There has been a lot of hot air surrounding recent advertising controversies – but, beyond the guff, there might also be valuable lessons for employers.
In the wake of #metoo and TimesUp, we have seen an increase in advertising campaigns focused on supporting progressive social change. The release of Gillette’s latest advert followed in the footsteps of Nike’s 2018 campaign faced by Colin Kaepernick: “Believe in something. Even if it means sacrificing everything.” Nike’s ‘sacrifice’ amounted to
The most recent statistics from the Entertainment Retailer’s Association reveal that the UK video games industry outperforms the music and video industries by a significant margin. Combined physical and digital sales of games reached £3.86bn for the year, a significant improvement on last year, where physical and digital sales for music and video achieved £1.33bn and £2.34bn respectively. That effectively means that games are responsible for over half of all UK home entertainment sales for 2018, a testament to the increasing numbers of the public who have grown up with games as a medium.
Macho nachos.
Monetisation opportunities around games have similarly increased as technology has enabled more ways for consumers to support game developers and publishers. Where once one-off purchases were the only way to support a game, the rise of free-to-play (F2P) games and paid-for downloadable content (DLC) have paved the way for many other models. Despite publishers being ever-more hungry for sources of incidental revenue from their titles, one potential form of revenue – in-game advertising – has never really taken off in the West. But that could be about to change.
We all know what’s happening with adspend. Digital advertising spend represents all net growth in adspend, and three big players are in control of that flow of cash. It’s an issue that isn’t going to be solved any time soon, and in the meantime the competition for the squeezed remainder is only getting fiercer.
As part of that various broadcasters, platforms and advertisers are reappraising the metrics they’ve traditionally used to demonstrate their superiority (or otherwise) compared to their competitors. In the US, for instance, the television and radio broadcast network CBS has failed to come to terms with the measurement company Nielsen, leaving the broadcaster without one of the most-cited measurements. As Variety’s Brian Steinberg explains, part of the issue is that broadcasters like CBS argue that Nielsen’s metrics fail to take into account viewing across a variety of platforms. The rise of VOD and the diffusion of television content across different devices means that – at least in theory – more people are being exposed to television content than ever before:
“TV networks have long based their advertising rates on Nielsen’s measure of linear TV audiences, which have slipped as consumers embrace Netflix, Hulu, Amazon Prime and other streaming and on-demand options. In such an environment, TV networks believe Nielsen’s overnight ratings are no longer the critical yardstick of viewership they once were.”
Audio content is having a mini Renaissance. Between radio’s strong showing in adspend predictions for 2019, the steady maturation of the podcast market and the strong showing for audio as a secondary activity, there is a strong case to be made that audio content is a sure bet for media companies.
That’s helped significantly by the mutability of audio content. Music, radio shows and podcasts tend to bleed into one another, with each existing alongside the others on Spotify, DAB and any number of streaming services.
That makes the relative lack of success of news content on connected devices and smart speakers all the more marked. Emarketer’s predictions suggest that the number of smart speakers in US households is set to rise from 16 million to 76 million between 2016 and 2020, based on “stronger than expected uptake” of the devices.
It’s undeniably been a bad week for print in the UK:
Shortlist Media (now rebranded as ‘The Stylist Group’) announced that its flagship men’s lifestyle title Shortlist was to go digital-only as the company prioritises Stylist magazine instead. If a circulation of over 500,000 isn’t enough to sustain a free title, what hope is there for the smaller titles? Especially, as Shortlist alumni Terri White pointed out, when the advertising market simply isn’t there to support them?
Shortlist commanded a huge share of the free titles
Esquire also announced plans to go bi-monthly rather than monthly. In doing so it is increasing page count, page quality and the number of sections, in part to refocus its business model around the core audience of ABC1 men who it is betting will pay to support a doubly-luxury title and its new suite of events. In the light of what’s happened to the once-thriving “lad’s mags” market, Esquire has always tried to set itself apart – but in the face of falling print ad revenue has been forced to change itself once again.
And in the most earth-shattering news, the bell finally tolled for Johnston Press plc, which despite the success of flagship titles like the i and The Scotsman, was forced to go into administration to help wipe the debt it had accumulated over the course of being a regional news publishing powerhouse. It took the newly-formed JPIMedia to provide some much-needed surety against the uncertainty, with the Independent’s Chiara Giordano reporting:
“In a statement, JPIMedia offered reassurance that the acquisition of Johnston Press “secures jobs and [the] future of its brands and titles”.
“JPIMedia’s shareholders recognise the vital role that local and regional media plays in the communities they serve and remain committed to protecting and enhancing the value of the business in the future,” it added.”
After the Cambridge Analytica scandal earlier in the year, you’d expect that platforms like Facebook would be rather more careful about how it exploits user data. Research has shown that consumer concerns over misuse of user data is one of the primary reasons why people choose to use ad blockers, and since user data is effectively the commodity on which the platforms operate, any further scandals are likely to have a cooling affect on their business models. Earlier this month a study from Pivotal Research Group found that people were spending less time across Facebook’s platforms (though it couldn’t say if that was specifically due to associaion with Cambridge Analytica).
Unfortunately Facebook has now been implicated in yet another potential misuse of user data: It registered a patent that uses geolocation to provide friend recommendations to people who are physically close to you. Or, as Lisa Vaas put it for Naked Security, “Facebook wants to reveal your name to the weirdo standing next to you.”
No doubt you’ll have seen the latest Facebook controversy (no, not that one): the social network didn’t let news publishers know about a bug that discounted people who watched less than three seconds of video, thereby artificially increasing the statistics around how long people were consuming videos on average. As a result, some people are claiming that Facebook effectively created the pivot to video that saw newspapers and magazines shed tons of editorial roles in favour of video teams, to cater for this new audience demand for video content. Some are even suing Zuckerberg’s brainchild over it.
Due to all the broken promises and missed expectations that came with news publishers’ rush into video, it’s easy to forget that the reasons behind the drive to produce more digital video were sound: consumers are viewing ever more video online across OTT services like Netflix, user-generated-content platforms like YouTube, and livestreaming sites like Twitch. Even if the figures around view time were skewed, the trend is undeniable – one of the worst affected companies, Mic, even claims that the inflated metrics weren’t even a consideration in their own change towards digital video.
Building brand success
Branded content – native advertising, paid-for content, advertorial, creative solutions, call it what you will – has been around for over a century. Contently point to Theodore MacManus’s famous story on “The Penalty of Leadership” for Cadillac in 1915 as one of the early examples of the art. But there is no denying that there has been a recent rush to exploit the form, as media companies have sought to diversify their revenues and fight back against declining revenues from traditional advertising.
Now, pretty much every large digital or print publisher has their creative solutions team beavering away and finding synergies between their audiences and client brands. Many have
Small but perfectly formed
The entrepreneurs behind the imaginatively-named NewTV, Jeffrey Katzenberg and Meg Whitman, will be feeling encouraged by their recent round of investment having closed at $1bn. The service promises entertainment providers an avenue onto the world’s billions of smartphones, being specifically designed for mobile use with short-form series of 10-minute episodes. And it seems they have Hollywood and Wall Street convinced, according to Variety:
“Backers include a who’s who of Hollywood studios: Disney, 21st Century Fox, NBCUniversal, Sony Pictures Entertainment, Viacom, AT&T’s WarnerMedia (formerly Time Warner Inc.), Lionsgate, MGM, ITV and Entertainment One. Tech investors include Chinese internet giant Alibaba Group; strategic investors include VC firm Madrone Capital Partners, which led the round, along with Goldman Sachs, JPMorgan Chase & Co. and John Malone’s Liberty Global. The funding officially closed July 31.”
Encouraging, sure. But will it really be enough for to penetrate an already saturated market where similar offerings have since failed? Securing $1 billion from such famous brands is no mean feat but
and you might be
This week The Washington Post announced its ambitious plans for broadcasting on Twitch. In acknowledgement of Twitch’s primary audience, one of its two new shows will feature hosts from the Post playing video games alongside politicians, an idea that has ‘Steve Buscemi in 30 Rock‘ written all over it. The other show is set to be an irregularly scheduled live news show – and we’ve spoken about the challenges around digital news video before.
So far much of the coverage of the deal has been around the implications for other publishers looking to reach new audiences on livestreaming platforms, or about what this says about The Washington Post’s commitment to finding new audiences despite its paywall. But something that has been lost in the noise is that Twitch offers its creators both ecommerce and advertising revenue – and its owner, Amazon, stands to benefit from both. Considering that Jeff Bezos, Amazon founder, also owns the Post,
Regulation and technological advances threaten many industries: just ask high street bookmakers. But the simultaneous combination of GDPR and the promotion of ad-blocking technologies by the likes of Google and Microsoft is worrying for digital media businesses.
A helping hand
Most free (and many paid-for) content models have long relied on an implied consent from their users: “you get this stuff for free, if we are able to send relevant advertising your way based on your browsing behaviour.” However, the ability to track browsing wasn’t really made explicit until GDPR, which requires consent for publishers to use many of the tools that had developed to serve those ads. Notably, GDPR has required digital businesses to explain to consumers how cookies work (see our cookie policy here!): paranoia about privacy is on the rise, and it is likely that many more consumers will follow those mandatory “manage your ad preferences” buttons.
At the same time, ad-blocking has never truly gone away as an issue for publishers. It often gets swept aside by seemingly larger issues like the Duopoly or rampant fraud, but it’s always there in the background, eating into publishers’ digital revenue potential.
It’s come back into view over the past few days after Microsoft announced that its mobile Edge browser for iOS and Android would have an ad-blocker installed by default, perhaps anticipating that post-GDPR audiences will be more savvy about their digital rights. The Verge reports that the feature – currently in beta – is set to be made available more widely and, crucially, won’t require any extra downloads to be used. Microsoft are making it as easy as humanly possible for their users to block ads, using the existing infrastructure of Adblock Plus – and that’s got publishers worried.
With the news that Facebook is betting upon news video to help grow its Watch platform, there has been a fundamental shift in the economics of video news production. Where once entertainment content was used to attract customers and audiences, against whom the broadcasters could sell adverts, the nature of video content has become somewhat flattened and undifferentiated.
Opportunity knocks for you, Mr Zuckerberg
That’s due to any number of things – unbundling, the rise of on-demand digital video on YouTube, Twitch and Facebook, and the overall conflation of ‘news’ and ‘entertainment’ that has come with homegrown news and analysis on those platforms.
In what is both one of the bigger tech acquisitions and recruitment stories of the year, the Japanese firm Recruit Holdings is set to buy Glassdoor in a deal worth $1.2bn. The buyer, which also owns recruitment site Indeed.com, will gain access to a vast database of employee reviews, salary data and a huge volume of active job seekers. Glassdoor is also the second-lar
gest job site in the US – the largest being Indeed – so the synergies are obvious, especially if the new owner opts to further integrate the two sites. Whether this justifies the gigantic valuation is another question entirely – the barrier to entry for new rivals doesn’t seem especially high to me, leaving the sector very open to further disruption. But Glassdoor, which has 30m members worldwide, is already growing faster than LinkedIn, Indeed and Monster, so what lessons can employers learn from it?
Everyone knows by now that the broadcast business model has been fundamentally altered by the rise of digital streaming. Digital ad-spend has overtaken TV ad-spend in the US and UK, and by many accounts US television ad-spend is in a state of permanent recession (it is expected to bounce back slightly in the UK).
Smart business
More than that, though, over-the-top (OTT) services have disassembled the bundles upon which lucrative television deals were built. Sports content, for instance, was once the foundation upon which most cable and satellite bundles were built, in what Stratechery’s Ben Thompson called last year as “the last pillar to crumble” in the traditional pay-TV model.
But OTT services, and people’s expectations about on-demand media, have finally reached that pillar: Among all the many skinny bundles that don’t include sports, there are individual subscription services like the WWE Network, and even efforts to create the ‘Netflix for sports’. The Guardian reports:
Modern media, to some extent, is just a series of stunts and marketing materials.
News publishers have to compete with digital outlets who, by nature of the race to scale, sell their content with hyperbole and screaming rhetoric of the sort we used to call ‘clickbait’. Even BuzzFeed, whose news wing is consistently breaking some of the biggest stories of any given week, used to indulge in this.
Switch your thinking…
Consequently even the legacy publishers find themselves dragged further towards that hysterical drive to be noticed. Take The Atlantic, the US-based publication whose work and business model other publishers look upon with envy. Last month, it appointed the arch-conservative columnist Kevin Williamson, as a stunt intended to broaden its appeal, though it was dressed up as an attempt to provide balanced coverage. Unsurprisingly,
There have been many moments where podcasts have been heralded as having ‘arrived’: The Guardian publishing the first series of The Ricky Gervais Podcast in 2005, the founding of Midroll Media in 2014, the first series of Serial in the same year and the launch of the GE-sponsored The Message in 2015 have all been pointed to as the moment the medium really took off.
Podcasts and radio are converging into ‘audio’ – what does that mean for publishers?
The truth, as I discussed with podcast expert Vanessa Quirk on an episode of Media Voices last year, is that there really was no moment you can point to as being the singular point at which podcasting became viable for publishers and media companies. Even the so-called ‘Serial effect’
The US linear television industry has hit ‘permanent recession‘ in terms of the proportion of the total ad spend it commands, according to Magna. The rapid rise of digital ad spend has necessarily come at the expense of other areas and television, despite its reputation for delivering the best ROI of any medium, is no longer looking quite so unassailable. Mediapost’s Joe Mandele writes:
“‘National television ad sales will decline between -2% to -3% going forward,’ Magna concludes.
The picture is not any prettier for the local TV ad marketplace, and with the exception of election years, Magna does not expect any growth for local TV at all.”
The same is true to a lesser degree in the UK, where AA/Warc predictions in January put the % YOY change in television ad-spent at -2, even including the 11.4% increase in ad spend against VOD. That’s despite
George Orwell wrote that jargon and obfuscating language contributes to the degradation of the English language to the point that meaningful dialogue is impossible.
One of many Google HQs
He might have had a point, too: The term ‘fake news’, which the Reuters Institute recommended should be stripped from conversation around online misinformation, was meaningless almost as soon as it was born, allowing it to be hijacked by politicians with an anti-media bent. One of the people who coined it, BuzzFeed’s Craig Silverman, has admitted culpability in that (though he can’t really be blamed for not predicting how it was to be co-opted), and I’ve been arguing it should be retired as a term since August of last year. Because it was jargon, ‘fake news’ has made discourse about misinformation impossible.
New report, published today by @EU_Commission High Level Group on disinformation, contains: “a clear and unequivocal abandonment of the term ‘fake news’. @rasmus_kleis #fake #news https://t.co/UbKwHmW2x8
— Reuters Institute (@risj_oxford) March 12, 2018
‘Millennial’, too, has drawn ire as being completely useless as a description of an entire generation’s habits and trends. It has led to
Old musical express
Another week, another print closure. Or, to put it in the euphemistic terms of the press releases: Another week, another refocusing on digital strengths.
The New Musical Express (NME) is shuttering its print operation after a much-publicised move to a free distribution model in summer 2015 which was designed to boost the magazine’s attractiveness to advertisers through an increase in circulation. In the announcement,
Shares in both ITV and WPP have fallen dramatically following their latest results. In both cases, this can be put down to the habitual complacency of a market leader. Neither business has been quick enough to restructure, nor trail-blazing in its digital offering. Neither have understood the major threats to their businesses through the duopoly of Google and Facebook.
Looking up?
So while there are obvious similarities in the business failings, the stories at the top of the businesses differ markedly. WPP is still helmed by its leader of 32 years, Martin Sorrell. ITV, after years of Adam Crozier’s stewardship, has a new CEO in Carolyn McCall.
McCall, the former CEO of the Guardian, has most recently been running EasyJet. She has seen advertising as both seller and buyer, and has hands-on experience of the value of data in her last role. As Simon English points out in the Standard, McCall is
The lack of noise – positive or negative – about the relaunch of the tabloid Guardian last week underlines just how irrelevant print is becoming to the newspaper market.
Tabloid, but not a tabloid.
Of course, it is also true that The Guardian is the last of the broadsheets – other than the Telegraph, which it seems will go to its grave in the larger format – to go tabloid or abandon print altogether. And given the perilous finances of the newspaper’s owners, GMG, this shift has been seen as inevitable after 13 years of the paper’s ruinously costly Berliner format (GMG made losses before exceptional items of £45m on turnover of £214m last year).
But the figures speak for themselves. Only 20% of the
Well, the best-laid plans of mice and men…
Only one week since we mooted the possibility that 2018 would be the year Facebook and Google would be held to account as publishers, Mark Zuckerberg stymies our plans for a part two by announcing that Facebook would no longer be a platform for quality news. It’s hard to imagine a neater sidestepping of an issue.
In the latest Monday note, Frederic Filloux points out that publishers in Europe have a tendency
At the tail end of 2017 many round-ups and prediction pieces (including my own) confidently asserted that 2018 will be the age of ‘audience-first’ publishing. It sounds an unnecessary description – surely publishing has always put audiences at the heart of their strategies – but it means something very tangible, and something that will hugely impact the media landscape over the next few months.
There are any number of predictions for media priorities in 2018 floating around. As with last year’s predictions some will be on point, some will miss the mark, and some will appear laughably naive by the time January 2019 arrives.
Almost certainly, all the predictions will be subject to Amara’s Law – that we overestimate the effect of a technology in the short-term and underestimate it in the long-term. As an example, we saw disappointment with early implementations of A.I. chatbots this year because of early hype around the technology, but the bots have been ubiquitous – and delivering significant revenue – since the middle of this year.
This year has also been the year of the ‘pivot to video’, a term that was used so widely and so often that it became
Most digital media businesses are slaves to the ‘hit’ – the number of clicks on or views of a particular page. And that’s a real shame, because the hit was never a great measure of success for an individual piece of content, and has only become less so as social distribution skews publishing priorities towards creating content designed to go ‘viral’.
How Idiots Track Success?
Worse still, as a result of a focus on the hit that has been around since the birth of the banner ad back in 1994, ads are mostly sold on a CPM (click per thousand) basis. When you sell in thousands of impressions, all you care about is how many thousands you have. As a result, in some quarters, ‘hits’ has become a damning acronym for
‘How Idiots Track Success.’
The truth is, the hit is a blunt instrument for attracting advertisers. It’s like having a thousand people come to your wedding, but you don’t know any of them, they are unlikely to
Different products…
What do Slimming World magazine and Heavy Lift & Project Forwarding International have in common?
On the surface, not much: one is a lifestyle magazine packed full of mouth-watering recipes and inspirational stories about weight loss; the other is a niche B2B title serving the global heavy logistics industry. One is sold on the newsstand and sells 640,000 per edition; the other is a controlled circulation title with a distribution of 19,000.
But there are several key similarities which may surprise people. First, they are predominantly print-based products. Second, they are growing and profitable businesses. And third, yes, they are both clients of ours.
…same philosophy
The fourth – and main – thing they have in common, though, is that they are both central to their communities, and invest heavily in content to ensure that this remains the case. Both titles have an acute sense of what works for their audience – what they want, and how it should be delivered – and are prepared to do what it takes to deliver that mission. They serve their readers. As a result, the publications are an absolute must for advertisers in their sector.
While much of the media landscape looks like
Ad blocking was labelled as an existential threat to ad-supported digital content by some (including us on occasion), but its anticipated growth has failed to materialise and digital publishers are breathing a sigh of relief.
According to the Internet Advertising Bureau UK, the proportion of British adults using ad blocking software online in February was 22.1%.
The figure is less than half-a-percent more than in the same month last year and shows growth almost grinding to a halt. In February 2016, year-on-year growth of those using ad blockers stood at around six percent.
The general tenor of the debate around the move of The Great British Bake Off from BBC to Channel 4 is that it is a travesty, equivalent to Love Productions selling the Crown Jewels. Bizarrely, even former Channel 4 CEO (and ex-BBC Chairman) Michael Grade has lambasted C4’s behaviour and warned that it was likely to hasten full privatisation.
As the prospect of C4’s privatisation has been on the cards for at least ten years, this seems a red herring. Surely, if it is going to be sold off, it needs to be commercially strong, and so the question should be: does buying Bake Off make commercial sense?
It’s only two weeks since the EU referendum and media businesses and their employees are still trying to get their heads around what Brexit might mean for the economy, and for the media industry in particular. The economic and political ramifications of the vote are likely to affect us all from years to come, and it’s too early to accurately say what might happen, but in our conversations with business leaders across the media sector a broad picture is starting to build up.
A colleague was recently sharing a cab with a senior sales director working for a traditional broadcaster and was amazed he had no idea of what affiliate marketing was.
It’s perhaps not as uncommon as my colleague might have thought, and many of our readers might be in a similar position. So, to spread a little light, here’s a simple explanation (those of you in the Affiliate Marketing world, turn away now!):
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