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Mobile Fix - January 17

The Decade of Mobile

Retail

Some fashion business friends are visiting London and have been quite surprised at how fragile the retail market seems. They thought Selfridges was world class but seemed tourist oriented.In Matches the staff were saying how quiet the stores are now whilst they talk on online rivals getting 70% returns. It’s a snapshot but news that US star brand Opening Ceremony are to close all their stores after a takeover (by Farfetch-owned New Guards Group shows this fragility. But there is a theory they might open a store in Shanghai given how important physical retail is there for newer brands.

And we just heard that Bose are to close all their Western stores - just keeping the Chinese and south Asian ones.

More evidence that one size doesn’t fit all with Ikea buying an entire London shopping mall

Our learnings from friends like Form and Thread are that a physical store can make a big difference with online being boosted . Their Kings Cross store does steady business and repeat purchases, online from many instore shoppers

Helping close the gap between buyers and retailers is a priority for the platforms and Google have added to their armoury with the acquisition of Pointy - a tool that helps traditional retailers list products online - with sophistications like the ability to show virtually real time stock levels. When Google started being able to surface stock levels in search ads year ago, it became really important for the big brands able to access the service. Democratising that for the smaller businesses is a good move for Google.

The newest shopping trend isn’t new at all - renting and resale are going mainstream.

newTV

Lots of attention on Quibi which I guess is no surprise given the track record of Jeffrey Katzenberg - but some seem to be willing him to fail as he is taking a very different approach to everyone else.

Some sceptics have been won round though and everyone will be watching to see how they do

We still don’t know what ads will look like on Quibi - other than being pre rolls and the spot length 'matched’ to the duration of the content

Over at Hulu they are taking things seriously, building out a strong team to help brands tailor their messaging to the content

And across the whole of NBC they want to reinvent TV buying by aligning it with online inventory. The challenge here has always been measurement and a new initiative from Tubular Labs feels like progress

One issue that keeps coming up is people sharing passwords - whenever we asks an audience who shares their Netflix login at least half sheepishly admit to it

Whilst it is possible to police this more strictly ( the Spotify link to Google maps comes to mind ) what is the upside? Some will start to pay but for many losing that ability to share diminishes value and with so much new competition it's not the time to risk churn.

This week we saw more detail on something we have been watching for a while - Amazon building their reach across newTV. As parrt of the deal to sell subscriptions they have been insisting on access to some inventory to sell. This seems to have been at the heart of their disagreement with Apple

But it's a compelling offer for most newTV players who are nowhere near fully sold. Because Amazon can use their top quality 1st party data for targeting - and be really good at attribution - they can sell at higher prices than the stations could. And given Amazon double dip - getting both the ad revenue and a cut of sales on their platform - it's going to make Amazon a lot of money. With more and more niche streaming service emerging we can see Amazon becoming the go to sales house for all but the biggest players.

As the choice grows exponentially we see a real need for discovery to get better and this CES pitch shows the sort of thing we might expect - a digital TV Times

Some good coverage of the issues behind Britbox as it emerges that it's essentially an ITV play with the BBC owning just 10%. The ITV CEO is being smart about finding other partners - on the my enemies’ enemy is my friend tip she is seeking a partnership with BT - starting with Champions League. With the jury still out on the Amazon football coverage - mixed views from both advertisers and viewers - Rights holders want to maximise reach almost as much as they want to maximise revenue and terrestrial coverage still adds an element of occasion. Witness the Leeds 45 minute masterclass against Arsenal shown live in prime time on the BBC recently. (A shame the game lasts 90 minutes)

Gaming

More evidence of the importance of gaming and the opportunity for brands, with Twitch poaching a Fix Friend from Facebook. Damian Burns has been key to Facebook building their games business and it’s a fascinating move for both parties

To better understand the opportunity read the A16Z thinking on Cloud Native games;

The new App Annie report has lots of good data on all types of mobile gaming

DTC

London based VC Felix have always focused on digital lifestyle brands and their success with Farfetch, Peleton, Goop and more has helped them raise $300m

At the other end of the scale Shopify now makes small loans ($200) to small businesses coming onto their platform

But the big news on DTC is the original Mattress firm Casper is filing for an IPO and has therefore shared lots of data on their business. A key issue is that they lose money and a lot of that is down to their returns - people who take advantage of the offer to refund a purchase up to 100 days from buying. The math here is indicative of many other DTC brands where the customer acquisition cost is justified against a lifetime value, that is often based on wishful thinking rather than data. The other problem is that the business is easily copied.

This piece on how a rival mattress brand Purple approached brand building through the evolution of the business is therefore timely. And this old article on how Wharton has been a source of any startups - seeking to emulate the success of the Wharton schooled Warby Parker team - is still a good read.

#AdtechPerfectStorm

We now know that Google are going to kill the 3rd party cookie - but not for 2 years. The commentary from Beeswax CEO (and before that long time Google exec) Ari Paparoi is a must read; Let's start with the deadpool: 

View-through attribution: dead.

Third-party data: dead.

DMPs: dead.

Multitouch attribution: dead.

A range of industry figures talk about what’s next but it’s still unclear - the only certainty is that lots of firms will struggle ( Criteo being the canary in the coal mine again) and the only people to benefit are Google and Facebook - and Amazon.

It’s worth reading the Google post on their actions We have a couple of years in limbo and we’ll be spending a lot of time on this in the coming months, because it’s not happening in isolation. Facebook are changing the way Custom Audiences work and this thread is another must read.

And as we wait for the ICO to act the IAB have an initiative to address the issues over Real Time bidding. But the concerns keep growing and the Norwegian regulator are taking action on what they say is the industry is systematically breaking the law. And if you want to go really deep this academic study gets into Dark Patterns after the GDPR: Scraping Consent Pop-ups and Demonstrating their Influence

One minor win though. The new version of Chrome (Chrome80) will help you regulate those annoying requests to enable notifications that blight most websites these days. Has anyone ever said yes (intentionally) to enabling a site to send notifications?

And on a positive note The New York Times had a good year. Great evidence of the value of a quality audience aggregated around great content and context. That’s the future.

Social Influencers

The rise of Influencers has clearly been facilitated by the rise of the big platforms but the way they handle this symbiosis varies. YouTube are the master at this and newer platforms like Twitch and TikTok are trying hard to get it right. But the Facebook family have been more hands off - until now. Instagram wants to have a role connecting influencers with brands and are now extending the Brand Collab Manager from Facebook to Instagram. This tool encourages brands and influencers to make a relationship clear, so as to access brand money to boost the influencers activity.

Competition between platforms to attract creators/ influencers is becoming intense and Instagram recognise that making it easier to make money on Instagram protects them. This is timely as Talent Agencies are professionalising the space - moving the best talent out of the Influencer agencies that have proliferated in the last couple of years. United are one of the top Hollywood agencies and have signed the family with two top teenage TikTok creators

Loyalty / Dialogue

It’s not that fashionable, what with Byron Sharp et al propogating the idea that new buyers are all that matters, but loyalty is due a come back.

The language needs work - as people are loyal to their football team but not to brands. And relationship seems a bit strong too - who would describe their choice of bank or supermarket as a relationship.

I have always favoured the idea of a Dialogue - using that term as the name of the highly successful digital arm of DLKW back in the day.

With the right permissions, brands can maintain a dialogue with their customers - as long as it adds value and each side recognise the customer can stop it whenever they want.

Done properly this Brand Dialogue makes the brand more important to that customer, and that customers more important to the brand.

Done properly it’s a great way to leverage the data to create a personalised dialogue - never treating your customer as a stranger. Target and Reebok have had some success with data driven programmes across a number of channels.

Smart DTC marketers are treating their customers as a network and looking at how they unlock the potential of early adopters who have shown enthusiasm for your product. And this good newsletter makes the point that the customer service team (customer success for B2B) have a crucial role as their knowledge of the customers is so valuable.

DTC brands can only prosper if they maximise their customer life time value. A smart Dialogue is the only way to do that. We need to remember the classic Seth Godin quote;

“Don't find customers for your products, find products for your customers.”

SMS

Lots happening with SMS. GaryV is using it for his Wine Club. Dirty Lemon has grown so fast with SMS only buying. The super smart EVP of newTV favourite Cheddar has quit to work on what she sees as the future of distribution, text-tech and SMS. And your favourite Celebs are moving from Twitter to a text based service called Community 

Who is doing this in Europe?

KidTech

Few people understand KidTech better than SuperAwesome and it’s quite likely that the tech they have developed without tracking, could be really useful for grown ups too. Their 2020 predictions make a lot of sense.

The way YouTube is responding to issues around tracking is causing issues for publishers - with one losing 50% of their revenue.

Etc ( because they are not all quick reads)

It’s so rare that businesses are open about their digital strategy and what works and what doesn’t. So this post from a Heineken exec is really good stuff. It backs up what I always say - if you can’t get digital to work, you are doing it wrong.

Our friends at Global have reimagined their DAX offering to include OOH as well as audio so brands can buy the two media together. Like the NBC initiative mentioned under newTV, it makes sense to have complimentary media traded together.

Smart thinking from Jeff Jarvis In Defense of Targeting

Clients who attended CES felt it was a good event in that the crowds full of smart marketers who are interested in what’s next, so a good place for Biz Dev conversations. Although no-one reached the heights of last year when our friends at a UK tech firm had Kanye turn up at their stand. And that turned into a fascinating project. More on that in the months to come.

But I am not sure CES is that good a place to see what’s next. Someone had a smart potato to make the point about pointless gadgets but this is a pretty comprehensive look at what was on show and worth reading.

McKinsey on the last mile logistics for 2030. Watch the video and you have to ask; what have they been smoking? The current melee on London streets with dozens of delivery vans isn’t feasible though and I do think we will see a hyper local play where you have all your deliveries go to a local shop and you arrange for that shop to deliver the lot when you are in. As included in our futurology video.

One tech trend I am sceptical over is autonomous cars. The change in behaviour needed to make them a thing feels unlikely to me. And the news that Drive Now / Share Now - the BMW / Daimler owned car sharing service - is pulling out of London seems to support that view. Giving up your car to rely on one parked on your Zone 2 London street feels like a baby step towards autonomous and we sold our Grand Cherokee to rely on a blend of Uber / Zipcar and DriveNow. But not enough others have.

Finally...The new App Annie report on the state of Mobile in 2020 is a great read. Lots of good data on how Mobile has changed how people live their life.

We never did have a Year of Mobile but we did have a Decade of Mobile


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