Month: February 2019

Anjali Sud has overseen Vimeo’s transition from a would-be Netflix competitor to a tech company that helps filmmakers create online content. Since she took over, the number of subscribers who use Vimeo’s video tools has climbed to 1 million.

“Data-Driven Thinking” is written by members of the media community and contains fresh ideas on the digital revolution in media. Today’s column is written by Gary Kibel, a partner in the digital media, technology and privacy practice group at Davis & Gilbert. Sir Francis Bacon is often credited with the phrase, “Knowledge is power.” It is… Continue reading »

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“On TV And Video” is a column exploring opportunities and challenges in advanced TV and video.  Today’s column is written by Lindsey Harju, co-founder at Blinc Digital Group. Love is in the air – and not just in the seasonal aisle at Target. The smell of chocolate and roses got me thinking: Which advanced TV… Continue reading »

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After publishing to Snapchat Discover every weekday, The New York Times has quietly stopped its channel.

The Times’ most recent edition is dated Dec. 21, 2018. The publisher launched on Snapchat on April 24, 2017 — about seven weeks after Snap’s Wall Street debut — and had been sharing newspaper and magazine stories as well as a miniature version of the crossword on the platform. The Times had 20 people across the company help with the launch of the channel, after which it had a team of about 10 managing it. The Times declined to provide a specific reason for stopping its channel.

“We’re happy with what we have built for Discover, which has helped us reach millions of young readers each month. We’re actively working on some new ideas that will best represent The Times on the platform,” a New York Times spokesperson said.

Indeed, the Times is currently not publishing on Snapchat Discover, but it could sign a new contract with the platform in the future as other publishers have done. For example, CNN stopped publishing on Snapchat in December 2017. The news network was one of Discover’s launch partners back in January 2015. It switched to doing a Snapchat Show called “The Update” in mid-2018. But after four months, it chose to cancel the effort. In September 2018, CNN rejoined Snapchat as one of the launch partners for Curated Our Stories, its breaking news tool.

A Snap spokesperson said the company is having ongoing “creative conversations” with the Times about launching something new on Snapchat. This effort could be a different version of the traditional publisher story or a Snapchat video show, the spokesperson said.

“The New York Times is an incredible partner and an important source of news for our community, especially in this unprecedented political climate. We’re currently working with their team on the next evolution of the New York Times on Snapchat. We’re excited to reimagine what the NYT can be on Snapchat and look forward to sharing more details when we’re ready,” the Snap spokesperson said.

Snap and The Times declined to share their revenue agreement. Some publishers split the ad revenue evenly with Snap while other publishers have more generous deals that include a certain guaranteed payment, according to Snap media partners.

Publishing on Snapchat Discover has changed significantly since its 2015 debut. It started with a dozen partners but has since expanded to more than 100. Snapchat now allows publishers to use repurposed content. It’s also been adding more shows, some of which are from Hollywood studios and others from news networks. For example, NBC launched “Stay Tuned” in July 2017, which now attracts between 25 million and 35 million unique viewers every month, two-thirds of which do not read or watch other NBC content, according to Comscore data.

Meanwhile, The Times has continued to focus on growing its subscription business as well as invest more in podcasts. On Feb. 6, The Times reported $709 million in digital revenue in 2018 and touted 4.3 million subscribers of its digital and print products. Its podcast “The Daily” grew to 5 million monthly listeners by July 2018.

Snapchat is no longer growing users, but it is increasing its revenue. The company reported 186 million daily active users on Feb. 5 for its fourth-quarter of 2018 earnings, which was the same number as last quarter. Its quarterly revenue was $390 million, up from $286.7 million the year prior.

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Here’s today’s AdExchanger.com news round-up… Want it by email? Sign up here. Too Big A Bite Publishers are raging against Apple’s proposal that it take an outrageous share of revenues from a planned “Netflix for news” subscription product. Under Apple’s plan, a new paid tier of Apple News would allow subscribers to access unlimited content for… Continue reading »

The post Pubs Spurn Apple Subscription Offer; IAB Europe Preps Consent Framework 2.0 appeared first on AdExchanger.

Facebook has created a new funding program where it would work with publishers and influencers on new shows for Facebook Watch.

Over the past few months, Facebook has been meeting with publishers and studio production partners in an effort to solicit pitches for shows that would be funded by Facebook, produced by the production partner and starring influencers with a huge number of followers on Facebook, Instagram and other social platforms, according to sources familiar with the matter. This incubator program spans verticals including entertainment, news and sports. The creators would be in charge of the actual production of the show, with Facebook providing funding and other support services, sources said.

Facebook did not comment by press time.

Facebook is looking to fund as many as six to eight shows per publisher or production partner, though there is no guarantee that the platform would fund just any project that’s pitched to them, said two sources who have been briefed by Facebook. The general framework of the deal would be that Facebook would pay publishers once it has approved the show. It’s willing to pay around $200,000 for an eight-episode series, said one source.

To be clear, shows produced as part of this program would not be Facebook-owned “originals,” sources said. Facebook would license only a limited window of exclusive distribution — roughly three months, one source said — after which those rights would revert back to the production partner.

“[Facebook] wants an in-road to more influencers,” said one source briefed by Facebook. “But instead of producing shows directly with talent, they want to work with some of the top publishers in the space.”

Over the past year, Facebook has ramped up its efforts in courting influencers to use Facebook Watch. Last June, the company invited 120 creators to its first “Creator Day” in Los Angeles, during which Facebook showed off new products and held workshops between Facebook product managers and talent. This week, Facebook rolled out a major presence in the U.K. for the first VidCon London, as well as another Facebook Creator Day prior to the conference. Part of Facebook’s efforts in London this week will center on how creators are able to make money through Facebook Watch’s ad products: Self-help guru Jay Shetty, who has more than 20 million Facebook followers, will talk about how he made $1 million from Facebook ad revenue last year.

Other video creators have previously said that Facebook’s ad breaks program isn’t delivering meaningful revenue.

This particular Facebook program can be placed in a continuum of Facebook’s efforts to work with creators that have huge, pre-existing fan bases on Facebook, Instagram, YouTube and other social platforms. Whether it’s celebrities such as Jada Pinkett-Smith or popular page owners such as MTV, Facebook has a tendency to go for projects that can get off to a “hot start,” sources have previously told Digiday.

That focus hasn’t changed even for Watch projects outside of this new program. For instance, Facebook recently asked one Watch video production partner to attach an influencer to star on a project that’s still in development, said a source at the production partner.

“[This new program] is a more targeted idea inside the old Facebook Watch idea of working with publishers and creators that have an audience on Facebook,” said a publishing exec who has sold multiple shows to Facebook since the beginning of Facebook Watch.

Facebook remains committed to funding Facebook Watch shows in 2019, including high-profile projects such as a reboot of MTV’s “The Real World,” as well as a recently announced series with NBA star Stephen Curry. Eventually, Facebook executives have said it wants to get to a point where Watch programming can be fully supported by revenue sharing from video ad breaks.

“We will definitely modulate our investment,” said Matthew Henick, Facebook’s head of content strategy and planning, during a Variety event at CES. “We are not going to make the bulk of the content that people want to see.”

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Snap is willing to pay for original shows, and it’s enough to pique entertainment executives’ interest in producing for Snap’s vertical video platform.

Snap is offering to pay companies $40,000 to $50,000 per episode for original series to premiere on Snapchat, according to four entertainment execs with knowledge of the matter. The company is looking for Snap Originals that would air for 10 to 12 episodes, with each episode running between five and seven minutes, the execs said. A Snap spokesperson declined to offer specifics but said the cost range for Snap originals varies much more widely.

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Augmented reality is far from becoming a mass force in advertising, but more brands are using it as a way to get customers to try out products before mobile purchases.

The shift is from using AR for its novelty effect to using the technology where it’s a good fit for a retail experience that’s increasingly happening on mobile devices. There’s also a realization that AR commerce is less about scale in these early days and more about PR, positioning and building knowledge.

Benefit Cosmetics, Speedo and Lego are among a flurry of advertisers weaving AR into their commerce strategies.

“AR should have a big say in the future of commerce and the wider retail industry given how difficult high street stores are finding it now,” said Lou Bennett, head of marketing for Benefit Cosmetics. “The brands who will win be those that are able to integrate offline and online mediums well to provide moments in shopping that are experiential.”

The cosmetics company is developing an AR feature within its “Wow Brows” loyalty app that shows users what they will look like with different eyebrows before they shape their real ones. Once a look has been decided, the person can either buy the products needed to produce the look directly from the app or they can head in-store and hand it to one of the brand’s experts who will then source the products.

It’s still being tested 18 months after it launched, with Benefit Cosmetics focusing early updates on the U.S. “We’ve not launched the AR tool with any noise yet because it’s really important to understand how people are using it so we can make tweaks where needed,” said Bennett. The app is our biggest investment in AR for the last 12 months.”

Bennett said there were no immediate plans to launch an AR product on either Instagram or Snapchat, but did not rule out investments in the long term. It’s a similar stance to swimwear manufacturer Speedo, which is set to launch an in-store iPad service for shoppers to virtually try on goggles later this year. Other brands like Island Records and StudioCanal, however, prefer to stick with the platforms as its less upfront investment.

It’s free to use the tools on Facebook or Snapchat to come up with lenses and camera effects, respectively. Building an AR-enabled app costs money and takes time.

“The in-app route will give companies better performance from a technological standpoint versus using the tools from the platforms because they’re able to use the phone’s processing power, but the platforms offer so much more immediate use cases because the development barriers aren’t there,” said Laurie Ainley, chief technology officer at AR startup Poplar.

Lego is using AR to sell adult Lego Wear apparel. The company has made what it’s calling an AR store, accessible via a Snapchat Snapcode, that once scanned takes people to an AR store where they can buy the streetwear line.

It was a daylong pop-up, doubling as a testing ground for people’s appetite to buy directly from Snapchat Lens.

“Our core business will always revolve around physical play and the idea of using your imagination to put bricks together in creative ways, but we see digital and things like the AR-enabled pop-up shop as an extension of that, so we are keen to do this experiment with Kabooki for their clothing line launch,” said Lea Sandell, social media innovation lead at Lego Group.

The catalyst for this investment and AR’s growing role in e-commerce strategies is the integration of the tech into native cameras on smartphones. Google Lens is now integrated in the camera on key flagship Android handsets,for example, while Apple’s recent updates to its ARkit platform continue to make it a more endemic part of how people use their iPhone and iPads.

“AR commerce can work for anything that requires the user to build their understanding and opinion of it prior to holding its physical manifestation in their hands,” said Gracie Page, innovation lead at VMLY&R. “This is why it is currently mainly applied to goods that relate to a user’s identity: AR affords us the opportunity to try things out.”

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Amazon is working on a new ad product that prompts users to review products they’ve purchased within display ads placed on Amazon.com, according to three agency executives who have been briefed on the new product.

The new review format will be targeted to people who have bought certain products, and will ask them to tap on a number of stars to leave their feedback. The ad will be sold to brands on a “cost-per-review” basis, said one buyer.

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While traditional retailers are beefing up their digital presence, online furniture retailer Wayfair is opening a big-box outlet store.

The store, which will open in Florence, Kentucky, on Friday, isn’t the first physical location for the online retailer (it experimented with pop-ups in Massachusetts and New Jersey last year). But the rationale behind it goes deeper than just making a brand statement in the physical world. The store will feature items that were previously returned and in good condition, along with discounted items, helping Wayfair save on delivery and recoup a greater portion of the costs from returned goods. It will be located in the same building as a Wayfair warehouse where returns are processed, and it’s also near its distribution center in Erlanger, Kentucky.

A company spokesperson told Digiday that given the store’s proximity to product distribution and return centers, it makes sense for the company to offer that inventory to the local community at a lower price. The company currently has no plans to build more outlet stores, the spokesperson said.

For e-commerce retailers, excess inventory, whether from returns or older merchandise, can be a major drain on resources. According to Appriss Retail, merchandise returns resulted in $351 billion in lost sales in the U.S. Some brands, including Untuckit, are offloading excess inventory on Amazon, but thanks to the logistical complications of furniture retail, putting that inventory on a marketplace isn’t necessarily the most cost-effective move.

“This strategy is much more cost-effective for them because there’s an [additional] cost to putting items on eBay or Amazon and dealing with individual purchases through them,” said Kevin Dugan, a spokesperson for Apex Supply Chain Technologies.

A physical outlet store is a major cost-saver for offloading excess inventory, especially when mounting delivery and supply chain-costs put pressure on margins. Sending an unwanted item through the mail can result in additional costs; by putting an outlet store next to a returns and distribution center, Wayfair is knocking out a few steps where it would incur additional expenses. Wayfair has invested significant resources in building out its in-house logistics and digital capabilities and, as a result, has yet to turn a profit. According to Hendrik Laubscher, marketplace research director at e-commerce marketing agency Buy Box Experts, Wayfair’s biggest challenge is logistics costs, returns, cancellations or mistakes have significant impacts on margins.

Wayfair is reliant on drop-shippers to ship items to their warehouses, which then ship the item to the customer, he said, in a recent report. This model can result in additional costs to the retailer if there cancellations, the incorrect products being shipped and products damaged due to poor packaging.

Reducing logistics costs is important for Wayfair. It is still market leader in online furniture, but other contenders, including Walmart and Amazon, are upping their game on private-label furniture brands. Walmart has the advantage of an extensive store network, while Amazon can offset fulfillment costs with revenue from other business areas.

Alice Fournier, vp of e-commerce and digital at Kantar Consulting, said Wayfair’s launch of a physical store for excess inventory is likely a trend that will continue with other online-first brands. Other large consumer brands are also grappling with the challenges of what to do with excess inventory: This week, Under Armor reported that in the fourth quarter of 2018, it reduced inventory by 12 percent. Under Armour has been selling its extra inventory on “off-price channels,” with items that are as big and bulky as furniture, a physical store is more practical because customers like to see and feel the products.

“Online brands will get to a point where they need physical retail — people love to touch feel with furniture,” said Fournier. “It’s a good strategic approach to combine managing returns with managing inventory [through the outlet store.]”

 

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