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Mobile Fix – March 31

Context Crisis

The Context Crisis continues – brand around the world are pulling money out of YouTube and analysts are predicting a drop in revenue for Google. Yet more evidence is emerging supporting our view from last week – that it is possible to mitigate the risk of the wrong context by buying better quality inventory. The Enders chart above shows the risk being taken when people buy cheaply.

If I buy a Greggs sausage roll it’s much cheaper than a Ginger Pig one. Why? Because the Greggs sausage has more crap in it. That applies to just about any market  - including media.

Buying the top 2000 channels on YouTube gives you around 70% of the reach of all the content. And you avoid most of the crap. Others think the tools needed are already here but just not being used properly. Smart brands were paying more and avoided the quality issues.

The fact much of the conversation now revolves around getting discounted access to premium content validates this.

Chase Bank in the US saw they had a problem and on investigation found their ads were on 400k sites. Only 12000 sites drove clicks so they had someone look at each one and now they advertise on just  - just ? – 5000 sites. The effect of this dramatic reduction? Apparently nothing. As one commentator puts it why doesn’t WPP – and the rest  - try old fashioned media planning?

As Rahm Emanuel used to tell Obama, one should never let a good crisis go to waste and it’s likely that out of this debacle will come better digital plans. Clients will scrutinise their media buys more carefully and Google etc will hopefully prevent the creators of this odious content from being able to monetise it at all.

And we might finally get to think about the important metrics – the ones that point to success. Clicks are a distraction and very likely to be mistakes; Fat fingers. Reviewing bounce rates for buys we often see up to 70% of clickers hitting the back button. Brand metrics are a much better measure of success and enable some comparison with trad media. Store visits are getting easier to measure – and to buy against. And the ecommerce people are getting better at attribution – from the click and the view through.

On the Agency side this crisis might serve some peoples agenda too – with tools like OpenSlate agencies can offer better insight on where ads appear – and the data inherent in this service helps them better understand Google and YouTube.

But whilst trad media have seized on this and offer themselves as a safe harbor it’s not really a digital vs trad debate – it’s about quality content. And premium publishers, who have suffered as money went to the cheap alternatives, should see a reverse in their fortunes.

But the controversy isn’t going away. The Guardian is to sue programmatic giant Rubicon for not disclosing the fees it charged advertisers buying Guardian inventory through them. They plan to defend the action and its likely civilians will learn quite a lot about the nuances of this business. Not sure that will ease concerns.  And Nasdaq are to enter the ad market using their tech to bring Wall Street process to media buying. Media is an inefficient market and these new techniques will keep coming. US Banks are fighting with ad tech companies over customer data and US Mobile operators have been given free reign over their customers data.

One of the intermediaries has jumped into the debate with a headline chasing quote, saying 60% of programmatic spend is wasted. We would tweak that to say that maybe 60% of brands are wasting their programmatic spend as we know many who are getting great results.

The question for brands is to work out how to get more than their fair share of value from this new ecology. And who can they trust to advise them?

This week we heard brands call for the end of the word digital and ask for more straight talking – we would echo that and remind you of the quote we always use, from Jazz great Charlie Mingus

Making the simple complicated is commonplace; making the complicated simple, awesomely simple, that's creativity.

We are always happy to help with an independent point of view.

Mobile Ads

A key component of making digital media more effective is getting the creative right. Our friends at OnDeviceResearch and at Celtra have collaborated on a new study on what makes an effective ad. They found the top 20% of ads performed up to 6 times better than the remaining 80% and have 10 common sense suggestions. Well worth your time.

And there is a new format on Facebook that some brands are trialing. The collection unit combines a video with fast loading product pages – effectively bringing the instant articles experience to ads

Al our work with consumers shows they hate slow loading pages and are quick to hit the back button if they don’t see immediate progress. With Instant Articles and the Google AMP initiative we are seeing improvements to the User experience and if these can be applied to ads that’s a good thing.

But it does mean that these two behemoths control your traffic, your user experience and, with their analytics, have a very good view of your business. Brands should be investing more in better user experiences on their destinations; most mobile sites are pretty average still.

Snap have been a major factor in raising the bar on mobile creative and they remind us that a key part of getting creative right is to make it fit the platform. What works on Snap for example probably doesn’t work elsewhere and bespoke is the best approach. The additional production costs are more than covered by the improved performance. And using ads repurposed from elsewhere will almost certainly limit performance. Just say no to running TV ads in mobile.

Amazing Amazon

The pace of news stories from Amazon is amazing, We see new products and launches all the time. Just this week we see they have entered the tickets market  - adding value to what they offer their Prime customers and it does feel adjacent to their music and video business.

Lots on retail too – they have big ambitions for physical stores and doing lots of experimentation. Real world AR stores for furniture and electronics. One of the most interesting things about the company is that as they fix their own problems, they offer their solution to the market as a whole. That’s how Amazon Web Services started.

Over the past few years Amazon have realised that phone based service is usually better than online service and they have encouraged customers to talk with an adviser rather than swap emails. They developed their own systems to do this and now anyone can set up a cloud based contact centre in minutes.

Their core business has created some very wealthy people but the mechanics of selling on Amazon is more complicated than you might imagine. This look at the high frequency price variations is fascinating.

But The Economist thinks the company is just getting started

Content & China

Chinese Apps offer to trade knowledge for cash – with celebrities sharing their thoughts in paid for podcasts. This FT piece gets into detail on a number of the key players in paid for content. Lots to learn here.

VC Jason Calcanis is bullish on podcasts too – predicting that an HBO of podcasts could be a billion dollar company

At the other end of the scale in content – movies - the Chinese are big players too. If you have seen the current blockbuster Kong you may have noticed that Tencent has a big credit and that a Chinese woman has quite a lot of screen time  - if not much dialogue. I guess on the Chinese edit she gets more to say. This is a good look at how Tencent is investing in content – and even suggests they could be the next Disney.

It’s the same logic as our view that GAFA will be big layers in content – if you have that audience you need content to ‘feed’ them. It’s easy to monetise premium content. And you can’t risk someone else having exclusives that could lure away your users.

Quick Reads

Tencent are also into cars, buying 5% of Tesla

GDPR and privacy regulation is going to shake up everything over the next couple of  years

The new Apple Clips app is getting a good reaction and we think it’s a hint of what’s to come with the next iPhone, where AR seems likely to feature. Some analysts think there is a lot of pent up demand for a new iPhone and have upped their price estimates

Facebook stories are here – thanks you Snap

Finally - a good interview with the cofounder of Essence  - the smart Agency with Google as a client and was recently bought by GroupM. Well worth a listen.

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