Month: June 2019

But why stop there? Shouldn’t advertisers require higher standards and more lofty expectations for their audience?

IAB doesn’t readily define who or what a publisher is. Nevertheless, at times, it seems almost impossible to avoid an ad publisher. They’re on TV; they’re on our phones; they’re in our lives. Advertising has become so ubiquitous that it can be difficult to locate the actual content one wishes to view/read/watch/listen to.

In the past, the norm for publishers was to intermix ad campaigns with original content that sparked interest or provided value. Now, there are never-ending ad streams that offer little to no entertainment, often only by way of a few clickbait-y headlines automatically fed by some third-party site.

Static, standalone ads can make sense when relegated to mass-reach billboards. But technological enhancements have allowed passive formats to exist in places meant to be more interactive. And despite innovative devices that empower publishers, some choose to neglect their primary duty of entertaining and educating an audience. Take, for example, large format outdoor digital billboards. Most are still used simply to display advertising despite a capability to offer much more to their viewers.

It’s publishing malpractice that didn’t exist yesteryear. Those who sought out the ads in print magazines always hoped to stumble upon editorial that would keep them engaged.

It’s this engagement that differentiates a bona fide publisher from a sandwich board. Showcasing original content captivates consumers on a more intense level than a publisher functioning as an advertising carousel. Whether it be fashion tips, sports news, or the weather, publishers need to supply their own content if they hope to engage an audience.

This is not to say that advertising fails to qualify as art or essential content. It is art and it is essential. But, in order to catch the ad, people need a hook. The modern consumer has learned to passively ignore ads that permeate their lives. It’s not because consumers are averse to marketing campaigns. They just want something of value bookending the ad. No one is demanding a full-length motion picture or a full-on resuscitation of the daily news. Yet, consumers expect more out of publishers in 2019. Advertisers should too.

Brand-safe content with proven engagement does exist. But as Unilever and other advertisers have realized, there is no easy or automated method to distinguish trustworthy publishers from Macedonian teenagers. In some instances, it’s hard to identify publishers that produce any content at all.

These days, media publishers are mostly competing against banner-filled websites that are more intrusive than they are inviting. To fix this, the industry cannot rely on Unilever to weed out unqualified publishers. An industry organization such as the IAB could help. IAB should heed the warnings of Unilever and help formalize concrete guidelines that define and promote publishers.

With these definitions in place, programmatic buying platforms can then assign a “premium” designation to those publishers that qualify, therefore making it simpler for advertisers to select and buy only those properties that offer real engagement. It may be a difficult task, but the confidence of advertisers and media buyers is at stake — along with $20 million.

The post How quality content separates publishers from ad streams appeared first on Digiday.

We’ll be writing on the industry’s nuances, through the digital lens, from Amazon’s strategic shifts and their implications, to stores’ recasting as experience meccas and fulfillment centers. We’ll follow the evolving strategies of DTC brands as they grow up, as well as the new internal makeups of traditional retailers like Walmart and Target as they retool operations to function more like Amazon. And always, amid the hype of a new brand reaching a weighty valuation, or the fallout of another round of store closures, we’ll seek out the underbelly of the most-talked about stories to get at the realistic implications, as retail’s newest players try to mature and its most traditional pillars struggle to stay upright.

Our ultimate goal: To build a community of people obsessed with the next generation of retail, tackling it from multiple angles and bringing new observations to the conversation. So, along with our editorial coverage, Modern Retail will host industry events, including one-day forums and three-day summits, to bring together like-minded retail leaders dealing with the same daily challenges.

Modern Retail will launch with myself and reporter Anna Hensel, and will feature regular contributions from Digiday and Glossy reporters to provide the most comprehensive perspective on what people working in and alongside retail need to know to do their jobs and stay on the cutting edge of the industry’s ongoing overhaul. A special thanks to Claudia Chow of Studio Chow, who designed the site, Peter Surrena and Aaron Gottlieb, who led product development, and Triad, our launch sponsor.

It’s our viewpoint that retail is not dead or dying — just getting smarter. We plan to tell stories that depict that transition with differentiated analysis you won’t find elsewhere. The best way to follow along is to sign up for our daily newsletter. Please send feedback, questions and commentary to hilary@modernretail.co. We’d love to hear from you.

The post Introducing Modern Retail, Digiday Media’s newest vertical appeared first on Digiday.

Airpods have invaded regular life — the first episode of the new season of “Big Little Lies” features a poignantly funny Airpods scene — causing a reassessment of what’s rude and how to simply navigate daily life when a significant amount of people have implants in their ears. Inside offices, it’s caused a few issues: For some, it’s a generational tug of war. For younger employees, it may be no big deal to have Airpods in their ears at all times. But for people, headphones are the universal sign of “Do Not Disturb,” so it’s a complete rewriting of accepted office rules if someone’s wearing them all day.

One 24-year-old agency employee told Digiday he “never takes them off” because he’s afraid to lose them. Some cite the restroom as the no-go zone. Others say anywhere is fair game, as long as they’re not actually being used. Ted Nelson, CEO at Mechanica, calls it the “Airpods barrier” that is “impeding cultures and work environments that require creativity and collaboration.”

For Nelson, the issue is that people need to reimagine how work is to be done in this kind of environment — but instead, Airpods, and other systems are simple “workarounds and hacks.” “The human factor is an invaluable first and last-mile contribution to the best breakthrough ideas,” he said.

“Airpods are a totally different phenomenon,” said Michelle Edelman, Petermayer evp and chief strategy officer. “The product is honestly good, but wearing them 24/7 is going to mess with the notion of when you can and can’t disturb someone. So it’ll change social norms if people just start to leave them in during meetings.”

It’s also led in some ways to the blurring of work and life. Stephanie Weisman, who runs business development at Y Media Labs, calls it the “work-anywhere culture.”

“Just yesterday I was walking on the street listening to a partner review some important data with me and a woman stopped me to ask for directions as she didn’t see my Airpods,” she said. “I had to do that thing where I listened to two people talk to me at once for about a minute before telling both of them I didn’t hear what either of them said.”

There’s little doubt that technology is changing both interpersonal relations and attention spans. Researchers from the University of British Columbia found last year that placing a phone on the table near you during a meeting lowered the perceived quality of the conversation and rates of empathy and trust among participants. 

“We don’t have a choice, and these conflicts will play out generationally,” said Leora Trub, professor at Pace University who specializes in clinical psychology and the intersection of psychology and new 21st century technologies. “Even if Airpods are the issue, what happens is that internal conflicts within workplaces are about people worried about replacement, or simply getting older. That plays out as these skirmishes.”

Some agencies are changing up things. At media agency Varick, the management team has agreed as a group to not wear headphones in order to set an example, and show that they are always approachable by employees.  At Watson & Company, founder William Richmond-Watson said that playing ambient music with curated playlists means rampant headphones use has become less of a scourge.

At Huge Detroit, managing director Renae Heuer said the agency has worked hard to create a culture that can be respectful of others state of mind. Headphones mean they’re busy, or trying to hammer something out. In that case, Slack them. Things just get slightly more confusing with Airpods over normal headphones.

“Airpods do present an entirely different issue,” she said. “There’s no visual signal that you’re occupied” since they’re smaller, easily camouflaged by hair, or in many cases, worn literally all the time. “So much for being respectful.”

The post ‘A totally different phenomenon’: Airpods are changing agency office life appeared first on Digiday.

“We wanted to use Amazon as a customer acquisition channel, same as Facebook and Instagram, where there’s a higher cost of acquisition. Being early is a huge advantage on Amazon, as it was on Facebook in 2012,” said Meeker. “That’s part of what makes it appealing. Customer trust with Amazon also helps a lot, and the idea of Amazon introducing the product to people was promising to us.”

Subscription models are no simple business: The cost of customer acquisition, customer fatigue and churn are hurdles for growth. Now, that difficulty to scale is bringing direct-to-consumer brands and Amazon closer together.

Within Amazon’s 100-million-person strong Prime subscription program is a burgeoning collection of sub-subscriptions: a collection of product replenishment models that build repeat purchases and recurring revenue into Amazon’s bustling ecosystem. Amazon’s subscription programs, including Subscribe and Save, for lower-margin replenishment items like toilet paper, The Subscription Box store, which includes BarkBox as well as Allure Beauty, Fancy Socks and GQ boxes, plays a role in two of the retailer’s overarching goals: To drive profitability in its retail business and bring more customer-loved brands into the fold. Boxes cost the same on Amazon as they do on brand’s sites — a BarkBox monthly subscription, for example, is $29 on BarkBox.com and Amazon, but BarkBox offers different prices at different delivery cadence. Amazon’s value, then, is in the ease of use: Prime members have payment and delivery preferences already set.

So the benefit for brands is integrating a subscription into a platform customers use regularly. For subscription-based direct-to-consumer brands, an Amazon partnership lowers the barrier to entry. As it usually works with Amazon, though, there’s a tradeoff involved: Subscribers are still Amazon customers, and the program limits the amount of control brands have over order frequency and personalization.

An Amazon spokesperson said that subscription programs “provide more ways in which customers can find products they need and want more frequently, with low prices and fast and free shipping options, as well as special discounts, convenient auto-delivery features and more. These programs also let our selling partners reach more customers in new and unique ways to help grow their businesses.”

“If you’re looking for no friction, which is the name of the game for subscriptions, Amazon has the lowest,” said Jason Goldberg, chief commerce strategy officer at Publicis. “In general, people don’t want to subscribe to one single product and manage subscriptions brand by brand. You want a single portal to manage all those things.”

It’s a more compelling reason to work with Amazon than others that DTC brands have grappled with, but the common concerns around an Amazon partnership remain: Subscription models thrive off of customer data, and rerouting a subscription through Amazon’s pipelines obfuscates the user insights these brands need to serve them properly.

Subscription brand boom
For brands, building a subscription into Amazon Prime helps to clear hurdles that set in once a subscription model hits a certain saturation point. Subscriptions are a popular model for direct-to-consumer startup brands, including Dollar Shave Club, Hims and MeUndies. By building in repeat-purchases, brands can guarantee a certain amount of predictable returning customer revenue, a figure that can be pointed to for VCs as an asset when in the funding process. But brands have a hard time fighting customer churn, meaning they have to spend customer acquisition and retention marketing fees, to not only bring new customers into the subscription but to keep the ones they have.

“How to figure out subscriptions, individually and at scale, is the million dollar question,” said Lily Varon, digital business strategy analyst at Forrester. “For brands, the appeal of the subscription box is that predictable revenue and gathering consistent customer insights, which may lead to stickier customer relationships.”

According to Forrester research, 5% of adults in 2018 had signed up for and were actively using a product subscription. There’s also overlap between subscribers and Amazon: researcher Hitwise found in 2018 that of those who had signed up for subscription boxes, 58% were Amazon shoppers.

“It’s hard to scale a subscription business,” said Meeker. “You have to have a compelling story to along with a good, low cost, and then get your supply chain in check and make sure your margins are good. So Amazon fits in as more diversification of sources for finding new customers. You never want to be too dependent on any one thing, not Facebook, not Google. So it’s the same with Amazon. The more channels we have that are cost effective is great. We just need to be where the customer is.”

While Amazon has become pay to play in its product listings, it can still offer built-in reach to new customers. That’s an important pitch as subscription boxes — Blue Apron and Birchbox among the most high-profile — struggle to maintain growth.

“Subscription programs haven’t scaled like the founders may have wanted, and as they look for pivots, Amazon’s large customer base could lead to an appealing pivot,” said Goldberg. “Day one, they probably had no interest in being available on Amazon. Today, Amazon is swooping in right as founders are looking for an alternative.”

And Amazon is sweetening the deal. As part of the agreement to launch BarkBox on Amazon’s Subscription Box platform, Amazon is promoting the BarkBox with positioning on the Subscription Box landing page and in email marketing. When early promotion on Amazon’s end runs out, Meeker said his team will explore investing marketing dollars within Amazon’s platform. It currently spends on Amazon advertising for its Bark-branded products sold outside of the subscription box on Amazon.

“Ultimately, what we’re looking for is a stable channel for growth,” said Meeker.

Dealing with a dearth of data
With the subscription box program, brands fulfill the orders (unlike Subscribe and Save, which is a program for first-party vendors selling directly to Amazon), but at the end of the day, customers still belong to Amazon.

Charlie Ritchie, the founder and CEO of online tea subscription Tea Runners, said that Amazon asked his brand, which didn’t sell on Amazon at the time, to be part of the launch of the new subscription box program last year. According to Ritchie, the brand saw an initial “big boost” in business, as Amazon set up an advertising push around the new subscriptions for free, including an email push to 200,000 Amazon customers. However, that boost didn’t match Amazon expectations: Ritchie said Amazon’s reps told his team to anticipate an extra 1,000 customer orders per month, which his team accounted for in manufacturing and inventory planning.

“Everyone’s wanted to nail a subscription, but there are all kinds of pain points.”

“The scale that was actually delivered was way lower than that. So we didn’t know what to expect and they didn’t either,” said Ritchie. Eventually, the retailer stopped free advertising on behalf of the brand and the growth tapered off.

For the customers that did sign up on Amazon, Ritchie said there was no way to introduce them to other Tea Runner offers.

“Amazon has a rule that subscribers through Amazon are their customer, and not ours. We can’t market to them directly, we don’t get their email addresses, we can’t contact them,” said Ritchie, who added that Tea Runners’ direct subscribers have options to curate the flavors or ask for monthly samples in their boxes, which isn’t available to Amazon customers. “What they were worried about was that we would get lots of customers through Amazon, and then funnel them to our own site, where we wouldn’t have to pay a fee. That’s a downside.”

Amazon takes 15% of sales for subscription orders, and Ritchie said that the limitations are a concern, as well as the lack of control. His team doesn’t receive specific analytics around customer churn, for example, which happens more frequently than on the brand’s site. But mostly, the benefit of the Amazon program is that it funnels in a regular stream of new customers without much heavy-lifting or marketing on the brand’s side. He sees it as a supplement to the company’s main business, which still accounts for the majority of sales.

For BarkBox, the Amazon subscription program has some ability for customization built in: Customers can select a box designed for small, medium or large dogs. “We had to accept that there’s a way this program works on their end, data-wise,” said Meeker. He added that for Bark, knowing dog type and customer locations from fulfilling orders was enough.

Heightened competition
Amazon’s Subscription Box program now includes more than 100 brand boxes across the beauty, lifestyle, pets, toys and kids and food and drink categories. As the program scales, it could be a lifeline to subscription startups that have begun to sputter.

“Everyone’s wanted to nail a subscriptions, but there are all kinds of pain points. Customers are fatigued, they get too much stuff, it’s too hard to cancel, so on. Amazon has been particularly good at alleviating those,” said Goldberg.

There’s benefit for Amazon as well, which is realigning its retail strategy in order to boost profits and minimize overhead. Unlike Subscribe and Save, Subscription Boxes require the brands to do the fulfillment and delivery, meaning Amazon’s only facilitating lighter lifts, like payment.

“Amazon is moving toward profitability as well, and subscription is a phenomenal way to get to profitability if you’re at Amazon’s scale,” said Goldberg.

For brands in the program, increased competition is something to consider both from other boxes, as well as Amazon itself. Ritchie said that as the program builds out, and there are other similar tea brands to compete with, he’ll consider spending more on Amazon advertising to generate the same customer stream. According to Meeker, competing against Amazon on its own turf is a matter of accepting the challenge.

“Our view on [Amazon competition] is that we have to be everywhere where the customer is to build real relationships with them, know their dogs, respond to their needs and be the best at that,” said Meeker. “If we start to cross off the list anyone who could compete with us, then we’re not selling at Target anymore either. Amazon just happens to be very good at competition.”

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The post In bid to get closer to brands, Amazon is building out a subscription box platform appeared first on Digiday.

By 2020, WatchMojo aims to release a TV- or feature-length piece of original content once a month, said Ashkan Karbasfrooshan, CEO of the company.

“For years, we’ve wanted to expand into new genres and formats,” Karbasfrooshan said. “But when you have a successful format on big platforms like YouTube, it’s always hard to do something different.”

With 34 million subscribers across its YouTube network, which includes 20 million subscribers on its main channel, WatchMojo is best known for its listicle videos and other evergreen video formats that are tailor-made for YouTube. Videos can have a wide range of subject matter — from “10 Animals That Are Almost Extinct” to “Top 10 Paranormal Events in Movie Shoots” — but are all typically 10 minutes long and ideally suited for YouTube’s search platform and algorithm, which promotes videos with greater watch time. The average watch time for WatchMojo videos in 2019 have ranged from just under 5 minutes on mobile phones and tablets to more than 7 minutes on internet-connected TVs, according to YouTube data reviewed by Digiday.

But a growing number of people are watching WatchMojo on TV screens: In 2019, internet-connected TV sets have accounted for 6.7% of WatchMojo’s views and 9.8% of total watch time; in 2016, TV sets accounted for 3.5% of overall views and 4.9% of watch time. These numbers are in line with overall viewing trends on YouTube, which now says users watch more than 250 million minutes of videos every day from TV screens.

Karbasfrooshan said growth in TV time on YouTube is giving WatchMojo the chance to expand into new, longer-form content areas — but it’s not the driving reason. “I focused on building a business first and then worrying about [TV- and feature-length programming], which is harder to crack,” he said.

WatchMojo is still experimenting with how it will distribute its longer programming. One possibility is releasing the first 10 minutes of “Fox in the Henhouse” on YouTube, and making the full film available for purchase or rental on Amazon, iTunes and other storefronts; with plans to eventually put the full documentary back on YouTube months down the road. “It’s worth exploring whether there is a download or subscription market,” said Karbasfrooshan.

Beyond its own productions, WatchMojo is also increasing looking to distribute movies and TV shows made by other companies — often in an effort to market new seasons, episodes or sequels of those shows. For instance, in May, Warner Bros. distributed an episode of “Doom Patrol” on WatchMojo’s YouTube channel as a way to promote the full season of the show on its DC Universe streaming service. Karbasfrooshan said he’s in discussion with other studios and TV networks on a similar type of arrangement, though he declined to name specific companies due to deals not being finalized yet.

“Viacom is releasing a ‘Top Gun’ sequel next year; to promote it, why not release the first one briefly on WatchMojo to boost awareness? We can offer that kind of spotlight on our core YouTube channel,” Karbasfrooshan said.

The post How YouTube programmer WatchMojo is expanding into long-form productions appeared first on Digiday.

Blonder described Reebok’s loyalty program as the “center of gravity” for the brand’s data analysis and personalization efforts. Some of the perks customers can get through the program, called Unlocked, include free shipping and returns, as well as access to training sessions and other events. Members can earn points not just by spending more at Reebok, but also by reviewing products and posting on social media platforms about the brand. 

A loyalty program isn’t the only way that retailers can collect more customer data, but it is one of the cleanest vehicles available for retailers to collect customer data beyond the point of purchase. It’s an opt-in program: Customers are providing their email address and allowing retailers to track their sales because they want to take advantage of certain sales or promotions. It also allows retailers to attribute in-store and online sales to the same customer, because loyalty program members often have to provide their email address or a member number to get points attributed to their account when they buy something. And, retailers can not only see how much a single customer shops with them, but how often they take advantage of promotions or what kind of products or offers make them want to redeem loyalty points. 

“Being able to have that identifier by way of the loyalty program gives you so much more richness of data and helps you determine behaviors, not just points of purchase,” said Owen Frivold, co-founder of customer experience agency Hero Digital. Frivold also said that some of the retailers his company works with like to test new marketing campaigns with loyalty members to “see if it works with a base that they know is committed to purchasing from them.”

Blonder said that Reebok is looking at using the data collected by its new loyalty program to better inform everything from product design to creation, and to better personalize its marketing and creative across digital channels.

“Without [data analytics], the program is just another tool, but it’s not a smart tool,” Blonder said.

So far, Nike has been quiet about how exactly it’s using Zodiac’s data analytics capabilities to improve offerings for NikePlus members. Zodiac developed a proprietary model for calculating average lifetime value of a customer based on more than just past purchasing behavior. If Nike can more accurately forecast the average lifetime value of NikePlus members, it can squeeze more value out of its most valuable customers.

Dillon, meanwhile, said in March during Ulta’s fourth-quarter earnings call that the company wants to use QM Scientific and GlamST — an augmented reality startup the company also acquired last fall — t0 power personalized communication like replenishment reminders across digital channels, and eventually deploy more sophisticated product recommendations.

By beefing up loyalty programs with data tech, retailers are investing more in their most valuable customers. But with reward comes the potential for risk: If retailers extrapolate the wrong conclusion from their data, for example, and sales from loyalty program members fall, it can hurt more significantly.

“There’s this double-edged sword [with loyalty programs],” said Steve Dennis, analyst at Sageberry Consulting. “Certainly if you screw it up, there’s more at stake.”

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The post ‘A center of gravity’: Retailers are adding data analytics teams to loyalty programs appeared first on Digiday.