The Drum’s Daily Briefing: Watt out at BrewDog, Ofcom talks tough & BooHoo’s losses
Our quickfire analysis of the brand, marketing and media stories that might just crop up in your meetings and conversations today.
Brewdog CEO Watt to stand down
Controversial BrewDog CEO Watt steps down
BrewDog’s often controversial boss, James Watt, is stepping down as CEO at the beer company he co-founded 17 years ago, but will remain as a non-executive director on the board and continue to strategically advise the group.
Watt will hand over the chief operating officer reins to James Arrow, taking on the newly created role of “captain and co-founder” and retaining his 21% shareholding in the firm.
BrewDog said it had put in place succession plans after Mr Watt first told the board last year he wanted to step away to focus on his other projects and interests.
A LinkedIn post by Watt said: “After 17 fantastic years as chief executive, I have decided to transition into a new role in the business, one of ‘captain and co-founder’ – and James Arrow will pick up the reins as chief executive as our business pushes forward into our next phase of growth.“
Watt’s tenure has been marred by controversy. In 2021, former staff accused the firm of having a “culture of fear” within the business and “toxic attitudes” towards junior staff. In January, the company also faced a backlash after revealing it would no longer hire new staff on the “real” living wage, instead paying the lower legal minimum wage.
Ofcom warns social media platforms to follow rules
Media regulator Ofcom has warned that social media and messaging platforms such as Facebook, TikTok, X and Snapchat could be banned for under-18s in the UK if they fail to comply with new online safety rules.
Ofcom has published a children’s safety draft code of practice, which requires social media firms to have more robust age-checking measures. Ofcom boss Dame Melanie Dawes warned any company that broke them could have their minimum user age raised to 18. But parents of children who died after exposure to harmful online content have described Ofcom’s new rules as “insufficient.”
Spokespeople for Meta and Snapchat said the firms had extra protections for under-18s and offered parental tools to control what children can see on their platforms.
Dame Melanie said any company that broke the draft codes of practice, which dictate firms must adjust their algorithms to avoid recommending harmful content to children, would be “named and shamed.”
A Snapchat spokesperson said: “We support the aims of the Online Safety Act and work with experts to inform our approach to safety on Snapchat.”
BooHoo is in trouble as China and the high street bite
Online fashion brand Boohoo has cut more than 1,000 jobs and dived into debt after sales slumped 13% amid competition from the Chinese online seller Shein and the revival of the high street after the pandemic lockdowns.
BooHoo, which owns Debenhams, Warehouse, Dorothy Perkins and Pretty Little Thing, said it had built up net debts of £95m in the year to the end of February – down from almost £6m of net cash a year before – after losses widened 76% to £160m.
Boohoo and other online sellers experienced a boom in demand during the pandemic when many households turned to the internet to buy comfy clothing to work and rest at home while many high streets were shut down.
With high streets now reopened and new competition from cut-price Chinese sellers Shein and Temu and secondhand marketplaces such as Vinted and Depop, once successful online fashion specialists have taken a hit.
Disney to slow down superhero movies
Disney CEO Bob Iger has said that the company will slow down making movies and TV series for its Marvel Studios and Lucasfilm franchises.
The move comes as recent superhero offerings have failed to ignite ticket sales at the box office and is an attempt to cut costs.
Earlier this year, Disney rolled out a broad business reorganization that included $5.5bn in cost cuts, of which $3bn would be slashed from content excluding sports.
Iger said on Thursday that many decisions were made to support the company’s flagship streaming service, Disney+, and attract more customers.
While also noting that Disney had some Pixar animation misses in recent months, he called out Marvel as a particular example of the company’s “zeal” to pump up its original content on streaming.
Disney acquired Marvel for more than $4bn in 2009 and the franchise has since grossed billions of dollars at the global box office for the company.
Legendary music retail brand Sam Ash to close stores after 100 years
Iconic US family-owned music retail chain Sam Ash is closing all of its stores after 100 years in the business.
Derek Ash, the great-grandson of founders Sam and Rose Ash, said the company has struggled to attract customers to its 42 brick-and-mortar locations across the country, three of which are in New York City.
“There are so many choices and to maintain a store with that much selection is very difficult,” said Ash. “A lot of this has been the move to online shopping.”
Sam Ash was a professional musician who was born Sam Ashkynase. He opened the first store in Brownsville, Brooklyn, in 1924 after immigrating to the US from Austria.
His wife Rose pawned her engagement ring for $400 to make a down payment on what was to become the first Sam Ash store. At the time, the store sold windup phonographs, a limited selection of sheet music and a few violins. It quickly gained a following and Sam Ash expanded to Long Island and Manhattan before other outposts popped up around the country over the decades.