Following our mention of the NYTimes subscription strategy last week it is interesting to see their subscription revenue is growing at a similar rate to GAFA ad revenues. Now a lot of that is driven by Trump and the desire for real news, but it is testimony to a strong brand.
In a post GDPR world we do see that strong media brands are most likely to get consumer consent — even if not a full subscription — and both our friends at the Guardian and the Telegraph are executing well here. But the Europeans are making more progress with the idea of unified login
Another trusted UK media brand has new owners; Time, the magazine company formerly known as IPC, has been bought by a private equity firm They have made the transition to the digital age better than most and the way they monetise their content in social is really impressive — hopefully the new regime will enable them to innovate even more.
Voice & Audio
The Spotify IPO is finally announced and the valuation has raised some eyebrows. But their asset is over 70 million subscribers; people they have a direct relationship with and that send them money every month. What else could they do for these people?
Their ad business is probably their first business extension and as the market expands they — as the biggest player — will do disproportionately well. Pandora are going programmatic and the UK firm Audioboom is taking over Triton to grow their podcast ad business. We don’t quite agree with Xaxis that audio is the best bargain in advertising, but it does have a lot of potential.
Whist Voice service don’t have ads — yet — we do see Alexa etc as related to audio and this piece on the impact on retail is interesting — referencing an OC&C report showing a huge proportion of Alexa users have bought through it. Amazon continue to try and improve Alexa so we are still in the early days.
We heard that there wasn’t much talk of Alexa at MWC — which given how much there was at CES is surprising. One Lenovo laptop will have Alexa baked in but with Apple and Android having their own dog in this fight, the mobile options for Alexa are difficult. They need an Amazon phone
Live by the sword die by the sword. Cosying up to celebs and influencers doesn’t always work out and having Kylie Jenner suggest you are old news hit the stock price of Snap hard. The real problem seems to be user resistance to the new redesign, though Snap shows no sign of backing down. But when you dig into the details the impact wasn’t as bad as it looked. And the new design seems to be having a good effect.
The opportunity for Snap continues to be their better understanding of the young mobile user and their ability to translate that into new products. Essentially Facebook and Google have desktop products that they have ported to mobile really well. Snap is native to mobile and things like their Map demonstrates this.
More interesting to us though is their move into mcommerce — with Nike selling trainers straight from Snap ads. Lots of potential here.
Mobile World Congress
I resisted the temptation to go to Barcelona for MWC this week and it doesn’t look like I missed much. It wasn’t even nice weather. Most of the news was about new devices and the BBC picked up on the point we have been making for years — they all look alike.
We have seen overall global sales slip as people delay replacing their old device and in Asia we see people choosing to buy Chinese brands rather than iphones. With any fashion item there comes a point when it is just not cool to pay top dollar for something everyone else has.
As we get closer to our New York event on newTV we are working with the speakers to fine tune content. Events keep validating our choice of topic; Comcast moving for Sky — and the reasons given for the interest — show how the tectonic plates of the business are shifting. The Comcast CEO warmed to the idea when a London cab driver told him about the Sky Q box. Who needs expensive Investment Bankers and consultants anyway?
One of our speakers thinks traditional TV is underpriced and that new methods of attribution will consequently drive up prices. I can’t see that myself. One thing we do suspect is that the cost ceiling for Facebook ads is driven by the cost of buying broadcast; is a premium for Facebook justified if you are using it for mass reach? We would argue the targeting — and the ability to have that shape the creative — make Facebook more valuable. But as Facebook push for the long tail advertiser who have more discreet audiences, and often geographies, they can charge more — as long as the ads keep working.
This is a good look at the issues in attributing traditional TV but some people do this with some success.
GAFA & Ads
Building on our Good Ad Bad Ad piece last week, this in depth look at Facebook ads on the Trump campaign is a must read as it’s a good summary of what is possible on Facebook with custom and lookalike audiences etc. It’s also worth looking at how Facebook have been quick to deny Trump paid less for his ads.
The intricacies and nuances of Facebook are where the real value is and the new changes to metrics illustrate how fluid the platform is. Are you getting a clear picture of how your money is being spent on social?
It is not just the complexities of Facebook that deserve your attention. This look at how the YouTube algorithm works is fascinating.
The Walmart CEO shares his thoughts on the future of retail but the video of retail in 2027 is a little uninspiring — all the trends mentioned are happening now and the idea it will take 10 years is nonsense. Most will be mainstream in 5 — and before that in the big cities
And any look at retail requires a good look at Amazon. The link to the tips on amazon ads was wrong in last weeks Fix — this is the correct one. One interesting tactic is Amazon microsites where the brand can drive traffic to their store within Amazon — but no-one has made it work well yet.
The latest Criteo report is a must read for anyone interested in online commerce. They have such a big footprint their data is compelling. The clear message is how strongly apps perform — but we wonder whether the fact apps tend to be used by existing customers — and mobile sites by new ones — has some effect on the data? Lots of good data also supporting our theory that the UBERfication of retail stores has huge potential.
Whilst it’s still hard for business to understand quite what will and won’t be possible under GDPR the regulator is planning a campaign to educate the public about the new rules. With our glass half full hat on we should think about the positives that the new legislation may bring. Driving out the poor use of data has to be a good thing — for consumers and for businesses that are wasting money in this way. This is clever thinking on how people might use the portability of data in a positive way. But most businesses still feel under prepared.
With GDPR comes the right to ask what data is held on you — and GAFA aren’t shaping up that well according to the FT. But to give some idea of scale Google have had over 2.4 m requests for data to be deleted over the past 3 years
Whilst most of the press Facebook get at the moment is around the negative views about them, we shouldn’t forget their ambitious plans to connect everyone. At MWC they announced new initiatives to spread internet connection with partnerships and new technology.
In all the talk of big data some lose site of the basic math that is needed to gain useful insight. Statistical significance is crucial and a Fix friend shares smart thinking about how to use this.
The clever people at the IAB have identified people as having their Personal Prime Time with digital. I love this concept and it feels related to our enthusiasm for context.
Pinterest are building their ad team out. A smart Fix friend is leading the creative and innovation team and now they have hired a heavyweight COO with lots of ad experience
Some interesting thinking about how Consultancies could move into media faster with some clever M&A activity. There are some very good companies on this shopping list.
Finally — we spend a lot of time talking about our model and approach with new business prospects. And we have realised that what we are selling — and what people really want to buy — is growth.Being very good at media and having a real understanding of creative is obviously important but it is also table stakes — or should be. This piece goes a stage further and talks about how agencies should be selling outcomes. Very interesting
Whats cooking at The Media Kitchen?
Still all about kissing lots of frogs and hoping to find Princes. New Business never changes.
We have a new business pitch in Milan today — snow permitting. Could your brand do with some fresh thinking?
And one of my smart colleagues has nailed how agencies should handle tech; as trusted advisors rather than vendors. Do you have the right tech stack for your business? Or is it the one that suits your agency?. Do you have the right tech stack for your business? Or is it the one that suits your agency?
Fix is my thinking rather than that of MediaKitchen. We now have over 5600 subscribers across Google, Facebook, Snap, Yahoo etc as well as many VCs, Brands and Agencies.
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