Paddy Power, Sky, British Airways: 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.

Paddy Power hit with fine for targeting excluded gamblers

Paddy Power has been fined £490,000 for sending a promotional push notification to customers who had signed up to exclude themselves from receiving gambling offers.

The Gambling Commission, the industry regulator, issued the fine after Paddy Power was found to have breached social responsibility rules in sending the notification, which encouraged users to bet on a football match between Tottenham Hotspur and Leeds United in November 2021.

The affected customers, the number of which has not been specified, had signed up to Gamstop, a scheme where gamblers voluntarily block themselves from betting sites, but due to what the bookmaker described as “human error” some customers on Apple devices received the offer.

Gambling Commission executive director of operations Kay Roberts, said: “Although there is no evidence the marketing was intentional, nor that all the people with apps saw the notification, or that self-excluded customers were allowed to gamble, we take such breaches seriously.

“We would advise all operators to learn from the operator’s failures and ensure their systems are robust enough to always prevent self-excluded customers from being sent promotional material.”

The fine comes at a time of increased scrutiny for gambling companies as the government launched its much-anticipated gambling White Paper last month, detailing tougher affordability checks and slot machines stake limits among its proposals, although most are still subject to consultation.

More than half of female gamers face sexist abuse online

Sky Broadband is launching a new campaign to highlight the abuse women face in gaming.

It comes off the back of research commissioned by Sky Broadband which shows that almost half (49%) of female gamers have experienced abuse online, with over 80% of those revealing the messages they received had been sexual in nature.

The research went on to claim that 52% of women feel worried playing games online and are concerned it will have an impact on their mental health.

This new campaign, created in collaboration with Guild Esports, an esports business who own a series of professional video game teams, is called ‘#NoRoomForAbuse’ and showcases a number of professional female gamers detailing the horrific abuse they and other women face when playing online.

It has created an immersive experience at the Sky Guild Gaming Centre in Shoreditch to visualise the abuse and highlight the differing experiences felt by men.

Jaclyn Beavis, head of advertising & campaigns at Sky Broadband, said: “Sexist abuse in online gaming is completely unacceptable and we must stand together to address this fundamentally important issue and make online gaming safe and accessible to all.

“We’re proud to be working with Guild Esports to help educate gamers and encourage them to be better allies. We’re also committed to creating a level playing field for women in gaming through tournaments, events, educational experiences and more.”

Airport chaos for British Airways ahead of bank holiday weekend

British Airways says a “technical issue” is behind the dozens of its cancelled or delayed flights from Heathrow airport ahead of the bank holiday weekend.

At least 50 BA flights were cancelled on Thursday due to the issue with a large number of inbound flights also delayed. Passengers set to depart today are being told to check their flight status before heading to the airport.

In a statement released late last night, BA says its systems are back working correctly, but there may still be intermittent issues.

It said: ‘While the majority of our flights have continued to operate [on Thursday], we have had to cancel a number of Heathrow flights due to a technical issue.

“Affected customers have been contacted and offered options, including a refund or rebooking to an alternative flight with us or another carrier. We are extremely sorry to our customers for the inconvenience caused.”

The problems come at a bad time for the airline which is trying to minimise the fallout from a three-day strike by security guards at the airport.

Naturally, then, today is expected to be the busiest day overall in the UK for departing flights since 2019, according to data from analysts Cirium.

Lebara takes aim at rivals in new campaign

British telecommunications company Lebara has launched its new campaign criticising rivals for what it considers wasteful sponsorship deals.

The fully integrated campaign called ‘Lebara Smarter’ was created with Double W Worldwide and makes the claim that as other networks have raised prices by up to 17% in recent months, Lebara have managed to keep prices fixed.

Lebara, which runs on the Vodafone network, believe that one of the reasons they can do so is because they don’t sponsor football teams, music venues or hire Hollywood stars, a thinly veiled dig at rivals O2 and EE.

The campaign will launch across national TV, radio, social channels and OOH and is the first in what the company describes as a series of straight-talking, no frills spots designed to showcase why a Lebara SIM plan is more cost effective.

Mayur Jauhari, director of marketing & online at Lebara, said: “In the current economic backdrop and the ongoing cost of living crisis, big mobile networks have increased their prices by up to 17%. We want people to know that they don’t have to put up with this.

“By switching to Lebara, customers can get better value for their money along with a reliable network and excellent customer service. With no annual price rises on top, Lebara is indeed a Smarter choice to make.”

Elon Musk’s brain-implant company approved for human testing

Neuralink says it has been approved by the US Food and Drugs Administration (FDA) to begin conducting its first brain-implant tests on humans.

The tech company, owned by Elon Musk, believes it can help restore people’s vision and mobility through its brain-implant chips, which link up with computers to send signals to the brain, and the approval would represent a major step forward for the business.

There are no immediate plans to invite participants for clinical trials currently and the FDA has yet to comment on Neuralink’s approval claims.

The news was announced by the company on Twitter, hailing the “incredible work” of the Neuralink team and believe this approval is the “first step” in allowing its technology to “help many people”.

Neuralink has suffered multiple delays in the past with the firm initially expecting to begin human trials in 2020 before pushing that back to 2022. It also came under investigation for alleged animal welfare violations, claims the company denied.

Wednesday, 24 May

M&S reaps rewards of growth strategy

M&S has posted profit growth of 18% as it makes gains on the growth plans the retailer laid out last year. The business’s profit after tax reached £364.5m, up from £309m last year. Sales across the business also saw a 9.9% boost, growing to £11.9bn from £10.8bn.

Sales were up across both Clothing and Home, and Food, by 11.5% and 8.7% respectively. However, it posted an Ocado Retail loss of £29.5m, up from a £13.9m share of profit last year – Ocado’s reset is now underway, the business said.

“One year in, our strategy to reshape M&S for growth has driven sustained trading momentum, with both businesses continuing to grow sales and market share. Our Food and Clothing & Home businesses invested in value to protect customers from the full force of inflation which, whilst impacting margin, was the right thing to do, as serving our customers well is the only route to delivering for our shareholders,” said Stuart Machin, M&S’s CEO.

M&S’s Food business “outperformed” the market across the year, while its “style credentials continue to improve”, said Machin.

“Despite facing significant headwinds, I am encouraged by the strong foundations established last year and excited about what we can achieve in the year ahead,” he added.

UK inflation drops to 8.7%, biggest decline since cost of living crisis started

The UK has recorded a drop in its annual inflation rate, which was down to 8.7% for April.

This is the biggest decrease in the inflation rate since the cost of living crisis began. The inflation rate was 10.1% in March, and peaked at 11.1% in October last year, according to data from the Office for National Statistics.

It’s the first time the inflation rate is below 10% since August last year. “We are no longer in double digit territory,” Grant Fitzner, chief economist at the ONS told the BBC this morning. “We have seen falls in bread, cereals, fish, milk, cheese, eggs, sugar, jam and honey – so that is positive.”

However, he cautioned that the drop in inflation won’t be reflected in consumers’ supermarket shops straight away.

“It’ll take some time for this to wash through to retail prices,” he added.

Netflix rolls out password sharing crackdown to major markets

Netflix’s crackdown on password sharing has begun, with the UK among the markets which will now be required to pay £4.99 to share accounts outside of the home.

103 countries will he hit by Netflix’s efforts to increase subscriber numbers, including the US, Australia, Brazil and France.

Netflix is eyeing long-term growth with the changes, as it says: “Longer term, paid sharing will ensure a bigger revenue base from which we can grow as we improve our service.”

The changes were rolled out in Spain ahead of the wider crackdown, which led Netflix to lose a million subscribers in the first three months of 2023. However, in Canada, which was also an early recipient of the move in February, its paid membership base is now larger than before.

ASA bans ‘exaggerated’ Sky Broadband ad

An ad rolled out by Sky in October last year to advertise its broadband offering has been banned by the Advertising Standards Association (ASA) for “misleading” customers about how powerful the Wi-Fi product is.

The complaint against the ad came from BT. The ad, one of many from Sky featuring the Minions, promoted the service’s ‘Wall to Wall Wi-Fi Guarantee’, suggesting customers could achieve strong Wi-Fi speeds in all rooms of their homes, or Sky would give them money back.

Sky says its use of a money-back guarantee in the ad indicated it “explicitly acknowledged” that some customers would not have a seamless Wi-Fi experience.

However, the ASA disagreed, with the Minions themed ad banned from further roll-out in its current form.

Meta loses millions as it sells Giphy to Shutterstock

Meta has made a loss of more than $260m (£210m) in its sale of the gif search engine Giphy to Shutterstock.

The Facebook owner acquired the gif business in November 2021 for around $315m (£253m), but it was blocked from completing the purchase last year by the UK’s competition regulation, the Competition and Markets Authority (CMA).

The deal between Meta and Shutterstock lays out plans for the new owner to ensure continued access to Meta platforms, as well as Giphy’s pre-existing user base.

Paul Hennessy, CEO at Shutterstock, calls it an “exciting next step in Shutterstock’s journey as an end-to-end creative platform”.

“Through the Giphy acquisition, we are extending our audience touch points beyond primarily professional marketing and advertising use cases and expanding into casual conversations,” he adds.

Tuesday, 23 May

Ireland to introduce compulsory health warnings on alcohol packaging

Ireland is to become the first country in the world to introduce detailed, compulsory health warnings on the packaging of alcoholic drinks.

Manufacturers will have to include information on alcohol products warning of the links to cancer, liver disease and the risk of drinking while pregnant. It will also be compulsory to detail the calorie and alcohol content of each beverage.

The rules will not be introduced until May 2026 to give businesses time to adjust to the new regulations.

“I welcome that we are the first country in the world to take this step and introduce comprehensive health labelling of alcohol products,” Irish health minister Stephen Donnelly said. “I look forward to other countries following our example.”

However, several of Ireland’s major trading partners, including Italy and France, have already registered concerns with the European Commission.

Coldiretti, Italy’s biggest farmers’ association, the warnings as a “direct attack”.

“The green light from the European Union for alarmist wine labels in Ireland represents a dangerous precedent as it risks opening the door to other legislation capable of negatively influencing consumer choices,” it said.

Which? launches major brand refresh

Consumer group Which? has launched a major brand refresh, which includes a new logo and campaign.

The consumer organisation claims that in an “age of uncertainty and misinformation, where people are struggling with the cost of living, and can’t trust what they read online”, it has “never been more relevant or important”.

Which? worked with design agency ODA on its new visual identity, which sees it drop the previous version of its logo which was imposed on a red block and replace it with a red line that runs under the question mark in its name. On its website, ODA says it “opened up a dynamic space using an iconic red line between ‘which’ and its question mark”, which “prompted people to ‘fill in the gap’”.

The rebrand is aimed at opening up the consumer group to more people. Which? wants to appeal to consumers “beyond reviews and white goods”. To this end, it has also launched its rebrand in a new above-the-line campaign entitled “Get answers”.

The integrated campaign, which will run across digital and out-of-home platforms, highlights a range of the sort of diverse questions Which? may provide help with, from the best plants to grow for bees, to how to keep the cost of a food shop down.

The campaign was developed with agencies Goodstuff, Brave Spark and Brainlabs.

Ocado launches ad campaign focused on price-match initiative

Ocado has launched an ad campaign highlighting its price-match initiative, which sees it pledge to match like-for-like shops to Tesco.com.

The “10,000 Price Promises” campaign highlights the online grocery retailer’s “Price Promise” initiative, which it claims “covers significantly more products than other grocers include in their value offers”. While the like of Sainsbury’s and Tesco have price matches against discounter Aldi, Ocado Retail, which is a joint venture between Ocado Group and M&S, is matching against Tesco.com.

In its 2022 financial year results, which were announced in February, Ocado Retail suffered a £4m loss as it saw smaller shop volumes from consumers post-Covid, as well as pressures from the cost of living crisis. Ocado Retail’s CEO Hannah Gibson said the retailer was “investing in great value” to grow its customer base.

The campaign highlights that its Price Promise will match the like-for-like price of a Tesco.com shop, including promotions and Clubcard prices. It also highlights the pledge to email a voucher for the difference if its price matching does not live up to this promise to equal a like-for-like shop via Tesco.com.

The TV ad which leads the campaign, created with agency St. Luke’s, aims to illustrate the extent of Ocado’s Price Promise initiative. It depicts a woman in her kitchen, who is surprised by a pinging noise in her bread bin, when she opens it up, she discovers a value roundel, which has popped up in there, next to her crumpets and seeded rolls. The roundels then pop up out of different areas of the kitchen, to physically demonstrate how widespread the value initiative is.

The campaign is running across TV, video-on-demand services, YouTube, social media and digital until July.

Rail passengers may lose wifi access in cost-cutting initiatives

Train passengers may lose access to free wifi on services, unless rail companies can prove its business value.

The Department for Transport (DfT) is looking to cut costs amid a wider push to “reform all aspects of the railway”. It claims that free wifi is low on passengers’ priorities and has reached out to all its contracted companies in England to tell them, if they cannot justify the expense, they should cut it.

“Our railways are currently not financially sustainable, and it is unfair to continue asking taxpayers to foot the bill, which is why reform of all aspects of the railways is essential,” said a DfT spokesperson.

However, some passenger groups and industry figures questioned the proposal.

Speaking on his Calling All Stations podcast, transport commentator Christian Wolmar challenged the idea that wifi was low on passengers’ priority list.

“My view is that wifi is as essential as toilets now – people expect to be connected,” he said.

Passenger campaign group Railfuture spokesperson Bruce Williamson said scrapping wifi may well deter passengers.

“We should be encouraging passengers to get back on the trains and this is a good example of a move that is going to make rail less attractive,” he said.

Meta fined £1bn for mishandling users’ data

Meta has been fined €1.2bn (£1bn), under GDPR rules, for mishandling users’ data when transferring it between the EU and the US.

The fine, issued by Ireland’s Data Protection Commission (DPC), is the largest handed out under GDPR. According to regulators, the Facebook owner broke EU rules by transferring users’ data to the US to be processed. It continued to do so, despite a 2020 ruling by the European Court of Justice, which required strong protection of that data. The DPC ruled that standard contractual clauses, the legal mechanism used by Meta to transfer the data, do “not address the risks to the fundamental rights and freedoms of data subjects”.

Meta has been ordered to suspend the transfer of data from the EU to the US within five months. It has also been given six months to halt “the unlawful processing, including storage” of personal data from EU users already transferred to the US, meaning that user data will need to be removed from Facebook servers.

Facebook president Nick Clegg claimed Meta has been “singled out” by regulators, as SCCs are standard practice among many large companies.

“This decision is flawed, unjustified and sets a dangerous precedent for the countless other companies transferring data between the EU and US,” Clegg said.

DMA CEO Chris Combemale said the ruling has created a “concerning situation” for many UK businesses.

“It highlights a significant challenge when transferring data between the EU and US, especially how businesses use standard contractual clauses to create sufficient privacy safeguards,” he said.

“While this ruling doesn’t affect international data transfers between the UK and US or UK and EU, it raises important questions about differing privacy standards between countries outside of the EU with commercial interests inside of it.”

Monday, 22 May

Ryanair profits surge to over a billion as customers return

Ryanair has posted a full-year profit after tax of €1.43bn (£1.24bn) despite making a Q4 loss of €154m (£134m).

The budget airline saw full-year profits rise significantly when compared to the same period in 2022 (where it made a €355m loss) something it puts down to customer recovery, improving fares and advantageous fuel hedges.

Customer numbers increased sharply by 74% in 2023 from 97.1m to 168.6m and gross revenue increased by 124% from €4.80bn to €10.78bn.

Chief executive Michael O’Leary welcomed the figures stating that despite a “disappointing Q1”, which he put down to Russia’s invasion of Ukraine, “strong travel demand through the remainder of the year saw traffic rise 74% at higher fares (+10% on pre-Covid)”.

He went on to be optimistic for growth opportunities in a statement to investors accompanying the results: “Our widening unit cost advantage over all competitors, our fuel hedging, strong balance sheet and our very low-cost aircraft order book, as well as our proven operational resilience, creates enormous growth opportunities for Ryanair over the coming years.”

There was a slight note of caution, however, for next year as he pointed to delays from Boeing in getting new aircraft into the fleet and significantly higher fuel costs as two things that may negatively impact the business.

The earnings news comes just a few weeks after Ryanair announced it has signed an agreement with Boeing to revamp its fleet with 300 new aircraft offering larger capacity at a significant fuel saving.

The deal, which O’Leary described as ‘game-changing’ for the airline, will help the business hit its environmental goals while increasing passenger numbers.

The BHF pulls on heartstrings in new ad campaign

The British Heart Foundation latest campaign is called ‘The Greatest Treasure’ created with Saatchi & Saatchi.

The TV-led integrated campaign is the second iteration of the ‘This Is Science’ brand platform the charity launched to position itself as more than just a support function in the battle against heart disease but a crucial member of the frontline.

The ad, which is narrated by actor Cillian Murphy, sees a woman waking up inside her heart and reliving the important milestones from her life until it is revealed her heart is not working as it should and she needs help. The ad concludes with BHF-funded research proving critical in her making a recovery.

In addition to the advert, the campaign will see the BHF’s vision of the heart run across digital and social channels.

Claire Sadler, chief marketing and fundraising officer at the BHF, says: “It was exciting to collaborate with Saatchi & Saatchi on such an ambitious and creative project as they support us in helping people reconnect with the preciousness of their hearts and our vital work.

“Central to our hero’s journey is the theme of discovery, which runs through the campaign – echoing the crucial work of our scientists. From discovering undetected heart conditions to finding new ways to understand the heart more deeply, the work highlights how BHF funded research results in breakthroughs that can save and transform people’s lives.”

Facebook bracing for record fine from Irish regulators

Meta is facing up to a record fine today over its transfer of European user data to US servers, reports say.

Regulators look set to hit the social media giant with a fine exceeding the current record of €746m (£647m) which Amazon received in June 2021 by Luxembourg when it also flouting data privacy rules, according to sources cited by Reuters news agency.

The ruling is expected to be announced this morning by Ireland’s Data Protection Commission and it will order Facebook to stop using ‘complex legal instruments’ to send EU data to the US.

This is seen as a problem due to the considerably weaker privacy laws in the States that European users could unwittingly fall foul.

It’s not the first time that Facebook has been warned about its use of data with the firm warned to cease transferring data between the US and the EU last year with Facebook at the time threatening to withdraw its services in Europe entirely if the ban was upheld.

Facebook is expected to appeal the decision by the Irish regulator and no fine will be implemented immediately.

Katherine Ryan brings the laughs to NOW’s new campaign

Streaming service NOW has enlisted the help of comedian Katherine Ryan for its latest campaign.

The ad, created with the support of agency partner House 337, sees Ryan play the ‘quality content controller’ who is notoriously hard to please but is won around by NOW’s large selection of drama and sporting moments.

The campaign is a continuation of its research that more people are looking for quality entertainment as opposed to merely quantity.

It is set to run across TV and cinema from 19 May until 1 June and will be supported by through-the-line executions of its content across OOH and digital assets featuring the brand’s green colour.

Jamie Schwartz, director of marketing and merchandising at NOW, said: “With Katherine at the helm, this was the perfect opportunity to remind new and existing members that we’ve got something for every TV fan, no matter what they’re into.”

China bans US chip maker as tech tensions mount

China has claimed products made by a US memory chip maker are a “security risk” as tensions continue to increase between Beijing and Washington.

The country’s cyberspace regulator announced on Sunday that Micron Technology, one of America’s largest memory chip firms, and its products would be banned from key infrastructure projects in China.

“The review found that Micron’s products have serious network security risks, which pose significant security risks to China’s critical information infrastructure supply chain, affecting China’s national security,” the Cyberspace Administration of China (CAC) said in a statement.

It did not, however, give details about what risks it had found in Micron’s products.

This marks the first time China has issued such a statement about a US chip maker and comes just days after the state of Montana banned social media app TikTok.

Micron confirmed to the BBC that it had “received” notice of the ruling and was planning next steps.