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Fix/Friday - September 11

Adtech & IDFA

Following last week's last minute announcement of a delay in the deprecation of the Apple IDFA , there are signs of a more conciliatory approach by Apple. The delay itself was welcomed as few are ready for the new regime, but no one thinks there will be any significant changes. But Apple will talk with a set of industry figures - led by the IAB in France - and the outcome of that conversation will be scrutinised.

I moderated a discussion around the implications of these changes at the AppCommerce event this week. Both Jay - the CTO of Poq - and Alex - CEO of Branch - had interesting thoughts on what happens next and good advice on how to prepare. Branch have shared a good note on what's happening and their advice is well worth considering. As is that of Adjust. Basically app owners need to take responsibility for getting their users consent, rather than leaving it to Apple. So the priority over the coming months is getting the consent for some form of tracking, by articulating the benefits..

The elephant in the room is whether Apple has any other plans. Apple essentially have two key constituencies that drive the health of the company. First the millions of people who pay $1000 for an iPhone. Privacy is important and plays well with these users. Second are the thousands of app developers who build the content and services that make an iPhone worth that substantial premium. The way Apple is choosing to improve Privacy hits them hard, in two ways.

All app developers need to drive downloads and digital advertising is far and away the best way to do this. But the demise of the IDFA makes that harder and more expensive

Most app developers need to monetise their content or service with advertising. The demise of the IDFA makes that harder and less lucrative.

So having created these problems for their loyal disciples, what do they do?

I think they ride in as the cavalry to save the day. With a context driven ad model. That they operate and control. And take a tax on. Some really smart people think along the same lines. Our friends at Arete posted this note in our Guild group and a more comprehensive report is imminent.

When you want to be a $3 trillion company you need new revenue streams. Especially when the 30% tax on the app store is coming under pressure from Epic and Spotify - and now Mark Zuckerberg;

The Benedict Evans essay on Amazon this week floats the idea that Amazon makes more money from ads than they do from ecommerce. Could ads be as profitable for Apple?

The idea of contextual ads doesn’t excite some. I think it has real potential and I liked this quote from Fix friend Joe Root, whose firm Permutive is pioneering the smarter use of 1st party data;

Could Apple offer smaller publishers a better way to monetise their iOS traffic? Do they need a better different tech stack? And a bigger sales team? I know of one (probably) going cheap. And whoever does buy Xandr from AT&T gets lots of inventory from WarnerMedia etc - and I saw research that Xandr reaches 26% of addressable homes in the US - more than anyone other than Ampersand - the cable companies sales house. That strength in newTV makes them more sellable. But it’s not really Apple style to buy these sorts of assets - maybe Microsoft wants to bolster their Bing business?

Get involved in our Guild group here to discuss this more - we now have 172 super smart people signed up.

Merchant

The new McKinsey report Reinventing Retail is a must read. It uses some of the survey data they have been publishing - and we have seen sharing - but goes deeper. One interesting fact was the gap between the talk of in store tech and the consumer experience;

A majority of shoppers said they haven’t encountered even the most talked-about or basic in-store technologies, and more than 35% reported zero exposure to any option

There is a need for less Press Releases and more simpler fixes. I believe people want to use their own tech in stores, so how do you make that easy? The QR code has a big role to play along with retailer apps.

No one is doing more to reinvent retail than Amazon - here they are partnering with US chain Kohls, building grocery stores within the Kohls premises. We have seen many retailers shrink their floor space as online sales take off, bringing in a complementary retailer to use the freed space. This subletting reduces costs and can increase footfall. The Tesco store at Surrey Quays now has a huge Next concession taking up a lot of their floorspace.

And Amazon have opened the first WholeFoods dark store in Brooklyn, with 100s of staff picking and packing orders, that Amazon then delivers across Brooklyn. Often less than 2 hours after ordering.

But it’s not only Amazon who can innovate. Swedish chain Lifvs has 19 unstaffed stores across rural Sweden - installed in a shipping container with a limited selection but open 24 hours a day.

TikTok

Getting slightly bored with all the rumours about TikTok? It looks likely the deadline will pass without any sign of a buyer. TikTok have a counter law suit, the Chinese are not going to be seen to be bossed around by Trump, who may well be gone in a few weeks. So I think nothing will happen - unless we have a second term of Trump.

And Snap founder Evan Spiegel has helpfully pointed out the pitfalls for any new owner

Bytedance have recognised the stress for their staff and are to give everyone cash bonuses. For their creators they have a number of programmes to engender loyalty, with one commentator saying

So it's business as normal. For our TikTok newsletter we keep seeing great ads (or TikToks) from big brands. This week Anthony and I celebrated the new ASOS campaign. Are you signed up yet? This nice piece of branded content with Campaign looks at how lots of brands like Nike Gucci and Heinz are using the platform.

The tool kit for brands is growing. Stitch lets you clip up to 5 seconds of someone else's video and integrate it into yours - with the original creator getting a credit. This is for everyone but clear opportunities for brands. Ecommerce is coming as buttons link to shopify sites and Teespring. They also now have a marketing partner program for advertisers now - learning from the Facebook playbook, this could be really powerful for both brand and agency.

Time to Experiment

Good reaction to my piece on experimentation last week. A Fix friend at a top Media Agency shared the Adaptive Experimentation framework which I hadn't seen before and looks super useful. I just heard a talk by Rory Sutherland where he argued - so eloquently - that a primary role of digital should be experimenting. He mentioned Nicholas Taleb Barbell Strategy which mirrors the McKinsey thinking - 80 or 90% in bankers and the rest in experiments that have significant upside.

Are you experimenting enough? What are you learning?

newTV

Our midweek deep dive on newTV was well received this week - we covered ad supported Netflix, Mulan & Tenet, Bundles and Adtech. Catch up here if you missed it

This is more good background on the Mulan release and the implications for cinemas. This Bloomberg piece concentrates on whether subscribers want to pay more for special content.

We mentioned a new Havas report on the UK marketplace which showed how the TV audiences is aging;

So it’s good to see ITV partner with Founders Collective to launch an initiative designed to find the talent that can create content that appeals to under 35s

newTV also encompasses social video - people can flick from Love Island on the ITV Hub to TikTok, YouTube and Instagram, all on the same device - and it’s all Telly to them.

This is a great piece on short form social video from a Disney+ product person - from TikTok to Reels to Tiller. And - in case you overlooked it on Wednesday - this look at Vertical video is a must read and do watch the Apple commissioned vertical movie Stunt Double

Fashion

One of the more resilient sectors over the lockdown has been fashion - at least in online sales. Google have seen an acceleration in some long-term trends: The end of seasonality in fashion, Online culture driving fashion trends and Reimagining omnichannel.

We have mentioned the growing synergy between art and fashion before. One example is the latest collection for Uniqlo with Basquiat art.And this is a good look at how Selfridges have used digital art over the past few seasons.

Plus

Great example of how to use personalisation to solve a real business issue - Aldi with Facebook ads informing people when their shops were less busy, powered by our friends at Spirable

Finally... Moneyness: Starbucks, monetary superpower. Perhaps the best example of a company truly embracing digital to improve customer experience and drive better revenue. If a coffee shop with minimum wage staff can do it, why can’t everyone else? We do a workshop going deep on Starbucks to show how they have accomplished this.

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