Twitter, Tesco, Burger King: Everything that matters this morning

Good morning and welcome to Marketing Week’s round-up of the news that matters in the marketing world today.

Twitter set to announce job cuts today

Twitter is set to tell its staff about job cuts today (4 November), following Elon Musk’s takeover of the social media platform. An internal email suggests that the layoffs are being made in “an effort to place Twitter on a healthy path,” reports the BBC.

“We recognise this will impact a number of individuals who have made valuable contributions to Twitter, but this action is unfortunately necessary to ensure the company’s success moving forward,” the email continues.

Alongside the scheduled job cuts, the company’s offices are temporarily closing. Twitter staff will reportedly receive an email at 4pm UK time (9am Pacific) outlining their roles.

A senior community manager at Twitter, Simon Balmain, told the BBC he believed his role had been cut when he was logged out of his work laptop, and access to Slack was blocked.

“Everyone got an email saying that there was going to be a large reduction in headcount, and then around an hour later, folks started getting their laptops remotely wiped and access to Slack and Gmail revoked,” he told the BBC.

Burger King owner sees sales and profits rise amid ‘macroeconomic pressures’

Restaurant Brands International has announced its third quarter 2022 results, showing sales growth across its brands at 9% and net restaurant growth at 4%.

Chief executive José Cil said the company is “fortunate to own iconic brands that offer great value for money with menu offerings that are loved by our guests.” The quick service restaurant company owns the likes of Tim Hortons, Burger King Global and Popeyes.

Burger King is driving growth with 20% sales growth across both franchise and company-owned branches for the quarter, following its announcement in September of its ‘Reclaim the Flame’ which is seeing an investment of $400m ($357m) into the chain, encompassing advertising, restaurant remodelling and digital transformation.

The company’s profits grew to $530m (£473m), up from $329m (£293m) in the same period last year, while revenue reached $1.73bn (£1.55bn) from $1.5bn (£.3bn) last year.

“We’re all fully aware of the continued macroeconomic pressures impacting our industry and our franchisees,” said Cil, during the company’s results call yesterday (3 November). “These include ongoing commodity and wage inflation and rising interest rates.”

Tesco wins appeal to take Lidl to trial over logo trademarking

Tesco has won its appeal against the decision earlier this year in court to dismiss its case of “bad faith” against Lidl, following the budget supermarket’s trademarking of its blue and yellow logo.

Tesco can now argue at trail that Lidl applied to trademark the image in “bad faith”. In 2021, Lidl claimed Tesco, the UK’s leading supermarket, was trying to “ride” on the supermarket’s “coat-tails”, by using its logo, with a blue background and yellow circle, to promote Clubcard prices.

Winning the appeal means that the claim from Tesco can now be used as part of next year’s trial, focusing on Lidl’s initial lawsuit and Tesco’s counterclaim.

Lord Justice Arnold said Tesco’s claim was supported by Lidl’s own admission that the image had been registered “in order to obtain a wider scope of protection”.

“We are pleased with today’s decision. We continue to deny and strongly defend this claim and remain very confident of our position for trial next year,” says a Tesco spokesperson.

Lidl’s spokesperson says: “This appeal is only a small procedural aspect of the case and we remain confident in the outcome of the trial in 2023.”

Cost of living and inflation set to impact Black Friday spending

Spending during this year’s Black Friday sales is expected to fall to £1.7bn, a drop of around 15%, claims research from Retail Economics and HotUKDeals.

The research suggests that despite an expected “positive impact” from the FIFA World Cup, taking place this winter, spending will drop as consumers face increased economic pressures. Consumers from the ‘average’ household are expected to spend a £177 this year, a decline from more than £200 in other years. Meanwhile, it’s claimed lower affluence households are estimated to spend £161.

It’s also claimed that the “most affluent” households will bring their spending forward to Black Friday to take advantage of deals on offer, spending 13% more on average.

As this year’s Black Friday coincides with the World Cup, Retail Economics suggests that around one in five shoppers anticipate they’ll be spending more during this period compared to other years, as a result of the tournament.

Ancestry launches campaign for Remembrance

A new campaign from Ancestry, the family tree and genealogy company, aims to highlight experiences from the First and Second World Wars, coinciding with this year’s Remembrance period.

The campaign, with poet Nikita Gill, centres around the poem ‘Who You Are’, by Gill, commissioned by the company. The campaign will be seen across TV, radio, social media and online from 4 November and the 30-second film will be seen in cinemas from 4 – 14 November.

“This Remembrance, we wanted to bring to life the untold stories from the home front and frontline in a new and creative way,” says Ancestry’s VP for international markets Sue Moncur.

“Working with Nikita Gill and amplifying her poignant poem via an integrated marketing campaign has helped us shine a light on the everyday and not-so-everyday stories of wartime Britain,” she adds.

“This is one of our biggest Remembrance campaigns and we hope that our multi-channel approach will not only reach new audiences, but help encourage and inspire people to discover their own family wartime stories.’’

Thursday, 3 November

John Lewis appoints first chief transformation and technology officer

John Lewis & Partners has appointed its first chief transformation and technology officer, Zak Mian.

The business is just over a year into its £800m turnaround strategy, Partnership Plan, with Mian being the first executive level appointment focused on transformation and technology. He will join the business from 7 November and will take responsibility for all of its technology, change and transformation activity and the teams who support it.

Mian recently led the digital transformation of Lloyds Banking Group as group transformation director. He spent 33 years at the bank before departing last year.

“I’m delighted that Zak is joining the Partnership. He brings a wealth of experience and an impressive background in business transformation and has a strong sense of purpose, which make him a great fit for the Partnership,” says John Lewis chairman Sharon White.

Mian says he has admired the business and its purpose “for a long time”. “I’m really looking forward to helping shape an environment in which partners can do their best work, enable the transformation of our business through technology and deliver great experiences for our customers.”

Coca-Cola and PepsiCo increase newly manufactured plastic use since 2019

Coca-Cola, Mars and PepsiCo have all increased their use of newly manufactured plastic over the last two years.

These companies are all signatories to the Ellen Macarthur Foundation’s Global Commitment to end plastic pollution, which targets 100% recyclable, reusable or compostable packaging by 2025.

In 2021, Mars used 11% more virgin plastic (by volume) than it did in 2019, while Coca-Cola upped its usage by 3.5%. PepsiCo also increased its newly manufactured plastic volumes by 5%. Meanwhile Unilever and Nestlé managed to decrease their virgin plastic use by 18% and 8%, respectively.

Coca-Cola is one of the sponsors for COP27, a decision that has already come under criticism from climate activist groups such as Greenpeace. An online petition calling for the UN to drop the FMCG giant as a sponsor has gathered more than 230,000 signatures. Its increase in virgin plastic use, as revealed in a ‘progress report’ on how companies signed up to the Ellen Macarthur Foundation’s commitment are doing, has already triggered more criticism

“For over 30 years, [Coca-Cola] have left a trail of missed targets and abandoned pledges,” says one of the founders of the petition and managing director of sustainability consultancy Element Four, Georgia Elliot-Smith. She adds the sponsorship enables the company to “greenwash their brand”.

Coca-Cola says 90% of its packaging is currently recyclable, adding it is “committed to do more, faster so we grow our business the right way”.

Aston Martin shares fall by 15% due to shortage of parts

Luxury car manufacturer Aston Martin saw its shares slide by almost 15% yesterday (2 November) as it revealed a shortage of certain parts means it will deliver fewer cars than expected this year.

Supply chain issues meant more than 400 vehicles were awaiting final parts at the end of September, which are now expected to be delivered in the fourth quarter. The car brand had expected to sell 6,600 cars this year but now that figure may be as low as 6,200.

The luxury brand says it is seeing “continued strong demand” for its vehicles. It saw revenues in its third quarter rise by a third to £315.5m as average prices increased by 28% to £189,000. However, it also saw an increase in pre-tax losses, which rose to £225.9m, from £97.9m year-over-year.

“Over the last two quarters we have encountered specific supply chain challenges that have delayed our ability to meet customer demand,” Aston Martin cChairman Lance Stroll told investors.

CEO of the brand Amedeo Felisa added: “Whilst this has created short-term impacts on our performance, I am confident that with the actions we are taking, we will exit the year in a stronger position to deliver on our goals for 2023 and beyond.”

Rival luxury car manufacturer Ferrari also reported results yesterday and saw a much better outlook. Its adjusted core earnings rose 17% to €435m (£374.9m).

Bank of England set to increase interest rates to highest level since 2008

The Bank of England is expected to up interest rates today, pushing the base rate to 3%, a level not seen since 2008.

It is expected the rate will be increased by 0.75 percentage points, which would represent the eighth increase in a row. Less than a year ago the base rate was just 0.1%.

A 0.75% increase would also represent the biggest single increase since 1989. Analysts have predicted interest rates could go as high as 4.75% next year. However, that prediction has been revised down since markets have calmed following the turmoil after Liz Truss’s mini-budget.

The decision to increase interest rates, which is expected to be announced today at midday, would push up mortgages for millions of people. The Bank of England is also set to release long-term inflation forecasts, these are expected to show that inflation next year will be much higher than the bank’s target of 2%. According to the Office for National Statistics’ Consumer Price Index, inflation hit 10.1% last month.

Other countries’ central banks are making similar decisions to up interest rates. In September, US central bank the Federal Reserve announced it was raising its key rate by another 0.75 percentage points, upping the target range to between 3% and 3.25%, its highest rate in almost 15 years.

KP Snacks launches radio campaign for McCoy’s

KP Snacks has launched of a radio campaign for its ridged crisp brand McCoy’s, which will see the brand partner with Capital Radio.

McCoy’s will become a mid-morning sponsor for Capital Radio on weekdays, with the campaign aiming to increase lunchtime meal-deal purchase occasions in particular. The campaign will run throughout November.

As well as the sponsorship, KP Snacks will run 30-second radio ads on Capital Radio throughout the day. These ads will be centred around the theme of flavour.

The crisp brand already has strong credentials in the meal-deal arena. McCoy’s Salt and Vinegar and Flame Grilled Steak are number two and number three best-selling meal-deal snack choices. The McCoy’s brand is worth around £148.2m and is growing 8.5% year-over-year, reports KP Snacks.

“We’re excited to be launching a brand new radio campaign to continue driving awareness of the McCoy’s brand and to build on its strong reputation for delivering full-on flavour,” says KP Snacks marketing controller Ilan Arkin.

“With a massive reach of 12.7 million, Capital FM is an ideal partner for this campaign to help maximise brand penetration.”

Wednesday, 2 November

Airbnb hails ‘efficient’ marketing strategy as it posts record profits

Airbnb’s top executives have praised its “efficient” approach to marketing spend and focus on brand-building over performance, as the business reports its most profitable quarter ever.

The online holiday rental firm reached $1.2bn (£1.04bn) in net income over the third quarter of its fiscal year, a nearly $400m (£348m) improvement from Q3 2021.

The business has also posted its highest quarterly adjusted EBITDA ever at $1.5bn (£1.31bn), a 32% year-on-year increase, which demonstrates “the continued strength of the business and discipline in managing our cost structure”, it said.

On a call with investors yesterday evening (1 November), CFO Dave Stephenson highlighted Airbnb’s decision to “radically” adjust its marketing expenditures to be “substantially lower” as a key factor in the business’s rising profitability.

In 2019, Airbnb shifted its marketing strategy to be more brand-driven and PR-led, and less dependent on search engine and performance marketing. The brand said it now looks at marketing as a tool for “education”, rather than a tool to “buy customers”.

“We’re really pleased with our approach to the marketing strategy that we’ve had,” Stephenson said. “Our brand marketing results are delivering excellent results overall with a strong rate of return.”

Indeed, 90% of the platform’s traffic remains direct or unpaid, he said, “which is driving a great return on investment for new active bookers”.

The CFO added that Airbnb’s brand advertising campaign has been “so successful” that the business will be expanding it into further countries over the next year.

Speaking alongside Stephenson, CEO and co-founder Brian Chesky claimed Airbnb now spends “a lot less” on marketing than its competitors and is “pretty efficient” with its investment.

This efficient spend, combined with a “lean” organisational structure, is positioning Airbnb well to navigate the challenges of the macroeconomic picture, he said.

“When the pandemic hit, we lost 80% of our business, and we completely changed our cost structure. And out of that crisis, we made a decision. And the decision we made is we weren’t going to wait for another crisis, another weakened economy or a recession to change how we invest or run the company. So we were going to be lean regardless of the economy,” Chesky explained.

“We are really embracing being a lean organisation, which is partly our functional structure. We’re not a business organisation where you’d have four marketing departments. We have one functional organisation, and so that allows us to be quite a bit leaner.”

Advertising spend for the year as a whole will be “relatively flat” compared to 2021, Stephenson added, with similar marketing as a percentage of revenue expected in 2023. There are currently no plans to cut marketing spend in response to the economic crisis.

“We’ve already hit this new lower overall rate. And what we’ve actually seen is, to the extent that we’re keeping it flat even as we grow, it’s because we’re actually seeing such success that we’re wanting to be able to invest in other countries,” he said.

“Certainly, we can moderate that over time, but we’re already so low that I wouldn’t anticipate us dropping it dramatically in face of substantial headwinds over growth. But we can flex it with the revenue within a reasonably a few hundred basis points here and there.”

Elon Musk proposes $8 monthly charge for Twitter blue tick

Twitter could begin charging users $8 (£7) per month in exchange for a verified account and a blue tick next to their name, the platform’s new owner and CEO Elon Musk has said.

Currently a blue tick on Twitter is reserved for high profile individuals, journalists and media outlets, as a means of preventing online impersonation and fake accounts. Verification is free and entails a short online application form.

However, in a tweet yesterday evening (1 November) Musk said the current “lords & peasants system [sic]” is “bullshit”. “Power to the people! Blue for $8/month,” he tweeted.

As part of Musk’s proposals, subscribers would gain the ability to post long videos and audio, see half as many ads, and would get priority in replies, mentions and search, which he said is “essential to defeat spam/scam”.

Price would be adjusted by country “proportionate to purchasing power parity”, he wrote, adding that the subscription would give Twitter a revenue stream to “reward” content creators. Anyone who is a public figure would have a secondary tag under their name, as is already the case for politicians, he proposed.

Next’s Q3 sales ‘slightly’ better than expected

Next is reporting “slightly” better than expected sales over the third quarter of 2022, but with the cost of living crisis taking its toll on consumer spending, growth remains slow.

Full price sales rose by 0.4% year-on-year, marginally ahead of expectations. Online sales dropped by 1.9% as customers continue to adapt their buying behaviour post-pandemic, while retail sales were up 3.1%.

Next is maintaining the same sales and profit guidance for the year as a whole, with sales across 2022 expected to be down by 2% compared to 2021, and profit before tax expected to rise 2.1% to £840m.

October shop prices rise at new record rate

October has seen annual shop price inflation break records for another month, after accelerating to a new high of 6.6%, according to the latest BRC-NielsenIQ Shop Price Index.

In September the shop price inflation rate was 0.9 percentage points less at 5.7%, while the three month average rate is 5.5%. October’s is the highest inflation rate since records began in 2005.

Food inflation jumped to 11.6% from 10.6% in September, with fresh food prices rising by 13.3%, up from 12.1%. Both mark the highest inflation rates in their categories on record. Ambient food inflation rose to 9.4% from 8.6%, the fastest rate of increase in the category to date.

Non-food inflation accelerated from 3.3% in September to 4.1% in October, above the three month average rate of 3.4%.

According to Helen Dickinson, CEO of the British Retail Consortium (BRC), even the price of the most basic items saw “significant” rises in October, including the price of a cup of tea.

“While some supply chain costs are beginning to fall, this is more than offset by the cost of energy, meaning a difficult time ahead for retailers and households alike,” she said.

NielsenIQ’s head of retailer and business insight, Mike Watkins adds: “External factors are keeping shop price inflation at record highs and the challenging economic conditions are significantly impacting consumer confidence and retail spend.

“With pressure growing on discretionary spend across both non-food and food retail, delivering good value is the table stake in the battle for shopper loyalty over the next 8 weeks.”

Morrisons to close 132 McColl’s stores

Morrisons is planning to shut 132 loss-making McColl’s stores, after winning a bidding war to acquire the embattled convenience store chain earlier this year.

McColl’s currently has 1,164 stores and newsagents around the UK, with 270 trading as Morrisons Daily outlets prior to the acquisition.

Some 1,300 jobs will be at risk as a result of the planned closures.

Morrisons’ convenience, online and wholesale director Joseph Sutton says the business “very much [regrets]” the proposed closures, but calls it “an important step towards the regeneration of the business”.

“I’m confident that the combination of McColl’s conveniently located stores and great colleagues together with Morrisons’ scale, brand, systems and fresh food expertise will lead to a transformation of the business,” he says.

Morrisons beat the owners of Asda in the race to acquire McColl’s with a last minute bid in May. In September the supermarket reported a 50% slump in profits over the summer, and was pushed off its spot as the UK’s fourth largest supermarket by discounter Aldi.

Tuesday, 1 November

Musk dissolves Twitter’s board of directors and makes himself CEO

Elon Musk has stepped in as CEO of Twitter following his $44bn (£38.3bn) acquisition of the platform last week. At the same time he has dissolved its board of directors, it was revealed in a company filing yesterday.

Twitter staff are also now bracing themselves for mass layoffs, with the Washington Post reporting Musk and his team have been talking about letting go 25% of the company’s workforce – nearly 2,000 employees.

On completing the deal last week, he immediately fired a number of top Twitter executives, including chief executive Parag Agrawal, finance chief Ned Segal and legal affairs and policy chief Vijaya Gadde.

While Musk is now sole director of the company, he said in a tweet this is “just temporary”.

Meanwhile, following the “coordinated trolling campaign” Twitter reported over the weekend, the platform’s head of safety and integrity Yoel Roth confirmed on Twitter last night it has made “measurable progress, removing more than 1500 accounts and reducing impressions on this content to nearly zero”.

Morrisons introduces priority prices for loyalty members

Morrisons is now offering loyalty card holders exclusive discounts, similar to Tesco’s Clubcard Prices deals.

In-store advertising promoting the initiative began appearing over the weekend, with offers for My Morrisons members to start being rolled out from this week. Discounts include offers such as two for £6 on tubs Cadbury Heroes, Celebrations, Quality Street and Roses.

The supermarket told Retail Gazette it will “evolve” the offers it provides as it continues to “listen to customer feedback”.

Morrisons relaunched its loyalty scheme last year, offering card holders “instant money” rather than points.

BP’s profit more than doubles to $8.2bn

BP’s has posted a profit of $8.2bn (£7.1bn) for the three months to September, more than double what it made over the same period last year.

The steep rise is due to soaring oil and gas prices caused by Russia’s invasion of Ukraine.

The figure is nearly $2bn higher than analysts expected, and not far off the record-breaking $8.5bn profit it made in the previous three months.

The oil giant has said it expects to pay $800m in UK windfall tax this year, which was introduced by Rishi Sunak in May and applies to profits make from extracting oil and gas in the UK.

Netflix bolsters gaming arm with Spry Fox acquisition

Netflix is acquiring independent games developer Spry Fox, making it the sixth in-house gaming studio it has brought into the company.

It comes ahead one year after Netflix launched its mobile games offer, as the streaming giant looks to bolster its credentials in this area.

With the acquisition of Spry Fox, which makes games including Triple Town, Alphabear and Cozy Grove, Netflix hopes to “accelerate [its] creative development in another beloved genre”, adding to the “growing variety” of games it offers.

Over the past year Netflix has acquired Next Games, mobile studio Boss Fight Entertainment, developer Night School, and internal studios in Finland and in Southern California.

Netflix’s vice-president of its games studio, Amir Rahimi, says: “Our games journey has only just begun, but I’m proud of the foundational work we’ve been doing to build out our in-house creative capacity so that we can deliver the best possible games experience — including no ads and no in-app purchases — to our members as part of their membership.”

Musk urged to uphold Twitter’s digital safety pledge

The Global Alliance for Responsible Media (GARM) has shared an open letter to Elon Musk urging him to elevate brand safety on Twitter.

The social platform has been a partner of GARM, which is part of the World Federation of Advertisers, since it was launched in 2019 to improve digital media safety and create an environment that protects consumers and the industry.

The letter describes the challenge of improving online safety as an “ongoing journey that require innovation and investment”.

“We have high hopes that your acquisition of Twitter, and taking it private, will tap into the innovation we’ve seen you apply to other ventures,” the letter says. “We view the topics of platform safety and brand safety as being quite serious and can impact human life and society in very serious ways. There are lots of eyes on leaders in this space, which now includes you.”

It continues: “Transparency and control over the underlying technologies that power platforms is a right (a choice as you frame it) that we should put back in the hands of users, creators and advertisers.”

GARM suggests it’s time for a “new industry-defining standard” and says it is “eagerly awaiting to see how Twitter can uniquely answer this”.

Addressing Musk directly, it goes on to say: “Your reflection on open dialogue, clear rules, consistent consequences is exactly what your stakeholders want… The GARM Brand Safety Floor nicely aligns with many of the rules, that when applied consistently avoid the harms no user, creator or advertiser wants to be part of. We would value your commitment to uphold these rules, and the measures and controls that we’ve all agreed as an industry standards around them.”

Monday, 31 October

General Motors pulls paid Twitter ads as site hit by trolls

General Motors has paused paid ads on Twitter as the firm seeks to “understand the direction” of the company under new owner Elon Musk.

The US car giant confirmed it had temporarily halted paid ads, stating this was in the “normal course of business” following significant changes to a social media platform. General Motors said in a statement it was “engaging with Twitter to understand the direction of the platform” under its new ownership.

On Thursday, Musk sought to allay advertisers’ fears by insisting Twitter aspires to be “the most respected advertising platform in the world” and that he has no intention of turning the platform into a “free-for-all hellscape”.

The Tesla CEO explained no changes have “yet” been made to the social media site’s content moderation policies, despite tweeting that “Comedy is now legal on Twitter”. Musk has proposed the creation of a new council to moderate posts formed of “widely diverse viewpoints”, with no major content decisions or account reinstatements set to take place before the new council convenes.

However, concerns over content moderation and the future direction of Twitter continued over the weekend.

The site was hit by a “coordinated trolling campaign”, consisting of more than 50,000 tweets containing hateful content from 300 accounts, the Guardian reports. Twitter head of safety and integrity Yoel Roth confirmed the platform had been targeted by an “organised effort” to make users think the firm had dropped or weakened its content moderation policies.

The tweets were said to have been posted by a small number of “inauthentic” accounts, featuring slurs and other derogatory terms. According to Roth, more than 50,000 tweets repeatedly using one slur came from only 300 accounts. Twitter has since taken steps to ban the users involved in the trolling campaign.

Aside from the emergence of trolls, Musk raised eyebrows over the weekend by suggesting users should be able to “select which version of Twitter” they want to see, much as a film viewer would by choosing an age rating. In a post on Saturday, he suggested the “rating of the tweet itself could be self-selected, then modified by user feedback.”

This ties in with Musk’s earlier message to advertisers, in which he said users should be able to choose their “desired experience” according to their preferences, as they would with a film or video game.

The new Twitter boss has also been forced to deny reports in the New York Times he plans to sack employees before 1 November to avoid paying out grants of shares in the company as part of their pay deals. Musk described the report as “false”, although he has so far already sacked the social media company’s chief executive, chairman and finance chief.

New National Lottery operator eyeing £100m Camelot deal

Incoming National Lottery operator Allwyn Entertainment is reportedly in talks to acquire the incumbent Camelot in a £100m deal.

Sky News reports Allwyn is in “advanced discussions” with Camelot’s Canadian owner to buy the UK operations, giving the company a controlling stake in the rival it will replace as National Lottery operator in February 2024. It is understood most of Camelot’s 1,000 employees will join Allwyn once the licence handover takes place.

In September, Camelot withdrew its legal bid to win back the disputed £6.4bn National Lottery licence, which was awarded to Allwyn Entertainment by the Gambling Commission in March.

At the time Camelot explained it had come to the decision that the potential damages covered by the undertakings needed for the legal appeal would have been “too large and involved too great a commercial risk”. The organisation confirmed it would “cooperate with Allwyn and the Gambling Commission to facilitate an orderly transition to the fourth licence.”

However, Camelot was planning to proceed with a separate claim for compensation, which Sky News understands would be withdrawn if the Allwyn acquisition is successful.

Reporting its annual results in June, Camelot’s sales surpassed £8bn following four consecutive years of growth, with the lottery operator claiming performance was driven by an “unmissable brand connection” combined with strong Lotto sales.

Despite the positive results, Allwyn has promised to “revitalise” the National Lottery, the expectation being the new operator will halve the cost of tickets for the main draw to their original £1 price.

Octopus Energy acquires failed rival Bulb

Octopus Energy has acquired failed rival Bulb, which collapsed in November 2021 along with more than 30 other firms following a spike in wholesale gas prices.

The London-based business was placed into “special administration” and run by the government through regulator Ofgem. While figures have not been published, the BBC understands Octopus paid the state between £100m and £200m to acquire Bulb, with the deal set to complete by the end of next month.

Taking on Bulb’s existing 1.5 million customers, Octopus Energy promised to provide a “stable home” for consumers and the company’s 650 staff. The firm’s CEO Greg Jackson said he is confident the takeover will be smooth, adding that the energy provider will share any profits from Bulb with the government for up to four years.

Octopus will continue to use Bulb’s technology and brand “for a transitionary period”, to ensure a smooth transfer for customers.

“We take our responsibilities very seriously. We will work unbelievably hard to deliver value for taxpayers and to look after Bulb’s staff and customers,” says Jackson.

“We started off as rivals but shared the same mission – driving a greener, cheaper energy system with people at the heart. We know how important this is to Bulb’s loyal customers and dedicated staff, and are determined that Octopus can provide them with a stable home for the future.”

The Department of Business, Energy and Industrial Strategy sought to reassure Bulb customers, promising they “won’t experience any disruption” due to the Octopus takeover.

Business and Energy Secretary Grant Shapps claims the deal provides “vital reassurance and energy security” to consumers nationwide, adding: “This is a fresh start and means Bulb’s 1.5 million customers can rest easy, knowing they have a new energy home in Octopus.”

Shareholders blast ‘tone deaf’ Zuckerberg as Meta ramps up metaverse spending

Shareholders are angry at Meta’s decision to ramp up investment in the metaverse, despite the firm reporting a 52% decline in profits during the third quarter to $4.39bn (£3.8bn).

Investors told the Financial Times CEO Mark Zuckerberg is using his majority control to ramp up spending on the metaverse, despite metaverse-focused arm Reality Labs making a loss of $9.4bn (£8.1bn) during the first nine months of 2022. Revealing its third quarter results last week, Meta admitted losses within Reality Labs would grow “significantly” in 2023.

While profits fell and shares are down 74% in value compared to just over a year ago, the social media giant intends to spend $39bn (£33.6bn) in capital expenditure next year, double levels seen in 2021.

Following discussions between Meta and shareholders, head of equities at asset manager Carmignac, David Older, told the Financial Times Zuckerberg was “tone deaf to the investment community, doubling down on everything.” He added the timeline for success in the metaverse was “very stretched”, meaning the company wouldn’t know if it had made the right decision for five to 10 years.

Jim Tierney, chief investment officer for US growth at AllianceBernstein, told the FT if any other company had behaved in this way activist investors would be calling for change at the top, claiming shareholders became “more disgusted” with the situation after follow-up conversations with the Meta chief.

Mark Zuckerberg currently owns 13% equity in Meta, the parent company behind Facebook, Instagram and WhatsApp, and controls 54.4% of votes through a special class of shares.

While a court can intervene if a company is found to be wasting resources, the bar is set “very high”, according to corporate governance expert at US university Santa Clara, Steve Diamond. He told the FT: “I’m astounded by how much they have already spent [on the metaverse] and they have little to show for it. If this was any other CEO who had only a 1% of stake, he’d probably be gone.”

M&S targets circular economy with plan to rent capsule wardrobes

Marks & Spencer will allow customers to rent capsule wardrobes of 10 different outfits for up to a month in a bid to help shoppers lower their carbon footprints.

According to the Guardian, the five-, six- or seven-piece womenswear collections will be available to rent from £39 per capsule for five days via specialist site Hirestreet. In total 78 womenswear items, including jeans, footwear and accessories, will be included in the scheme.

M&S is ramping up its partnership with Hirestreet, which began for the autumn/winter 2021 season, after customers expressed a desire to change the way they buy clothes to address the climate crisis. The offering is also designed to appeal to cost conscious consumers, with a black leather M&S dress typically costing £35 to hire for four days versus its £250 sale price.

“This season it’s not just about what we offer but how – this is just one of the ways we’re working to support customers as they expect to lower their carbon footprint,” M&S managing director of clothing and home, Richard Price, told the Guardian.

This push for circularity is already in evidence within the retailer’s childrenswear division. Earlier this year M&S announced a trial with circular kidswear peer-to-peer marketplace Dotte, which enables parents to buy, sell, donate and recycle children’s clothes.

The digital platform offers a resale collective of 16 independent and “sustainably-minded” kidswear brands, with M&S representing the first major retailer to join the site. Users who sell a pre-owned M&S item via Dotte get an M&S voucher for £5 off when they spend £25 online, with parents typically recouping 50% of the original value of the garment.