‘No keywords’: Media buyers are testing Facebook’s search ads product

Facebook is allowing more advertisers to buy ads in search, stepping deeper into the search market dominated by Google, Amazon and Microsoft.

The development, first reported by MarketingLand, is a further roll-out of a test Facebook began at the end of last year. Some advertisers can now choose to run ads in search results with Facebook’s main search bar and within Facebook Marketplace. Two buyers with access said these ads can be within the same targeting group as other News Feed ads. But there’s no ability to bid for specific search words, unlike buyers would on Google and Amazon.

“We continue to test placing ads in Facebook search results and are evaluating whether these ads are beneficial for people and businesses before deciding whether to roll them out more broadly,” Jason Rudin, product manager at Facebook, said in an emailed statement to Digiday.

For Facebook, search ads are another way to get ad dollars by positioning themselves within search, not just social. That’s especially important as Amazon’s ad revenue continues to grow and Google still dominates the search market. Indeed, Facebook has been exploring more intent-based behaviors on its platforms such as shopping on Instagram and Facebook Marketplace.

Ad buyers said search ads are a welcome addition to Facebook’s ad ecosystem as traditional News Feed ads become more competitive and therefore expensive. Facebook advertisers have been investing more in the Stories format, especially Instagram Stories, over the last year due to increased usage and cheaper pricing. Search ads could be the next place to find cheap ads targeted to Facebook’s massive user base.

“When there are more competitors on the platform, it’s good to open up these other pockets of inventory. From a buying perspective where we might have really performance-oriented goals knowing there’s an opportunity for the targeting overlay to happen and if that person happens to be searching on Facebook is great,” said Kieley Taylor, global head of social at GroupM.

But Taylor said she won’t necessarily be advising her team to move ad dollars from other search portals like Google and Amazon to Facebook’s search ads — for now. Unlike Google and Amazon, Facebook doesn’t have the same reputation for intent while shopping and the details behind the current placements are unclear.

“What’s someone intent in search on Facebook is very different than search on Amazon or Bing. I try to counsel the team to think about what we should be buying rather than what we can buy, not just because it’s a new surface. We should see where we’re getting efficiency,” Taylor said.

The effectiveness of Facebook search ads is unclear. Unlike on Google, buyers can’t optimize for where a Facebook user is in their customer journey or understand what share of voice the client has for a particular term.

“I was expecting to add keywords based on our competitors who are more established in the market just to educate landscapers about our new brand,” said Steve Johns, digital marketing consultant at Door4, who recently gained access to the feature.

A Facebook spokesperson confirmed that advertisers do not select specific keywords or phrases and added that these ads may appear in search terms that have commercial intent, such as related to e-commerce, retail and auto.

These search ads look similar to News Feed ads, with a headline, image and copy text. But it’s unclear where the search ads appear on the mobile or desktop screen. That’s quite different from Google, where search ads are the first result.

“The placement itself may or may not appear above organic search results. The ads are seemingly somewhere for some underdetermined term,” Taylor said.

Johns said he had “mixed results” in his first initial test of £50 ($61). The test had a 2% click-through rate and a few conversions at double the cost per acquisition of his current campaigns, Johns said. He said he plans to test the placement again in a few months.

Going forward, Johns said the effectiveness of Facebook’s search ads could provide valuable insight for campaigns across Facebook.

“It would be nice to create custom audiences of people who clicked on our ad via the Facebook search placement, but that option doesn’t seem to be there yet,” Johns said.

The post ‘No keywords’: Media buyers are testing Facebook’s search ads product appeared first on Digiday.

Amid streaming wars, BritBox focuses on older subscribers

Traditional TV has clung to older audiences as younger viewers increasingly switch to streaming. However, older viewers are also streaming shows and movies on TV, and this demographic may be especially important for subscription-based services to weather the streaming video war.

More than 60% of subscription-based streaming service BritBox’s 650,000 subscribers are 45 years old and older. That older audience has helped to keep BritBox’s overall subscriber churn in the low single-digit percentages, with churn among 45-and-up subscribers being lower than the overall average, according to BritBox president Soumya Sriraman. “They are not one of many segments that we’re catering to; they are the segment we cater to,” she said of the older demographic.

BritBox’s focus on 45-year-old and older viewers makes sense not only for the anglophilic streaming service but for any subscription-based streaming service. Older viewers are generally considered the core audience for British programming, such as Victorian-era costume dramas, so they may be more inclined than the average person to subscribe to BritBox — a joint venture between BBC Studios and ITV — to watch shows like “Jane Eyre” and Charles Dickens adaptation “Bleak House.” But having programming tailored to this audience may be important for any streaming service as the market is about to become even more crowded with the impending launches of Disney+, Apple TV+, HBO Max and NBCUniversal’s streaming service.

“In the ‘flixpocalypse,’ the older audience is going to be the key because 23-year-olds are going to subscribe to one service at a time, if at all,” said Alan Wolk, co-founder and lead analyst at consulting firm TVRev. He noted that younger subscribers have a reputation for using family members’ or friends’ subscriptions whereas older subscribers are more likely to be the ones paying for a subscription.

Subscription-based streaming services are already grappling with subscriber churn. It’s become very easy for people to sign up for a service like Netflix to watch the latest season of “Stranger Things” and cancel their subscription after a month to flit over to HBO Now to catch the new season of “Succession.” However, the lower churn among BritBox’s 45-and-up subscribers shows that older audiences have a penchant for sticking around for the long run. “By the time people get to be 45 [years old], they know their own minds. So if they’re a fan of British TV, that’s not going to change,” said Wolk.

BritBox is counting on older audiences’ interests remaining consistent. The two-year-old streaming service has built up a library of shows aimed to appeal to its 45-and-up audience, more than half of whom are female. Programs such as crime drama “Vera” and comedies “Mum” and “Hold the Sunset” star women who are more than 60 years old and are among the service’s most popular shows as well as shows that tend to drive people to subscribe to the service, according to the company.

In addition to older subscribers being more likely to stick with the streaming service, BritBox has seen that the female members of this demographic segment are also more likely to stick with individual shows than younger subscribers. “They will come into a show and they will stick with it to the end. The audience that’s not female 45-plus is more likely to try out other genres,” Soumya said.

That steadfast viewing behavior is consistent with older audiences appearing to be less inclined to waste time browsing for something to watch. Only 24% of 50- to 64-year-old viewers and 13% of 65-plus viewers browse services’ menus, compared to 45% of 18- to 34-year-old viewers, according to Nielsen’s “Total Audience Report” for the first quarter of 2019. Moreover, when older viewers do browse, they typically don’t do so for long. Viewers who are 50 years old and older on average take about five minutes to select something to watch while viewers who are between 18 and 34 years old spend 9.4 minutes deciding and viewers who are between 35 and 49 years old spend 8.4 minutes, per Nielsen.

To keep older audiences coming back and help them quickly find something to watch, BritBox also parcels out its programming in batches rather than all-at-once dumps. If a show has 20 seasons available, BritBox will opt to put up three seasons per month instead of all 20 seasons simultaneously, according to Sriraman. That distribution strategy risks viewers blowing through those three seasons in a week or two, finding something else to watch on or off BritBox and forgetting about the show by the time the next batch of seasons become available the following month. But BritBox takes that into account by having its recommendation algorithm highlight the show on the service’s menu when the new batch of seasons become available.

BritBox’s batch-release strategy helps to give its subscribers more reason to renew their subscriptions each month. In turn, that may help to fortify its subscriber base at a time when many more companies stand to compete for viewers’ subscription budgets. The increased competition may aggravate churn among younger subscribers and reinforce the need for subscription-based services to cultivate a strong base of older subscribers. “The 24-year-olds are not the ones who are going to be making and breaking most of these services,” said Wolk.

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Inside Nuuly, Urban Outfitters’ attempt to take on the rental clothing market

Urban Outfitters, Inc. is making a big bet on the online rental apparel industry — and is building the apparatus itself.

Nuuly, which launches today, is the retail group’s answer to rental services like Rent the Runway. Sitting alongside Urban Outfitters, Inc.’s retail brands — its namesake brand Urban Outfitters, Anthropologie and its subsidiaries Bhldn and Terrain, and Free People — Nuuly is a rental platform carrying more than 1,000 items from more than 100 different brands. In addition the group’s own brands, participating retailers include Levi’s, AYR and Gal Meets Glam. For $88 a month, subscribers can rent six items at a time per month.

The company is led by president David Hayne, who is also chief digital officer at Urban Outfitters, Inc. and has worked with the company since 2001, most recently as Free People’s COO. (Hayne is also Urban CEO Richard Hayne’s son.) According to Hayne, the company wanted full control over its rental model, which led to it building the operations — which include a digital inventory tracking system, a new e-commerce experience, shipping, delivery and returns processing, and a fully owned dry cleaning arm — from scratch. It was born out of Urban’s digital innovation arm, where leaders from all of the company’s brands meet to plan new projects in response to quickly evolving customer behavior within the company’s millennial demographic.

“Developing Nuuly in-house made the most sense,” said Hayne. He broke down the rental models three primary cost drivers: cost of goods, delivery expenses and customer acquisition costs. “In each of these areas, Urban has opportunity to drive down costs, [and] these advantages will help Nuuly operate more efficiently than if it were not affiliated with Urban.”

According to Hayne, Urban’s existing infrastructure has helped to soften the expenses it’s incurring by building a rental model, which is costly to scale. Pulling other Urban brands’ inventory in the system means it’s taking on less inventory costs overall, while it has cheaper carrier rates thanks to existing relationships across the company as well as the resources to build new warehouses to reduce delivery costs as needed. Customer acquisition costs will be lower than a startup’s, Hayne said, because of the existing brand awareness and internal customer data across brands that can be used to target potential Nuuly subscribers.

There are new expenses to consider, because launching a rental service means running a business with specific needs that typical fashion brands don’t have. To support the logistics of the new company, Urban built a 100,000 square-foot facility outside of Philadelphia and rolled out a “fingerprint-tracking” system for individual inventory monitoring. Within that warehouse is a full-service dry-cleaning system, which Urban hired dry-cleaning specialists to run.

With its positioning, Nuuly is targeting customers who are interested in the rental model, but are looking for more everyday brands and a cheaper entry cost than a company like Rent the Runway currently offers. Rent the Runway’s Unlimited subscription, at $159 a month, is nearly double the cost of Nuuly’s monthly subscription, which charges users $88. Nuuly has more inventory restrictions, letting customers rent a total of six items per month, while Rent the Runway lets its Unlimited members rent four items at a time but swap them as often as they want.

Rent the Runway was launched in 2010, but in more recent years, competition has cropped up. Beyond Nuuly, multi-brand rental services include Le Tote, Armoire and Haverdash, which all offer subscription models for everyday clothing items. Individual brands, like Ann Taylor, Vince and American Eagle, are also testing out rentals to reduce customer concerns over commitment by partnering with Caastle, a turnkey solution for clothing rental models.

“It’s exciting to see these companies really mature and grow. They have a lot of runway ahead of them,” said Graham Brown, partner at Lerer Hippeau. “The key, and the challenge, is to build businesses with the infrastructure and experience that is just so different than the previous generation of businesses.”

Growing a new business model for fashion, for Rent the Runway, has been difficult to do. While the company is valued at $1 billion and has been rumored to be exploring an IPO, it’s run into recent problems at scale, including customer service, inventory availability and shipping delays, as the Wall Street Journal reported last week. All of those issues together amount to a decline in customer experience, which could prompt Unlimited subscribers in particular to turn off the service. Rent the Runway doesn’t share revenue specifics, but two years after the Unlimited model launched in 2016, the company reported that more than 50% of its revenue came from subscribers.

According to Hayne, Urban Outfitters, Inc.’s well-oiled e-commerce and retail machine, as well as its deeper pocket of resources, will be Nuuly’s advantage as it takes on the rental apparel market.

“The supporting functions that were needed to develop something like this were things we already had at Urban — product sourcing, logistics, creative. We err on the side of self-operating,” he said. “Urban is well-situated from a brand standpoint and capital standpoint that we have cash to invest. If you put all those things together, it netted out that we were in the right position to take on this challenge.”

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Streetwear subscription company ThreadBeast is now spending half its media budget on Instagram

In an effort to target fashionable young men, ThreadBeast is moving its marketing dollars away from Facebook to Instagram. 

“It wasn’t drastic. It wasn’t like one day we woke up and said, ‘Hey, we have to go big Instagram.’ There’s been a shift over time,” said Uday Singh, founder and CEO of the subscription box service for men’s streetwear. “I think, lately, Instagram has been the bread and butter.” 

Initially, ThreadBeast spent roughly 50% of its budget on Facebook; now, it spends 25%-30% of its budget on the platform. On Instagram, however, the budget has increased from 30% three years ago to 35% two years ago to 40% last year and now 50%.

In the middle of 2018, ThreadBeast realized that its target consumers — fashionable men in their 20s — were spending more time on Instagram over Facebook where they could focus on picture and video content for fashion inspiration. “When it started becoming more obvious that this is where people are, [we said], ‘Let’s focus on how to get in front of them and use that channel,” said Singh.  

ThreadBeast spends $500,000 on media each month, according to a representative for the brand. In 2018, ThreadBeast spent $48,000, up from $14,000 in 2017, per Kantar, which doesn’t track social spending, which is where the company spends the majority of its marketing dollars. 

Aside from Instagram and Facebook, which account for 75%-80% of the company’s budget, ThreadBeast divides the rest of its media dollars between other digital channels — Google, YouTube, Snapchat, TikTok and Verizon Media properties like Yahoo and ESPN — and offline spending, like event sponsorships, which it allocates 10% of its budget for brand building. 

“If you look at just how much time people in their 20s are spending on Instagram versus Facebook, I think a lot of that has to do with the shift of Instagram being [on top],” said Singh. 

As previously reported by Digiday, brands have moved media dollars from Facebook to Instagram, specifically to Instagram Stories, where 3 million advertisers are buying media, according to Facebook’s Q2 earnings report. 

“There are few places to connect with young male consumers online,” said Quynh Mai, founder and CEO of digital agency Moving Image & Content. “There’s YouTube, gaming platforms like Twitch, even Reddit, but none of those platforms give you the targeting capabilities that Facebook and Instagram have. ThreadBeast’s move away from Facebook to Instagram makes sense as brands see Facebook as a place for an older generation.” 

Instagram in particular is where fashion brands find the best connection with consumers, per Mai, who added, “Instagram continues to be a really strong platform for all fashion brands because there’s still this need to be perfect and put together. Other platforms are come as you are.” 

Earlier this month, Instagram kicked off a test to hide some metrics, like the number of likes a post may draw, which could prove difficult for influencer marketing, as CNBC reported. Mai believes that while this change in strategy could be difficult for brands like ThreadBeast in the short term, that it will push brands to create more engaging content and foster a deeper connection with consumers long term.

Singh also believes that as consumers want more short-form video content, that’s where Instagram succeeds. “Instagram as a platform is more focused,” said Singh. “A couple of years ago, YouTube was where people were watching. Now it’s more short-form, and that’s where Instagram has the advantage.” 

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‘Value is a proxy’: Publishers are soliciting feedback from readers with one-question surveys

Now that publishers understand their relationships with their audience are important, they’ve begun asking readers directly what they think of their products and content.

At the beginning of July, Business Insider started adding one-question surveys to the bottom of the paywalled stories it distributes to Business Insider Prime members. Last month, Axios sent an email to newsletter subscribers asking how likely they were to recommend the news publisher’s newsletters to someone they knew (it sent a second out Sunday night), hoping to establish a Net Promoter Score for its newsletters.

The asks for direct feedback, along with more established efforts like The Athletic’s, are part of a yearslong transition away from scale-oriented metrics such as pageviews or unique visitors in favor of numbers that measure the scope of the audience’s engagement with their content. Today, most of that measurement is still done in the background: measuring things like how long site visitors spend on pages, how frequently a story is shared, or whether it converts readers into newsletter subscribers.

But volunteered feedback is different enough that it needs to be gathered and treated differently. Some publishers such as Axios are funneling the data to their product teams, hoping to set a baseline that can be used to see a trend line in how people regard what they make. Others, such as The Athletic, use reader feedback about stories to help figure out how to distribute or package content on a personalized basis.

But in all cases, the feedback publishers solicit from readers is being thrown into a larger stew of metrics. Though a Net Promoter Score might be easy to understand, or a list of the stories readers deemed most valuable is easy to compile, all of the publishers using user-provided feedback say that they cannot use it as a standalone signal that shapes product, editorial or audience decisions.

“I think [this trend] makes sense with revenue, but you’re not just trying to attract drive-by traffic anymore,” said Gwen Vargo, the director of reader revenue at the American Press Institute. “Value is a proxy of if someone’s going to pay for it or not.”

“Because it’s a singular number, it’s easy to understand, but you don’t want it to become the new pageviews of 2019,” Vargo went on, talking about Net Promoter Scores. “You don’t want them to be not looking at other things.”

Though the one-question surveys mentioned above bear superficial similarities, the language of each of publisher’s message differs in a meaningful way.

BI Prime members are asked how “valuable” the story was, while Athletic readers are asked, “What did you think of this story?” Back in 2015, Mic readers that got to the bottom of stories saw a widget that asked, “Was this story worth your time?”

That people were identifying with the icons’ faces made the feedback less valuable for its intended purpose. But the replies remain one of the signals The Athletic uses in its strategy. This year, the site began using the data to figure out which kinds of stories specific readers like, then serving more of those kinds of stories to subscribers using newsletters or mobile push notifications. A reader that prefers biographical back stories on athletes, for example, might be sent more of those than a newsier or more analytical item, using their story feedback as a signal.

The key, Hansmann said, is to measure and analyze lots of signals at once, including comments, scroll depth, time spent, shares and other things. Finding the balance, Hansmann said, without offering specifics on the Athletic’s process, is the key.

“If you over-optimize for one variable, then everything becomes the same,” Adam Hansmann, Athletic co-founder, said. “If you over-optimize for raw clicks, then you get a pile of mock drafts. If you optimize for emoji, then you get positive backstories. No one piece of data is the end-all.”

In the case of BI Prime, the purpose of its survey is to measure what readers find valuable and to reinforce the message that their input, along with their satisfaction with the product, matters.

Claudius Senst, the head of consumer subscriptions at Business Insider, said BI will take time gathering data before using it to inform any product changes. But it has already gotten one unexpected benefit out of it. BI Prime readers who answer neutrally are given an anonymous feedback form where they can leave additional details, and many respondents have used that field to share questions that the story they read did not answer. That has yielded several ideas for followup stories, Senst said.

Ad-supported publishers have tried to incorporate that kind of feedback into their strategies too. Mic first put a one-question survey at the foot of stories in 2015, and within a few months of deploying it, people discovered there was little correlation between how valuable the story was deemed and how many pageviews it got, or how often it was shared, one former employee said.

That seemed important enough that a small team began trying to figure out a new aggregate metric that could be shared with Mic’s newsroom, a combination of pageviews, share counts, how valuable the content was deemed. Persistent pressure to grow revenue made it hard to make the project a priority, and a metric was never ultimately shipped, that source said.

As publishers focus more on concepts such as consumer journey or consumer experience, Vargo said she expects publishers will work to gather more of these kinds of insights from their audience. They will have to do so with a light touch. “I always say, ‘Don’t make them work too hard,’” Vargo said.

 

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How to Make Better Videos with The Head of Culture & Trends at YouTube | GaryVee and Kevin Alloca

How to Make Better Videos with The Head of Culture & Trends at YouTube | GaryVee and Kevin Alloca
This podcast episode with Kevin Alloca comes from Gary’s trip to Cannes during July of 2019. Watcht the rest of his 3-day trip to Cannes in DailyVee 564 here: https://youtu.be/KgBmAgEywPA

Gary sat down with the Head of Culture & Trends, Kevin Alloca, for a 30-minute interview. They discussed things like how YouTube content has evolved, what makes a good YouTube video and what prevents people from starting to make content. Kevin also gives some tips on how YouTube deems the quality of a video and how the algorithm impacts it… Enjoy!


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