Month: August 2019

The results so far have been encouraging, NBC News said. The vertical sites, which live as pages within the NBC News domain, now attract a combined monthly audience of around 15 million unique users, according to a spokesperson, double the 8 million the verticals attracted in their first year. For context, NBC News’ site attracted 67 million unique users last month, per SimilarWeb.

That growth has been partly driven by increased output: The vertical sites now publish around 200 pieces of content per month, up from 150 in their first year. But it’s also because the verticals have established regular audiences. The verticals’ newsletters boast the highest open rate of any that NBC News distributes; its weekly Think newsletter, for example, has an average open rate of 40% this year, along with a click-through rate of 25%, according to a spokesperson.

“I think we’ve had an incredible amount of success just in terms of growth of the audience,” said Catherine Kim, executive editor of NBC News Digital. “We have to develop that kind of feedback loop in that relationship. I think Mach, Better and Think are the leads on that strategy.”

NBC News has conducted several product experiments using the vertical sites since they launched two years ago. For example, Better tested out a site redesign designed to increase the amount of time people spent on the site without forcing them to click on anything; that same redesign also debuted a custom display unit that the vertical properties are still selling.

Those tests helped NBC News eventually migrate the design over to NBC News and sister properties MSNBC and Today last year. But successful content formats and learnings from sister brands are passed along to the verticals as well. For example, this year, Better began publishing commerce content, which became a seven-figure revenue stream for The Today Show’s site last year.

But the key focus for the brands is figuring out new kinds of content, both text and video, that will resonate across NBC News’ audience. Kim said that the sustained success of pieces written about arts and culture, particularly reviews of popular music and TV, has led to NBC News covering more arts and entertainment news. “The success that Think has had with criticism and analysis has, on the news side, triggered this kind of ‘we’re going to respond to the news event’s response,” Kim said. “I don’t think we would have covered Lil Nas X spending 17 weeks at #1 on the Billboard charts if it weren’t for that.”

The sites also hunt for opportunities their sister brands might seize on. Every month, the vertical sites conduct an analysis of the top-performing content, where one area of focus is outlier pieces of content that do well. The hope, Kim said, is that an unexpected success on one vertical might be more consistently replicable on another.

That works both ways. “Part of Think’s mandate has always been to advance and complement the excellent original journalism that is published every day by our colleagues on the news side,” Meredith Bennett-Smith, Think’s senior editor, wrote in an email. “While always careful to avoid blurring the lines of opinion and news, we view the news side as a valuable resource when it comes to analyzing what stories resonate with our audience, where there is room for editorial growth and how we can use opinion, analysis and essay to add additional contextual layers to NBC News’ coverage.”

The post How NBC News’ vertical sites became audience engagement laboratories appeared first on Digiday.

In the earnings calls that have followed the close of the deal, which became official in October, IPG CEO Michael Roth said that the company is pleased with the integration and attributed gradual growth for the holding company to Acxiom. Last month, during the Q2 earnings call, Roth shared news that Acxiom has expanded its relationship with a major auto distributor in the U.S. and that it had won a new financial and technology client. 

“We want to ensure that Acxiom can stay focused and delivering on its core business, so we are being very thoughtful about how and when we engage them, as well as how we’ll bring new services and products to market,” wrote Philippe Krakowsky, chief strategy officer for IPG and chairman and CEO of IPG Mediabrands, who has been central to the deal, in an email. “On that front, we should begin to see some proof of concept in the latter part of the third quarter, or the early part of Q4.”

What’s going on inside
Still, the company does attribute some new business wins to the addition of Acxiom. “Acxiom people and capabilities have played an important part in some significant new business wins,” wrote Krakowsky. “When it comes to data privacy, and the ways in which companies need to approach data in an age of increased scrutiny and regulation, we can also now bring [an] expertise and credibility that would have been more challenging without a company with Acxiom’s pedigree.”

So far, IPG has plugged Acxiom into media agencies UM, Initiative, Cadreon and Reprise. It has also started to use Acxiom with its digital and CRM agencies, as well as in healthcare, per Krakowsky, which includes agencies like MRM, R/GA, Huge, FCB Health and McCann Health. When it comes to clients, Acxiom has been working on major existing clients and on new business opportunities, but it’s unclear exactly who those are. “As you’d expect, there is a ton of demand from across the holding company,” wrote Krakowsky. 

When it comes to creative agencies, how IPG uses Acxiom will “vary widely,” wrote Krakowsky, from “using data to inform a team’s understanding of audiences and to help craft messaging depends as much on a client’s industry, and on the nature of the marketing challenge or brief, as on the creative teams themselves.”

Later this year, IPG wants to “launch new data-powered products,” according to Krakowsky, but what exactly those products will be is yet to be seen. “In terms of opportunities for growth and new products, our initial focus can broadly be described as performance media,” he wrote. “This allows us to help marketers get the best out of all their data assets, driving better and more efficient one-to-one connections with consumers, at scale.”

Over the last year, IPG has been cross-training its senior agency teams with Acxiom and looking at how the agencies’ teams are organized to facilitate collaboration among both. There haven’t been layoffs following the acquisition, per Krakowsky, who added that the holding company has made investments in new talent and that IPG has moved some key executives and their teams around internally, with some Acxiom leaders moving to Mediabrands’ onto the data and tech side and some Mediabrands’ leaders moving to Acxiom. One example of this change, per LinkedIn, is Chad Engelgau, previously the chief marketing and strategy officer at Acxiom, who in recent months has been moved to IPG Mediabrands, where he now serves as the global chief data strategist and head of client management. 

Given the sensitivity around data, Krakowsky expects it to be more difficult for the company to share information publicly when it comes to data strategy than it has been for agencies to talk about creative campaigns. 

Mixed reviews
Outside of IPG’s assessment that the acquisition has been beneficial to its business, one year into the acquisition, reviews are mixed. (Digiday reached out to a number of IPG clients to see if they would speak to what they think of Acxiom but did not receive responses by press time.)

“They have an owned resource with a global footprint that aligns very well with IPG Mediabrands’ footprint,” said Jay Pattisal, a principal analyst at Forrester. “As a resource for audience activation for IPG it’s a good combination. They’re very complementary, and they’re additive to the media agencies to use first-party data, third-party data to more effectively target and activate campaigns within the marketplace.”

While the data offering may be attractive to clients and a good fit for the media agencies, the real challenge will be when IPG starts to put Acxiom and its creative agencies together, according to analysts. 

“The biggest challenge at most firms is developing actionable insights based on that data,” said Allen Adamson, brand consultant and co-founder of Metaforce. “People are collecting mountains of data. You can find out exactly when someone is going to brush their teeth and what toothpaste they’re using, but you only get to, ‘So what?’ The trick is to get people who can look at the data and say this is what’s happening and this is what it means.”

Over the last five years, both clients and agencies have been focused on acquiring new technology to help with marketing. Pattisal noted the focus on technology rather than creativity has negatively impacted brands’ differentiation in the marketplace. “They’re spending so much on technology that they aren’t spending enough on services and agencies so that they could create marketing and customer experiences that are different and unique and make their brands and businesses stand out,” said Pattisal. “If marketers have over-corrected and spent too much on technology, so too have the agencies as a whole.”

Owning versus renting data
In late July, during the Q2 earnings call Roth argued that the holding company’s acquisition of Acxiom and offering those capabilities to clients had been mischaracterized. Krakowsky echoed that, “There seems to be recurrent confusion around the issue of ‘renting’ versus ‘owning’ data. It’s a debate that some of our competitors, present and past, keep stoking. What we feel very strongly about is that owning the highest level of capability and expertise in data management is a significant, and increasingly necessary, asset in today’s world.”

Other holding company positions on data offerings vary. Dentsu Aegis has owned Merkle since 2016. In April, Publicis Groupe acquired its own data offering with a $4.4 billion purchase of Epsilon. WPP, on the other hand, selling its stake in Kantar to Bain Capital. Omnicom isn’t looking to buy a data offering and argues it doesn’t need one. Meanwhile, Martin Sorrell’s S4 is currently searching for a first-party data company.

What an acquisition of a data-offering like Acxiom will look like when dealing with the renewed focus on privacy and the various laws, like GDPR and the CCPA, as well as Google’s and Apple’s work to close cookie windows, remains to be seen, but Krakowsky believes the focus on privacy is an argument for owning that data. “The focus on data will only grow, and it’s been heightened due to privacy issues, GDPR and CCPA,” he wrote. “Therefore, what you want to ‘own’ is data management expertise, at scale.” 

“But when it comes to the data itself, the idea that you rent or buy is misleading,” wrote Krakowsky. “You can own an important data asset, but still plug into and use a wide range of additional data sources. In fact, that’s more or less a given. Staying open-source — so as to be able to incorporate new data sets or use complementary data sets to boost the effectiveness and efficiency of your marketing efforts, instead of becoming reliant on a single ‘owned’ data set — will always be a requirement.” 

The post 1 year in, IPG attributes growth and new business wins to Acxiom acquisition appeared first on Digiday.

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Facebook’s pitch deck includes a rate card detailing the prices to reach various age-and-gender-based audience segments for each quarter from the fourth quarter of 2019 through the third quarter of 2020. That inclusion was “off-putting” for the agency exec because TV ad buyers are not used to being given rate cards and rely on historical data when negotiating upfront deals with TV networks. “It feels like they’re trying to formalize too much,” said this exec. That said, the rate card serves as the pricing baseline from which Facebook and ad buyers can negotiate, and the CPMs, which typically range from $22 to $34, are “a good start,” the exec said. “They’re not being ridiculous.”

However, the rate cards only reflect the prices for when advertisers are buying Facebook’s in-stream video ad inventory with Nielsen measuring that the impressions reached their intended demographic audience. If an advertiser opts instead to only be charged when an ad is viewed to completion — which Facebook refers to as “thruplay” — the rates would be at least 20% higher, according to the deck.

“Our goal when launching Showcase was to offer an upfront solution that meets the market where it is. We invested significant time working together with the industry to ensure a clear product-market fit, which resulted in many of the defining elements of Showcase — from Nielsen demographics, to pricing and the overall approach to negotiations,” said Erik Geisler, director of North America agency partnerships at Facebook, in an emailed statement.

In this year’s upfront, Facebook sought sponsorships for individual original shows distributed on Facebook Watch, but the centerpiece of its pitch — and the focus of the deck published below — was its In-Stream Reserve bundles of inventory from the platform’s top video channels. Advertisers can buy ads against the entire portfolio of In-Stream Reserve channels, or they can choose among four specific content categories: food, sports, beauty and entertainment.

Facebook said in February that nearly 100 million adults in the U.S. watched In-Stream Reserve eligible videos each month, on average, between November 7, 2018, and January 31, 2019. In a separate document that Facebook has shared with ad buyers and that has been reviewed by Digiday, the company broke down that average monthly audience by age group: 51 million viewers between the ages of 18 and 34 years old, 85 million viewers between the ages of 18 and 49 years old and 75 million viewers between the ages of 25 and 54 years old. Also in that document, Facebook broke out the number of U.S. adults that watched In-Stream Reserve eligible videos between Jan. 17 and April 14 for each of the four content categories: 23 million viewers for the food category, 25 million viewers for the sports category, 11 million viewers for the beauty category and 74 million viewers for the entertainment category. A Facebook spokesperson declined to comment on the numbers.

The fact that Facebook calls out advertiser-agency relationships throughout the deck stood out to one agency exec. For Facebook’s traditional social ads, “they often prefer working directly with the client than with the agency,” said a second agency exec. However, agencies play a primary role in the TV-and-video upfront market because they buy in bulk, and Facebook seems to acknowledge that by incorporating agencies’ spending commitments in the discounts it is offering.

One slide outlines how Facebook is offering discounts to advertisers based on the amount of money that an advertiser — as well as its agency — commits to spending money in the upfront. According to the deck, advertisers and agencies receive separate discounts based on the amount of money they commit to spend. Those discounts are then combined for the amount that Facebook bills the advertiser; agencies must pass their discounts in full on to clients as opposed to using them for any type of arbitrage play. There are three tiers to each set of discounts, though the size of those discounts could not be learned.

Facebook’s cancellation terms for upfront deals are also not onerous, according to agency execs. Facebook is allowing advertisers to cancel up to half of the money they had committed to spend on its in-stream video ad inventory in a given quarter. That gives advertisers and agencies more flexibility in their commitments to buy Facebook’s pre-roll and mid-roll ad inventory, according to agency execs.

As with the pricing rate card, there is flexibility around the cancellation terms for Showcase deals, which is important for advertisers that care about the videos that may carry their ads. For example, Facebook states in the deck that, if an advertiser wants to cancel a portion of its spending commitment for a given quarter, the advertiser must notify Facebook at least 90 days before the start of the quarter. The issue with that is that Facebook does not provide advertisers and agencies with the list of channels included within In-Stream Reserve until one month before a campaign launches. At that point, it would be too late for an advertiser to pull back their budget if they don’t like the lineup of channels that may carry their ads, according to the deal principles. However, in practice, advertisers and agencies are able to parley with Facebook to reduce the cancellation window.

See the full deck below.

The post Pitch deck: How Facebook competes for TV, video ad budgets appeared first on Digiday.

Beyond just increasing general use of and time spent in the app, Games provides another line of revenue for Snap as it seeks profitability. Snap reported $388 million in revenue for the second quarter of 2019, up 48% compared to the prior year. But it’s still losing close to $100 million a quarter. In good news for Snap and for users, the ad experience in Games is actually seen as supplemental to the game experience and not invasive.

“The thing people can’t stand about ads on social is getting slapped in the face with them constantly instead of having the ability to opt in. If there’s a bonus, reward or some type of personal benefit for watching them, they have no problem with ads,” said Jeff Higgins, a social media director at AMI Social Media.

The ads in Snap Games are the same unskippable, six-second ad units found in Snap originals and other Snap Shows. But while on these so-called Snap Commercials, first released in May 2018, interrupt the viewing experience of Snap Shows, Snap users opt in to watching an ad in Snap Games. Tiny Royale players can watch ads to upgrade their weapons or double their XP. Snake Squad players can watch ads to respawn their snakes. Zombie Rescue Squad players can watch ads to double their rewards.

“Snapchat seemed to find a clean and simple way to integrate the ads. When I get one, it really doesn’t bother me. If there is one, I can’t skip it, but I don’t mind since I get a reward for watching it,” said Chris Higa, an official lens creator on Snapchat who plays Bitmoji Tennis and Tiny Royale.

Snap’s decision to monetize gaming through unskippable ads is a departure from other mobile games that rely on in-app purchases. Pokemon Go is estimated to make more than $3 billion by the end of this year since launching in July 2016, according to Sensor Tower. HQ trivia has been pushing its in-app purchases ($3.99 for one extra life or $9.99 for three) as it moves to rely less on interstitial ads and sponsored games.

This incorporation of advertising impressed advertisers at launch. “I like that [a Commercial within Snap Games] is opt-in. It feels very people-first, very user-friendly. But also it will start to give the opportunity for brands to create more meaningful value,” Mike Dossett, vp and director of digital strategy at RPA, said at the time.

When talking about Snap’s improved relationships with marketers, quite visible at Cannes this year, GroupM’s global head of social Kieley Taylor mentioned her appreciation of Snapchat expanding Snap Ads to new areas of the app, like gaming.

“The choice full product design that accommodates the full duration of short-form video in Discover, and now in Gaming, is appreciated by marketers restrained in budget to create yet another bespoke ad while wanting to sway the coveted audiences on Snap,” Taylor said.

Despite the early praise for Snap Games, it’s questionable how long the love will last. Facebook users once had similar affection for games on the site, specifically FarmVille. Yet interest later fell as did the momentum of Zynga games overall. (Coincidentally, Zynga is a partner for Snap Games.) In 2016, TechCrunch reported revenue from Facebook peaked at “a quarter-billion dollars per quarter on its 30% tax on in-game purchases,” but at that time “15% of time on Facebook.com is still spent playing games, though payments revenue has declined to $196 million in the latest quarter.”

Facebook, for its part, has moved to offer other types of gaming experiences. In 2016, Facebook launched Instant Games within Facebook’s Messenger. Similar to Snap Games, they’re short mobile games intended to be played between friends. But Facebook recently shifted its strategy. Later this summer, Instant Games will no longer be available on Messenger and instead can be accessed through the Gaming tab on Facebook’s app. Facebook also allows gamers to stream on the site, competing with Amazon’s Twitch and Microsoft’s Mixer.

Of course, Facebook and Snapchat are far from the only destinations where people can play games on their phones. These platforms compete with apps that are just meant for mobile gaming, like Epic’s Fortnite and King’s Candy Crush. Apple is also releasing a new subscription service for mobile games called Apple Arcade later this year.

For now, Snap sees games as a valuable part of the app. Snap CEO Evan Spiegel said on earnings call of the second quarter of 2019 that the gaming platform aligned with the company’s core mission: to connect real friends. That’s the name of the recently launched marketing campaign, led by Snap’s new CMO, Kenny Mitchell.

“I think the exciting thing that we’re seeing is that people who are playing games with more friends are playing longer, which means that at the Snap platform can really provide unique value to gaming publishers because we’re able to bring this group of real friends that likes hanging out together,” Spiegel said.

Dan Garon, general manager of the Snap Games effort at Zynga, said his team “has been impressed with the level of innovative thinking from the Snap Games team, particularly with new social features like real time voice.”

Indeed, Snap users are enjoying that part of the experience. “I love how nice it is to play games on Snapchat and I can still message [friends] inside the game and messages don’t save like the classic Snapchats. I can talk to them while playing, without leaving the game,” Higa said.

This article is part of an editorial series on mobile game advertising presented by AdColony.

The post With opt-in ads, Snap Games is intriguing Snapchat users and advertisers appeared first on Digiday.