Month: July 2018

Agencies are playing up Amazon angst to their advantage.

Marketers are wary of their margin becoming Amazon’s opportunity when they buy ads for products they sell on the site. Agencies, in response, are acting like advisers to those marketers, building on their earlier attempts to capitalize on interest in the platform.

When e-commerce management firm Kwontified met with one of its advertisers recently, the client wasn’t interested in learning how to buy a search campaign. Instead, it wanted to know how to protect its interests if it shared its data with Amazon in order to reach the right shoppers.

“There’s a latent fear among a lot of brands that if they get too close to Amazon that they’ll copy and extol what they have,” said Jordan Taylor, Kwontified head of marketing. “Rather than just creating campaigns, we’re forecasting sales for clients, talking to them about whether the platform is right for their brand before going in to negotiate deals with Amazon reps on their behalf.”

An ad agency executive, who spoke to Digiday on condition of anonymity due to existing deals with Amazon, summed up why that difference is such an intriguing concept for their agency: “Not all my clients like working with Amazon because it has been going directly to them, absorbing all their information without sharing anything back. People talk about the role of an agency in a world where Amazon becomes the dominant channel, and my answer to clients is, ‘You should treat us like having a lawyer in the room.’”

The agency is building a consultancy capable of bringing the e-commerce and media aspects of Amazon together for clients. Once built, the agency’s Amazon division will have little similarity to its other specialist teams, said the executive. While media planning and buying will be offered, the real differentiator will be in the team’s ability to advise marketers on what products to put on Amazon, how to control the third-party seller environment, creating a product review process and working with Amazon’s executives.

“The fact is that there are many advertisers that are still looking at Amazon like a retailer rather than an advertising platform,” the agency exec said. “That means a lot of the spend is coming out of shopper marketing budgets than the bigger media ones.”

To a business like Nike, which likes to keep its brand on a tight leash, Amazon’s web of third-party sellers took that control away. Search ads from the Amazon Marketing Services division aren’t going to solve those sorts of problems for advertisers, said Avery Durnan, vp of media platforms at VaynerMedia. Some of the advertisers just want guidance on how to fit Amazon’s e-commerce offering in their media strategies, rather than actual campaigns. It’s those clients that don’t want to be left behind on Amazon, said Durnan, but also don’t want to jump into it with limited knowledge of the impact it could have on their own businesses.

VaynerMedia has an entire division dedicated to tackling those questions for clients, said Durnan. More brands “just want the education on Amazon,” she said.

“There are brands hesitant to invest on Amazon because they feel like they will lose their margin, but we’re trying to encouraging them to realize that if they’re not going to be there [on the site], then someone else will by distributing their product,” she said. “We’re having to explain to brands that they can control those third-party sellers by owning their [product] listing and owning their own brand terms.”

Experienced Amazon advertisers don’t appear to share the concerns of first-time advertisers on the platform. By the end of the year, Amazon’s ad revenues in the U.S. are forecast to jump 63.5 percent, surpassing $2 billion for the first time. The rise will give the retailer a 2.7 percent share of the U.S. digital ad market, a portion that will grow to 4.5 percent by 2020.

“We absolutely have to act as consultants right now,” said Gareth Owen, managing director at digital agency Roast. “Learning the best way to hack the platform, learn with Amazon and being agile and fleet of foot is the only way to keep ahead of what will be a long journey to maturity.”

The post ‘Like having a lawyer in the room’: Agencies are turning advertisers’ angst about spending on Amazon into an opportunity appeared first on Digiday.

Facebook’s new political ads policy has drawn scorn from publishers — and now a constituency more near and dear to Facebook is bothered: ad buyers.

In the wake of Russian meddling in the 2016 U.S. presidential election, Facebook has taken an extra-cautious approach for political advertising. Anyone who wants to spend money on Facebook to promote political topics must register with an official government ID, and once approved, they must mark all political ads as political.

Yet frustration has mounted since ad buyers — even executives at major media-buying agencies — have been unable to properly identify what ads need to be labeled as political. Brands’ corporate responsibility efforts, such as ads during Pride Month, have been swept up in the madness and have led to delayed campaigns. Facebook’s automated system has also erred. It’s all left buyers feeling like Facebook is just guessing and not doing enough to be transparent.

“I’ve been very clear with the people I talk to at Facebook that trial and error is not an appropriate way we should go to market because advertisers may or may not be able to get through it,” said an executive at a top global media agency. “It’s creating a lot of extra work, and I have yet to get definitions that are clear enough to provide enough guidance.”

In May, Facebook released a list of 20 issues that would be subject to its new terms that require advertisers to register as political advertisers and to properly label ads that are political. At that time, media buyers told Digiday they appreciated Facebook’s attempt to regain public trust, but were concerned about the barriers the policy would introduce. Now, media buyers are dealing with those hurdles and remain confused about what exactly is included in these 20 issues.

WeWork had been running Facebook ads promoting its support of #pride on June 20. It also ran an ad for the WeWork offices in Chicago on May 21. Both ads were archived as ads with political content and marked as “ran without a ‘Paid for by’ label.” A Facebook ad from Nestlé promoting tips on how to help veterans succeed at work received the same treatment. So did Facebook ads for insurance company Lemonade that promoted its renters insurance plans “for the price of a latte.”

WeWork declined to comment on its Facebook ads. Lemonade did not respond to a request for comment. Kate Shaw, who handles corporate communications at Nestlé, said the company has been working closely with Facebook during this process.

“As a key partner, we have engaged in a constructive dialogue with Facebook about the measures it is taking to provide more transparency to users,” Shaw said. “We are encouraged by and broadly welcome the changes it has announced and implemented to date. We will, however, look into whether any of these moves have had unintended consequences — such as the inappropriate tagging of content as ‘political’ — and share any concerns we have with Facebook.”

A Facebook spokesperson said the company has been pretty clear that it’s still working on its policy, and it will not be perfect.

“This is a first step. Certainly we don’t want to create unnecessary roadblocks for businesses — and we’re grateful when people help us discover where we’ve made errors, which is also why we have processes in place like the ability to appeal an ad. At the same time, these tools are incredibly important in helping us prevent election interference,” a different Facebook spokesperson said.

The appeals process is one way Facebook is trying to improve and account for errors in the system, the spokesperson said. After Ad Age flagged a Facebook ad paid for by Walmart about the company bringing jobs back to America, Facebook said it was inaccurately deemed political.

“The aim of this policy and authorization process is increased authenticity for political ads on Facebook,” a Facebook spokesperson emailed Ad Age. “It won’t be perfect to start — we’ll learn and evolve over time — but we think the good far outweighs the bad.”

Publishers have been critical about this new policy since it also required them to label political articles as political ads if they put paid media behind it. To publishers, the move conflated independent journalism with advertising. Following the protests, Facebook tweaked its policy to put those articles in a separate archive, but it didn’t eliminate the step.

Separately, media buyers for brands are juggling the initial registration process. Registration can take a few weeks to complete. It also requires someone on the account to send their official government ID, which some people inside brands are uncomfortable with and therefore agency executives are doing on their behalf.

Once registered, buyers need to properly mark their ads that are political, according to Facebook. Facebook will remove an ad if a buyer erroneously marks it as political or if it is political and not marked. Bloomberg reported that ads with the words “Bush” and “Clinton” are being removed even if they don’t have anything to do with the former presidents.

Buyers can request an appeal if they believe Facebook inaccurately removed an ad. Betsy Hindman, a digital marketer for business-to-business clients, said one of her Facebook ads promoting an editorial on how cities without an airline hub can attract fly-in visitors was not initially approved by Facebook’s system but was later accepted after a manual review. Her appeals process lasted a day.

For ad buyers, it’s simply not clear what is political and what isn’t to Facebook. For example, one of the 20 top-level issues in Facebook’s list is values. Another is the environment.

“There’s a lot of corporate responsibility campaigns that you wouldn’t anticipate, like Pride,” said the agency executive. “Facebook is casting a wide net, but for an advertiser, like a big retail account that supports Pride and does BOGO on shoes, we’re having to go through new processes on if and when they should mark things as political.”

Indeed, during a press event last week about the launch of the ad transparency tool, Facebook’s chief operating officer Sheryl Sandberg said the company was opting for more transparency.

“We had a choice. We decided that our goal is transparency. We’re just erring on the side of being more transparent,” Sandberg said in response to a question on publishers’ frustrations with the policy.

While buyers at top agencies have access to Facebook representatives to share their complaints and ask about individual ads, smaller advertisers are more limited. Ads can initially be approved and run in the system for hours before they are deemed inactive.

These hiccups are just the beginning. Facebook’s system is only live in the U.S. and is rolling out to Brazil ahead of the country’s general election in October. If Facebook, a U.S.-based company, is struggling to properly identify English ads, it’s questionable how the system will perform internationally. Additionally, it remains to be seen how the issue ads will be localized and then interpreted elsewhere.

“I imagine there will be even more false positives in a place that speaks Portuguese versus English,” said the agency executive.

The post ‘Trial and error is not appropriate’: Facebook’s issue ads policy sweeps up brands appeared first on Digiday.

While cashless retail is far from a reality in North America, Target is taking a major step to eliminate the unseen headaches (and expenses) cash causes in day-to-day store operations.

Starting next month, the retailer will start installing automated cash-counting machines called “cash recyclers” in its stores, which it said will free up more time for employees to take on new tasks. Since counting cash manually is costly, time-consuming and inefficient, the machines will let employees focus on personalizing in-store experiences for customers.

Target will install the machines at 500 stores in August, with the goal to eventually roll them out to all U.S. locations. The machines will let Target, which has 1,800 stores across the U.S. and 300,000 in-store employees, more easily integrate cash transactions into its banking system and improve the efficiency of employee workflow, the retailer said. Target estimates that on an average day, the cash-counting process can take up to an hour and a half collectively for all team members working in a store. Over the course of a week, the machines can relieve an entire shift that employees can devote to other tasks, according to Target.

The efficiencies from digitized cash counting let large retailers like Target, Walmart and Amazon bolster their competitive positions against online e-commerce retailers, including Amazon. Target said the “cash recyclers” will let its staff members focus on customer experiences, but Barry Clogan, president of retail operations at MyWebGrocer, a company that builds e-commerce platforms for grocery retailers, said the flexibility could allow employees to take on a range of tasks, including fulfilling online orders.

“It’s fundamentally driven by the disruption of online retail that Amazon continues to drive,” he said. “The trend is to make these stores more efficient because then they’re a good distribution point, and as you map out the trend toward e-commerce, they become great collection points and fulfillment centers.”

Target differentiates by offering niche product categories that carry higher margins and faster growth rates than other areas of its business, but this business model is under pressure as more customers shift to digital retail, Morningstar analyst Zain Akbari wrote in a recent report.

Other large brick-and-mortar retailers that embarked on similar moves have eliminated the need for certain types of jobs. Walmart, for example, reportedly introduced a similar machine last year that eliminated 7,000 accounting jobs from its stores.

Target said the automation of cash counting won’t result in staff reductions; rather, the “cash recyclers,” which are built by Retail Cash Solutions, will let employees serve customers better. Quicker integration of cash and online banking systems can amount to major cash savings for retailers, according to Fifth Third Bank, which developed a similar machine for retail clients it’s been working with in recent years. A spokesperson for the bank said the machines, which have been installed in Pilot Flying J locations for more than three years, freed up $20 million that the client could allocate to other priorities.

The post Target’s not going cashless (yet), but it wants to digitize cash counting appeared first on Digiday.

Telemundo’s biggest screen for its World Cup coverage is the smallest screen.

The NBCUniversal broadcaster, which has Spanish-language rights to air every World Cup game in the U.S., said between 48 and 51 percent of its live digital viewers consistently watch the games on their smartphones. The other half flips between connected TV and desktop streaming, said Peter Blacker, evp of digital media and emerging business for NBCUniversal Telemundo Enterprises. The most popular screen for streaming live video — including sports — remains the connected TV, according to recent FreeWheel data.

“What we’ve learned is that inside of our streaming numbers, we have two different groups: We have the mobile device group, which is using smartphones, and we have the other group, which is on connected TVs and desktops,” Blacker said. “The mobile device group has stayed steady, no matter how much numbers have spiked from game to game.”

By the end of the World Cup’s group stage, which consisted of 48 total matches, Telemundo said its livestreaming coverage had reached 10.7 million unique viewers, 105.3 million total livestreams and more than 1.6 million total minutes watched. The games averaged 2 million livestreams per match. On average, Telemundo’s digital coverage of the games delivers an additional 15 percent of viewers to its TV-only audience, the company said.

Key highlights include Telemundo’s broadcast of the Wednesday match between Mexico and Sweden, which peaked with 1 million concurrent livestreams, according to Telemundo — the second time any NBC Sports broadcast has hit that mark and second only to this year’s Super Bowl, which averaged 2 million livestreaming viewers and a peak of 3.1 million concurrent viewers. (The relative success of countries such as Mexico and Colombia in the World Cup — each of those national teams advanced to the knockout round — has unsurprisingly been a boon for Telemundo.)

Telemundo, which has more than 500 people on the ground in Russia for its coverage of the monthlong tournament, said its results so far demonstrate how much time U.S. Hispanics spend time on mobile devices — even when it means watching live and long-form programming such as a World Cup game.

“With [the mobile device] group, I would have thought that come the weekends, they might have put the phone down and switched to connected TVs, but they remain die-hard,” Blacker said. “This is different from the Olympics [which Telemundo parent NBCUniversal broadcasts], where there was a much greater variety of folks swimming back and forth.”

For Telemundo, the World Cup is an opportunity to demonstrate to marketers the consumption habits of U.S. Hispanic audiences and how they are more digitally savvy than what others might think, Blacker said. By the end of the group stage, Blacker said Telemundo had revised its total revenue estimate for the World Cup twice — and beaten it both times.

“This is forcing a dialogue around scale when we talk about the multicultural audience,” Blacker said. “Maybe folks in our industry didn’t understand or see it previously, but when you see this level of scale, you quickly realize that this is the marketplace, and this is where the audience is.”

Next up for Telemundo: educating its own users about authentication with TV Everywhere services. Through the group stage, Telemundo offered its livestreams for free. In the tournament’s elimination rounds, Telemundo will try to get its users to sign in with their cable and satellite account info. A few early tests that Telemundo ran during the group stages beat the broadcaster’s initial expectations, Blacker said, though he declined to provide specific conversion rates.

“Anytime you remove a paywall, you’re going to see a amazing audience growth — we have seen that repeatedly across the board with the streaming services we work with,” said Hui Zhang, chief scientist at streaming video analytics company Conviva. “Conversion rates will be the key parameter, but this was the right move for Telemundo. At a foundational level, consumers are king, and you need to get them to your app first.”

The post Half of Telemundo’s live digital viewers for the World Cup are watching on mobile devices appeared first on Digiday.

Looks like Acxiom Marketing Solutions (AMS) is an agency business after all. Interpublic Group said Monday it acquired Acxiom’s legacy data management business for $2.3 billion. AMS represents about three-quarters of Acxiom’s total revenue. Dennis Self and Rick Erwin will serve as co-presidents of AMS, which will remain a standalone unit aligned with IPG Mediabrands.… Continue reading »

The post IPG Acquires Acxiom Marketing Solutions appeared first on AdExchanger.

Today, Interpublic Group confirmed rumors that it will pay more than $2 billion to acquire Acxiom, an Arkansas database marketing company that collects and distributes information drawn from an estimated 2.2 billion consumers around the world. The holding company believes that this acquisition will help clients better target their ads while relying less exclusively on…

Citi Bike, a bicycle-sharing network ubiquitous in New York, is getting a new owner. Lyft, the ride-hailing company originally known for its pink mustaches, announced it’s acquiring Motivate, the parent company of Citi Bike and other bike-sharing networks. The deal, announced today, gives Lyft access to Motivate’s technology, business operations and existing city contracts even…

Data-driven marketing has a problem. Unilever chief marketing officer Keith Weed set off alarm bells recently when he called for “urgent action” in response to the problem of fake followers of supposed social media “influencers.” Given Unilever’s $8.4 billion marketing budget and hundreds of consumer brands, those comments carry tremendous weight. Beyond social media, third-party…

Quartz is changing hands and pivoting to paid. On Monday, the digital business news publisher announced it had been acquired by Uzabase, a Japanese media company that operates Speeda, a business information terminal and NewsPicks, a news curation app operated jointly by Uzabase and Dow Jones, parent company of The Wall Street Journal.

Uzabase will pay somewhere between $75 million and $110 million, depending on how much revenue Quartz brings in over the remainder of 2018. It earned $28 million in revenue in 2017, almost all of it from advertising, and has targeted revenue estimates of $35-38 million for 2018, according to Uzabase documents.

While Quartz’s operation, with its focus on branded content and mobile-focused products like chatbots and newsletters, will remain unchanged for the most part, the immediate priority is to develop, then graft on a separate paid offering.

Quartz is now responsible for building two brands: Quartz and NewsPicks, which earns half its revenue from subscriptions, which cost $15 per month.

Digiday spoke on the phone with Quartz publisher Jay Lauf about the news. The conversation has been condensed.

You’re estimating $35-38 million in revenue for 2018, which suggests Uzabase paid a multiple of a little over 2.5 times revenue for Quartz. is that good? How do you feel about it?
I’d say everybody is saying it’s a good price and a good valuation. We feel really happy with it in that sense.

In a memo sent to staffers this morning, you mentioned this is a bet on where media is going. Can you elaborate on that?
One of the ways media is headed is toward businesses that have multiple revenue streams. More important than that is content that users and readers will pay for is becoming increasingly important on a lot of levels. It’s a signal of distinctive journalism that really matters to people, which is a healthy place for us to be. It’s been something that’s been on our radar screen from the beginning. and it was becoming a more earnest part of our strategy as we headed into this year. That’s where we see the future of media: reaching a targeted, high-value audiences with content that is valuable enough for them to pay for it. That’s the foundation of a valuable business model.

Are you going to have to hire more reporters to build the content-focused side offering?
We don’t think so, in the beginning. We’ve built a pretty strong reputation for building high quality content. We’ve been doing a lot of research and surveying of our audience over the last number of months in preparation of our own plans. We’ve found a high propensity among our readers to pay for products. That’s based on a product like we already have or could execute with the staff we’ve got currently. I wouldn’t speculate yet on the growth of the editorial staff around this initiative, but you could imagine that down the line.

Would you have gone after consumer revenue if you hadn’t gotten acquired?
Yes absolutely. It was very much on the drawing board. This year, as we started building developing executing against 2018 strategy, part of that was to experiment with a paid product.

What made you feel like you were ready to do that?
We’ve talked about it in our strategy sessions every year since we’ve been born. We’re just at a scale and an age where we felt like we could do it effectively. We’ve got 20 million users that come to the site. we’ve built an incredibly loyal audience over five years. It was the phase of existence we were in, as much as anything.

The post Quartz’s Jay Lauf: Getting readers to pay is critical appeared first on Digiday.

The world, and especially the internet, took a walk down Nostalgia Boulevard as Toys “R” Us officially closed their doors on Friday and bid the beloved (albeit debt-riddled) toy chain adieu. There were fond memories about weekend trips to the toy mecca and plenty of acknowledgment and sadness about the brand’s mascot since 1965, Geoffrey,…