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Social media meltdown over Sydney Sweeney’s jeans ad, eugenics, Nazi dog whistle accusations, and over-wokeness, explained

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U.S. fashion retailer American Eagle Outfitters wanted to make a splash with its new advertising campaign starring 27-year-old actor Sydney Sweeney. The ad blitz included “clever, even provocative language” and was “definitely going to push buttons,” the company’s chief marketing officer told trade media outlets.

It has. The question now is whether some of the public reactions the fall denim campaign produced is what American Eagle intended.

Titled “Sydney Sweeney has great jeans,” the campaign sparked a debate about race, Western beauty standards, and the backlash to “woke” American politics and culture. Most of the negative reception focused on videos that used the word “genes” instead of “jeans” when discussing the blonde-haired, blue-eyed actor known for the HBO series “Euphoria” and “White Lotus.”

Some critics saw the wordplay as a nod, either unintentional or deliberate, to eugenics, a discredited theory that held humanity could be improved through selective breeding for certain traits.

Marcus Collins, an assistant professor of marketing at the University of Michigan’s Ross School of Business, said the criticism could have been avoided if the ads showed models of various races making the “genes” pun.

“You can either say this was ignorance, or this was laziness, or say that this is intentional,” Collins said. “Either one of the three aren’t good.”

Other commenters accused detractors of reading too much into the campaign’s message.

“I love how the leftist meltdown over the Sydney Sweeney ad has only resulted in a beautiful white blonde girl with blue eyes getting 1000x the exposure for her ‘good genes,’” former Fox News host Megyn Kelly wrote Tuesday on X.

American Eagle didn’t respond to requests for comment from The Associated Press.

A snapshot of American Eagle

The ad blitz comes as the teen retailer, like many merchants, wrestles with sluggish consumer spending and higher costs from tariffs. American Eagle reported that total sales were down 5% for its February-April quarter compared to a year earlier.

A day after Sweeney was announced as the company’s latest celebrity collaborator, American Eagle’s stock closed more than 4% up. Shares were volatile this week and trading nearly 2% down Wednesday.

Like many trendy clothing brands, American Eagle has to differentiate itself from other mid-priced chains with a famous face or by saying something edgy, according to Alan Adamson, co-founder of marketing consultancy Metaforce.

Adamson said the Sweeney campaign shares a lineage with Calvin Klein jeans ads from 1980 that featured a 15-year-old Brooke Shields saying, “You want to know what comes in between me and my Calvins? Nothing.” Some TV networks declined to air the spots because of its suggestive double entendre and Shields’ age.

“It’s the same playbook: a very hot model saying provocative things shot in an interesting way,” Adamson said.

Billboards, Instagram and Snapchat

Chief Marketing Officer Craig Brommers told industry news website Retail Brew last week that “Sydney is the biggest get in the history of American Eagle,” and the company would promote the partnership in a way that matched.

The campaign features videos of Sweeney wearing slouchy jeans in various settings. She will appear on 3-D billboards in Times Square and elsewhere, speaking to users on Snapchat and Instagram, and in an AI-enabled try-on feature.

American Eagle also plans to launch a limited edition Sydney jean to raise awareness of domestic violence, with sales proceeds going to a nonprofit crisis counseling service.

In a news release, the company noted “Sweeney’s girl next door charm and main character energy – paired with her ability to not take herself too seriously – is the hallmark of this bold, playful campaign.”

Jeans, genes and their many meanings

In one video, Sweeney walks toward an American Eagle billboard of her and the tagline “Sydney Sweeney has great genes.” She crosses out “genes” and replaces it with “jeans.”

But what critics found the most troubling was a teaser video in which Sweeney says, “Genes are passed down from parents to offspring, often determining traits like hair color, personality and even eye color. My jeans are blue.”

The video appeared on American Eagle’s Facebook page and other social media channels but is not part of the campaign.

While remarking that someone has good genes is sometimes used as a compliment, the phrase also has sinister connotations. Eugenics gained popularity in early 20th century America, and Nazi Germany embraced it to carry out Adolf Hitler’s plan for an Aryan master race.

Civil rights activists have noted signs of eugenics regaining a foothold through the far right’s promotion of the “great replacement theory,” a racist ideology that alleges a conspiracy to diminish the influence of white people.

Shalini Shankar, a cultural and linguistic anthropologist at Northwestern University in Evanston, Illinois, said she had problems with American Eagle’s “genes” versus “jeans” because it exacerbates a limited concept of beauty.

“American Eagle, I guess, wants to rebrand itself for a particular kind of white privileged American,” Shankar said. “And that is the kind of aspirational image they want to circulate for people who want to wear their denim.”

A cultural shift in advertising

Many critics compared the American Eagle ad to a misstep by Pepsi in 2017, when it released a TV ad that showed model Kendall Jenner offer a can of soda to a police officer while ostensibly stepping away from a photo shoot to join a crowd of protesters.

Viewers mocked the spot for appearing to trivialize protests of police killings of Black people. Pepsi apologized and pulled the ad.

The demonstrations that followed the 2020 killing of George Floyd by a white police officer in Minneapolis pushed many U.S. companies to make their advertising better reflect consumers of all races.

Some marketers say they’ve observed another shift since President Donald Trump returned to office and moved to abolish all federal DEI programs and policies.

Jazmin Burrell, founder of brand consulting agency Lizzie Della Creative Strategies, said she’s noticed while shopping with her cousin more ads and signs that prominently feature white models.

“I can see us going back to a world where diversity is not really the standard expectation in advertising,” Burrell said.

American Eagle’s past and future

American Eagle has been praised for diverse marketing in the past, including creating a denim hijab in 2017 and offering its Aerie lingerie brand in a wide range of sizes. A year ago, the company released a limited edition denim collection with tennis star Coco Gauff.

The retailer has an ongoing diversity, equity and inclusion program that is primarily geared toward employees. Two days before announcing the Sweeney campaign, American Eagle named the latest recipients of its scholarship award for employees who are driving anti-racism, equality and social justice initiatives.

Marketing experts offer mixed opinions on whether the attention surrounding “good jeans” will be good for business.

“They were probably thinking that this is going to be their moment,” Myles Worthington, the founder and CEO of marketing and creative agency WORTHI. “But this is doing the opposite and deeply distorting their brand.”

Melissa Murphy, a marketing professor at Carnegie Mellon University’s Tepper School of Business, said she liked certain parts of the campaign but hoped it would be expanded to showcase people besides Sweeney for the “sake of the brand.”

Other experts say the buzz is good even if it’s not uniformly positive.

“If you try to follow all the rules, you’ll make lots of people happy, but you’ll fail,” Adamson said. “The rocket won’t take off. ”



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Netflix to buy Warner Bros. in $72 billion cash, stock deal

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Netflix Inc. agreed to buy Warner Bros. Discovery Inc., marking a seismic shift in the entertainment business as a Silicon Valley-bred streaming giant tries to swallow one of Hollywood’s oldest and most revered studios.

Under terms of the deal announced Friday, Warner Bros. shareholders will receive $27.75 a share in cash and stock in Netflix, valuing the business at $82.7 billion including debt. The total equity value of the deal is $72 billion. Warner Bros. will spin off cable networks such as CNN and TNT into a separate company before concluding the sale of its studio and HBO to Netflix. 

Media mergers of this scale have a rocky history and this one is expected to bring intense regulatory scrutiny in the US and Europe. The deal combines two of the world’s biggest streaming providers with some 450 million subscribers. Warner Bros.’ deep library of programming gives Netflix content to sustain its lead over challengers like Walt Disney Co. and Paramount Skydance Corp. 

The acquisition, which confirmed a Bloomberg report Thursday, presents a strategic pivot for Netflix, which has never made a deal of this scope in its 28-year history. With the purchase, Netflix becomes owner of the HBO network, along with its library of hit shows like The Sopranos and TheWhite Lotus. Warner Bros. assets also include its sprawling studios in Burbank, California, along with a vast film and TV archive that includes Harry Potter and Friends. 

“I know some of you are surprised we are making this acquisition,” Netflix co-Chief Executive Officer Ted Sarandos said on a call with analysts Friday. He noted that Netflix has traditionally been known to be builders, not buyers. “But this is a rare opportunity that will help us achieve our mission to entertain the world.”

Netflix shares were down 3.5% Friday afternoon in New York. They have declined about 17% since the streaming leader emerged as an interested party in October. Some investors and analysts have interpreted this deal to mean Netflix was worried it couldn’t expand its current business, a theory co-CEO Greg Peters dismissed.

Warner Bros. stock was up about 5.2% midday in New York. It has almost doubled since reports of deal talks with Paramount emerged in September. Play Video

The news concludes a flurry of dealmaking over the past few months that began with a series of bids by Paramount. That prompted interest from Comcast Corp. and Netflix, who were both chasing just the studios and streaming business. All three submitted sweetened bids earlier this week, with Paramount ultimately offering $30 a share for all of Warner Bros. Discovery, arguing that its proposal offered a smoother path to regulatory approval. Netflix won out in the end although significant hurdles remain before the deal can close, which the company expects it can do in the next 18 months.

Paramount could still try to raise its bid, take its offer directly to shareholders or sue to try and block the Netflix deal. The company had no comment.

California Republican Darrell Issa wrote a note to US regulators objecting to any potential Netflix deal, saying it could result in harm to consumers. Netflix has argued that one of its biggest competitors, however, is Alphabet Inc.’s YouTube, and that bundling offerings could lower prices for subscribers. Netflix accounts for between 8% and 9% of TV viewing in the US each month, according to Nielsen. It accounts for closer to 20% or 25% of streaming consumption.

Analysts at Oppenheimer said platforms such as Reels, TikTok and YouTube competing for viewers’ time should help the deal pass antitrust review. 

It was 15 years ago that Time Warner CEO Jeff Bewkes, who oversaw Warner Bros. and HBO, shrugged off the threat posed by Netflix, comparing the then fledgling company to the Albanian Army. As Netflix began to invest in original programming, Sarandos declared that Netflix wanted to become HBO before HBO figured out streaming.

Sarandos succeeded and Netflix led the streaming takeover of Hollywood while HBO struggled to respond to the rise of on demand viewing and the decline of cable. Bewkes agreed to sell Time Warner to AT&T in 2016, the beginning of a decade of turmoil for HBO and Warner Bros., storied brands that are about to have their fourth owner in a decade.

Warner Bros. put itself up for sale in October after receiving three acquisition offers from Paramount, which were rejected, opening the door for Netflix and Comcast. Peters said he didn’t see the logic of these big transactions at Bloomberg’s Screentime conference in October, but Sarandos privately pushed for the deal.

The bidding got contentious, with Paramount accusing Warner Bros. of operating an unfair process that favored Netflix. The Netflix offer topped Paramount’s when combining the money for the studio and streaming business with the estimated value of the networks. The two sides agreed to the deal Thursday night. 

Under terms of the agreement, Warner Bros. shareholders will receive $23.25 in cash and $4.50 in Netflix common stock. Moelis & Co. is Netflix’s financial adviser. Wells Fargo is acting as an additional financial advisor and, along with BNP Paribas and HSBC Holdings, is providing $59 billion in debt financing, according to a regulatory filing, one of the largest ever loans of its kind. Allen & Co., JPMorgan Chase & Co. and Evercore are serving as financial advisers to Warner Bros. Discovery.

Netflix agreed to pay Warner Bros. a termination fee of $5.8 billion if the deal falls apart or fails to get regulatory approval. “We’re highly confident in the regulatory process,” Sarandos said Friday.

In addition to streaming overlap, regulators will also likely look at the impact on theatrical releases, which Netflix has traditionally eschewed in favor of prioritizing content on its platform.

Netflix said it will continue to release Warner Bros. movies in theaters and produce the studio’s TV shows for third parties — two major changes in how it does business. The company was a little short on details of exactly how it will integrate the different businesses, but Netflix said it expects to maintain Warner Bros.’ current operations and build on its strengths.

The deal will allow Netflix to “significantly expand” US production capacity and invest in original content, which will create jobs and strengthen the entertainment industry, the company said. The combination is also expected to create “at least $2 billion to $3 billion” in cost savings per year by the third year.

Warner Bros. Discovery CEO David Zaslav was the architect of combining Warner Bros. and Discovery in 2022, a deal he hoped would create a viable competitor to Netflix. But the company’s share price tanked in response to a series of public miscues and the continued decline of the cable network business. 

While performance rebounded a bit over the last year, the company never quite became the streaming dynamo Zaslav envisioned. He’ll continue to run the company through its spinoff and sale. The two companies haven’t yet agreed on him having any role at Netflix.

The traditional TV business is in the midst of a major contraction as viewers shift to streaming, the world that Netflix dominates. In the most recent quarter, Warner Bros. cable TV networks division reported a 23% decline in revenue, as customers canceled their subscriptions and advertisers moved elsewhere.



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Mark Zuckerberg renamed Facebook for the metaverse. 4 years and $70B in losses later, he’s moving on

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In 2021, Mark Zuckerberg recast Facebook as Meta and declared the metaverse — a digital realm where people would work, socialize, and spend much of their lives — the company’s next great frontier. He framed it as the “successor to the mobile internet” and said Meta would be “metaverse-first.”

The hype wasn’t all him. Grayscale, the investment firm specializing in crypto, called the Metaverse a “trillion-dollar revenue opportunity.” Barbados even opened up an embassy in Decentraland, one of the worlds in the metaverse. 

Five years later, that bet has become one of the most expensive misadventures in tech. Meta’s Reality Labs division has racked up more than $70 billion in losses since 2021, according to Bloomberg, burning through cash on blocky virtual environments, glitchy avatars, expensive headsets, and a user base of approximately 38 people as of 2022.

For many people, the problem is that the value proposition is unclear; the metaverse simply doesn’t yet deliver a must-have reason to ditch their phone or laptop. Despite years of investment, VR remains burdened by serious structural limitations, and for most users there’s simply not enough compelling content beyond niche gaming.

A 30% budget cut 

Zuckerberg is now preparing to slash Reality Labs’ budget by as much as 30%, Bloomberg said. The cuts—which could translate to $4 billion to $6 billion in reduced spend—would hit everything from the Horizon Worlds virtual platform to the Quest hardware unit. Layoffs could come as early as January, though final decisions haven’t been made, according to Bloomberg. 

The move follows a strategy meeting last month at Zuckerberg’s Hawaii compound, where he reviewed Meta’s 2026 budget and asked executives to find 10% cuts across the board, the report said. Reality Labs was told to go deeper. Competition in the broader VR market simply never took off the way Meta expected, one person said. The result: a division long viewed as a money sink is finally being reined in.

Wall Street cheered. Meta’s stock jumped more than 4% Thursday on the news, adding roughly $69 billion in market value.

“Smart move, just late,” Craig Huber of Huber Research told Reuters. Investors have been complaining for years that the metaverse effort was an expensive distraction, one that drained resources without producing meaningful revenue.

Metaverse out, AI in

Meta didn’t immediately respond to Fortune’s request for comment, but it insists it isn’t killing the metaverse outright. A spokesperson told the South China Morning Post that the company is “shifting some investment from Metaverse toward AI glasses and wearables,” point­ing to momentum behind its Ray-Ban smart glasses, which Zuckerberg says have tripled in sales over the past year.

But there’s no avoiding the reality: AI is the new obsession, and the new money pit.

Meta expects to spend around $72 billion on AI this year, nearly matching everything it has lost on the metaverse since 2021. That includes massive outlays for data centers, model development, and new hardware. Investors are much more excited about AI burn than metaverse burn, but even they want clarity on how much Meta will ultimately be spending — and for how long.

Across tech, companies are evaluating anything that isn’t directly tied to AI. Apple is revamping its leadership structure, partially around AI concerns. Microsoft is rethinking the “economics of AI.” Amazon, Google, and Microsoft are pouring billions into cloud infrastructure to keep up with demand. Signs point to money-losing initiatives without a clear AI angle being on the chopping block, with Meta as a dramatic example.

On the company’s most recent earnings call, executives didn’t use the word “metaverse” once.



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Robert F. Kennedy Jr. turns to AI to make America healthy again

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HHS billed the plan as a “first step” focused largely on making its work more efficient and coordinating AI adoption across divisions. But the 20-page document also teased some grander plans to promote AI innovation, including in the analysis of patient health data and in drug development.

“For too long, our Department has been bogged down by bureaucracy and busy-work,” Deputy HHS Secretary Jim O’Neill wrote in an introduction to the strategy. “It is time to tear down these barriers to progress and unite in our use of technology to Make America Healthy Again.”

The new strategy signals how leaders across the Trump administration have embraced AI innovation, encouraging employees across the federal workforce to use chatbots and AI assistants for their daily tasks. As generative AI technology made significant leaps under President Joe Biden’s administration, he issued an executive order to establish guardrails for their use. But when President Donald Trump came into office, he repealed that order and his administration has sought to remove barriers to the use of AI across the federal government.

Experts said the administration’s willingness to modernize government operations presents both opportunities and risks. Some said that AI innovation within HHS demanded rigorous standards because it was dealing with sensitive data and questioned whether those would be met under the leadership of Health Secretary Robert F. Kennedy Jr. Some in Kennedy’s own “Make America Health Again” movement have also voiced concerns about tech companies having access to people’s personal information.

Strategy encourages AI use across the department

HHS’s new plan calls for embracing a “try-first” culture to help staff become more productive and capable through the use of AI. Earlier this year, HHS made the popular AI model ChatGPT available to every employee in the department.

The document identifies five key pillars for its AI strategy moving forward, including creating a governance structure that manages risk, designing a suite of AI resources for use across the department, empowering employees to use AI tools, funding programs to set standards for the use of AI in research and development and incorporating AI in public health and patient care.

It says HHS divisions are already working on promoting the use of AI “to deliver personalized, context-aware health guidance to patients by securely accessing and interpreting their medical records in real time.” Some in Kennedy’s Make America Healthy Again movement have expressed concerns about the use of AI tools to analyze health data and say they aren’t comfortable with the U.S. health department working with big tech companies to access people’s personal information.

HHS previously faced criticism for pushing legal boundaries in its sharing of sensitive data when it handed over Medicaid recipients’ personal health data to Immigration and Customs Enforcement officials.

Experts question how the department will ensure sensitive medical data is protected

Oren Etzioni, an artificial intelligence expert who founded a nonprofit to fight political deepfakes, said HHS’s enthusiasm for using AI in health care was worth celebrating but warned that speed shouldn’t come at the expense of safety.

“The HHS strategy lays out ambitious goals — centralized data infrastructure, rapid deployment of AI tools, and an AI-enabled workforce — but ambition brings risk when dealing with the most sensitive data Americans have: their health information,” he said.

Etzioni said the strategy’s call for “gold standard science,” risk assessments and transparency in AI development appear to be positive signs. But he said he doubted whether HHS could meet those standards under the leadership of Kennedy, who he said has often flouted rigor and scientific principles.

Darrell West, senior fellow in the Brooking Institution’s Center for Technology Innovation, noted the document promises to strengthen risk management but doesn’t include detailed information about how that will be done.

“There are a lot of unanswered questions about how sensitive medical information will be handled and the way data will be shared,” he said. “There are clear safeguards in place for individual records, but not as many protections for aggregated information being analyzed by AI tools. I would like to understand how officials plan to balance the use of medical information to improve operations with privacy protections that safeguard people’s personal information.”

Still, West, said, if done carefully, “this could become a transformative example of a modernized agency that performs at a much higher level than before.”

The strategy says HHS had 271 active or planned AI implementations in the 2024 financial year, a number it projects will increase by 70% in 2025.



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