Friday Roundup: Week Ending June 16th, 2017

Friday Roundup: Week Ending June 16th, 2017

Natalie Munio, Advertising Week

Amazon announces plans to buy Whole Foods, a giant Amazon Echo popped up in Times Square, McCann has a falling out with a client over potential copy-cat ad, Spotify has another good week, and Oath is officially in business after Verizon/Yahoo deal.

Here are this week’s top stories in advertising and marketing.

Amazon to Buy Whole Foods

Internet retailer Amazon announced Friday morning it will acquire Whole Foods Market Inc. for an estimated $13.7 billion, signifying another push by Amazon into brick and mortar retail. In a news release, Amazon stated that Whole Foods will continue to operate under their own brand and that Whole Foods co-founder, John Mackey, will continue to run the business. Whole Foods, which now has 465 stores in North America and the UK, will also continue to source their products from their established and trusted vendors. The $13.7 billion is expected to conclude later in 2017.

Giant Echo Takes Over Times Square

In keeping with Amazon news, a giant 79-foot Echo appeared in Times Square this week as part of the company’s latest campaign, ‘Music Unites,’ promoting Amazon Music’s streaming services. Though the structure wasn’t interactive, it was modeled to look identical to an Amazon Echo and weighs more than 7 tons. According to AdWeek, Amazon found inspiration from John Lennon and Yoko Ono’s billboards in Times Square that showcased song lyrics, which amplified how “the right song, at the right moment, can connect with large groups of people.” The giant Echo also breaks the record for largest ad build in Times Square, which previously belonged to Pepsi who set the record in 1940.

Copy-cat Ad Ends Relationship for McCann and Philippine Department of Tourism

After criticism this week that McCann plagiarized an ad from South Africa in its latest work for the Philippine Department of Tourism, the client has fired the agency and has demanded that a public apology is made. The spot, created by McCann Worldgroup Philippines and titled “Sights,” was supposedly inspired by the true events of a foreign traveler with visual impairments who eventually makes the Philippines his home. On Monday, mere hours after the ad was released, a Reddit user recognized the video and called it a copy-cat of an ad by Johannesburg-based agency, Ireland/Davenport, that ran in 2014 to promote tourism in South Africa. Both McCann and the department initially defended the work, but soon after, the video was taken off of YouTube and the tourism department held a press conference to announce it would cut ties with McCann and relaunch efforts to find another creative agency.

Spotify Sees Growth in User Base and Revenue

On the heels of an announcement last week that Taylor Swift would be returning to the streaming service, Spotify continues to have a good run as it was announced that the company grew its revenue by 50 percent last year, raking in roughly $3.5 billion in total. According to a financial filing, Spotify raised $1 billion in debt financing in March of 2016, and now plans to pay record labels roughly 2 billion euro in royalty over the next two years, as a “baseline for their continued allegiance to the service.” The streaming service also grew its user base to 140 million total users, including both free and paid users, which is up from 126 million users last year.

Yahoo’s Out, Oath Is In

After what seems like an eternity of ups and downs, Verizon has completed the $4.48 billion Yahoo deal and former Yahoo CEO, Marissa Mayer, has made her exit. In a farewell letter to Yahoo employees, Mayer wrote that working with them has made her “time as CEO nothing short of a privilege.” The new division, Oath, which combines both of Yahoo’s and AOL’s businesses (HuffPost, Tumblr, Yahoo Mail, etc.) will now be run by Tim Armstrong as CEO and will take on about 1.3 billion monthly users. According to the New York Times, Oath’s strategy will be to feature content across multiple locations and to push Oath apps onto Verizon phones so as to increase viewership and to reach the widest possible audience.

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