June 7 2023 - Wednesday Roundup

👋Happy Wednesday everyone. It's a surprisingly light day, given the flurry of news yesterday. I'll take it–

Quick Take

• Crypto has an image problem, that even the largest exchanges can't escape
• PGA Tour + LIV Golf merger is officially (surprising advertisers, and everyone?)
• Layoffs come for Reddit

The SEC has filed a lawsuit against Coinbase, the largest crypto exchange in the US, accusing it of operating as an unregistered securities broker and putting investors at risk of fraud and manipulation. The lawsuit, filed in U.S. District Court for the Southern District of New York, followed the regulator’s lawsuit against Binance, the world’s largest crypto exchange, on Monday. The broadening legal maneuvers aim to increase regulatory oversight of the cryptocurrency industry.

The PGA Tour and LIV Golf, a Saudi-backed professional golf tour, have agreed to merge and end their rivalry. The merger involves combining the commercial businesses and rights of both tours into a new company. The PGA Tour will have majority control of the new board, while the governor of the Public Investment Fund (PIF), the Saudi wealth fund that runs LIV, will serve as chairman. The exact amount of Saudi investment is unclear, but it is expected to be in the billions of dollars. LIV Golf emerged as a competitor to the PGA Tour in 2022 with significant financial backing from the Saudi investment fund. The rivalry led to legal battles and the PGA Tour suspending some of its golfers from participating in LIV events. LIV Golf has faced criticism for its association with Saudi Arabia, with allegations of "sportswashing" and attempts to distract from human rights violations. LIV Golf is offering a prize money of $405 million during the 2023 season.

Reddit is cutting approximately 5% of its workforce and scaling back its hiring plans as part of a restructuring effort to focus on future growth. The company is eliminating around 90 full-time positions and reducing its hiring plans from 300 to 100 new roles. CEO Steve Huffman stated in a memo that the restructuring aims to position the company for continued momentum and achieving breakeven next year. Reddit plans to increase prices for third-party app developers and prioritize funding data and API tools for moderators. The tech industry has seen significant job cuts in recent times, but Reddit had not announced any major staff reductions until now. The company filed for an initial public offering in late 2021 but has faced delays due to market conditions.

Sequoia Capital is splitting itself into three independent partnerships, with its businesses in China and India becoming separate entities. The move is aimed at simplifying the firm's operations and comes amidst increasing tensions between China and the United States regarding technology investment and access to advanced technologies. Sequoia's China business will be called HongShan, while its business in India and Southeast Asia will be known as Peak XV Partners. The firm has played a significant role in the growth of China's tech giants, making notable investments in companies like ByteDance and Ant Group. However, venture capital investors have become cautious about investing in China due to geopolitical tensions and regulatory complexities.

• Clean Creatives has released a guide on "How to stop a Shell pitch" in response to agencies pitching for Shell's global media account. The guide offers suggestions on what to say to an agency pitching for the account, such as pointing out that they are moving backwards on clean energy and asking why they lied about climate science. The guide also includes details that Shell's board voted against compliance with the Paris Climate Agreement and a statement from an internal presentation regarding their lack of plans to move to a net-zero emissions portfolio over the next 10-20 years.

• Kevin Costner has mortgaged his $50 million home to finance his new project Horizon, a four-film series about pre-and post-Civil War expansion of the American West. The "Yellowstone" star expressed that he has put all his money into the project as he believes in the idea and the story, mentioning that "he's not a good businessman and his accountant has gone into a fit". Although he has high hopes for the film, Costner has stated that he will never put his own money into a movie again after these four.
• NHL sponsorship revenue has seen a significant increase of 21% to reach $1.28 billion this season, driven by investments in "digitally enhanced dasherboards," expanded league advertisers, and jersey sponsor patches, according to a report from SponsorUnited.
• McDonald's is continuing its nostalgic marketing approach by featuring its classic character Grimace in a new campaign. The campaign promotes the Grimace Birthday Meal, which includes a purple milkshake, and aims to evoke memories of childhood birthday parties at McDonald's. McDonald's is leveraging the nostalgia surrounding its McDonaldland characters to connect with both old and new consumers.

• Apple now allows users to try out developer betas of iOS 17, watchOS 10, and macOS Sonoma without needing to pay for its developer program. Users only require an Apple ID to access and install these developer beta releases. However, it is important to note that these beta versions may have bugs, broken apps, or other issues, so it is not recommended to install them on your primary device. Apple plans to release public betas in July, which may be a more suitable option for those eager to try out the latest updates.
• Territory Group has expanded its creative services with Terra Firma Pictures, a new studio that specializes in content creation for agencies, brands, game companies, and developers. Terra Firma is a director-led animation and creative production studio with a diverse range of directors. They are now represented in the US West Coast region by Pop-Arts Management.
• The Cannes Lions Festival is expected to have a more subdued atmosphere this year, with tech companies, brands, and ad agencies toning down their presence due to a year of retrenchment and layoffs. Despite the reduced presence, these companies still plan to have a presence at Cannes, focusing on showcasing their products and services and engaging with clients. While private beach clubs run by tech companies usually dominate the festival, this year's event will be more work-focused. The ad industry also faces economic uncertainty, and travel expenses need to be justified, leading to smaller contingencies being sent. However, major holding companies such as WPP, Omnicom, Dentsu, and Publicis Groupe will still be attending.
• Instagram might be developing an AI chatbot, according to leaked images from app researcher Alessandro Paluzzi. The chatbots have 30 AI personalities to choose from and can answer questions and give advice, as well as help with writing messages. Instagram has not confirmed what AI tools are being used.

• Around 50% of McKinsey and Company's employees are using generative AI tools, according to Ben Ellencweig, senior partner and global leader of QuantumBlack, the firm’s artificial intelligence consulting arm. The chatbot ChatGPT is among the tools used by staff, who must adhere to guidelines and principles on the input of data into the AI services. The firm's employees are using generative AI for creative content generation, customer engagement, coding and content synthesis, with marketers aiming to offer a "segment of one" through personalized content.
• Apple has acquired Mira, an augmented reality startup that makes headsets for other companies and the US military. Mira has contracts with the US Air Force and the Navy and also has an agreement with Nintendo World for its Mario Kart ride.
• Digiday+ Research has conducted an analysis of marketers' social media usage and budgets, focusing on leading platforms such as Instagram, Facebook, TikTok, YouTube, Twitter, Pinterest, Reddit, and Snapchat. The research found that social media has the highest usage rate among marketers, with 97% using it for marketing purposes. However, some marketers are looking to shift away from Meta-owned platforms due to changes and challenges. TikTok has gained prominence due to its ability to create viral moments, while YouTube serves as a dual-purpose platform for both social engagement and ad-supported streaming. Twitter, Pinterest, Reddit, and Snapchat have lower usage rates among marketers, as they are more focused on user-to-user engagement rather than brand marketing. Marketers face challenges in budgeting and creating platform-specific content, with different platforms requiring different content perspectives. Instagram, Facebook, and YouTube receive the majority of budget allocations, while TikTok is growing in popularity.
• Japanese eyewear brand Jins has hired former Apple creative director Paul Nixon as its global chief creative officer, starting on June 1. Nixon, who spent over 17 years at Apple in various design roles, including creative director of Apple.com, will now lead the design efforts at Jins. He expressed his excitement about joining and its mission to provide innovative and impactful eyewear products that enhance customers' lives. Nixon aims to make Jins the global standard for eyewear design, innovation, and value.

• Meet Rebecca, the 2023 Doodle for Google winner
• Google partners with Priceline to use AI to help customers book trips
• Several major subreddits are going dark for two days to protest Reddit's plan to charge for API access.
• All the New Features Apple Didn't Announce at WWDC
• Eric Schmidt backs Keeta, a startup working to make cross-border payments ‘as easy as Venmo’
• US Senators question Mark Zuckerberg over Meta's LLaMA leak
• What Trends Are Driving The Fashion Business Forward?
• Are consumers willing to wear virtual reality headsets constantly?
• Agencies using AI should get advertisers' permission, ANA says

As always, send us feedback at: thebrandtrackers@gmail.com