Wednesday Wake-Up Call: Your daily update on the Papa John's saga (there's a Kanye West angle)

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John Schnatter, left.
John Schnatter, left. Credit: Papa John's ad

Welcome to Ad Age's Wake-Up Call, our daily roundup of advertising, marketing, media and digital news. You can get an audio version of this briefing on your Alexa device. Search for "Ad Age" under "Skills" in the Alexa app. What people are talking about today: Laundry Service says it's going to defend itself against "disparaging and outrageous comments" by the founder of Papa John's, its former client. The agency also says the claims are "completely false," as Ad Age's Megan Graham writes. The backstory: Papa John's founder John Schnatter had accused Laundry Service of trying to extort the pizza chain out of $6 million after he used a racial slur during a conference call with the shop in May. In an interview with Kentucky's WLKY, he claimed the shop wanted the big sum of money to stay silent and make the problem "go away." In an internal memo obtained by Ad Age, the agency said it plans to go on the record to refute the claims, and it asked employees not to speak to journalists about what happened.
Schnatter stepped down as chairman last week, after a news report about his use of the N-word, and the company has been distancing itself from him; it's pulling his image off all its marketing, including pizza boxes and logos. As The New York Times says, "Papa John's just wants Papa John to go away."
On second thought: Schnatter reportedly thinks he made a mistake in stepping down as chairman at the board's request, arguing that his comment was taken out of context and he didn't mean it as a racial epithet. And he is "not going quietly," his lawyer told CNBC.
Kanye: There's also a Kanye West angle to this story. As CNBC reports, Schnatter says Laundry Service suggested the brand partner with West in its ads. But Schnatter didn't want to, because West "uses the 'N' word in his lyrics."

'Biggest decline in nine years'
Omnicom Group posted quarterly organic revenue growth of 2 percent, and investors were not impressed. The holding company's stock dropped nearly 9.5 percent from Monday evening to Tuesday's close, and Bloomberg News says it was Omnicom's "biggest decline in nine years." North American revenue dropped 0.9 percent year-over-year. The results revived "concerns that the ad giant can weather media disruption spurred by the likes of Google and Facebook," Bloomberg says. Omnicom's holdings include DDB, BBDO, TBWA and Omnicom Media Group; its results are more fuel for the discussion about holding companies and how they should face challenges like digital disruption and competition from consulting companies.
Also: Omnicom says it looked at acquiring Acxiom's Marketing Solutions business, before Interpublic Group of Cos. decided to buy it for $2.3 billion. But Omnicom has "come out on the side of renting the data, versus buying the company that compiles the data," an executive said during the conference call. Read more by Ad Age's Megan Graham.

Sleeping Giants
The conservative Daily Caller named an until-now anonymous founder of Sleeping Giants, the activist group urging brands to pull their ads off Breitbart and news sites it accuses of racism, sexism and other offenses. And the man who was outed appears to be a freelance ad copywriter. After his name went public, Matt Rivitz confirmed via the Sleeping Giants Twitter account that he had founded the group. "While this isn't obviously how I wanted things to play out, I have nothing to hide," he wrote. Sleeping Giants tweeted that Rivitz "has had his address published, had death threats and gotten threatening calls and texts tonight," and it criticized Twitter for not intervening. One of Rivitz's Twitter critics also urged boycotts of past clients and an agency he reportedly used to work at, Goodby Silverstein & Partners. The Sleeping Giants account tweeted that Rivitz hadn't been employed by Goodby in almost a decade. "Find someone else to counter-boycott," it wrote.
One POV on this: "The Daily Caller's doxxing of Sleeping Giants was a dick move," from The Next Web.

Meanwhile in Washington
Republicans say social media platforms show bias against conservatives, a claim that was much discussed in a hearing with Facebook, YouTube and Twitter and the House Judiciary Committee. Some Democrats have zero patience for that line of thinking. As Ad Age's Garett Sloane writes:

Of all the issues to be concerned about, "alleged anti-conservative bias is simply not one of them," said Rep. Jamie Raskin, a Democrat, calling it a "conservative fantasy."

Lawmakers also pressed Facebook and YouTube to explain how they decide to ban an account, and why Alex Jones' InfoWars hasn't been evicted. As Sloane writes, "both sites have a strike system, but they were vague about how those strikes ever add up to a complete ban, and there is some discretion in their policies." In other words, Facebook and YouTube didn't shed much light on that. Despite lasting three hours, the hearing doesn't seem to have produced much substance.

Just briefly:
Watching Walmart:
"Walmart is considering launching a subscription streaming video service to compete with Netflix and Amazon Prime Video," The Information reports. The idea would be to offer a subscription at a cheaper price than the competition, the report says.

Zut alors: For the World Cup final, "Fox's ratings fell well short of the kind of numbers ABC scared up four years ago," Ad Age's Anthony Crupi writes. Nielsen says the game (France 4, Croatia 2) had an average 11.3 million viewers, compared to 14.1 million for the final four years ago.

Stepping down: Isaac Lee, the influential content chief for Univision Communications and Grupo Televisa SAB, is leaving, Bloomberg News reports.

Huge: President Trump is Facebook's biggest spender on political ads, New York University researchers say, after crunching the numbers. Read more in The New York Times.

World Emoji Day: In case you missed it, it was yesterday. Slack has some new emojis specific to the agency world, and there is now an actual emoji for a "hovering art director." The new emoji pack was created by Firstborn; read I-Hsien Sherwood's story in Ad Age.

Cheers: Aperol spritz (that nuclear-orange drink that tastes much better than it looks) is in vogue this summer, and The New York Times reports that its popularity stems from a marketing push by the maker of Aperol, Campari.

Listen: In the latest edition of the Ad Age Ad Lib podcast, Editor Brian Braiker talks to Bill Holiber, president and CEO of U.S. News, which focuses much less on news than reader service. "The emphasis is on SEO-friendly advice and evergreen practical information," Braiker notes. And the strategy is working, since the brand gets 40 million visitors a month.

Creativity pick of the day: Netflix may be having a relatively rough week, but it just released a charming new teaser for the next season of "Stranger Things." Basically, it looks like a retro ad for a mall in the fictional '80s-era Indiana town where "Stranger Things" takes place. "The clip is a trip back in time for '80s enthusiasts, when brands like Claire's, Waldenbooks, Sam Goody and the Gap ruled the mall scene," as Ad Age's Adrianne Pasquarelli writes. The faux-mall "even has a Jazzercise." Check it out here, and enjoy those retro mallrat hairstyles.

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