Google AI Blunder, Abercrombie's Record Growth, and Marketing Agency Pitch Win
Welcome to the 8th edition of The Marketing Search Digest, a monthly newsletter aimed at informing you of the latest branding wins, updates in Marketing and tech innovation.
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Google Updates AI Overviews After Errors
After a series of notable errors, Google is revising its AI Overviews search feature, which was recently introduced to all US users. This tool uses generative AI to gather and summarise web information for quick responses at the top of search results. Despite its intended benefits, some publishers have criticised it for redirecting valuable web traffic, and users have shared screenshots of the AI providing incorrect and bizarre advice.
In response to these issues, Liz Reid, Google’s Head of Search, detailed the company's plans for improvement. She noted that the AI model produced unexpected responses to absurd queries, like suggesting the consumption of "at least one small rock per day." To address this, Google has developed better detection mechanisms for nonsensical queries and has reduced the inclusion of satire and humour in AI-generated content.
This isn't Google's first experience with AI-related controversies. In February, the company paused Gemini’s ability to generate images of people after users reported historically inaccurate and biased results. Google's swift actions in response to feedback reflect its commitment to maintaining high standards and continuously improving its AI features.
Britvic Appoints Coolr as Social Media Agency
Soft drinks company Britvic plc has selected Coolr as its new social media agency after a competitive pitch. Coolr will handle social media content and campaigns for Britvic's various brands, including Tango, Mathieu Teisseire, Robinsons, J2O, and London Essence. The agency's role will focus on a social-first approach, aiming to enhance content, drive innovation, and boost cultural relevance by engaging more effectively with their audiences.
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The decision follows Britvic's review of its social media account initiated in November 2023. Previously, Britvic had brought its social media operations in-house in 2022 by establishing Infused, a digital strategy and content studio in collaboration with The & Partnership. This review was part of Britvic's efforts to expand its Infused roster and improve its social media strategy.
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Olivia Blairman, managing director at Coolr, expressed enthusiasm about the partnership, highlighting the creative synergy between Coolr and Britvic's brands. Callum Watt, Head of Digital Marketing at Britvic, praised Coolr's passion, creativity, and social-first initiatives, expressing confidence in their collaboration for the next phase of Britvic's social media journey.
Abercrombie & Fitch Achieves Record Results through Strategic Brand Building?
Abercrombie & Fitch reported record first-quarter results, crediting fewer promotions and clearly defining its brand identities. The company posted net sales of $1.02 billion in Q1 2024, a 22% increase from the previous year and the highest in its history. CEO Fran Horowitz attributed this success to growth across both women's and men's divisions, clean inventory management, and reduced promotions, which boosted the gross profit margin to 66.4%.
Horowitz highlighted that Abercrombie & Fitch has effectively clarified its brand purpose, capitalising on global market opportunities with relevant products and a strong brand voice. The company's operating margin improved to 12.7%, with Abercrombie's net sales up 31% and Hollister's up 12% year-over-year. Marketing expenditure increased to 5% of total sales, focusing on long-term customer acquisition and engagement. CFO Scott Lipesky emphasised maintaining this "sweet spot" in marketing spend to drive both short-term and long-term growth.
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Since hitting a low in 2017, Abercrombie & Fitch has undergone a significant transformation under Horowitz's leadership. The brand, once struggling due to its exclusionary tactics, now appeals to a broader demographic, particularly millennials. This shift has resulted in a 245% increase in stock price over the past year. Looking ahead, the company plans to expand globally, targeting key markets in the UK, Germany, and China, bolstered by strategic investments in marketing and new store experiences.
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Google Validates Leak, Sparking Concerns Over Search Transparency
Google has confirmed the authenticity of recently leaked internal documents that detail the types of user data it tracks, such as clicks and browsing activity, potentially used in its search ranking algorithms. The leak has stirred extensive speculation within the SEO community regarding Google's data collection practices and how these might influence search rankings. However, Google warns against making hasty conclusions based on the leaked information, emphasising that the data might be out-of-context, outdated, or incomplete.
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The revelation has placed Google in a difficult position, prompting the typically reserved company to address the situation publicly. This incident raises questions about whether Google will become even more secretive about its search engine operations and ranking processes. Historically, Google has carefully balanced providing guidance to SEO professionals while protecting its algorithms from exploitation. The current leak could lead to even tighter communication restrictions as Google seeks to manage the fallout.
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The leaked documents offer some insight into Google’s search algorithms, but much remains unclear about how the company collects and prioritises various data points. The SEO community is advised to use the leaked information as a basis for further research and testing rather than definitive answers about search rankings. Open discussion and knowledge-sharing, paired with rigorous testing and healthy scepticism, are essential in navigating the complexities of Google's search systems.
Here at The Marketing Search, we specialise in placing into Marketing functions, covering all disciplines, specialities, and seniorities across the UK and US
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