Less BS, More Facts, Some Opinions
With over half of all TV now consumed via streaming services, measuring it in a granular way is possible for the first time. Given this newly-available feedback loop, Jason Fairchild,
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Here’s today’s AdExchanger.com news round-up… Want it by email? Sign up here. It Takes Two ACR data and ad analytics firm Samba TV’s media sales business is now in the
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At this time last year, marketers expected the Super Bowl to be even more important than usual for 2022 as live events like the Golden Globes and the Grammys had been off the air or postponed. That’s not the case this year, as the Golden Globes returned to NBC last week (with ratings reportedly down roughly 26% from when it last aired in 2021) and the Grammys slated for Feb. 5.
Even so, marketers and agency execs say that the importance of the Super Bowl remains high as it is one of the few events where consumers are tuning in live and actually paying attention to the ads. That attention – harder and harder to come by – is why marketers are still willing to shell out up to $7 million for a 30-second spot on Super Bowl LVII on Fox on Feb. 12, despite the economic downturn.
That’s not to say all brands are ready to pony up that kind of cash — some like Toyota and Carmax, among others, are sitting out this year’s game. As for categories, “movies and streamers are the category that is up the most,” said Jon Lefferts, evp of integrated investments at UM.
The price increase at a time when many marketers are pulling back on ad spending given economic uncertainty will have marketers looking to get as much bang for their buck as possible with the game to justify the investment, according to marketers and agency execs.
“Marketers are stretching investments as much as possible,” said Brendan Gahan, partner and chief social officer at Mekanism. “There’s a greater emphasis on TV placements integrating second-screen experiences to generate a halo effect of earned media [and engagement].”
Gahan continued: “To maximize their dollars, brands will be maximizing consumer engagement. I think Coinbase’s QR code activation last year opened a lot of people’s eyes. The Super Bowl doesn’t need to be a pure brand-building exercise. Undoubtedly, we’ll see the impact of that. Forward thinking brands will be opening the aperture and expanding beyond ‘celeb + funny commercial = success’ model.”
Will 2023 be the year of QR codes in the Super Bowl? That remains to be seen, but marketers will be looking to find ways to get consumers to pay attention to their brand – whatever that may be – beyond the 30-second spot they’ve got in the Big Game.
“A few years back, brands were trying to rewrite the rules for the Super Bowl by using the second screen,” said Tom Murphy, CCO at Wunderman Thompson North America. “The coolest thing possible was to hijack attention by not even having a spot in the game, but doing something designed to steal attention.”
Murphy continued: “But in the last two Super Bowls, we’ve seen brands breaking the rules with their spots themselves – most notably Reddit, and then last year, Coinbase. Both of those ads rethought what a Super Bowl spot can be. This year, brands will be out to mess with the structure of what a spot on the game can be.”
Some expect that might be by using AI in some way, something that’s become a very hot topic in marketing and media in recent weeks. “I think we’ll be seeing a lot of references to or use of AI,” said Ben Wolan, executive creative director at DDB San Francisco. “With the rise of Midjourney, Dall-E, and ChatGPT, it feels inevitable.”
Keith Cartwright, founder and CCO of agency Cartwright, echoed that sentiment: “If I had to guess, AI will play some role in this year’s Super Bowl, too. It’s the talk of the tech world and ours.”
That being said, marketers expect that a return to humor will dominate the Big Game ads as the current climate makes people seek out a good laugh in challenging times. “We know comedy will probably be king,” said Cartwright. “People are still looking to laugh, especially during a moment like the Super Bowl.”
Aflac is carving out more budget for women’s basketball. Why?
From a business strategy perspective, it makes sense for us to invest there. But also, it’s the right thing to do. If we can use our superpowers for good, which in this case is a sponsor with monies to invest in a player and a fan experience, it was an easy decision to make.
How did you communicate with your team about this change?
I had this whole ramble about how it got me a mixture of fired up and sad. [I sent] a very pointed email: Plan on the ground activities for the men’s Final Four are canceled. All planning efforts, including budget, will ship towards a Women’s Final Four dominance effort. Friday, March 31, 2023, between 51% and 100% of our activation spend will be allocated to the Women’s Final Four in Dallas.
What’s Aflac’s overall sports marketing strategy?
We know that the audience we’re targeting are fans of college sports. Specifically, college football and college basketball. Which is why you’ll see us advertising heavily throughout the year, on Saturdays during college football season, and during March and April, with the NCAA March Madness tournament for basketball. That’s top of mind for me. How do we insert ourselves in a way that’s meaningful to our target audience during these passion points that they have? The bulk of the spend for a program like this, for March Madness, will be in linear. After that, the next biggest investment is our on-the-ground experiential activations. And that’s similar for both football and basketball. There’s CTV and OTT in there as well. — Kimeko McCoy
The Netflix series “Emily in Paris” is still a top 10 show in 92 countries three weeks after the newest season premiered on the streamer. The titular Emily is a marketing executive, she is able to afford lavish lifestyles, designer outfits and glamorous parties, which may be why the show is apparently making viewers more interested in the gig. According to Movchan PR, “Emily in Paris” triggered a huge spike in marketing job searches. Here are some key findings:
“The whole identity thing is like the emperor’s new clothes… you need to gain a deep understanding of the privacy routine of the vendor.”
— A former in-house media executive, who now consults with CPGs on their retail media strategies, on how to gauge the right solution for the cookieless future.
Ever since Elon Musk bought Twitter, the platform has been in a constant state of frenzy, with some of the biggest advertisers leaving the flock. While a swath of users have fled the coop to nest in alternative platforms, such as Mastodon, Hive Social, Post.News and soon-to-launch Spill, many marketers say they’re on the fence about whether they’ll follow.
That’s not to say there isn’t any curiosity around what Twitter’s alternatives could be. “But ultimately, there isn’t a logical alternative for Twitter at this time, no matter the challenges with brand safety and uncertainty on the platform,” Greg Swan, Chief Creative and Strategy Officer at The Social Lights, a Minneapolis-based social media agency, said in a written statement to Digiday. “Will there be another platform to prioritize in the coming years? Yes. Which one remains to be seen.”
Unlike the TikTok gold rush, in which brands dashed to create a presence and be a first-mover on the short-form video app, the push for some brands to leave Twitter hasn’t been as momentous, even with the previously mentioned upheaval. In fact, many social media agencies say they’re in wait-and-see mode, hesitant to recommend alternative apps to clients given that many alternatives have yet to offer ad infrastructure, verified user numbers, brand safety framework or audience volume that truly challenges Twitter. What’s more, some marketers see the rewards of advertising on Twitter outweighing the risks.
“The platforms that are being positioned or positioning themselves as a Twitter replacement, are seen as less compelling among our more adventurous clients because it’s not immediately apparent that they have relevance to the audience,” said Liz Cole, executive director and U.S. head of social at VMLY&R. The agency has yet to leverage any of the aforementioned apps on behalf of their clients. “From an operational perspective, even the brands of ours that have taken a big giant step back from Twitter, the lights are not off by any means,” she added.
Late last year, business mogul Musk started his Twitter takeover, spooking both advertisers and users with mass layoffs, verification overhaul, reinstating banned accounts and launching seemingly never ending platform and policy changes. That turbulence created just enough space for challengers to enter the fray, like Mastodon, a decentralized social network made up of independent servers, microblogging platforms like Hive Social and Post.News, and Spill, a new social network launched by former Twitter employees. Even Twitter founder Jack Dorsey announced plans for a new social media company called Bluesky Social.
At first, the pendulum swung and, in response, users threatened to leave Twitter for other platforms (mostly Mastodon, one of the alternatives that is most similar to Twitter). Mastodon’s usage spiked 6,380% worldwide between Oct. 15 and Oct. 26, and again between Oct. 27 and Nov. 7, following Musk’s takeover, per Sensor Tower and eMarketer.
That surge in growth subsided shortly after many reported the app wasn’t user-friendly. However, the pendulum seemingly hasn’t swung far enough to encourage more users to abandon Twitter. For some, Musk’s changes aren’t bad enough to push them to flee and explore social media’s largely unknown frontier of Twitter alternatives.
“Any platform can be a Twitter alternative, just as conservatives found out when they moved to platforms like Gab, Gettr and Minds when they were suspended and banned from Twitter last year,” said Baruch Labunski, CEO of Rank Secure, an SEO and digital marketing agency. “However, no other platform will be Twitter.”
Per Labunski, abandoning Twitter to invest time and effort into an alternative platform means losing an already-built community just to have to build a new one from scratch that may not reflect the previous audience. “I’m not looking to make any changes or reduce time on any of the platforms. Twitter has picked up many curious onlookers so that is more of a visual presence for me,” he added.
And Labunski isn’t wrong. For the six-month period between July and December 2022 alone, the average monthly visits to Mastodon totaled 3.2 million, while there were 478,000 visits on Hive and 1.5 million visits to Post.News, per data from SimilarWeb. These numbers are a far cry from the 450 million monthly active users marketers would get from Twitter. So with these alternative platforms each still attempting to scale their user numbers, it’ll naturally take far longer to build rich followings.
Beyond Twitter alternatives, there’s a buffet of social media platforms to choose from, ranging from TikTok to Discord. Not to mention, Twitter still exists and marketers can return to the platform should they so choose. Meaning marketers need to be selective about how they spend their time and money, especially as projected economic uncertainty has ad dollars under more scrutiny than ever.
While there’s no clear winner in the race of potential Twitter alternatives, Mastodon seems to be piquing the most interest, given its similarities to Twitter. In fact, Musk’s changes have sent even some Twitter founders to Mastodon, according to Bloomberg.
Marketers at Verasoni Worldwide, Smartly.io and Battenhall social media agency have experimented with Mastodon. “For us, looking at the growth of Mastodon, it was really to help any brands, that’s after that tech community to find them,” said Drew Benvie, CEO of Battenhall. “From the way we see it, from having used [the alternatives], Twitter and Mastodon [do] really well side by side.”
Benvie said the bulk of the Mastodon strategy is organic, in which company spokespeople create a presence on the platform to connect with their target audience. But with so many unknowns about the platform, there’s more listening and learning that have to happen in order to avoid any bad players or chances of upsetting a Mastodon community, he added.
Even before Musk, Twitter was challenged with maintaining advertisers’ interest, whether in a paid or organic sense. Meaning Twitter’s share of ad dollars and strategy efforts paled in comparison to other established apps like Instagram, Facebook and TikTok. Even among users, Twitter’s numbers fell behind YouTube, Facebook, Instagram, Pinterest, Snapchat and even LinkedIn. In 2021, Pew Research reported that 23% of U.S. adults regularly used Twitter. For Facebook, that number is much higher in comparison, at 69% of U.S. adults using the app.
Since Twitter’s buyout and exodus of some advertisers late last year, the lingering question has been: Where are the ad dollars going? It turns out, the answer is everywhere.
According to marketers, there doesn’t necessarily seem to be a correlation between clients stepping away from Twitter and clients stepping toward platforms similar to Twitter. Instead, agency clients are asking to explore and invest in already established platforms, like Reddit, TikTok or Meta.
“Most of my clients aren’t looking to necessarily replace Twitter with one of these but are looking to add some other platforms to their list of strategies,” said Labunski. “It could result in less effort going into Twitter over time but we’ll have to see where the platform goes.”
To Mark Lainas, president of Canvas United digital agency, it speaks toward the current trend of social media fragmentation. In other words, there are more online communities built across various platforms for which marketers will need to consider social media strategies.
“When we pull back from investment in Twitter, they’re actually the logical next step to go and do a test and learn it,” said Lainas, referring to platforms like Reddit and TikTok. “The winners will be not necessarily those new start up social channels, but actually, some of those second tier channels on many social media plans.”
This is the fifth part of a research series on the most popular emerging technologies. The series follows up on a report Digiday produced five years ago to discover how technologies previously reported on have evolved and to explore new technologies that have since emerged. In this segment, we look at how publishers and marketers are using blockchain technology.
Despite a lot of hype surrounding non-fungible token drops and cryptocurrency investments, blockchain technology is lagging well behind other emerging technologies in widespread adoption. In fact, of all the emerging technologies Digiday+ Research has examined in this series, blockchain remains the most theoretical and speculative in its use.
NFTs and cryptocurrency were hot buzzwords in 2021, with brands and publishers ramping up investments and experiments – or at least paying lip service to doing so. But by late 2022, the daily market size of NFTs on Ethereum, a cryptocurrency platform supporting the majority of NFTs, was much lower than in 2021. The daily average sales value dropped from $178 million in August 2021 to just $90,000 by Nov. 29, 2022, according to Statista.
And cryptocurrency itself suffered a major market crash late last year, with crypto exchange FTX filing for bankruptcy in November. The crypto market in general tends to be volatile as cryptocurrencies are purely speculative, backed by little inherent value or meaningful regulation. Waning consumer interest in cryptocurrency was also reflected in Google search trends, as searches for the term “cryptocurrency” rose and fell rapidly between 2020 and 2022 with lower and lower peaks, according to Digiday analysis.
Of the small set of publishers and marketers who do use blockchain technology, the majority have found the most practical applications in NFTs, with cryptocurrencies coming in third in actual usage. To ramp up consumer interest, some early adopters aim to make the technologies more accessible and easy to use. Publishers are incorporating blockchain experiences into live events by turning event tickets into NFTs, while marketers are hoping to demystify NFT sales by letting consumers use credit cards rather than cryptocurrency for transactions. Other marketers are adding bitcoin payment options for transactions on their websites. But across the board, both companies and consumers are struggling to find a true purpose for the technology.
“If there’s a term that is overused more than AI, it’s probably blockchain,” said Gannett’s CTO Vincent Cirel. “I don’t think the general public out there has anything but the vaguest idea of what some of the use cases for blockchain are.”
For this report, Digiday+ Research surveyed 388 industry professionals at organizations including agencies, brands, retailers and publishers to uncover how they’re currently using blockchain technologies, like NFTs and cryptocurrency – and how they plan to incorporate the technologies in the future.
When considered alongside the other emerging technologies Digiday has examined over the course of this series, such as artificial intelligence and augmented and virtual reality, blockchain is lagging behind other emerging technologies in widespread marketer and publisher adoption. Only 16% of marketer and publisher respondents invest in or use blockchain and nearly three quarters (72%) of marketers and publishers said they don’t use the technology at all.
Adam Simon, executive director at IPG Media Lab, said this lack of adoption is keeping blockchain stuck in the realm of a largely theoretical emerging technology, rather than one with widespread usage. “NFTs and Web3 technologies have gotten a lot of attention, but if you look at the real numbers, they’re quite small,” Simon said. “The number of people who have activated a crypto wallet is less than a million people.”
A primary reason behind the lack of adoption is that companies are struggling to find real-world opportunities to use the technology beyond creating buzz through one-off events like NFT drops. NFTs act as a non-duplicable digital certificate of ownership for any assigned digital asset. They are easier to market to consumers in the form of digital artwork or collectibles, but maintaining consumer interest in NFTs is something companies are still experimenting with, according to Simon.
“There are potential long-term interesting applications of things like tokenized access — using an NFT on the blockchain to provide access to unique experiences,” he said. “The experiments we’ve seen with tokenized access so far have been very similar to things you could easily build using traditional technologies like ticketing.”
“There has been talk about reducing the cost of coordination and offering experiences that are unique to someone who is a holder of multiple NFTs from different providers,” Simon added.
Cryptocurrency has its own hardships to face when it comes to business investment and consumer interest. It took a major hit recently — both financially and in terms of public perception. FTX, a popular cryptocurrency exchange based in the Bahamas, collapsed in November 2022 after a CoinDesk report revealed that the company lacked funds to back customers’ withdrawals. FTX declared bankruptcy on Nov. 11, with founder and CEO Sam Bankman-Fried stepping down as his net worth dipped to near-zero from almost $16 billion. In December 2022, Bankman-Fried was arrested on eight federal counts of fraud and conspiracy after being accused of organizing a plan to defraud FTX investors.
In general, the crypto market tends to be volatile, as cryptocurrencies are currently purely speculative, backed by no inherent value and no federal governing body yet regulating the market. Likewise, the value of NFTs can be unpredictable, since they tend to rely on hype to drive and sustain consumer interest.
For companies that have found a reason to invest in blockchain technology, most rely on external vendors to build their technology applications, with just over half (51%) of respondents saying they use a third-party vendor. Only about one quarter (24%) use an in-house team to build blockchain technology – likely given its complexity and security implications – and another 25% use a combination of in-house and third party vendors.
Decrypt Studios is one such third-party vendor that helps provide brands with the means to mint their own NFTs and produce other blockchain-related products. The studio is owned by the media arm of the blockchain investment company ConsenSys Mesh and opened in October 2021. It focuses on producing projects using blockchain and Web3 technology for both brands and individual creators, ranging from NFT drops to metaverse-adjacent activations.
“Minting an NFT is not for the faint of heart. You have to understand things that are endemic to the crypto world that a lot of the folks coming into [Web3] don’t understand yet,” said Alanna Roazzi-Laforet, CRO and publisher at Decrypt Media and head of Decrypt Studios. “There’s so many open questions in the space and the answers keep changing. So we help demystify all of that.
In other instances, brands themselves are investing in third-party solutions. For example, late last year Nike bought digital art studio RTFKT, which specializes in virtual product drops and NFTs. With the purchase, Nike became the first major retailer to acquire a company in the NFT space, perhaps signaling that NFTs and virtual product drops could become a more important part of retailers’ digital strategies going forward, despite some post-hype skepticism.
Although blockchain’s early promise for business utility was to securely log transactions between buyers and sellers — and indeed that remains its most talked-about capability — the most common reason marketers and publishers use blockchain technology is for NFTs (according to 64% of respondents). Supply chain transparency and sustainability (49%) and cryptocurrency (47%) are second and third, with nearly half of respondents using blockchain for those purposes, respectively. Only a little more than one-third of respondents have found reasons to employ blockchain for encryption and security, making it the least common utility.
NFTs have risen to the top of the list of potential applications thus far because both publishers and marketers can readily market and sell NFTs to consumers as digital art pieces or collectible items, foregrounding the aspect most understandable to consumers. Brands generally make the one-of-a-kind digital tokens available through “drops” on an app or NFT marketplace, releasing them at an exact date and time and minting them in limited batches.
An NFT’s value is based on how well received the item is by the people who are willing to buy it, usually using cryptocurrencies such as bitcoin. Once a consumer has purchased an NFT, they have the digital rights to resell, distribute or license it as they see fit.
Some companies, like clothing brand PacSun, have even shifted to a digital-first marketing strategy, with an emphasis on NFTs, along with other emerging technologies like AR and VR. The company launched its first NFT initiative in November 2021, which focused on its classic wave logo. In January 2022, PacSun unveiled its own NFT series, dubbed Pac Mall Rats.
“This is not just a new category, but it’s an important one,” PacSun co-CEO Alfred Chang said. “Being able to have products, skins and other elements in a virtual world along with the physical world, I think it just expands our retail reach. For us, it’s important that we not only participate today, but it’s something that we absolutely [need to] stay relevant. Our expectation is that we will be right there as well in terms of expanding our offering.”
While PacSun has its eye on increasing its future use of NFTs, Complex Networks’ head of experiential Neil Wright said not enough brands have thought about how to use the technology beyond initial experimentation.
“A lot of brands have tried to drop an NFT as a knee-jerk reaction to what was happening [in the marketplace], but they didn’t have a long term strategy,” Wright said. “They’re not monetizing this NFT on the secondary market because there’s really no value, no incentive for people to want to trade it.”
Notably, brands are unable to make revenue in the secondary market when NFTs are resold because reselling typically happens on platforms other than brand owned-and-operated ones. Since NFTs do not generate lifelong revenue for brands, marketers typically use NFT drops in order to bring attention to the brand and the company’s ability to use emerging technologies.
Companies’ second most used application of blockchain technology is for supply chain transparency and sustainability. This form of blockchain technology provides accountability and security through the production process —- something that’s particularly important for fashion brands as a way to better verify a material or product’s authenticity.
In April 2021, luxury goods conglomerate LVMH, in conjunction with Cartier and Prada, launched a global luxury blockchain in which users can add information about a product as it makes its way from where materials are sourced to the creation of the finished product — thus opening a window into the company’s supply chain and allowing consumers to follow the entire product journey.
The nature of a blockchain means that no one can change any information added to the ledger, and LVMH said in a statement at the time, “The objective is to provide consumers with a high level of transparency and traceability throughout the lifecycle of a product.”
Five years ago, as blockchain began to enter more mainstream vernacular, it mainly referred to cryptocurrencies like bitcoin and Tether. However, in 2022, cryptocurrency is only the third most commonly used form of blockchain technology, with 47% of respondents saying they use blockchain for cryptocurrency and digital coins — mainly by accepting them as payment.
Much of the early hype around cryptocurrencies subsided not long after it began. Crypto values skyrocketed for a while until early 2018, when the bitcoin bubble burst and prices dropped. At the same time, public perception of the technology began to erode.
Early on in blockchain discussions, security and decentralization were main selling points for the entire blockchain paradigm as well. However, the majority of companies do not use the technology in that context — or at least for that purpose — with less than 35% of respondents saying they use blockchain for encryption and security benefits.
When Time launched its first NFT, decentralization and security were front of mind for the publisher, but Time’s CTO Bharat Krish noted the company had to adjust its strategy for future sales. “We went into the first drop thinking that we have to keep it open and inclusive, but it turns out it was actually the opposite effect,” Krish said. “We kept it so open that only the crypto-native and people who could game the system could participate. That gave us an important lesson that we really need to focus on the customer journey from the beginning for somebody who’s a novice.”
Since then, Time has shifted its approach to put more emphasis on requiring advanced user registration and verification prior to NFT purchase, while adhering to the principles of decentralization. “Everything we’ve built is 80 to 90% decentralized,” Krish said. “We purposely made sure that we don’t use the centralized ways of database management. Everything we do is purposefully decentralized to follow the principles of Web3.”
It’s important to emphasize that security and decentralization aren’t always ends unto themselves, but can be a feature inherent in some other blockchain use cases. So, while survey results show that security isn’t respondents’ main end use, it may factor into other blockchain technology applications, such as supply chain transparency, as discussed above.
As marketers and publishers dip their toes into the NFT waters, they do so mainly with the goal of raising awareness about their brands. The majority of respondents (81%) said they use NFTs for brand awareness, while more than half (64%) use NFTs as a new revenue stream. New customer acquisition and increased security were less important outcomes for companies.
NFT drops can be a quick way for larger companies with research and development dollars to spend to create attention-grabbing headlines and potentially generate new revenue in the process. The strategy focuses on using the moments in which the brand announces it’s using blockchain technology and then actually releases the NFT to garner interest, but it tends to be employed as a short-term strategy to generate public awareness rather than as a long-term technology strategy.
In July 2021, Campbell Soup Company jumped into the NFT game with a digital product art drop geared toward increasing brand awareness and product purchases after canned goods sales declined post-pandemic. It used the drop to remind customers of its most iconic brand images, including the red and white soup can labels Andy Warhol appropriated in the 1960s to create his famous Campbell’s Soup Cans artwork. The NFT collection could be repurchased on OpenSea, a leading NFT marketplace, and the art pieces were selling at around 0.39 ETH (Ether, equaling $1,283.38) in January 2022. Campbell also used the drop as an opportunity to further connect with the tech-savvy millennial demographic.
Time magazine, on the other hand, has taken a slightly different approach in its use of NFTs — potentially converting a shorter-term awareness tactic into a longer-term strategy — by stoking a community in which current and future NFTs will maintain value and cachet. The publisher built its encompassing blockchain business bit by bit. The publication represented one of the only companies seeming to use blockchain technology as a long-term strategy.
In March 2021, Time launched its first NFT project, a three-part collection of digitized magazine covers from decades prior. The top-selling one sold for the equivalent of $250,000 (135 ETH at the time). One month later, the company began accepting cryptocurrencies as payment for both subscriptions and advertising deals. That fall, Time launched its TIMEPieces project, which convenes crypto-enthusiastic audiences into one Discord-based club (that had 40,000 community members as of April 2022) and labels all of its NFT drops under the TIMEPieces umbrella.
Keith Grossman, who was president of Time when Digiday spoke with him and is now president of enterprise at MoonPay, said Time’s strategy is meant to engage consumers on a long-term basis. “What we learned through all of the ups and downs is the importance of building community,” Grossman said. “It doesn’t make a difference that we dropped all these NFTs. What makes a difference is how much we’ve managed the community. Our community is not about short-term thinking.”
“The community is about values, and we rally our community around those values every single day,” Grossman added. “The rationale is that we believe that values create value over time. Our ability to think long about what we’re building allows people to think and care about the community that we’re building through good moments in the crypto cycle and challenging moments in the crypto cycle.”
Other publishers see potential value in future use of NFTs and other blockchain technologies to serve multiple purposes at the same time, such as providing access to events or educational certifications while creating brand loyalty. This overlap within blockchain applications harkens back to the security-based underpinnings of the technology and the potential to apply these benefits across uses of the technologies.
Vadim Supitskiy, CTO at Forbes, said he sees many potential uses for blockchain technology among publishers. “One of the major use cases is access — membership, access to live events, access to metaverse,” Supitskiy said. “The second is authentication — education, certifications, validation that you completed a course. For publishers it could be grading, reading a series of articles or watching a series of videos that are reported on blockchain.”
“For publications, it creates loyalty and engagement,” he added. “It gamifies the whole experience and it gives the user that validation, ‘Hey, I accomplished that.’ [The user] could potentially get perks for [activities] on a website or inside that ecosystem.” For the time being, however, these applications of blockchain are largely theoretical outside of some publishers sporadically using NFTs as authenticated event passes.
Cryptocurrency, while a more established use of blockchain than the theoretical authentication and certification applications mentioned above, is still largely abstract. Marketer and publisher survey respondents said that their most common goal for future usage of cryptocurrency is for transactions, with new revenue streams (50%), brand awareness (47%) and new customer acquisition (33%) also top of mind, similar to NFTs.
However, when it comes to real-world use of cryptocurrency, most notably consumers typically use cryptocurrency as a speculative investment. Cryptocurrencies are created, distributed, traded and stored using blockchain technology, which serves as a digital ledger, recording and facilitating the digital transactions. This is the only mainstream practical application of cryptocurrency currently, while survey responses noted here are marketers’ and publishers’ goals for its future use.
Several beauty brands have been adding bitcoin payment options for transactions, the most common usage goal of cryptocurrencies, with nearly 60% of survey respondents selecting this usage. It is also the only one that most companies can readily implement.
In January 2021, Wake Skincare, a U.K.-based DTC brand designed for millennial and Gen-Z consumers, began accepting cryptocurrency payments by making bitcoin and ethereum payment options available using Coinbase in its Shopify checkout. Wake co-founder Alex Mavor said he sees the payment option as a long-term strategy for the company.
“The reason why we wanted to do it is because other beauty brands weren’t doing it,” Mavor said. “We know that we’re not going to get a load of customers, or maybe any customers, today paying with bitcoin.”
“A lot of the people at the moment are just using it as an investment,” he added. “But the thing is that — with all technologies — they always say that change happens really slowly, then all at once.”
Publisher Time has aimed to use crypto applications to create new revenue streams and to stimulate brand awareness, the second and third most commonly selected answers at about 50% of respondents each. In April 2021, Time started accepting bitcoin (and 31 other types of cryptocurrencies) from paid subscribers through a partnership with Crypto.com.
Maya Draisin, chief brand officer at Time, said while current subscribers weren’t asked to switch to the crypto payment options, the method allows the company to introduce the Time brand to native crypto users and to give them accessible payment options — thereby setting up pipelines to generate new revenue streams. She said she hoped it would also give current subscribers that are “crypto curious” an entry point to see crypto usage in the real world.
While not an offered survey response, other brands are using cryptocurrencies to create brand loyalty. Lolli, a Rakuten-esque platform, gives portions of bitcoin as online shopping rewards rather than money. Similar to NFTs, this usage generates buzz for the brand, and the application has gained traction, with more than 1,000 Lolli merchants using the program. Alex Adelman, co-founder of Lolli, said the incentives are not aimed at getting consumers to spend bitcoin just yet.
“We saw it as a way to distribute bitcoin to more people, way easier by not making them have to be an investor to get into bitcoin,” Adelman said. “They could just be a shopper, which is something that everybody [is].”
While cryptocurrency, like other areas of blockchain technology, has strong potential applications for security by using cryptography to secure transactions, security was very low in importance to survey respondents. Only 11% of respondents said their goal is to use cryptocurrency for its security benefits.
IPG Media Lab’s Simon said one reason for the lack of interest may be the need for users to set up crypto wallets to protect their currency from hacks. “The complexity of setting up a crypto [wallet] is the biggest consumer block and some of the complexity extends to things like security,” he said.
“You see high profile people all the time who theoretically know what they’re doing, who get their NFTs phished and lose millions of dollars, everyone from celebrities to people who are leaders in the space have fallen victim,” Simon added. “The setup and onboarding is complicated, but the security is also complicated. Until we have decent answers to both of those things, it’s going to remain a niche hobby technology.”
When marketers and publishers are determining where to sell virtual items like digital art pieces in exchange for cryptocurrencies, the majority turn to NFT marketplaces. Seventy percent of respondents said they use the third-party marketplaces to sell virtual goods for cryptocurrencies and digital coin-based payments. Owned-and-operated platforms, where some companies are putting the framework in place now for what could become more wide-scale use of crypto in the future, are their next best choice, in second place at 60% of respondents.
Cryptocurrency exchanges are much less commonly used, with less than half (45%) of respondents saying they use the exchanges – likely because they’re only accepting cryptocurrencies, not creating them. But, perhaps not surprisingly, almost one-third of companies are finding opportunities to sell goods in gaming environments, with 30% of respondents selling virtual products through online gaming.
The most commonly used platforms, NFT marketplaces such as OpenSea and Rarible, allow companies and individuals to display, sell and buy NFTs in exchange for cryptocurrencies. Consumers can also resell NFTs to other shoppers on the marketplaces, and some NFT marketplaces offer the ability to mint NFTs on the platforms as well.
Time magazine chose not to create its own platform for selling its TIMEPieces NFTs, instead making them available through a third-party marketplace. Time’s Krish said the marketplaces offer a built-in consumer base.
“We don’t need to build our own marketplace because the audience is actually in marketplaces like OpenSea and Coinbase,” Krish said. “So we only take care of the primary mint and then we create our community within our collection within OpenSea for secondary sales.”
“The journey of going from a primary mint to the secondary sales is also something that’s part of a lifetime customer journey that we’ve built,” Krish added. “User experience is really important. … We want to make sure that everybody who comes in could be a novice and participate in this.”
Other companies find value in offering consumers the opportunity to use cryptocurrencies on their owned-and-operated platforms (60% of respondents). The strategy is interesting considering the majority of respondents said they primarily use third parties to build their blockchain technology. However, having a strong owned-and-operated system in place now could pay off down the road.
By accepting cryptocurrencies on their own platforms, companies can potentially set themselves up technologically now for what could become more wide-scale use of cryptocurrencies in the future. Additionally, accepting crypto payments may provide access to new and younger demographic groups and to consumers who may not have access to more traditional payment methods like bank accounts and credit cards.
Another platform through which publishers and marketers are trying to reach new consumer groups with cryptocurrency transactions is online gaming. Thirty percent of respondents said they are selling virtual goods for cryptocurrencies and digital coin-based payments in gaming environments.
Companies, including the aforementioned PacSun, sold NFTs in ComplexLand 3.0, the third iteration of a virtual fashion and music festival hosted by BuzzFeed’s Complex Networks in May 2022. ComplexLand sold its own artist-created NFTs within the environment as well.
Complex Networks’ Wright said although the NFTs were available in the virtual environment, sales took place on third-party platforms. “In year two, our NFT gallery was in partnership with Nifty Gateway, so everything was a click out to Nifty Gateway’s marketplace for the actual transaction,” Wright said. “This year, we weren’t rigid to one partner. So many different marketplaces have emerged that we are working with whatever the artist or the collaborator prefers. If an artist is dropping on OpenSea, we could accommodate that.”
Wright said that selling NFTs in gaming environments has the dual value of helping artists monetize their artwork, while simultaneously supporting burgeoning Web3 technology. “That’s really important that whatever we do within ComplexLand, even if it isn’t happening within the confines of the venue that we’ve created, that we’re still supporting it,” he added. “The technology is very important to these virtual worlds and we really want to stay curatorial, first and foremost, whether it’s brands or artists, and then be able to support them wherever their transactions are occurring.”
Despite marketers’ and publishers’ new ventures and experiments with NFTs and cryptocurrencies, the majority of survey respondents haven’t found a reason to use blockchain technology yet. Business relevance is the main barrier to company adoption, with the majority of respondents (71%) saying the technology isn’t relevant to their business.
Of the respondents who aren’t currently using blockchain technology, more than half said they aren’t investing in the technology because it isn’t relevant to their business, while another 16% percent cited a lack of customer interest.
When it comes to NFTs, the digital tokens are often used to create immediate buzz and awareness around a brand, but companies struggle to maintain ongoing consumer interest. Another challenge is getting audiences to care about acquiring digital art in the form of NFTs. The inability to associate value to some level of ownership of an image, video or other digital asset limits adoption by individuals who have never before bought an NFT or invested in crypto.
Complex Networks’ Wright said finding a long-term approach with added user benefits is needed to retain consumer attention. “In the short term, there’s no equity or utility in the actual [NFT],” Wright said. “If you are strategic about how you’re launching it, from a brand standpoint, you can really build a deep connection to your community that is giving them skin in the game to a certain degree of decision making. That’s the lowest barrier of entry, giving them perks.”
Turner Sports has attempted to do that by creating an NFT-based golf game called Blockletes that gives players the opportunity to buy and increase the value of their NFTs. Yang Adija, svp of digital league business operations, growth and innovation at Turner Sports, said perks can help build communities among users and increase and sustain longer-term consumer interest.
“If you own a particular NFT or digital collectible, you are then given access to other media assets … and so these become a rewards program and a ticket that you then own and have access to something that has a value,” Adija said. “Because you own this, you can sell it or give someone else access to it, and you’ve earned it. It’s yours, and you have jurisdiction.”
Turner Sports’ approach is similar to Time magazine’s community building approach noted earlier — here within a game and there within a cultivated community — of creating a context in which the NFTs are valuable, and sustaining that context so the NFTs maintain value within it beyond the initial purchase. The companies’ efforts to make NFTs matter to specific circles of users, within specific environments, while not banking on the inherent value of the NFTs, seems to offer a winning strategy.
Cryptocurrency faces some of the same challenges as NFTs in terms of lack of consumer interest, including a need for more widespread use for transactions as opposed to speculation. But a more pressing concern at the moment is market stability.
With the recent FTX collapse, some prominent companies have begun distancing themselves from crypto across the board. At last November’s Fortnite Championship Series 2022 Invitational, for example, TSM taped over the FTX sponsor logo. When asked about the move, an Epic Games spokesperson pointed Digiday toward the company’s public event license terms, which restrict the promotion of sponsors in a number of “risky” categories, including crypto.
Gannett’s Cirel, whom Digiday spoke with prior to the recent crypto market crash, said he could see potential for increased use of blockchain if the industry can find a way to move past the technology being discussed theoretically and if cryptocurrencies were narrowed down to a few select digital coins.
“When you say blockchain, people automatically think of cryptocurrencies, bitcoin,” Cirel said. “It’s pretty clear that as those types of services and products and domains become more commonplace that some form of cryptocurrency is an absolute requirement to facilitate the economy. … One of the things that the industry and the players in the industry have to sort out is how do we divorce the term blockchain from equating to cryptocurrency? Are we going to wind up with hundreds of different ones? I don’t think that’s a sustainable structure.”
Time’s former president Grossman agreed the technology itself needs to be less at the forefront of discussions and instead must become enmeshed in people’s everyday lives, similar to the way computers evolved. “The technology right now is leading the conversation, in the way that in the earliest days of PC adoption, people talked about their computers,” Grossman said.
“What’s really important is [blockchain] will not be mass adopted until the technology is invisible and people are not using the term NFT,” he added. “It’s at the earliest point of the early adopter curve, but we could see, every day, friction being removed from the ecosystem and mass adoption coming.”
IPG Media Lab’s Simon said user experience needs to improve, with more decentralization. “People who are theoretically primed to do something like own multiple NFTs from multiple brands and unlock experiences is still a very small number,” he said. “There’s a lot of work to be done on the user experience side.”
“The way those technologies are mainstreamed is that they’re absorbed into the platforms and the platform owners that we already have,” he added. “A lot of the promise of decentralization around Web3 is not guaranteed because decentralization tends to be pretty consumer- and user-hostile.”
In order for blockchain technology to see increased future marketer and publisher adoption, further innovations to the technology will likely need to come from tech giants that have the funds and bandwidth to invest in improvements. In the same way that Meta acquired VR headset maker and developer Oculus VR in 2014 and Samsung and Apple are creating AR compatible smartphone camera lenses, other tech companies will need to lay the foundational infrastructure to make blockchain technology readily available before marketers, publishers and consumers alike increase their use.
So, for now, blockchain remains a largely theoretical emerging technology.
Every downturn is good for someone. Take TikTok, for instance.
Even as marketers continue to scrape dollars back wherever they can, whether that be from TV or Facebook, they can’t stop pouring money into the short-form video app. And that’s despite some big question marks over whether those ad dollars could be funding growing tensions between the U.S. and China.
Until those answers materialize, those frictions are nothing more than ifs, buts and maybes to marketers. What isn’t up for debate, though, is how much TikTok continues to dominate people’s attention. And that will always be the big draw for advertisers — irrespective of economic or political tensions.
“Between the first three quarters of 2022 and the final one, we saw ad spending on TikTok rise 20%,” said Ben Allison, head of media operations at VaynerMedia. “It’s still early this year to say for sure, but anecdotally we see this trend of investment in TikTok continue to increase with quarterly comps expected to grow at least for the duration of this year. “
It’s hard to argue with this view. Whether marketers are in a place to spend now or are instead optimistically planning for future campaigns, TikTok is now in consideration alongside always-on media channels, especially for driving awareness of big brand moments
“TikTok makes up about 25% of the social ad budgets,” said Brendan Gahan, chief innovation officer at digital marketing agency Mekanism. “Since 2020 it’s grown pretty steadily. Each year it’s grown around 50% year over year.”
That’s rapid growth for an agency that did its first branded hashtag on TikTok back in 2019. And it looks like that pace is going to continue this year for Mekanism’s advertisers just like it is for many others elsewhere.
“While TikTok accounts for less than 10% of total spend for our marketing firm, it has more than doubled year over year,” said Rob Jewell, chief growth officer at Power marketing agency Power Digital, a tech-enabled growth marketing firm, which works for clients such as Procter & Gamble, Uniqlo and Casper. “We anticipate a similar growth trajectory in 2023 as the channel keeps attracting more advertisers eager to scale their TikTok efforts.”
When this happens advertising tends to get less experimental.
In fact, the moves on display from TikTok advertisers nowadays are starting to resemble a tried and tested playbook.
What works for a lot of them these days seems to be to run TikTok ads in conjunction with influencer marketing. So they use paid ads to essentially boost content they think could, or is, getting traction among users. Estee Lauder said as much last year, as did Pepsi the year before that.
“Advertisers that have tested TikTok generally see success in driving incremental revenue, and are continuing to double down on the platform,” said Jewell. ”Many advertisers are testing TikTok in Q1, with plans to scale exponentially throughout 2023.”
Which is to say TikTok is fast becoming a mainstay on the media plans for many advertisers. Granted, it isn’t as big an investment for these advertisers as Facebook or Instagram. But where advertising on those platforms is slowing (and in some cases in actual decline), the complete opposite is happening on TikTok.
Why? Because more often than not the money that would’ve gone to those platforms is now going to TikTok. And it’s not hard to see why. Marketers get a sound on, full screen video ad opportunity when they advertise on the app, which effectiveness research shows is most impactful. That’s a world away from advertising on Facebook, Instagram and even Twitter where that sort of efficacy is hard to come by with video ad formats that aren’t as intrinsic to the wider feeds. Put another way: TikTok’s growth is coming at the expense of its more established counterparts.
“On the whole we continue to see the movement of dollars from traditional channels into online channels so the pie for TikTok to dip into is getting bigger, although this migration of spend is slowing,” said VaynerMedia’s Allison. “When it comes to TikTok specifically, though, the increase in budgets there is coming from direct competitors. It’s money that’s becoming available, like Twitter for example, that TikTok has been able to pull into its ads business.”
In many ways, this goes against the grain. Normally, ad dollars tend to retrench into tried and tested areas like Facebook and Instagram where marketers know they will do a job. Relatively new platforms like TikTok aren’t exactly top of mind in these moments.
Then again, these aren’t normal times.
There’s a growing realization amongst the marketing community that the effectiveness of the most established platforms doesn’t necessarily warrant the spend. That’s due to a few reasons. Chiefly, that Apple has throttled the data advertisers relied on to believe whether or not their advertising on social media. TikTok, for the most part at least, continues to avoid the same issues.
Yes, it had to cut its global revenue forecast for 2022 by $2 billion, but $14.5 billion was always ambitious even at the best of times. The forecast wasn’t unrealistic, though. Not when there’s a big gap between the amount of money being spent on online ads (less than 2%, per Insider) on TikTok and the amount of time spent on it (22% of the two trillion hours spent in social apps on Android devices, according to analytics firm Data.AI). Fast as the gap is closing it could close faster still if ad prices continue to make an easier decision even easier for advertisers.
“For self-serve, or programmatic, it’s gone up about 10% YOY. There are additional factors, like new placements, targeting strategies etc, said Kevin Renwick, director of media at Mekanism. “It still is extremely cheap and competitive against other platforms (still coming in cheaper versus YouTube, Meta, Snapchat etc) so even though it is incrementally increasing, it is not a concern yet.”
Not bad for an ad sales team that had a tricky 2022 that included a restructure. It’s even more impressive given that TikTok has yet to announce any big trading deals with the media agencies. Proof that once a narrative takes hold, it can drive markets.
“TikTok is shifting the way we like to consume content on social media,” said Amy Gilbert, head of social for North America at The Social Element. “There are opportunities on that platform from a paid perspective, even if it’s just testing and learning. If brands aren’t thinking about this, they’re a little late to the game.”
Now come the caveats.
For starters, the amount of ad dollars spent on TikTok is nowhere near what’s getting dropped on Facebook and Instagram. Last year, the short-form video app raked in around $10 billion in revenue. Facebook did nearly triple that ($27.7 billion) in its last quarter. Then there are those worries that TikTok has become a new habitat for manipulated videos and photos. To say nothing of the fact that as a pure advertising channel, TikTok doesn’t have the efficiencies performance advertisers crave. Part of it has to do with the maturity of their algorithm and the ability to identify the right customer within the audience to help serve the ads.
To say the app has come a long way over the last two years is an understatement. Back then it was seen by many marketers as more of a niche channel where young people went to watch quirky videos of each dancing. Now, not only is the app more mainstream with more than 850 million users worldwide — 40% of whom aren’t on Facebook — people are going there to do a lot more than watch random videos. Yes, they still do that, but they’re also shopping, watching the news and even using TikTok as a search engine.
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Many publishers pivoted to short form vertical video in the past year as platforms prioritized those content formats in their algorithms. Betches Media, however, invested more in its social-first content strategy that it’s had since its creation in 2011, according to co-founder and CEO Aleen Dreksler, to continue reaching its audience of primarily millennial and Gen Z women.
It seems to have paid off in 2022, despite how challenging the ad market was for many publishers’ businesses. Betches Media saw a 40% increase in revenue year over year, according to David Spiegel, the recently appointed chief revenue officer who joined the company last July who did not provide specific figures.
Despite having a long history of producing short form vertical video, Dreksler and Spiegel both said on the latest episode of the Digiday Podcast, that there is more learning that needs to be done, especially on emerging platforms like YouTube Shorts — which has been particularly helpful in the company’s launch of video podcasts.
Below are highlights from the conversation, which have been lightly edited and condensed for clarity.
A growth business in a down economy
Spiegel: Coming out of the pandemic, we’ve organically grown on an annualized rate of about 35% year over year. [In 2022], we [finished] over 40% growth year over year. And as we’re looking into [20]23, we still see a similar growth trajectory.
It comes down to a couple of things. When you’re reading about the trends in the ecosystem… the IAB [is reporting that] the markets are going to grow 6% instead of 9% next year, and the major [categories] that are going to fall are linear television. These kinds of legacy products that are outdated, but have kind of carried the beltway, I think the same thing happens in digital publishing.
If you are a massively scaled publisher who has a very large percentage of your business tied to direct display, that’s risky, right? There are easier ways to do that. Especially if you’re non-differentiated, which unfortunately, because we’ve spent the last 20 years on the internet chasing scale at all costs and in digital publishing, that creates a lot of risk.
There are a lot of stones to still be unturned, the majority of marketers happen to be in our demographic [and] most of them, as I find out, are fans of us, [but] they have not looked at us from a business perspective. So if we can connect those dots, there’s a huge opportunity there. And so I’m projecting growth, not just solely on market dominance or historical trends, but I’m still in a growth business. And even going into economic uncertainty, a growth business still has incredible growth opportunities.
Not needing to pivot to short form vertical video
Dreksler: I don’t think that we ever pivoted away from short form video. We were testing with long form and obviously it’s a lot larger of an investment to do long form, so we pivoted back sooner, because we know how to make content for our audience in short form. It comes very, very naturally to us. And if anything, we understand the type of content that makes sense for short form and the type of content that makes sense for long form, and they’re different. And that’s the key to the strategy. What we are going to continue to do is serialize a lot of our short form content.
Spiegel: This isn’t a company that is pivoting out of a core business of monetizing a giant YouTube following or saying we have a CTV channel that no one actually has ever watched. But what they’ve done is they’ve gone for organic audience engagement from day one. And short form vertical skits have been a core of the business for a bit now.
If we can give [our audience] something that’s incredibly funny, in less than 60 seconds, they’re going to share it with other friends, it’s going to slide into the group chat. And that’s what we want to do. So I think it’s an incredible marketing vehicle for our brand and it’s a great monetization vehicle, because we use the same sensibility [and] the same team, when we’re working with brand partners.
Testing the YouTube waters
Spiegel: In October, we brought [the podcast] “U Up?” to YouTube and it was our first time doing in-studio podcast video on a channel. And that’s grown to almost 6,000 subscribers organically in the last couple of months. That, I think, plays into our Short strategy also, because while we’re also publishing long, if not full, episodes of “U Up?,” we’re also doing a lot of Shorts from the show, to get into the feed and start promoting it from that angle. We are also distributing our skit content across platforms and I think we’re still in a bit of a learning phase in terms of what works there. I don’t think anyone’s really figured out the Shorts algorithm other than it’s TikTok lite, and if we can take advantage and build scale and build importance in that algorithm, then we might be at a competitive advantage when they do turn on monetization.