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Mobile Fix - November 2

The original sketch by Architect Frank Gehry for the majestic Louis Vuitton Foundation in Paris

Agencies & Brands

So much news about agencies and little of it good. The latest ANA reports celebrates inhousing and says most (US) brands do it and most are satisfied, with cost efficiencies the main benefit. Now the media world knows, better than most, that cheaper doesn’t always mean better.

When you dig into the report the areas where inhousing is happening most are relatively new; content marketing, influencers, experiential and data and analytics. And 30% claim to do some programmatic inhouse. So the classic Agency skills ( those that Don Draper might recognise) remain something that clients value from Agencies.

We have always like the Architect / Builder model. The clever thinking sits with the Architects in an Agency and the Building gets done by whoever can do the best job at the best price. That often used to be freelancers but now may be an inhouse team. Great architects really understand how things get built, so get the most from their builders.

The driver for inhousing is usually the CMO and at an ANA event Terry Kawaja called for companies to fire their CMOs as the new rules of marketing are being written by the DTC brands. Mark Pritchard (CMO of P&G) unsurprisingly offered a different point of view. But both accept there is a new playbook. And CMOs are moving around more than ever - a headhunter calls 2018 the year of the CMO shuffle.

So you have to ask; Are you getting the best advice? Facebook are creating a new set of marketing consultants to help, as they see Agencies struggle with the pace of change. Many in the industry still hanker for the good old days.But those who get the new Playbook are seeing real growth. Do you need some Architect thinking?

Signals

We suspect that a key issue over the next few years will be around privacy; how ones data is used and by whom. With Tim Cook talking about the weaponisation of peoples data last week the debate is getting heated. This week a Guardian article talks about how the online business model encourage prejudice - using the example of of ads targeted by gender. What we in the industry see as efficiency - showing ads to the people most likely to respond - is seen as discrimination by some.

Now targeting isn’t new. Back in the day the flexibility was less - but if you were interested in a job in Media or Teaching you needed to read the Guardian on a Monday or a Wednesday. The Sun never got any of those job ads.

Our collective responsibility is to use these new tools to make the user experience better - so more relevant ads and less lazy retargeting. As those Mary Meeker charts on Facebook ecommerce ads show, click through rises as people are shown ads they like.

Improving tracking can facilitate this better user experience. But the lack of common tools hinders this - it’s still too hard to recognise if someone on Google that has seen your ads 3 times is the same as the person on Facebook who clicked the first time they saw it.

With Apple restricting tracking Google are introducing new parallel tracking procedures, which should speed up sites. But we seem no closer to a universal ad ID although TradeDesk are having a try.

There are significant innovations around - as Amazon allow brands to use search behaviour as a signal for ads outside of Amazon owned and operated sites- as long as you use the Amazon DSP. This way to harvest intent is really powerful and the only issue is the lack of video formats.

newTV

The challenge with newTV is it’s diversity of channels, content and formats. We’d argue that watching a Netflix show, a YouTube video, a Facebook Watch show and binging a BBC blockbuster all fall into newTV. And all eat away at the attention devoted to Trad TV.

But working out how Brands can make the most of these new behaviours is hard. Video on Facebook and YouTube work well. There are new techniques, like our pals at Mporium enabling syncing of search and social activity with rivals TV ads. The new opportunities from Netflix and Amazon are on the way. And OTT is at a stage where you can use Signals to drive ads on the big screen too. But it’s complicated. A new US service called D2CX cuts through this, letting you take a modest budget and spent across 135 different TV services. It is designed for DTC brands looking to scale and we will be watching with interest.

Measuring across all the options is equally complicated and a recent event saw the old and new sides of the industry discussing this. No resolution though - but in Germany YouTube will soon be measured alongside TV.

On the content side lots going on too - this guide to new shows across Netflix and Amazon shows the quantity and the quality. And Snap have announced new UK partners makingTV like shows to be featured within their app. Given they are not funding production and sharing ad revenue the risk is all with the partners.

In China we see a new business model for movies - a mobile service showing brand new movies inside the traditional windows- ie at the same time they are in movie theatres. This remains a major issue in the West where the theatre owners have managed to preserve the Windows they see as crucial to their business model. The content producers would love to see more flexibility and will watch the Chinese service with interest.

Dollar Dollar

Lost of quarterly results are out and mixed news. Last week Amazon and Google underwhelmed wall Street. This week though Facebook impressed. Looking at the slides from the results call, DAU are flat in the US and show a very slight decline in Europe. For both DAU and MAU the other regions have enough growth to keep the number going up but it looks like we are close to Peak Facebook. But there is no sign of the sort of decline the Pew research a few months suggested.

Snap numbers disappointed - with DAU dropping slightly with further decline expected in Q4 as their Android app struggles. But they did show good revenue growth.

It’s worth looking at the results from Criteo to see the effect of GDPR and Apples new tracking restrictions. Revenues fell by 5% and they announced the acquisition of a mobile app business as they try and reduce their exposure to cookies and use device Ids more

No-one in Digital seems impressed by the idea of taxing the digital giants - European digital businesses worry they will bear the brunt of this. Some movement is inevitable, as the climate seems to be shifting to regard GAFA as a problem rather than an opportunity.

Retail

More experiments from Amazon around fashion. Wardrobe send you up to 8 items for free and you just pay for what you decided to keep - with a discount for buying more items

Snap is partnering with brands to make retail sales - snap the Snap code on a Levis item and buy it through the Snap app. Not sure this solves a problem for anyone but Snap want to play in commerce. A NYT piece on stores being more than just retail is interesting but misses the big point on Brand Cathedrals; places you go to worship a brand.

They don’t have to be high end - Nike and Primark on Oxford Street both qualify. In Paris last week we saw some great examples; the Nike concept store has great staff, Comme have their trading museum and the Dries menswear store right on the Seine is remarkable

Quick Reads

There is an interesting theory that Spotify is doing a Netflix and dominating the music business. I am not so sure - Apple, Amazon and Google all see music as vitally important as an Anchor for their other businesses. It is more likely that the future growth of Spotify is in video and other content.

Chinese app firm Bytedance have closed their raise, which values them at $75billion. As well as being one of the top downloaded apps globally TikTok now has the honour of a Facebook copy

Good work from the IAB on shoppable video ads. Our friends at Spirable are having great success with their shoppable instagram videos

German broadcaster ProSieben has bought dating site eharmony. They have already evolved a dating TV format into a matchmaking business.

Doubleclick defined the online ad industry for a long time and this history of how it grew out of an ad agency to be a Google subsidiary is a good read. As one of the founders of Poppe Tyson in Europe lots of the story resonates with me.

Finally… more evidence that the lustre of GAFA is wearing off. The people of Stockholm have vehemently refused Apple permission to build a store in one of their parks. And it seems people is Silicon Valley don’t let their kids use phones.

Fix is my thinking rather than that of MediaKitchen. We now have over 6000 subscribers across Google, Facebook, Snap, Amazon etc as well as many VCs, Brands and Agencies.

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