Happy Valentines Day….I’m Simon Andrews, it’s first thing Friday and this is the newsletter I have been sharing for 10 years - with news and my views on Mobile, Digital, Social and more. Quite a few new subscribers this week (lots in gaming) - let's keep the sharing going. And let’s continue the conversation on Twitter — I’m @SimonBigPicture
TLDR - If you read just one thing this is a really thorough deck on Social Advertising
Lots of smart thinking and it goes some way to bridging the gap between the Brand thinking of Byron Sharp and Binet & Field et al and the modern digital world. As ever it’s a guide rather than an instruction manual, but lots to learn here (It’s a Google doc so loads slowly)
#Adtech Perfect Storm
So much happening here and lots of conversations so i have decided to run a (paid) half day event on this topic - hopefully - next month. We have a number of Fix readers agreed to speak (Arete / Beeswax / Permutive / IAB / 7Stars / Superawesome / Telegraph / Trade Desk) and talking with more. The idea is a Chatham House rules event where we discuss the issues openly and try and navigate solutions that get us to a better place.
I will share the agenda once we sort the date/venue and confirm speakers, but if it sounds like something you would like to participate in, let me know. Still open to more speakers and sponsors that will add real value.
In the conversation I have been using this quote from the US IAB CEO Randall Rothenberg;
This isn’t the end. This is a new and better beginning
At their US event this week we saw some good early thinking and it’s well worth reading both the charts shared and the script of Randalls talk - both here in a PDF. Solving the issues isn't just about tracking; its rethinking how we manage Personalization and Privacy and this quote from the script is worth calling out;
Consider, for a moment, that personalization and privacy – these superficially opposed values – are actually different perspectives on the same thing: individuality.
“Personalization” is a third-party perspective on individuality: It can be a friend mailing me a birthday card to my home, or Spotify algorithmically offering me a package of tunes tailored to preferences it’s gleaned from my expressed interests or behaviors. The agency sits outside of me.
“Privacy” is first-person – my ownership of my individuality: I invite you into my home, but I don’t want that other person intruding in my space without my invitation. You can have my data – but only if I offer it to you and you give me something of value in return.
One of the challenges is that the debate and discussion on these topics is lost in translation as Three Letter Acronyms, buzzwords and jargon are favoured over plain English. So I liked this eloquent explanation of the loss of cookies from Beeswax.
This thread on publisher first-party data is a useful reminder how the balance of power can switch back to good publishers. But we do need to work on standardising the taxonomy so what I buy from one publisher is comparable to what I buy from another.
The allure of SharedIDs is fading as it becomes clear they need cookies to work, but i think another way in which GAFA benefits from the switch to Privacy is that their logins become even more valuable. Could switching to a Facebook, Google or Amazon login boost commercial success as they can sell your ads for you? Given the cookies become 1st party as you are logged into the platform.
In their latest earnings call Criteo are being bullish about their Identity solution - claiming it is not cookie dependent. Their site explanation of their Shopper graph mentions cookies an awful lot and the idea they are protected from the PerfectStorm has not convinced many - their share price is close to a 5 year low.
Facebook Ad Network
I still think there is something here. Facebook has great data, huge demand from millions of advertisers — from Mom&Pops to P&G — and a constant need to grow their revenue. Could they guarantee their growth by solving the crisis facing content businesses, unable to monetise as their traffic is dark without 3rd party cookies? More to come on this.
One of the myths of Digital is that mobile time is hugely skewed to App and that Mobile Web is something of a side show. This comes from counting the huge amounts of time spent in Facebook as all App time. A significant proportion of that time is following links and opening mobile web pages.
A forgotten part of the ecosystem is the Facebook Mobile Browser that opens all these pages. Look at this Bloomberg page opened by clicking a link in the Feed. It’s the original page, but shown in the Facebook browser. You can switch to Chrome (or Safari on IOS) in the page settings.
I don’t think this thin browser supports cookies but why would it? There is no tracking or privacy issue as every user is logged into Facebook.
So here Facebook have an advantage over the publisher; the loss of cookies will mean that Bloomberg doesn’t know who I am so it is a challenge to monetise me. But Facebook clearly do know who I am and therefore have another surface to monetise me on.
So why doesn’t Facebook offer to monetise all traffic originating in their browser? Some publishers may decide to go it alone but many (most) would take a better revenue source, as long as Facebook was fair in sharing the revenues.
Have I missed something here? Or should we expect Facebook to announce a revitalised version of their Ad Network?
3Cs Content / Community / Commerce
As we think about what a new ad ecology looks like I keep coming back to this 3C idea. You use content to build (and / or) serve a community, and then look at the commerce opportunity. You can start with any one of these focuses, but you need all three to maximise the opportunity.
I keep mentioning the Kevin Kelly thinking on 1000 true fans and A16Z built on this, looking at 100 true fans. And taking their thinking further they look Beyond Ads with a detailed piece on the new business models that can replace or support ad revenue. A similar story can be seen in this great video by the same author.
But it’s not all good news - DTC darling Brandless has closed - after raising over $200m from Softbank - whose investment record isn’t that good; WeWork, Uber and now Brandless. Quite why they needed that amount - and what they did with it - is a mystery, but the concept was always flawed.
Brandless became the brand and there was nothing else to attract or retain customers. Muji- which translates as “no-brand quality goods - had the idea first and use design and a clear aesthetic to give meaning to the brand and the business.
Maybe this doesn't matter if you just want to shift product but if you use a lifetime value metric to justify your Customer acquisition cost, you need a brand. Back to the 3Cs. The idea that there is a Playbook undermines Merchants - especially as it seems to keep changing; BOF now have the new 2020 Playbook
There are new tactics - we have mentioned buy now pay later before but this is a good look at the key players. It’s a very competitive space and UK based Afterplay have just hired a new CMO (and Fix friend) from AirBnB. We see that these companies do have a positive effect on conversion and so too does Apple Pay - which is now doing 10% of all card transactions globally.. Testing all the payment options is essential as they can have a big effect, but getting the customer experience just right can be a challenge.
Who is regulating the regulator?
The excellent new Benedict Evans deck talks about regulation and we are seeing more and more examples. The US regulator blocking the acquisition of Harrys surprised everyone and it raises the question of whether an old school regulator understands markets that are very new ad developing fast. The Amazon Deliveroo issue comes to mind and so too does the Clearscore Experian deal faltering as regulators indicated their concern
The US FTC have asked GAFA and Microsoft to detail the acquisitions they have made over the past 10 years - so deals too small to appear on regulator radar will now be looked at. It’s not just GAFA; this thread shows Snap have been snapping up small firms too.
I am not sure the impact of the Perfect Storm on measurement has been fully grasped yet. Things like ViewThrough - which has enabled the cockroach of digital media to flourish - will stop working. Even Brand metrics will be affected as we will find it harder to separate reached and non reached, without cookies.
In a good video (maybe skip the first 2 minutes of sales pitch) Ball talks about Marketing in the Age of the Streaming Wars. This includes some good insight on why Netflix isn't likely to run ads for a while (20mins in). In a long written piece, he rolls back on the idea of streaming wars and does a great deep dive on the various business models. Always worth reading his thinking.
A big PWC survey of US consumers shows that customers are pretty content with the current TV situation - but are excited about the new offerings. Though it seems to suggest new subs may be funded by dropping an old one. A Nielsen study sort of supports this showing that 93% of U.S. consumers say they will either increase or keep their existing streaming services. The key factors are cost, ease of use and variety of content
As part of the Tory pressure on the BBC there was a cheap jibe comparing the BBC to Blockbuster in the age of Netflix. It’s worth remembering that the BBC had a brilliant strategy or video and streaming back in 2008, but the regulators killed Project Kangaroo before it could get started. In my time at Mindshare we met the team and were hugely impressed.
And the new head of the Premier League has been talking up the idea of a Netflix style service for Premier League matches. Remember he is not new to the organisation and these plans are likely to be well developed.
The image we opened with shows just how many Creatives Trump is using in his campaigning as democrats try and catch up on Digital. It's a powerful argument for what I see as the biggest opportunity in digital marketing - more and better creative – which will pay for itself 10 times over
It's easy to knock Agencies these days but at their best they are an amazing collection of smart people with good ideas. A Chicago agency has developed a super project for Black History Month on Chicago soul and it’s a wonderful piece of content. They deserve to win loads of new business as a result. Explore it here and go back in a couple of weeks when they get to the House era
Finally - I am amazed at how many smart people think GAFA is listening in. They see an ad for a product they have been thinking about and decide it must be Alexa or Facebook spying on them. I don’t believe this is true - or even possible.
It’s actually a version of Cocktail Party Effect or what I now call Pret Prattle. I tend to spend more time in Pret than at cocktail parties and the white noise of the other people prattling and chattering lets me get on with my work. But should someone mention a company I know, or Leeds, I hear that. Or when you hear a favourite song and realise for the first time that music is playing.
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