customers to get creative with leftovers and embrace change,” he says.
Starbucks explores potential sale of UK business
Coffee chain giant Starbucks is reportedly exploring the sale of its UK business operations, according to The Times.
The chain has reportedly asked its adviser to canvass interest in the UK business, which includes more than 1,000 shops employing 4,000 people. Some 300 of the stores are operated directly by Starbucks, with the rest franchised. Currently, the UK is home to more than 25,000 coffee shops.
The move follows the company’s statement in May that it plans to “single-mindedly focus on enhancing” its core US business, however a “formal sales process” has not begun, according to reports.
Starbucks was impacted by Covid-19, as lockdowns and a move to home working took hold, as well as dealing with increasing competition from the likes of Pret and Costa.
Government rules out video game ‘loot boxes’ ban, despite gambling concerns
Despite a government consultation finding evidence of a “consistent” association between gaming “loot boxes” and problem gambling, the feature will not be banned across video games.
The boxes have garnered attention for gambling comparisons, as gamers spend money to access in-game features, such as characters, weapons and outfits, without knowing what they’ll receive when purchasing.
After a 22-month long consultation, UK culture minister Nadine Dorries says the government will not be banning the feature, popular in games such as Call of Duty. In 2018, the features were banned in Belgium.
Instead, the government is “calling for the purchase of loot boxes to be made unavailable to children and young people unless they are approved by a parent or guardian”.
Dorries says the government will be discussing “tougher” protections with the gambling sector, as legislating against loot boxes could have “unintending consequences”.
“For example, legislation to introduce an outright ban on children purchasing loot boxes could have the unintended effect of more children using adult accounts, and thus having more limited parental oversight of their play and spending,” says the government, in response to the consultation.
While loot boxes can’t be cashed out for money as consumers can with gambling, the Gambling Commission previously stated that third-party websites are allowing people to exchange their loot box items for money.
Vaping brand Elf Bar broke advertising rules to sell to children
The vaping brand Elf Bar has ignored UK advertising rules to tap into the younger market, according to an investigation by the Observer.
Elf Bar, a Chinese-owned vaping brand, has enlisted the use of social media influencers to promote its products as the brand sees its sales in the under-18s market increase in the last year.
The investigation found that the videos are not age restricted, and not always “clearly” marked as ads either on TikTok.
Elf Bar’s social activity comes alongside a marketing push from the brand which has been pushing out campaigns across billboards and buses as it hopes to increase its UK business. Two accounts were removed from TikTok following the investigation by the Observer.
It’s currently illegal to sell e-cigarettes to under-18s, as the Association of Directors of Public Health (ADPH) says it wants to see “tighter regulations to ban brightly coloured packaging” and a review of flavours that are “likely” to appeal to children.
Elf Bar products come in flavours such as “rainbow candy” and “bubble-gum”, and are known for being disposable.
According to the Advertising Standards Authority (ASA) rules, e-cigarette ads must be “targeted responsibly”, which means not targeted at under-18s, not promoted on any platform where more than 25% of the audience is under 18. Those advertising the products should not be, or appear to be, younger than 25.
The ASA is assessing evidence, while a TikTok spokesperson says: “Our guidelines make clear that content promoting the sale, trade or offer of… vaping products is not permitted, regardless of age. We have investigated and removed the content flagged to us and taken action against these accounts.”