Less BS, More Facts, Some Opinions
“On TV And Video” is a column exploring opportunities and challenges in advanced TV and video. Today’s column is written by Chris LaHaise, director of TV solutions at dataxu. Connected TV audiences are growing. And despite reports implying that the demand for connected TV inventory is far greater than the current programmatic supply, that’s not… Continue reading »
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Here’s today’s AdExchanger.com news round-up… Want it by email? Sign up here. Second Bite Apple has discussed a potential in-app ad network to target audiences based on keywords – similar to its current App Store search business – and drive app downloads. Snap, Pinterest and others have been approached about the idea over the past year,… Continue reading »
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A lack of measurement standards is keeping brand advertising dollars away from podcasting. But its move toward a measurement standard has been fitful because doing so will cause podcast producers short-term pain.
Now, nearly half a year after two leading organizations released competing measurement standards, the industry is slowly getting its act together. On July 1, Wondery, a top five podcaster that’s responsible for shows including “Dirty John” and “Accused,” will become what it says is the first to completely adopt the Interactive Advertising Bureau’s new standard for podcast measurement. Wondery hopes switching to the IAB standard will encourage its peers to do the same.
Doing so comes at a cost, though. Transitioning to the IAB’s standard has caused a “double-digit percentage” drop in downloads for many of its shows, Wondery said. That hit is slowing the transition that both producers and ad buyers say is necessary to attract more ad dollars.
“It is the right thing to do.” Wondery CEO Hernan Lopez said. “We certainly hope agencies will notice we’re taking the first step.”
The IAB standard creates this short-term pain because it addresses a problem that’s arisen as podcasting has grown into a mobile-dominated medium. If a user began streaming an episode, podcast apps such as Apple’s, which accounts for a majority of podcast consumption, would download the show in chunks, rather than all at once, and in many cases, the shows’ hosting platforms would record those requests as multiple downloads. That and other moves artificially inflated download counts across the industry, particularly for shows with longer episodes or higher bit rates.
There’s little incentive for producers to give up the impressions they can dangle in front of advertisers, but that’s just what the IAB’s new standard would do. The standard only counts downloads from a user over a 24-hour period. The longer window minimizes the likelihood of double-counting downloads, leaving the podcast producer with less to sell. When Midroll, an ad network that sells ads for podcasts including “WTF with Marc Maron” and “The Bill Simmons Podcast,” switched to a system that aggregated all episode downloads a user made during a one-hour window late last year, download numbers for some shows dropped by as much as 40 percent.
“I applaud what Wondery’s doing here,” said Lex Friedman, the chief revenue officer of Midroll Media. “And if the rest of the industry gets to 24 hours, we’ll be there.”
Friedman said Midroll has mostly weathered that storm. But in the 24-hour window, Friedman sees the potential for further declines from things like large groups of employees, all using the same IP address, downloading shows in a single day.
“We care about what advertisers want,” Friedman said. “But we don’t want to put ourselves in that position.”
Others are interested in adopting the IAB standard, but at their own pace. Megaphone, a podcast hosting company owned by The Slate Group, which hosts shows for publishers including HowStuffWorks, Bloomberg Media and The Wall Street Journal, has given its publisher partners until the end of the year to switch over to the new methodology.
“I think now that there’s substance to the [IAB] spec, everybody’s moving in that direction, but at their own pace,” said Joel Withrow, Megaphone’s head of product.
Podcasting remains tiny relative to other digital media formats, with about 73 million Americans listening to podcasts monthly in 2018, according to Edison Research. Podcasting is also dominated by direct-response advertisers, which have made up for the format’s lack of analytics and tracking by relying on download codes or unique URLs to track the effectiveness of the ads.
But brand advertisers say they need those tracking capabilities, and they have long maintained that they require a unified standard that’s embraced by big players to move ad dollars that way.
“I think you need two to three more big publishers to say, ‘We’re going to do the same thing,’” said Gregorio Roseto, the audio investment lead at Horizon Media.
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The General Data Protection Regulation’s enforcement got off to a shaky start, marked by programmatic ad demand volumes plummeting in Europe. While some publishers have recovered programmatic ad revenue drops relatively quickly, others have seen display ad revenues fall further in the past week. Independent ad exchanges aren’t out of the woods, either.
A core reason for the upheaval: Google.
The vagueness of GDPR has led to wildly different compliance interpretations from businesses. Google has taken a strict consent-based approach to avoid the risk of hefty penalties. Days before the law’s arrival on May 25, Google warned ad tech vendors that rely on demand from Google’s DoubleClick Bid Manager to expect some short-term disruption to European campaigns until Google has integrated fully with the Interactive Advertising Bureau Europe’s GDPR framework — to which Google only publicly confirmed its commitment in the week of the law’s enforcement.
However, media buyers were also informed on the eve of May 25 not to buy via DBM on third-party exchanges, as Google could not verify they are compliant. The consequence was that just hours after the law’s enforcement, numerous independent ad exchanges and other vendors watched their ad demand volumes drop between 20 and 40 percent. But with agencies free to still buy demand on Google’s marketplace, demand on AdX spiked. The fact that Google’s compliance strategy has ended up hurting its competitors and redirecting higher demand back to its own marketplace, where it can guarantee it has user consent, has unsettled publishers and ad tech vendors.
“Everyone is watching the dramatic shift in demand from Google,” said a publishing executive at a national publisher. “The concern we all [publishers] call out is Google’s dominance, which is driving distortion of the market, while they’re lining their own pockets. If you believe the privacy cases that have been launched at Facebook and Google, then they’re not pursuing a path to compliance in all areas, but they are insisting with publishers that they are compliant — that undermines that argument.”
“We have suddenly become even more dependent on Google, while other exchanges are hurting,” said the same exec. “It’s the concern of the last two years playing out. We always said, ‘What happens if Google is the only demand source in the market?’”
An ad tech vendor owner, who has seen a collapse in spend on its platform since May 25, said: “GDPR has, as predicted, become an acronym for Google Data Protection Regulation, such is the level of self-claimed ownership the tech company has over the industry’s ability to respond. We and numerous other smaller tech suppliers are seeing our revenues significantly affected by Google’s last-minute decision to join in. It’s exhausting.”
Google has tried to quash any suspicions in the market that its GDPR policy has been devised for strategic commercial gain. At each of the four meetings Google held with publishers last week in New York; London; Chicago; and Washington, D.C., the tech giant stressed its intention has been only to comply fully with its own interpretation of the law. Afterward, Google published an FAQ document based on questions that arose at the meeting. At the meetings, Struan Robertson, Google’s senior product counsel, said: “If regulators change or clarify their position on consent versus legitimate interests, we would change our policy,” a statement that was then emailed to attendees the following day.
A Google spokesperson said it contacted ad tech vendors a month prior to the GDPR enforcement date to warn them they’d need consent to work within its ecosystem. “We worked with our third-party exchange partners to develop an interim solution to minimize disruption while we finalize integration with the IAB framework,” the spokesperson added.
A couple of the larger exchanges, AppNexus and Teads, worked out ways to assure Google of their compliance over the first weekend of enforcement, and as such, can still have their targeted ads bought via Google DBM, which is used by most buyers, The Wall Street Journal reported. “We reached out to publishers earlier this week to let them know that despite a couple of days of disruption after the regulation came into effect on [May 25], spend in our marketplace in Europe has largely normalized,” said Steve Truxal, vp of product management at AppNexus. “We have the backing of our largest demand partners, including Google DBM, whose spend is almost back to pre-GDPR levels.”
That’s also helped publishers recover former programmatic revenue drop-offs seen in the first few days of the law’s arrival. But many others are still hurting.
Some publishers that saw their programmatic revenue nose-dive this week said Google account managers haven’t given them enough information about why. “We’re fumbling around in the dark,” said a publishing executive. This publisher’s display ad revenue dropped 250 percent on May 30, after demand stopped coming from Google DBM and another major exchange, The Trade Desk. For some reason, video inventory has been less affected, just single-digit percentage points down. “We’re still trying to figure out why, but with no help from Google,” said the executive.
Ad operations executives at consumer titles spent the days following the law’s enforcement obsessing over programmatic ad campaign activity. Those that did have seen interesting patterns such as performance-based advertisers, like travel clients, pulling all spend.
One big publisher said it is examining its ad stack intently, watching factors like bid density, to try and understand why its programmatic ad fill rates are still down. “Our fill rate is our main cause of concern, and we believe this is linked to less demand from key [supply-side] partners,” said an executive at the publisher. “We could be anywhere from zero to 25 percent down.”
But even those publishers that have experienced moderate short-term dips are reluctant to count their chickens. GDPR arrived on the Friday before U.K. and U.S. national holidays on May 28 — a time when buyers typically look to offload budget. That fits with some big publishers reporting that brand programmatic ad spending spiked May 27-28, after dipping from May 24, the eve of the law’s enforcement.
There are also differences in how publishers are faring depending on the justification they use to collect visitors’ data. Publishers are divided between those that have tried to abide by GDPR to the letter, prioritizing opt-in consent from users for everything, and those that have relied on opt-outs or legitimate interest. Those that have gone the consent route believe they are getting the raw end of the deal compared to those that have relied on opt-outs or legitimate interest, or simply done nothing and hoped to skim under the U.K. regulator’s radar, according to sources.
One publishing executive is concerned the rest of the supply chain isn’t yet in a position technologically to be able to pass consent information back and forth, which could also be what’s causing a drop in its revenues. Not every publisher has a consent management platform running yet. Those that do aren’t sure the buy side is picking up on when consent is being passed back.
“We think we’re doing the right thing [in being consent opt-in driven], but we may be inadvertently penalized for doing the right thing,” said the executive, “because the publishers that haven’t seen as much of a drop-off are saying they have either not done much [to be compliant] or that they haven’t yet set what they’re doing live yet.”
The post ‘The Google Data Protection Regulation’: GDPR is strafing ad sellers appeared first on Digiday.
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Amazon has become a significant driver of subscriptions for TV companies with over-the-top streaming channels. But even as Amazon assumes the role of a powerful player between TV networks and viewers, networks say they’re not too concerned about ceding too much control to the tech giant.
Launched in late 2015, the Amazon Channels program lets TV networks and video publishers with OTT streaming channels distribute those channels to Amazon Prime customers. Today, the program has more than 160 channels in the U.S. and more than 260 channels worldwide, including those from big-name TV programmers such as HBO, Showtime, Starz and CBS. Amazon Prime subscribers pay extra to add streaming channels from these companies.
Amazon has not broken out how many Prime members use Amazon Channels. But for networks, the program has been a boon for subscriptions. According to a recent study from The Diffusion Group, Amazon Channels accounts for 55 percent of all direct-to-consumer video subscriptions. Sources at two major U.S. TV networks that distribute on Amazon Channels disputed TDG’s findings, saying the numbers weren’t that high, but conceded that Amazon was a top subscription driver. (Other TV network sources have told Digiday that Amazon can account for anywhere from 25 to 45 percent of total subscribers.)
Regardless of the actual percentages, it’s clear Amazon has become a big deal in OTT video distribution.
Amazon makes it quick and easy
With more than 100 million Prime members, Amazon’s biggest selling point to networks is that it can offer quick and easy access to a ton of potential new subscribers. Prime members can add as many channels as they want with just a few clicks, and Amazon takes care of all the billing.
For smaller video companies, which don’t have the resources of an HBO or a CBS, this can be appealing. “Launching a subscription video service is hard. We help our partners to get their services in front of tens of millions of Prime members who are looking for premium video content across 650-plus devices,” said Rich Au, head of the Amazon Channels program in the U.S. “We also have a lot of experience streaming video at scale and handling billing and customer service.”
Evan Shapiro, who was a longtime producer and TV executive at NBCUniversal and elsewhere, said Amazon Channels accounted for upward of 60 to 70 percent of early sign-ups for Seeso, a now-defunct comedy streaming service from NBCU. By the time Shapiro left NBCU in May 2017, Amazon was still responsible for roughly 40 percent of Seeso subscribers.
“Amazon’s a great place to start a [subscription video-on-demand] business without having to make a huge tech investment,” Shapiro said. Au said some Amazon Channels partners launched there even before creating their own direct-to-consumer streaming apps.
Even companies with existing subscription streaming services find a lot to like about Amazon Channels. CBS All Access, which has more than 2.5 million subscribers, is a relative newcomer to Amazon Channels, but CBS has been pleased with the program’s ability to drive subscriptions and consumption, said Marc DeBevoise, president and chief operating officer of CBS Interactive.
“We have only been live since the first week of January, and they were tremendous for us in the first quarter and helped move some good volume [of subscribers],” DeBevoise said. “It’s going to be a great long-term play for us.”
Marketing support, low churn
Through dedicated reps in its Amazon Media Group, Amazon gives its channel partners marketing support, which is another part of the appeal to partners.
Most of the promotion happens inside the Amazon ecosystem and can include banner ads and promoted placements on everything from Fire TV devices to IMDb.com and email notifications. For at least some top networks, Amazon also commits a certain amount of ad space and spending to ensure the channels and their programming get marketed, multiple sources said. (Shapiro said Amazon committed $2 million worth of ad spending for Seeso when the service launched on its platform.)
“Amazon is an important OTT partner for Showtime,” said Ken Kay, evp of distribution at Showtime Networks. “They market our shows very well to their Prime subscribers, informing customers exactly when their favorite Showtime programs are streaming, maximizing opportunity for growth and retention.”
“They have a unique ability to reach out to [Prime] subscribers and drive those people to our programming,” said DeBevoise. “That’s where their value really lies.”
Sources said churn can also be lower with Amazon Channels — by as much as 25 percent — than what networks see on their own streaming apps. That’s because Amazon is a single billing outlet, said Shapiro.
Viewer data is limited
By now, media companies of all sizes are aware of the dangers of relying too much on any one platform. Even TV networks have felt this impact. Many were happy to take money by licensing their shows to Netflix, only to see Netflix grow a global subscriber base and become a disruptive competitor to linear TV. With Amazon driving such a big chunk of subscribers, channel partners privately acknowledged that there should be some concern about ceding too much control over the customer relationship to Amazon.
“[At Amazon], we’re not delivering subscribers to our own and operated platforms,” said an executive at a major U.S. TV network that’s an Amazon Channels partner. “Yes, we’re making money off them — but not as much as we would on our own service.”
Amazon also does not share details about who subscribes to and watches programming on the channels. Media partners said they would like to see information like emails, demographic breakdowns by age and geography, and even more detail on what viewers did on Amazon before and after watching something on their channels.
Others argued that it’s unfair to expect this, partially because these subscribers are Prime members first, and it’s not like existing traditional TV distributors offer detailed information on who subscribes to their TV channels.
“Comcast does not want you to know the full details of the buy flow of somebody — that’s their secret sauce,” said the U.S. TV network executive. “It’s the reason that all of these services fight hard to keep their data and control of the audience — that’s everything to them.”
Plenty of distribution options
With continued streaming growth coming not just with Amazon Channels, but streaming live TV services and direct-to-consumer streaming apps on platforms such as Apple TV and Roku, networks said they’re not worried about relying too much on Amazon or any one platform.
“Ultimately, we do not own a device company, we don’t do hardware, but no matter what, we have to be on those devices,” said DeBevoise. “And ultimately, we’re going to have to go through someone else’s platform or hardware, whether it’s a PC browser or an app for iOS or a connected TV provider. I view Amazon in the same bucket as that.”
DeBevoise said a majority of CBS All Access subscribers still come to the app directly across various screens and platforms. And while CBS can make the most money through its own app, that doesn’t diminish DeBevoise’s view of Amazon or any other distributor. With Amazon and other platform distributors providing services such as marketing, customer service and billing, it becomes a fair trade-off.
“We don’t make significantly more or less on any one platform versus others, including our own, relative to the cost of what they are doing for us — the net to us is effectively the same across platforms,” said DeBevoise. “Yes, it’s always best for us when a person comes to us directly. Our platform is perfect. But every other platform is something less than perfect, but nothing less than what we need and what is good — and Amazon is the same as the other ones.”
The post Amazon has become an important distributor for over-the-top networks appeared first on Digiday.
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Musical.ly is singing a remix to advertisers.
After being acquired by Chinese media company Bytedance last November, the lip-syncing app is stepping up its ad sales effort in a push to attract more ad dollars beyond small influencer-based campaigns. Representatives from Musical.ly have met with ad agencies over the last few weeks to discuss three ad products, which they described as formalizing its pitch.
Musical.ly shopped around most of these ad formats last fall, but since then, it’s gone beyond lip-sync videos via content partnerships and helped advertisers with content creation, according to two media buyers. The new products include more custom content creation and co-creation of assets, said one media agency director, who recently met with Musical.ly. The director’s agency has not bought any paid advertising on Musical.ly, but is considering these products for clients later this year, this person said.
One of the ad formats is called #HashtagChallenge, where brands can “challenge the community to create videos inspired by a brand’s initial video,” said the director, who described it as “formalizing one of their old products that work.”
Another ad product is a brand takeover, where advertisers can create still images and GIFs that will either direct users to a brand’s Musical.ly page or to a #HashtagChallenge it created. Advertisers can also buy 5- to 15-second vertical video ads.
An executive from a New York-based agency said the #HashtagChallenge experience seemed the “most engaging.” Advertisers like Disney and Kit Kat have worked with social influencers on Musical.ly in the past year.
Musical.ly has not shared a formal pitch deck, according to four media agencies. One agency whose team has repeatedly spoken with Musical.ly said the platform hadn’t yet met its media team, but it expects to get updates on the new ad units soon.
Musical.ly did not respond to Digiday’s request for comment.
Similar to Snapchat, Musical.ly boasts an attentive young audience. According to Apptopia, 43 percent of Musical.ly users in the U.S. are 18 or younger, and 67 percent of U.S. users are female. The biggest markets for Musical.ly’s iPhone users are the U.S., India, Spain, Italy and Brazil, according to Apptopia.
Musical.ly still says the app has more than 200 million registered users (same as the time of its acquisition), but is also touting 66 million users in the U.S. (up from 60 million reported last fall), according to an agency executive.
While Musical.ly has an audience that’s attractive to a lot of marketers, agencies have been skeptical of Musical.ly’s ad prices and return on investment. One media buyer questioned how effective vertical video ads would be, given Snapchat’s woes with serving ads to its young audience and its experiments with unskippable ads. The media agencies did not have new Musical.ly ad prices to share.
Musical.ly’s young audience also limits the advertisers it can work with. Alcohol brands, for one, have been hesitant to spend on Snapchat due to the age of its users, with companies like Diageo pulling its ad dollars from Snapchat after an investigation by the Advertising Standards Authority.
For now, Musical.ly is rather light on ads and other branded content within the app, so there is the inevitable fear that adding more ads could turn off its attentive user base. Musical.ly itself has been buying ads on YouTube and on Snapchat, prompting some users to express their annoyance:
Hello 911 yes I’m being attacked by https://t.co/7ru1mGTwSB ads on snapchat without my consent
— mary kate (@mkmcg2596) May 29, 2018
The guys in the https://t.co/M1ly2MLVsf ads on Snapchat make me so uncomfortable someone please make them stop
— Ida (@weehish) May 18, 2018
if i have to see that https://t.co/iRQI1PLoyf ad with that douchebag “singing” into his mic i’m going to sue snapchat for torture
— danny devito but fake (@fakedannydevito) April 19, 2018
The post Musical.ly is quietly starting another big advertising push appeared first on Digiday.
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Last week, in a new campaign for Nestle Pure Life called “Choose Water,” Nestle Waters launched a series of social videos with World Wrestling Entertainment. The videos feature WWE wrestlers talking about staying hydrated and are being shared on Nestle and WWE social channels. People who use the hashtag #ChooseWater to say why they choose water over other beverages will get a chance to win a trip to WWE’s pay-per-view SummerSlam event.
Watching professional wrestlers tackle each other may not be the first thing that comes to mind when you think of family-friendly entertainment. But Tara Carraro, chief corporate affairs officer at Nestle Waters North America, worked as the svp of global communications for WWE, and based on that experience, said more families watch WWE programming together than any sports league in the U.S. except the NFL.
WWE’s SmackDown Live alone averages 2.59 million viewers a week, according to WWE. The network has over 850 million followers across social channels, including 38.4 million followers on Facebook.
WWE has tried to restyle itself as family-friendly for the past decade. In the past, WWE, formerly called WWF (World Wrestling Federation), was known for its brash characters and abrasive language, when blood, scantily clad women and profanity was common in the ring and in its marketing. It’s since covered up women more and invited kids into the ring to meet star wrestlers. WWE has also sponsored do-good organizations like Make-A-Wish and Susan G. Komen to burnish its image.
Carraro said WWE reaches the type of consumers that Nestle Waters wants to reach: parents and their kids. Nestle Waters has its own battle ahead of it. Although consumers are moving away from sugary beverages, generic store brands are often the top sellers in the water category because they tend to be cheaper. The hope is that tying itself to WWE will help Nestle Waters stand out.
Image courtesy of WWE
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Bayern Munich is building out an internal agency.
The German club’s Digital & Media Lab has 60 staffers across content production and delivery, cause related and digital marketing as well as IT services. Most of the team works from the club’s training facility in Munich, Germany, where new premises are currently under construction, including a studio.
Not all of the club’s digital expertise will be housed in the new division. Bayern Munich’s digital team in New York will continue to operate out of the U.S. as a separate unite rather than be moved into the lab. There’s no point in bringing those marketers who oversee the club’s media strategy in the U.S. and Latin america under the control of a German-based media team, said Stefan Mennerich, director of media, digital and communications at Bayern Munich. Instead, the club’s marketers in New York will work alongside those in the lab.
Bayern Munich’s digital team will initially assess existing revenue streams like merchandising, partnerships and TV rights. Retail, sponsorships and broadcast are areas of the sport’s commercial model under pressure from how fans follow football and consequently how brands want to reach them. While Bayern Munich has been more responsive than most to the shift, an in-house agency will give it the ability to manage fans between first party channels such as the app it fully owns, secondary channels, which feature the club’s logo but are operated by other companies, and third party channels such as social media. Consequently, the media lab will manage the club’s work with Dugout, a site it owns along with eight other clubs, as well as a recently announced content partnership with ESPN in the Americas.
Beyond content production and brokering deals with media owners, Bayern Munich’s digital arm will also oversee the club’s app strategy, which includes its early bets on augmented reality and mobile commerce. For commerce efforts the club’s digital arm will work with developer and sponsor SAP to consolidate customer data from 52 third-party technologies so it can serve more personalised offers to visitors to its online store. The club wants to use that data to better target international fans across the Americas and Asia.
Digital rights, which the club has used to increase the value of sponsorship deals, will also be managed by the in-house agency alongside its investments in digital marketing, CRM, technology and its dedicated TV channel FC Bayern TV. Bayern Munich has also recently started working with start-ups following its first hackathon earlier this year, relationships which will be developed via the in-house agency.
Digital rights “are of course becoming more important” to Bayern Munich’s commercial efforts but “digitization as a whole” is the bigger focus for the club’s global ambitions, said Mennerich, who has been promoted to the digital team’s managing director. Mennerich’s strategy is predicated on the club no longer — as is usually the case in sport — being a licensee of third parties but instead owning its own technology and media, which the in-house agency will develop and monetize moving forward.
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