There is an old Management Consultant cliché that people manage what they can measure. Nowhere is that more true than digital media – where the initial promise was of true measurement of actual behavior versus old media reliance on panels and claimed behavior. But as we all know that didn’t work out that well.
Everyone knows how to game the system and too many people continue to obsess about meaningless stats; clickthough for example, where fat fingers usually outnumber intended clicks. And many ignore salient ones, like bounce rate.
Fix Friend David Wilding of Twitter nails it in this piece arguing how important blending media and creative thinking is – and that we need to consider more than just reach – but also impact and context;
We need to recognize that smart hunches are also still really useful. We helped Google tell the story of their work with Hertz for an IAB event a while back and loved that the client had decided to count all bookings made in under 1 minute as mobile inspired. Because unless you have researched before, it’s virtually impossible to make a booking that quickly.
But God is still in the details and this look at Cohort analysis reminds us that it is possible to learn lots by really getting into the detail. Ask around in your Marketing Stack and see who is doing this sort of work for you. If you don’t have someone who is this focused on detail, you don’t have the right team/partners.
As we have discussed before, there is a real business advantage emerging here. A key factor in a content owner choosing an ad network is fill rate; do they have enough volume of ads to fill all my ad opportunities? Of course the CPM is crucial but if only have the ads get filled, the revenue per thousand is half the cpm.
Speed takes this a step further. You often see ads loading late into mobile pages – or not showing up at all. Increasingly this latency will be picked up by viewability tech and the advertiser won’t pay – so the content owner loses out on the revenue.
If you can combine a good fill rate with faster loading ads, the content owner maximizes their revenue.
Talking with some people from Financial Markets who are entering ad tech confirmed our view that the current plumbing is too slow. They talk in micro seconds whilst ad tech labours over milliseconds. As the revenue opportunity opens up, we will see speed become more and more important - as it has done over the last 30 years in Financial Markets. Read Flash Boys to get your head around this.
GAFA & Content
We are learning more about Facebook plans for video. The rumoured Baseball games deal has been confirmed and they have deals with Buzzfeed, Vox and others to provide shows that will – initially - be exclusive to Facebook. These shows will be from 5 to 10 minutes long and some that are 20/30 minutes long.
Reuters report that Facebook are paying $250k for the longer shows – which they will own - and between $10k and $35k for the shorter ones where they will share ad revenue with the show creators. Clearly testing lots of models to see what works best for all parties
As well as building out the Video offering, these shows will provide Facebook with ways of running mid roll ads, easing their Ad Load issues.
This Variety piece looks at the way Snap are approaching Video – with Elizabeth Murdoch focusing her slate of shows just on Snap at the moment. Other providers include NBC (an investor in Snap), BBC, Discovery and many more. What is really interesting is that the Snapchat Shows are not just short, captioned, vertical videos. They are constructed from the fabric of Snap, as they are actually a set of Snaps – the atomic unit of Snapchat that last up to 20 seconds.
Early signs are that these shows are being successful – 8 million views for the start of The Rundown (although these metrics don’t compare to TV metrics). UK Copa90 have had a big success with their football show Saturdays are Lit on Snap. And with talent like James Corden signing up to create a new show for Snap their pipeline is good.
Amazon are extending their Prime TV service to include live content from ITV, Eurosport and other channels, for an additional monthly charge. In the US the equivalent offer includes channels like HBO, but Sky deals preclude this in Europe. We wouldn’t be surprised to see BT on this platform before long – they showed the Europe League Final on YouTube.
Learning lots about retail as we prepare for the Google event I am keynoting soon. Inevitably Amazon features heavily and with the UK registration of the trademarks they use for their Go format it is being rumoured an opening is imminent. Registering trademarks is just good business sense and we think Amazon will continue to experiment in the US before opening stores over here. Their latest book store has opened in New York and it’s actually pretty traditional.
The one thing we see from all the instore gizmos is how little people use them. The one piece of tech that dominates retail is the customers own smartphone.
But what is clear is that operating both offline and online can be an advantage. Walmart online sales are up by 63% helped by the ability to collect online purchases from your local Walmart store. Warby Parker have just 8 stores but plan to open more as they achieve amazing sales per square foot – $3000 - getting close to Apple. And their new App beautifully demonstrates how brands can add real value by solving a consumer problem in a way that solves a business one. By letting you test our own eyes, Warby remove the need to go visit one of their high street rivals. Is Branded Utility back?
We have also been digging into loyalty and offers – and the new Facebook Rewards looks really interesting as it’s a great way to combine offline and online. It is also more proof that QR codes are back.
If you are interested in a deep dive into retail – and O2O - let me know.
A couple of smart readers pointed out (nicely) my schoolboy error on the amazing growth of Amazon in last weeks Fix. The stock has increased in value 1000 times, which is of course 100,000%. We’re going to need a bigger calculator.
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