Tag Archive: digital advertising

  1. Is the future all talk?

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    For 100 years, radio dominated audio media, entirely unchallenged. It still attracts the lion’s share of listeners and therefore advertisers: 92% of Americans listen to AM/FM radio every week – more than TV viewership (87%), PC use (54%) and smartphone use (81%). However, its dominance is becoming less certain with the rise of podcasts and now, social audio. So what does the future of audio look like?

    The impact of the pandemic on our listening habits

    The pandemic has had an impact on the way we live our lives, and that includes our listening habits. Despite fears that radio listener numbers would crash as commutes turned into 30-second walks to the kitchen table, in many countries, numbers increased as people turned to this trusted medium for information, comfort, connection and entertainment. In the UK, 40% of people working from home listened to the radio for an extra two hours and eight minutes a day. However, there is a belief in some quarters that, despite this increased listenership, advertising may have suffered because of radio’s great reputation for brand-building: amidst the hardships and budget cuts of the pandemic, marketers have been under pressure to deliver short-term sales results at the expense of longer-term brand-building ambitions.

    Podcasting followed an interesting trajectory over the course of 2020. Podcast downloads decreased by 10% when the US went into lockdown, and it seemed that the pandemic was threatening to throw off podcasts’ meteoric rise. However, as people adapted their routines, download figures recovered and are even improving. The top 10 US podcast publishers saw a 20.6% increase in downloads in the summer of 2020 compared to the previous summer.

    2020 was also the year that saw the rise of ‘social audio’: with people seeking connection but sick of screen time, social audio apps came on the scene, offering the ‘Goldilocks’ of connection – not too much, not too little, but just the right amount. But more on that later…

    Ad dollars are following ears

    More and more people are listening to podcasts: about 41% of Americans aged 12 and up now listen to one podcast a month, compared to 37% in 2020 and 32% in 2019. Ad dollars have inevitably followed: IAB PwC estimated that US podcast ad revenue would increase by 14.7% to near $1 billion in 2020, despite the pandemic. In 2020, 37% of marketers said they would likely advertise in a podcast over the next six months – compared to 10% in 2015. The highly engaged audiences that podcasts enjoy have shown a propensity to take action when hearing an ad, which is of course very attractive. What’s more, digital audio has the great advantage of not being reliant on cookies in the same way that other digital channels are. It offers other, privacy-centric ways of targeting listeners, such as topic-based targeting – indeed, this type of contextual targeting is likely to become more common across other digital channels after the death of the cookie.

    That said, it is difficult for marketers to track which users end up purchasing their products after hearing a podcast ad. Many are hoping that Spotify and the other podcast platforms will develop a pixel tool, similar to Facebook’s, which will be able to track user activity across the platform. Podcast platforms are aware that marketers need more tools if they are to continue growing their investments in the platform. This awareness has led to acquisitions such as Spotify’s purchase of Megaphone, a podcast ad tech company, in late 2020 in order to expand its self-service advertising platform. Megaphone claims to be able to target ‘types’ of users, so only listeners who fit a specific demographic will be served an ad.

    Social audio – the new kid on the block

    With the popularity of social media and podcasting, it was perhaps only a matter of time before someone created ‘social audio’, where people connect through conversation. The pandemic was the optimum time for these chat rooms to take off, with people yearning for connection but fed up with their screens. Clubhouse is making waves with conversations that people can sit in on or participate in, and its success has spurred established platforms like Twitter and Facebook to create their own equivalents. Twitter’s Spaces and Facebook Rooms are still in the beta phase.

    Clubhouse is, so far, ad-free and seems to actively discourage hard-selling. This means that working with the app’s influencers to create relevant, interesting conversations is the best way for brands to share their messaging with users – and has the added benefit of reaching people who have chosen to be in the room. However, as the social audio apps mature, it’s likely that advertising will become more prolific, as happened with the social media platforms. Experts predict that the explosion in social audio platforms will lead to a secondary explosion in analytics and marketing tools that will help influencers and, most significantly, brands understand their reach and impact in the social audio space.

    Digital audio: the new frontier

    Digital audio is the new frontier in advertising, with plenty of opportunities to engage with interested, relevant audiences. There is still some way to go in the development of tools for marketers to understand the impact of their investment, but they are in the making – this is not a space to be overlooked.

    The future may not be all talk, but there will definitely be more talk.

    Header image: atk work / Shutterstock

  2. Clear history: Google confirms its plans to kill the cookie

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    In a blog post released on March 3rd, David Temkin, Google’s Director of Product Management, Ads Privacy and Trust, confirmed that Google would be killing off the cookie, as early as January 2022. He also clarified the tech giant’s plans for targeted advertising and a ‘privacy-first web’. The tech, media and advertising industries have all known this is coming – Google first announced that it would be stopping support for cookies on Chrome back in early 2020, and it is not the first browser to do so. However, the blog post has got everyone talking about Google’s search for alternative solutions to targeted advertising, as well as proposals from other players. So what does it mean? And where will it leave advertisers?

    Why is Google stopping support for cookies?

    Google, like the other tech giants, has come under increasing scrutiny and regulation around the world, with regulators and lawmakers looking very carefully at the company’s privacy and antitrust record. Indeed, two hires that the Biden administration recently made would appear to confirm that the US will continue to robustly enforce antitrust laws and other regulations. What’s more, there is a prevailing and increasing sentiment amongst internet users that they are worried about their privacy: in research conducted by Pew Research Center in 2019, 79% of American adults reported being somewhat or very concerned about the way their data is used by companies. It’s also as simple as a change in consumer habits: in the third quarter of 2020, mobile devices (excluding tablets) generated 50.81% of global website traffic – a share that has consistently hovered above the 50% mark since the start of 2017. Mobile browsers and apps don’t accommodate web-based cookie tracking as effectively as desktops, so there is a hole in advertisers’ ability to target their users.

    What is Google proposing as an alternative?

    Google’s statement earlier this month and the ensuing debate makes it clear that the industry is still only in the early stages of redefining how the online media market will work when the cookie becomes defunct. There is still a lot of uncertainty, and the industry is in a period of frantic experimentation, urgently seeking the best way to effectively target consumers with advertising.

    In his blog, Temkin promised that Google would not implement new ways to track individual users around the internet, and vowed that the company would only use privacy-preserving technology that relies on methods such as anonymisation and aggregation of data. Google’s Privacy Sandbox initiative, which is seeking ways to protect privacy whilst allowing content to remain freely available on the open web, has plans to start testing one proposal with a group of advertisers in Q2 of this year. This proposal would group internet users based on similar browsing behaviours; only cohort IDs, rather than individual user IDs, would be used to target them. This approach is based on the same principle as Facebook’s, which offers advertisers the opportunity to target ads to certain categories of users based on their data. Google will be keen that this proposal is workable and appeals to brands, as marketers are already diversifying their ad spend up and down the funnel.

    Other players are exploring targeting alternatives as well

    It’s not just Google with skin in this game: other collectives and ad tech players are also seeking ways to balance privacy with personalised, targeted advertising. A major collective formed last summer, called the Partnership for Responsible Addressable Media (PRAM), has brought together the IAB Tech Lab, the WFA, major advertisers like Ford, Unilever and IBM, media agencies, tech vendors and publishers. PRAM is proposing relacing cookie-based tracking with tracking tied to individual email addresses, whereby a user would log into a participating site with their email address or phone number, which would then be scrambled and used to keep tabs on them as they navigate other participating sites. Google has called this email-based approach impractical, and claims that it wouldn’t meet ‘rising consumer expectations for privacy’, or ‘stand up to rapidly evolving regulatory restrictions’ – and therefore wouldn’t be a sustainable investment in the long term.

    Even taking into consideration Google’s motives for casting doubt on whether cross-site individual tracking will meet consumers’ and legislators’ expectations and therefore the wisdom of investing in such a targeting methodology, the tech giant isn’t wrong in its conclusions. Many view this as a bold act by Google – they are soberly letting go of bad habits while others are just trying to cut back on the worst parts and hoping it will be enough. Perhaps Google’s statement was in fact the most helpful thing that they could do for the industry as it approaches this crossroads, pointing out that what they are trying to do won’t work, and they need to start over.

    Industry experts aren’t yet sold

    While some industry experts and commentators believe that Google’s Privacy Sandbox proposal would be an improvement on the current, cookie-supported situation, others are yet to be convinced. They claim that Google is just swapping one form of invasive tracking for another and could, for example, work out who a user is by cross-referencing their information with an email address from one of Google’s owned sites.

    They are equally sceptical about the email address approach, pointing out that it would be easy to ‘reverse-engineer’ a user’s identity by combining scrambled information with other information available in the public domain.

    What are the implications?

    The implications of Google’s announcement are still unclear, and the situation will continue to unfold over the coming months. It’s safe to say, however, that we will never see anything close to the breadth and width of tracking coverage that cookies have given marketers over the last 25 years. It is thought that the demise of the cookie will affect 85% of online advertising as we know it. New solutions will come from a wide range of different sources and approaches, so will be fragmented. What’s more, a large share of online traffic may not be identified at all; outside walled gardens, contextual targeting is likely to become the main tool. That isn’t necessarily a bad thing – it offers marketers the ability to deliver ads to consumers when they’re in a specific situation or frame of mind, which can only be a positive as consumer behaviour becomes more fragmented and unpredictable. It’s also an antidote to many of the issues around brand risk and safety.

    It’s worth bearing in mind that, just because the ways in which we manage reach, frequency and targeting are being fundamentally redesigned, it does not mean that people will radically alter their media consumption patterns, or that there won’t be any ways to target people online. Large sites with good user experience and consumer trust will retain their traffic and they will still be open for ads, even if impressions are anonymous. Ad impact on brand metrics and sales will remain, even when conversions can no longer be tracked. As Google said in their statement, ‘advertisers don’t need to track individual consumers across the web to get the performance benefits of digital advertising.’

    How should advertisers prepare and adapt for the post-cookie era?

    For now, advertisers need to understand which tools will be lost, which will remain uncertain and which will not change. They should also keep their ad tech flexible and rely on their media agencies for guidance and updates. This is probably not the best time to be investing in ad tech or in-housing.

    Looking ahead, even when data outside of Facebook and Google’s walled gardens is scarcer, advertisers should not resort to increasing their spend with these two platforms beyond what is proportional to media consumption patterns. They should also refrain from resorting to last-click attribution as view-through conversions tracking and MTA fail. Survey-based data and insights on brand metrics will undoubtedly surge.

    Many advertisers are, rightly, focusing on their valuable first-party data, exploring ways to leverage it in order to make better-informed advertising decisions. Many will seek to work with partners to establish a data-exchange from different sources, including with the walled gardens. Marketers will also be able to integrate their consumer research with their first-party data, giving a clearer picture of what consumers do, and why they do it. This will in turn allow them more effectively target audiences with the best messaging in the best context.

    The key takeaway? Hold tight – there’s no need to panic or do anything rash. Alternatives are being worked on and anyway, a world without the ability to track your consumers across the web might not be such a bad place.

    If you would like to discuss how you can prepare for the post-cookie era, please feel free to contact us:

    Header image: atk work / Shutterstock

  3. The Upfronts: Is the old ship slowly changing course?

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    Our US Business Director Victoria Potter explores how the Upfronts format might finally be changing – and why that’s good for advertisers. 

    How did the pandemic affect the Upfronts format?

    A few months ago, I questioned in another of our ECI Thinks posts whether the pandemic would force through seismic changes in the Upfronts landscape. There has been a growing appetite for such changes in recent years, but it takes a lot to change the course of a huge, 60-year-old ship. Then the global coronavirus pandemic came along, and it seemed like the kind of storm that could expedite that change in directiontransforming consumers’ consumption priorities and their paths to purchase, and therefore affecting the media strategies of B2C brands. 

    But the change in direction didn’t happen as we anticipated. The Upfronts went ahead, and many advertisers bought their inventory. However, there are now indications emerging that some transformation is on the cards. Marketers are demanding changes to help them cope with the uncertain environment: 

    • Increased flexibility: Advertisers feel more comfortable committing to longer-term deals if there is greater flexibility and more options available to them 
    • More streaming: Many vendors managed to keep their revenue flat (rather than dropping) thanks to a shift in investment from linear to streaming. Streaming now accounts for one-third of ad dollars invested in TV. 

    Just a couple of weeks ago Marc Pritchard, Procter & Gamble’s Chief Brand Officer, declared that fundamental changes must happen, and must happen by next year. This is particularly important because P&G is such a key player in the Upfronts, and indeed has been a driver of the ‘FOMO’ (fear of missing out) that other advertisers experience, and which has been fundamental to the continued existence of the current format. Pritchard said the Upfronts are ‘inconvenient at best’ and that the system must change because ‘a level playing field means planning and negotiating when it fits the business – that’s calendar year for most.’ 

    So, what exactly is behind the desire for change – and the apparently increased willingness of the Upfronts system to accommodate that change? 

    Timing

    As Marc Pritchard observed, the Upfronts have long adhered to a schedule that suited the TV networks best, from October to September. Most advertisers work to a calendar-year agenda, so having to purchase TV inventory in a different schedule is disjointed. What’s more, the Upfronts format obliges advertisers to purchase inventory for almost a year away; as pandemic has laid bare, plans can change dramatically just a few months into the future. The old format was therefore driving inefficiency, with the purchase of too much inventory driving frequency and waste.  

    This year, however, was a buyers’ market, thanks to the deflation in media pricing (see our recent Inflation Report Update for more details) and a lack of content. Buyers could negotiate options that suited them more, forcing TV vendors to introduce more flexibility. Buyers were able to commit dollars by quarter, and to negotiate better conditions such as the ability to cancel a certain percentage in a larger window.  

    Traditionally, streaming and linear ads were sold in two separate packages, with the former offering more flexibility than the latter. However, vendors are increasingly selling the two as a combined package, again because of advertiser demand. This has resulted in less flexibility for streaming but more for linear – and that benefits most advertisers because the majority of investment is still in linear. It will be interesting to see if and how this changes in the coming years, as streaming becomes increasingly prominent.  

    Control

    Linear TV used to be the foundation of any media plan for the larger advertisers, but TV budgets are now divided across a number of areas, including linear, streaming, programmatic and addressable. Committing spend so far in advance, as per the ‘old’ Upfronts format, limits the opportunity for advertisers and their agencies to adjust to the rapidly changing landscape and optimize their buys. 

    It’s no secret that the media landscape is fragmenting, and that the most effective ad campaigns are optimized across all channels. Buying advertising separately, at the Upfronts, NewFronts and the podcast upfronts means that optimization is more difficult to achieve. Merging them, as 39% of media buyers favor, would help them to better understand measurement and research across screens, which would intern improve performance. The IAB’s new CEO, David Cohen, pushed for this ‘coming together’ to happen over the summer. 

    Optimization and measurement are key factors in the combined linear and streaming packages that vendors are increasingly offering at the Upfronts. Viewership is changing dramatically, particularly this year as more and more consumers have subscribed to streaming platforms during lockdown, and this is leading to an increase in streaming dollars at the Upfronts. However, recent Wall Street Journal article highlighted that measurement problems are holding back advertising in Connected TV. Keeping track of who is watching what, and where, as well as how many times they see the same ads, is becoming a source of frustration for advertisers seeking to move their dollars into the medium. Ad-supported streaming from the likes of Amazon.com and Roku is attracting more and more viewers, but a fragmented media-buying landscape can mean that viewers are hit repeatedly with the same ad. Ad inventory purchased from multiple sellers often shows up in the same ad break; the problem is exacerbated by the fact that there is a smaller pool of advertisers in streaming than in traditional TV. There is a lack of transparency on when and where ads run within streaming platforms and apps; while it is slowly improving, the situation is far from resolved and this is causing significant wastage for advertisers. We’ll be exploring this in more detail in an upcoming post on ECI Thinks. 

    So, what’s the bottom line?

    Advertisers are demanding transparency and that their media buys work together to drive maximum efficiency and effectiveness. The old Upfronts format is without doubt in need of an update so that it aligns more closely with the current media landscape. Furthermore, the vendors have work to do to ensure that measurement is unified and keeps up with the pace of change. The times they are a-changin’, and the Upfronts need to change accordingly. 

     

    Image: Andrey_Popov / Shutterstock

  4. AT&T’s digital advertising ambitions

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    Rumors have been swirling in recent weeks about AT&T’s plans to sell off parts of its business, and even whether it will pull out of its media play altogether. In recent years, it has purchased a number of companies – including, most famously, Time Warner – in order to become a major player in the digital advertising sphere. Pursuing a line of business outside its traditional telco remit has become increasingly important in order to ‘keep up’ with key competitors Verizon and Comcast, who have both expanded their offerings: Verizon invested in a fiber-optic network for high-speed internet, while Comcast has focused on bundling content, mobile, internet, cable and landline. AT&T’s proposition, on the other hand, was seen by many as somewhat antiquated; this could only be remedied by upping its technological capabilities through investment or acquisition. AT&T chose the acquisition of companies that would make it a major player in digital advertising. This, said new CEO John Stankey, would allow it to ‘compete with companies that are incredibly strong and capable, like the Googles, Amazons and Apples of the world – and so we’re playing big’.

    Rumors that DirecTV will be sold off

    AT&T started its journey into advertising with the acquisition of DirecTV for $49 billion in 2015; however, it made the purchase just as the TV market started to change dramatically and irrevocably. It was a time when the likes of Netflix and Amazon Prime started to make cord-cutting a viable option, and new live TV players like Hulu Live and YouTube TV have since made inroads into the appointment viewing arena. Subscription numbers have been falling, so it is perhaps unsurprising that AT&T is under pressure from shareholders to offload the unit, even though it is now reportedly worth less than half what AT&T paid for it.

    Digital advertising moves

    Having acquired a source of inventory for its digital advertising capabilities, AT&T then purchased AppNexus to serve as the foundation of Xandr, its programmatic marketplace for targeted TV and digital video advertising. To complete its digital advertising triumvirate, the telco giant famously acquired media titan Time Warner in 2018, giving it access to assets such as HBO, the newly launched streaming platform HBO Max, Warner Bros and CNN.

    Expanding digital capabilities

    So have these big purchases, which have left AT&T in a large amount of debt, paid off? AT&T’s rumored sale of DirecTV led to speculation that it was also seeking to offload Xandr (this was later dismissed by CFO John Stephens) and that led some to wonder if Warner Media (as Time Warner was rebranded) was also for the chop. As far as we know, AT&T is not entertaining these ideas at all; WarnerMedia is an important revenue-driver for the telco giant, and Xandr has recently partnered with the Dentsu Aegis Network (DAN) in Asia to create Dentsu Curate, which leverages Xandr’s tech platform to create a new programmatic supply solution. Xandr was struggling to make its product offering appealing as it was unable to pull together inventory from enough platforms to make it interesting to advertisers; the Dentsu move could help address this issue and increase Xandr’s reach. It will also be enhanced by the launch of HBO Max’s advertising-supported tier in 2021.

    Could bundling streaming services be part of AT&T’s future?

    With the uptick in the streaming wars at the start of this year, many consumers are likely wondering whether they want to pay for several subscriptions at once – the cost could start to look like the high cable costs that led to so many cutting the cord. AT&T’s ownership of WarnerMedia, particularly HBO Max, could make it a viable option to start ‘bundling’ streaming services. These streaming bundles could be used to incentivize consumers to stick with AT&T’s telco services and will, of course, create an even richer inventory list for Xandr – a win-win situation for AT&T.

     

    Image: Connect World / Shutterstock

  5. The Facebook boycott: what are the implications for brands and for Facebook itself?

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    Facebook has faced significant challenges over the last few years, notably since 2016, which saw the tech giant embroiled in controversies relating to the election of President Trump in the US, and to the UK’s Brexit referendum. 2020 is not proving to be any easier.

    The world’s largest brands boycott the world’s largest social media platform

    The current controversy was sparked when President Trump reacted to the Black Lives Matters demonstrations in a post on Twitter and Facebook, which he ended with the phrase ‘when the looting starts, the shooting starts’. Twitter reacted by hiding the post behind a warning that it ‘glorified violence’; Facebook, on the other hand, did nothing, with Zuckerberg saying that it was “better to have this discussion out in the open”.

    Shortly after this debate, a consortium of civil rights groups started urging advertisers to reduce or even halt their spending on Facebook throughout July, under the #StopHateForProfit hashtag. The campaign gathered momentum, peaking with Unilever’s announcement last Friday (June 26th) that they would cease all their US advertising on Facebook until the end of the year. Within two hours of the announcement, Mark Zuckerberg released plans to prohibit hate speech ads and to better protect groups such as immigrants on Facebook. He also said that the platform, undoubtedly with one eye on President Trump, would label posts that violate their policies but need to remain published ‘in the public interest’.

    Facebook’s changes weren’t enough

    But Zuckerberg’s pledges weren’t sufficient to stem the flow: over the weekend and into the beginning of this week, more and more brands announced they would be joining the boycott. Facebook is now facing the loss, at least temporarily, of income from 150 brands as large as Verizon, Starbucks, Adidas, Coca-Cola and Honda – as well as Unilever of course. To give an idea of the amount of money this means, Unilever and Verizon spent $850,000 and $504,000 respectively on Facebook in the first three weeks of June alone. The World Federation of Advertisers claims that a third of the world’s biggest brands will, or are likely to, suspend advertising on social media, while an additional 40% are undecided.

    What are the implications for Facebook?

    The loss of income because of the boycott will undoubtedly be a real blow for Facebook – but by no means a fatal one. The majority of its income comes from the longtail: eight million small and medium-sized companies who are priced out of TV and therefore can’t afford not to advertise on Facebook. However, Facebook’s share price was affected by the boycott, down by 10% to $212.50 over the course of the week to June 28th. They have no choice but to closely consider their next steps, particularly ahead of what is sure to be a contentious presidential election in November.

    The Facebook boycott was catalysed by the Black Lives Matter movement, but came amid a context of haphazard policing of the site. Facebook’s stance on hate speech has long been less clear than its position on other controversial content such as nudity; this is partly because it believes that it shouldn’t be responsible for this content, and partly because it’s so much more difficult to automate this work. It has made significant progress in this area: according to its Community Standards Report, in 2017, Facebook identified just 25% of hate speech removed from the platform itself, relying on users to flag the other 75%. By the spring of this year, however, 88% of the hate speech removed was found with its own tools, meaning it could remove or restrict four times as much as it had two years earlier.

    Facebook, and many of the other social media companies, continue to maintain that they are tech platforms, not media platforms, with the limited responsibility for content that that status implies. However, in introducing measures such as those described above, they are arguably de facto admitting that they are publishers and therefore have a duty to ensure that their content abides by local and international laws.

    What is motivating brands to boycott Facebook?

    Facebook has long been a key advertising platform for brands, giving them access to billions of users across the planet. Boycotting the company as part of the #StopHateForProfit campaign is a very sound PR move, and a great example of the world’s largest corporations using their power for good – in this case, holding social media companies to account. Advertising budgets for many brands, especially travel and consumer goods brands, are shrinking as the world faces an almost certain recession following the coronavirus pandemic. They will be seeking to make cuts and the #StopHateForProfit campaign may have presented an opportune moment to start making those cuts whilst simultaneously spurring change. What’s more, media cost deflation for most traditional media types and lower-than-expected inflation for digital channels mean that advertisers may feel they are in a strong position regarding where they place their advertising spend, allowing them to boycott a previously key channel. However, it’s important to remember that, while this move by advertisers may have been partially instigated by the fall-out from Covid-19 crisis, digital is a key channel and has become even more so during the pandemic as billions seek entertainment and information at home – this is a big move. Some brands will also undoubtedly use their break from the platform to evaluate the impact that Facebook activity has on their marketing results. In short, the move by marketers to boycott Facebook is both altruistic and strategic: it will be fascinating to see how it pans out.

    Brands have long been uneasy about advertising on Facebook, thanks to historical brand safety issues and because they are worried about contributing to the consolidation of the Facebook-Google duopoly. No matter what the reasons or motivations for the boycott, perhaps now is the time that Facebook will be forced to implement fundamental change to the platform, including allowing marketers to better control where their ads are placed, and making the algorithms that control content more transparent.

    Image: BlueSkyImage / Shutterstock

  6. Will the demise of the cookie lead to better brand building opportunities online?

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    By Victoria Potter, US Business Director at ECI Media Management

    Google announced in January that it would be phasing out the cookie in its Chrome browser over the next two years. Apple’s Safari and Firefox have already killed off the cookie in their browsers, but Chrome is by far the most popular browser in the world with 64.1% of global market share in January 2020, so Google’s decision will lead to a major industry shift.

    A pivotal year for digital advertising

    2020, then, is a pivotal year for digital advertising. But exactly how it will change is as yet unclear: how will tech companies, agencies and advertisers react? Will the digital landscape change dramatically or imperceptibly? Will that change be positive or negative?

    An opportunity to refocus on brand building

    For a very long time, advertisers have been able to follow consumers from page to page across the internet, understanding their consumption patterns and using that insight for targeting. Focus has turned away from more difficult to measure brand building activity. It’s always easier to value what you can measure over what you can’t. But now that the cookie is on its way out, advertisers and agencies will need to re-evaluate what they use digital advertising for. Could brand building, traditionally the realm of TV and OOH, be one of its new uses?

    Harnessing digital to build relationships with consumers

    Before the advent of the cookie in particular, and digital advertising in general, building brands was always at the heart of advertising: trusted brands are fundamentally important in helping consumers make choices. In this new era of digital advertising, can we harness its strengths to make this the new way to build relationships with consumers and earn their trust, rather than just trying to push them to click and buy? This will be particularly important for brands who do not have access to high-quality first-party data, for example FMCG companies.

    Context-based media buying will become a key tool

    A key tool will be context-based media buying, with advertisers seeking out environments where their broader target audiences congregate. Ben Plomion of tech company GumGum advises that marketers should “use the insights they generate from their current cookie data to inform their future contextual strategies”. Technological advances and the growth of AI are making contextual advertising an increasingly powerful tool: they can be used to understand web page sentiment, understand linguistic nuances, verify the content and tone of images and video, and automatically configure ad creative so that it complements the context.

    Premium publishers are able to offer brands superior contextual advertising opportunities thanks to their high-quality inventory and relatively low ad loads, creating a better experience for the user. This means they can help advertisers obtain meaningful reach and build trust and connection – all valuable assets for a brand building campaign.

    Plan to build relationships with humans, not to reach consumers

    At the heart of these approaches is planning with humans – not ‘consumers’ – in mind. Without the targeting and measuring abilities associated with cookies, refocusing on enriching people’s lives through advertising will become critical for success – and that is why we believe the demise of the cookie should, on balance, be a good thing for advertisers.

    Walled gardens could increase the dominance of the tech giants

    There are some pitfalls to look out for. Of course, Google and Facebook’s walled gardens will be largely unaffected by the decline of the cookie (indeed, some believe that Google decided to kill the cookie so that it wouldn’t have to share its data with anyone else). Advertisers will still be able to leverage the first-party cookie within these walled gardens, which will further strengthen the tech giants’ position and even allow them to raise their prices, if advertisers don’t push for content strategies to find their target groups in the digital space.

    In the face of Google and Facebook’s strengthened position, publishers might be tempted to increase ad loads in order to avoid declining revenues; with advertisers struggling to drop their reliance on last click performance metrics, this could lead to an increase in irrelevant ads, which would in turn lead to a rise in ad blocking.

    It’s time to revisit priorities and foster deeper connections

    The decline of the cookie is a seminal moment in the history of online advertising. While it could undoubtedly spell trouble for those unwilling or unable to adapt, in our view advertisers should see it as an opportunity to reappraise and revisit priorities, and to create brand-building campaigns that foster deeper connections with human beings for greater trust.

    What’s your opinion?

    We would love to hear from brands, agencies and tech firms about how they envisage a cookie-less future. What do you think will happen? Do you think the decline of the cookie will usher in a golden era of advertising, or is your forecast less optimistic? Comment on our LinkedIn post, or email us at .

    Image: Kim Reinick/Shutterstock

  7. Insights from day 2 of CES 2020

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    The momentum doesn’t slow for a second at CES! On day 2 in Las Vegas we were treated to a smorgasbord of innovation – some ready-to-go, some just conceptual, but almost all are exciting and will transform how we as consumers go about our everyday lives.

    Hollywood meets Silicon Valley – but will it work?

    We started the day by attending one of CES’ flagship corporate keynotes. This one was from Jeffrey Katzenberg, former Disney Chairman and founder of Dreamworks, and Meg Whitman, former President and CEO of eBay and Hewlett Packard. They were unveiling Quibi, their mobile entertainment platform which they have positioned as the sweetspot where Hollywood meets Silicon Valley; they underlined the collaborative aspect of the creative process, where content creators and engineers work hand-in-hand right from the start to drive innovation. Quibi offers viewers a ‘revolutionary’ video-streaming technology that delivers portrait and landscape video at the same time, and allows creators to take advantage of other mobile capabilities such as GPRS, time, camera and interactivity. All content is in ‘quick bites’ (hence ‘Quibi’) of 10 minutes or less – so that it can be consumed in those historically hard-to-reach moments on the go. This means super-short series episodes and splitting movies into ‘chapters’.

    A lot of emphasis was placed on the opportunities that this platform represents for advertisers, especially the fact that it specifically targets the hard-to-reach millennial generation at a time when they are particularly hard to reach – on the go. Their low ad-load will also no doubt appeal to ad-weary generation Y. Quibi’s first-year advertising inventory, worth $150m, has sold out and they have many world-famous brands on their client roster, including AB InBev, Procter & Gamble, T-Mobile and PepsiCo; the latter was invited on stage to talk about the innovative, collaborative creative process and the brand-safe, brand appropriate environment.

    Quibi is undoubtedly an innovative new streaming platform and the idea of creating short-form video content for the on-the-go generation is a good one, but some questions remain. In the age of the streaming wars, how will this young start-up fare against established competitors such as Disney, Netflix and Warner? And will viewers really want to keep flipping their phones while they are watching a show to get the full Quibi experience? Furthermore, with content costing on average $100,000 a minute to produce and with plans to deliver a huge amount of content, is the business model sustainable? Quibi launches in April – after that, time will tell.

    A dose of futuristic technology

    After Quibi’s talk we made our way up the Strip to the Las Vegas Convention Center, where the world’s leading future-facing brands showcase their innovations. The Center is mind-bogglingly huge with the footprint of many exhibitors’ ‘stalls’ matching that of a mansion. We made a beeline for Samsung’s space, eager to see for ourselves the products that they revealed in their keynote speech. There’s so much to say about Samsung’s contribution to CES that we will be posting a separate blog about it tomorrow, but suffice to say that their space was seriously futuristic and shakes up what the future of the home, the city and even of you (and me, and all of us) looks like.

    It’s all about screens

    Screens were a big area of innovation. Our eyes were drawn by LG’s undulating display of their OLED screens – and as we entered the LG space we were shown just how slender these screens are. There was also a roll down screen on display – similar to the roll-up screen showcased a few years ago and which is now available to buy. Meanwhile, Samsung displayed its enormous MicroLED screen called ‘The Wall’. MicroLED technology allows screens to be built at any size, and The Wall is truly huge, at 292 inches or 7.4m. Its sheer scale and extreme brightness and contrast meant that it was truly a sight to behold!

    Flexible screens were another big talking point. Intel showcased its conceptual 17-inch foldable screen which works as a laptop or monitor, while Lenovo unveiled the ThinkPad X1 Fold. It seems inevitable that foldable screens will become far more commonplace over the next few years.

    Tomorrow: Samsung deep dive

    We’ll be posting a deeper dive into Samsung’s presence at CES tomorrow, including their keynote and seeing their innovations in action on the show floor. In the meantime, if you’d like to discuss anything at CES and how it affects marketers, please contact us on

    Image: Alex Matthews

  8. Insights from day 1 of CES 2020

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    Las Vegas, early January: it must be time for CES, time for 180,000 delegates to discover, quite literally, what the future holds. Alongside the famous show floor, where delegates can enjoy futuristic product demos from brands as diverse as Samsung, Nikon and Impossible Foods, there is a dazzling array of talks and discussions on a wide range of topics, from smart cities to health and fitness.

    We spent our first day on the ‘Future of TV’ tract, a series of panel discussions and talks featuring brands, agencies and TV experts discussing what the future holds for TV, and what that means for advertisers.

    A mantra for the new decade: progress before perfection

    The day started with a session on ‘The New Frontier of Television’, with the Editor of Forbes’ CMO Network, Jenny Rooney, interviewing Deborah Wahl, Global CMO of General Motors, about what developments in TV mean for her brand. Deborah talked about how GM has reaped huge benefits from the rapidly changing TV landscape – their effectiveness has increased by 10% over just three month – and how they are embracing the change by getting their teams comfortable with learning and failing. She noted – as have many over the week – that failure is inevitable, but that’s ok. If everything you do is working all the time, then you’re not doing enough, because there’s so much out there to play with. Deborah’s mantra epitomises this mindset: progress before perfection.

    Deborah also discussed how excited she is about the future of TV and how the huge amount of data available to advertisers now is helping creativity to become scientific. It’s delivering faster, better, more measurable results so that creative can be customised in almost real-time, creating content that is better for consumers – and therefore better for brands.

    When CTV effectiveness is fully measurable and provable, ad dollars will shift quickly

    Next up was a panel featuring Lynn Blashford of White Castle, Gustavo Alvarado of Activision and PepsiCo’s Kate Brady, facilitated by Innovid’s Stephanie Geno. The group discussed scaling success in connected TV (CTV), and started out by discussing what is holding brands back from CTV: it receives just 3% of media investment in the US, despite accounting for 30% of media consumption. The key reasons given were measurement, high CPMs, a lack of inventory and proven models from linear TV: investment in tradition TV has always led to an increase in sales, and it’s difficult to take money away from something that is proven to work. Brands are still looking for ways to illustrate success as clearly and quickly for digital devices and CTV so they can start shifting significant ad dollars to these platforms.

    Kate Brady mentioned how her ultimate goal is to harness data from CTV to optimise activity on a weekly basis – and ideally even more frequently – ‘the more data we can have, and the better we can optimise, the more it will help us’. She emphasised the importance of using data to work out what resonates with one customer versus another, so that personalisation can drive brand love as well as ROI. Meanwhile, Gustavo Alvarado discussed how direct response hasn’t been a focus on how we buy TV, but the opportunity to ‘add to cart’ direct from a CTV ad would be a really exciting development for advertisers. However – he said that whatever the future holds, it must be measurable. Measurement is key.

    What do the streaming wars mean for CMOs?

    With the launch or imminent launch of streaming platforms from Disney, Apple, NBC and Warner, we were particularly excited about the next session, about what the streaming wars mean for CMOs. Innovid’s Tal Chalozin interviewed Rich Greenfield from LightShed Partners about how CMOs can best navigate this new landscape. Rich noted how numbers for live TV are down by double digit percentages, and even when we do watch live TV we are not as engaged as we used to be, particularly during ad breaks. That’s true even for live sport, the saving grace of linear TV. This is partly because the ad experience on traditional TV is not nearly as engaging for viewers as it is on, say, Instagram. TV advertising has not kept up with the internet and isn’t customisable or shareable. He went on to discuss how expensive channel bundles are and how they force consumers to pay for channels they are not interested in. This, combined with a frequently heavy ad load, sends consumers straight into the embrace of the streaming platforms which are cheaper, offer content that they actually want to watch, and allow them to watch it seamlessly across devices.

    An interesting point that Rob raised was the fact that wealthier consumers are now effectively able to buy themselves out of advertising – so how do we reach them? The obvious answer is live sport, but there simply isn’t enough to satisfy the demand of the many brands for whom wealthier demographics are their target audience. It’s a question that has yet to be answered, but integration may be part of the solution.

    Moving from creating ads to curating experiences

    Next to take to the stage was the Chief Marketing and Communications Officer at Mastercard, Raja Rajamannar, in discussion with Innovid’s Beth-Ann Eason about Mastercard’s new approach to marketing. Raja started by emphasising that Mastercard now looks at consumers as people, for whom consumption is just a small part of their lives. What happens outside of that consumption – how they live their lives, their values, their passions – informs how and what they consume. People are bored of ads and care more about experiences than things, so Mastercard’s marketing strategy focuses on ‘nothing but curating experiences’, targeted in a highly effective way. Raja’s team divided people’s lives into 10 different passion points, such as music and food, and curated multi-sensory experiences at scale, with seamless and non-intrusive integration of the Mastercard brand. These experiences engage people completely and make them want to tell and spread the story of that experience – word of mouth for the 21st century. This strategy and razor focus on experience has helped Mastercard to move from number 87 to number 12 in Kantar’s ranking of the top 100 most valuable brands, and to be named Interbrand’s fastest growing brand across all categories.

    The future of linear TV in the US relies on NFL

    Innovid’s ‘Future of TV’ tract was wrapped up by Luma’s inimitable Terry Kawaja, who took us on a rip-roaring ride through the stream wars and the future of TV. He pointed out that the streaming wars have created Nirvana for customers, who have more choice at less cost, and that the future for linear television in the US essentially rests in the hands of NFL. NFL contracts are up in the next few years, and the big tech companies such as Amazon are getting ready to swoop – Jeff Bezos himself has said that Amazon wants to use live sports to drive value for prime customers. The big problem for the linear TV companies? Those big tech companies have a lot more money, and global reach. In order to defend themselves, the broadcast networks are turning to scale consolidation, direct OTT distribution and CTV tech acquisition – but they need to do it quickly.

    There are few losers in the future of TV

    One of our favourite slides of the day was one that we shared on our LinkedIn page here. In it, Terry showed his audience the winners and losers of the streaming wars. For agencies, tech intermediaries, big tech, content creators and consumers the streaming wars are undoubtedly great news, while for media distributors it is less positive. Terry believed that for brands it could go either way, but in a subsequent panel discussion that he hosted with brand CMOs and TV experts, he revised his opinion and decreed that the age of streaming was in fact a great opportunity for brands!

    An opportunity to bundle streaming service packages

    Another key takeaway from Terry’s talk was his prediction that the myriad options available to consumers would in time open up an opportunity for an independent third party to re-aggregate the streaming platforms, bundling up their services in order to make them more manageable – and more affordable – for consumers. His prediction for who that third party could be? Apple – who could well want to position themselves at the top of the TV ‘waterfall’ in the same way that Amazon is for shopping and Google is for search.

    More insights from #CES2020 tomorrow

    Day one at CES was an incredible opportunity to hear from experts about their vision and predictions for the future of TV: if you would like to discuss anything you have read here in more depth with our experts then please ">get in touch. In tomorrow’s blog we’ll be covering the keynote from Jeffrey Katzenberg and Meg Whitman on their new mobile entertainment platform, Quibi, and bringing insights and innovation from the CES show floor.

    Image: Alex Matthews

  9. Why the decline of the online tracking ecosystem could be the start of a golden age for digital advertising

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    Advertising without digital is like transport without engines. Yes it’s possible and yes there is something quite charming about it, but it’s old-fashioned and less efficient: once you’ve tasted modernity, you can’t go back. Digital advertising has brought us capabilities beyond the 20th century marketer’s dreams: individual targeting based on behaviour and preferences, as well as cross-device tracking, programmatic buying and real-time optimisation.

    Much of that was made possible by the humble cookie, but after 25 years its very existence is under threat. Indeed, tracking online activity is a house of cards that has been slowly but steadily collapsing over the last few years thanks to ad blocking, browsers blocking cookies, the rise of walled gardens and cookie-free environments such as apps, connected TVs and the Facebook stack, and privacy regulations. But what does that mean for advertising? In truth, no one really knows. Should marketers be quaking in their boots? Will programmatic die along with the cookie? Is the cookie even dying? In all the uncertainty, we can be sure of one thing: digital advertising will change and the successful marketer will be the one who adapts.

    Look beyond the cookie for reach, frequency and frequency capping

    Cookies can still be used to track and control reach and frequency in Google’s Chrome browser, which still has a majority market share in many countries, although its key competitors – notably Firefox and Apple’s Safari – have smart cookie-blocking technologies activated by default. This means that all browsers except Chrome are a black hole for measuring reach and frequency based on cookie data. Furthermore, Google is moving towards an opt-in version of cookie blocking, making the future of cookie-based tracking precarious.

    One solution for ensuring that reach, frequency and frequency capping are still tracked effectively is the use of audience verification services, for example Nielsen DAR and ComScore vCE. These services validate delivery, reach and frequency for real human audiences with much less reliance on cookies. However, very few advertisers outside the US invest in these products – we expect this to change as the cookie continues to decline.

    A return to contextual marketing

    Targeting is another area that will be dramatically affected by the change in the tracking landscape – and nowhere is this truer than in programmatic buying. Much of what we recognise as programmatic buying relies on the cookie and is therefore likely to decline. That doesn’t however mean that DSPs will become useless: marketers will still be able to efficiently handle direct, high-quality publisher deals, as well as buy lower cost, mixed quality data-free inventory across select sites on the open web.

    While the ability to target individuals on the open web is likely to decrease with the collapse of the tracking house of cards, contextual targeting is set to explode. Contextual targeting is based on the content the user is looking at, rather than their behaviour profile, meaning that ads are more likely to be relevant to their current activity. It puts an emphasis on the placement of the ad, so is similar in that respect to traditional print advertising – the focus is on producing and distributing relevant content. This approach allows advertisers to deliver marketing messages to consumers when they are in a specific situation or frame of mind; as consumer behaviour becomes more fragmented and unpredictable, taking the guesswork out of advertising can only be a win.

    Contextual targeting is not just an answer to the demise of the cookie: it is also an antidote to many of the issues around brand risk and safety, and is a way to be less dependent on the personal data that is so heavily regulated by GDPR and CCPA.

    Is this digital advertising’s moment?

    While the collapse of the digital advertising house of cards may seem catastrophic to brands who have relied on precise targeting in their advertising strategies, in reality it opens as many doors as it closes. Indeed, with consumers now spending more time in apps than in longtail websites, making programmatic audience-targeting even more challenging, many marketers will already be exploring ways to bypass programmatic altogether. The resultant high quality, content-focused advertising is pushing out and replacing click-bait strategies. Perhaps the decline in the online tracking ecosystem will herald a golden age for digital advertising because, ironically, the shift away from targeting individuals will lead to a better user experience.

    Image: Shutterstock

  10. Is Snap really a threat to the Google-Facebook duopoly?

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    A few weeks ago we wrote about how Amazon poses a serious threat to Google’s search dominance. But Amazon is just one of a few companies snapping at the heels of the Google-Facebook duopoly that has for so long dominated digital advertising. Third quarter results, released in the last few weeks, revealed that the ad businesses of Amazon, Pinterest and Snap all grew more rapidly than that of the industry giants in Q3. Amazon is the biggest disruptor in terms of size, but it’s Snap – owners of Snapchat – that is enjoying the fastest growth.

    Snap’s growth is remarkable

    The latest round of quarterly results were not a resounding success for Facebook or Google. While Facebook’s results were better than expected, it recorded its third consecutive quarter of sub-30% expansion; meanwhile, Google’s growth is languishing below 20%, at 17.1%.

    Things were much brighter for Snap: its ad business grew 50% year on year in Q3, and its stock price surged by over 175% this year as advertisers increasingly look to the platform to provide a return on their investment. Why?

    What is behind Snap’s success?

    Snap’s CEO, Evan Spiegel, has credited two major changes at the company for their success. The first is an initially poorly received redesign which Spiegel says boosted time spent watching premium content by 40%, thereby increasing ad revenue; the second is their adoption of a self-serve ad platform over the last two years, which has made it easier for brands to buy ads on the platform and expanded Snap’s ability to sell ads.

    Those ads are increasingly popular as Snap is good at leveraging its hard-to-reach audience and building innovative, intuitive ad products that increase ROI for advertisers. Its core userbase is the often hard-to-engage youth audience: 90% of 13-24 year-olds in the US say that they use Snapchat, and they’re highly engaged – they open the app on average 20 times a day, and dwell time is around 25-30 minutes, significantly longer than that of other social networks. All this gives brands plentiful opportunities to reach their audiences at the right time, with the right message – and that amounts to increased ad revenue for Snap.

    Snap’s range of ad products come in a range of different formats, including Snap ads which allow users to swipe up to visit the advertiser’s website or app and can be optimised against reach, clicks and sales; and commercials, a more premium offering which are unskippable and appear within premium content. They feel more like a TV buy for advertisers and have high viewability and completion rates. In October, Snap launched a new product to target direct-response advertisers, for whom Instagram – their historical home – is starting to feel a bit crowded. Its new dynamic ads allow advertisers to create ads linked directly to their product catalogues and can be served to users based on their interests, using a variety of templates created for mobile. This new product brings Snap’s offering more in line with that of its bigger competitors, and is one of a range of features that has helped to make Snapchat more shoppable, engaging and effective for marketers.

    Snap’s focus on the development of effective advertising formats is commendable, and will be key to its future success; indeed, it will be key to the success of the digital advertising industry as a whole. Traditional channels continue to have the upper hand when it comes to the price-effect ratio, and digital players must aim to emulate their success.

    AR is key to Snap’s future success

    While Snap’s star is certainly in the ascendant, there is still plenty of work to be done: it is still unprofitable and it only has 210 million daily active users – mediocre compared to the 500 million who use Instagram’s Stories product every day. CEO Spiegel stated on the quarterly earnings call last month that augmented reality (AR) will be crucial for the company’s future: each daily active user interacts with a Snap AR product, such as lenses and filters, an average of 30 times per day. This month the company is launching Spectacles 3, a redesigned version of its augmented reality sunglasses, and in the next seven to 10 years plans to integrate other AR wearables into its range. Snap has historically led the way in AR and has had viral success with some of its AR filters, but Instagram and Facebook are moving into the space, so Snap will need to move quickly to retain its first mover advantage and remain the dominant AR platform.

    So, is Snap a serious threat to Google and Facebook?

    Snap’s product development and innovation are turning it into a serious contender for advertisers’ ad dollars, and its growth rate means that the digital advertising giants – Google, Facebook and increasingly Amazon – need to pay attention, particularly as Snap has such high access to the millennial and Generation Z audience. It does however have a lot of work to do if it is to grow exponentially and become a real threat.

    Image: Shutterstock