So it’s been a while but a lot’s happened whilst we have been relaxing on a beach…
Bots are still a thing
The hype around Bots may have quietened down but there is still plenty going on. Facebook Messenger has 18000 bots for its 1 billion active users to engage with, although few seems to have caught on. Learning from China seems the smartest strategy, with WeChat setting the pace. David Marcus of FB calls it inspiring. This is a good round up of the latest Bot news with a good emphasis on China. Over 20k bots have been built for Chat App Kik and their view is interesting – they think the right approach is around simpler interactions, as AI and natural language processing still has a way to go.
FB Snakes & Ladder
No it’s not a new ad format, but the constant game played by publishers attempting to game the Facebook algorithm and get their content seen by as many of users as possible. As it becomes crystal clear that the key aim of Facebook is to keep their users happy, publishers and content producers are having to adapt. The recent change to the algorithm that favours friends content is starting to have an effect and some data suggests traffic from Facebook is falling sharply for many publishers. Other analysis suggests it’s not that black and white.
Some publishers are prospering – Ladbible is now the top publisher on Facebook in the UK according to Tubular Labs– with one of their Facebook Live videos getting over 6 million views. And newish player Fatherly have shared their strategy – smartly looking to build a direct relationship with viewers as well as maximising reach within each platform.
Given the shift to video and the challenge of the algorithm changes what are ‘traditional’ publishers to do? We think sharing is the only metric that really matters now as, other than paid promotion, it’s the only way to get significant reach. So a focus on building in sharing is a no brainer but it’s hard to achieve – and probably the only way to get there is doing more content; some of the US gurus talk of doing 20 or more posts a day.
Being very good at Content Creation is the best shortcut to getting good at Content Distribution. This good piece on YouTuber Casey Neistat shows how production techniques are evolving and the BBC had one of their journalists go MOJO – Mobile journalist - by just using his iPhone for a month. Guess what? It worked out fine.
The leaning from these two is that it’s less about the equipment – and more about the idea.
It’s still all about test test test. It’s Time to Experiment.
Which is why we see Amazon starting to share Pilot episodes of its new shows on Facebook and YouTube. Why not see if people will watch long form content on these platforms? Yes, all the data suggests short is better on mobile, but quality wins out. Mobile Video is still evolving and iPlayer data shows people will watch long form if it’s good enough. With Chromecast, Amazon Fire Stick and Apple TV lots of mobile content is watched on the big screen anyway. ( And Facebook have started testing ways to encourage users to watch Facebook videos on their TV screens)
We believe the next big opportunity is episodic video and Jeffrey Katzenberg nailed it when is talked of an extra 3 episodes of Breaking Bad, delivered in 6 minute segments. With a Pay per View business model.
Legacy TV companies continue to be nervous about these new opportunities. As Facebook seek to license TV content for their Suggested Video feature, as well as Facebook Live, they are getting little take up, as no one wants to outsource ad sales as the moment.
In their latest stellar results, Facebook mentioned that they are getting close to maximum Ad Load – ie they are running out of places to shows ads. Of course they can just show more ads, but as we mention above they know that keeping the user happy is crucial. In the results call just about every analyst mentioned this, as it’s the first sign of vulnerability in the Facebook ad bonanza.
As they test Mid Rolls ads, getting more video has to be one way around the Load, but we all know people tend to hate pre and mid roll ads. They get closer to TV ads – Reach and Frequency is now just as much a part of Facebook as it is of ITV or ABC - but there is still a question about how best to use them.
P&G got lots of headlines when they said they were scaling back targeted ads on Facebook, but many missed their point. They will continue to spend the same amount but will favour reach over narrow targeting – which may be good for Baby products but is less useful for laundry. We suspect many brands don’t invest in targeting as they don’t have different creative – and if you are saying the same thing to everyone why bother.
But smart brands know that tailoring the message to a specific audience can be highly effective. And even where the targeting may not be product relevant, could clever creative increase engagement? If a Gillette ad had a Leeds United calendar in the background would more Leeds fans notice it? Robert Heaths work on Cocktail Party Syndrome suggests it would. We are very keen to partner with a brand to dig deeper here so do shout if you are interested.
The other opportunity is probably around the groups that don’t get as much advertiser attention. So many agency briefs still focus on millennials – a pretty useless definition – whilst there is lots of money and opportunity sat with older age groups that are very well represented across Facebook.
US start up Postmates is the latest Sharing Economy business to lose its lustre. Delivery costs - be that for grocery, fast food or anything else – is a pretty narrow margin to try and squeeze. As the Deliveroo news this week shows, it is hard to shave costs and when your only asset is a way to optimize minimum wage staff, that’s a vulnerable business. The winners in any delivery driven sector will probably be Amazon or Uber, who have other revenue streams to cover their costs.
Snapchat acquires another business. Vurb is described as a search business but to us it’s more about curating experiences and we used it as a model as we continue to develop RCKSCK. It will be interesting to see how Snapchat use the team and the product – the fact the deal includes $75m incentive to keep the CEO around, suggests he is quite well rated by Evan.
Finally – it’s still summer but as you think about getting back to work, think about this; is the Programmatic market about to crash and burn? Probably overly gloomy but there are too many players and too few can really articulate how they add value.
We mentioned how we value Marginal Gains last time and the GB Cycling squad demonstrated just how effective that strategy is
Are you sure you have the best tech and the best advisors to help you get those Marginal Gains? Remember the Chauffeur story we mentioned last time. And if you think I might be able to help, get in touch.
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