Month: September 2019

“Within Ventures, it’s not our job to create the next laundry detergent or baby diaper,” said Betsy Bluestone, commercial discovery leader at P&G Ventures. “What we do is create businesses in areas where P&G doesn’t compete.” 

The strategy of the studio is not to simply hand a cash infusion to entrepreneurs but offer the tools of a massive brand holding company like P&G — be that distribution, an understanding of regulatory practices or brand building, etc. — to those who have ideas that could potentially blossom into those billion-dollar brands. The goal for P&G Ventures, per Bluestone, is not to invest for a rate of return but to build a brand with an entrepreneur that “will be sustainable, global, that will be noticeably superior.” 

Of course, P&G isn’t the only big brand holding company adding a ventures arm; Anheuser-Busch has ZX Ventures, Siemens has Next47 and Visa Ventures. “It’s hard to be innovative and entrepreneurial in a big company so more and more companies have peeled off this component to be a catalyst for growth,” said Allen Adamson, brand consultant and co-founder of Metaforce, adding that other big brand holding companies will likely adopt this strategy. “It’s mission-critical, but there’s a long runway for [the brands the studio creates] to have an impact on the company.”  

With a startup studio like P&G Ventures, the company is not looking to generate ideas to update its older brands but to find what the brands of the future will be and have a role in growing them. Bluestone scouts for potential brands for the studio at universities, accelerators, through meetings with investors and other groups to find brands or brand ideas. While each brand deal is different, the studio aims to give those behind a brand whatever they need to help it grow, be that help with brand building, technology, distribution, whatever is needed.

To bring the brands created by P&G Ventures to market, the company uses a direct-to-consumer strategy so “the playbook is different,” said Bluestone. As previously reported by Digiday, growing DTC brands either through acquisitions or in-house has been a recent focus for the company. But that doesn’t mean a brand created via P&G Ventures will only be DTC. The past summer, P&G Ventures took one of those brands, Zevo, a natural insecticide, beyond its DTC roots testing a brick-and-mortar retail presence for the brand within Target and Home Depot. 

“Every one of these brands starts DTC,” said Bluestone. “That doesn’t necessarily mean that’s its destination, but it’s a great way to learn, to speak one-to-one with the consumer, to prove out a proposition.”

Others, like Pepper & Wits, are focused on growing out its sole DTC channel. How the brands grow beyond DTC will depend on the brand proposition and how the market responds to it. Once a brand has proven out its proposition and started to generate revenue, P&G Ventures will move it from the creation phase to the build phase with a program called Launchpad where those brands will take on additional funding from the outside via a partnership with venture firm M13. 

“The intention is to build them up to a stage where we would buy them back and put them into one of our business units,” said Bluestone. “There’s great external validation that comes from that. Raising money tells you how valuable that idea is. [Already, the studio has] one that has moved in, Pepper & Witz has moved there and two more on the way.” 

How marketing capabilities for the brands are handled will vary by brand, but they are typically done in-house rather than with an agency. Overall, the studio has had help with its DTC strategy from the DTC brands P&G has acquired, like Bevel and First Aid Beauty, taking lessons from those brands and applying them to the ones it is growing. 

Building out its own DTC brands rather than solely acquiring DTC brands makes sense for the company. “P&G now has several DTC acquisitions under its belt as a way to buy into relevance,” wrote Dipanjan Chatterjee, vp and principal analyst at Forrester, in an email. “However, acquisitions are culturally messy. And late-term free-spirited brands brought into the fold can get choked by the bureaucracy of big companies. P&G Ventures is a way to find the best of both worlds — to play a role in the inception of a different business and brand models, and then throw its weight at channel management and marketing weight behind them.”

The studio model may also help the company attract younger talent, per Adamson, as younger people with an entrepreneurial spirit would rather create something on their own than work at a big behemoth like P&G. 

That said, it may be too early to tell if any of these brands will become the next Dollar Shave Club or Glossier with P&G’s help. 

“If CES 2019 was any indication, there is a lot of activity in the innovation that is being brought forward by the group,” wrote Chatterjee. “But these initiatives still have to thrive under an overlord with a less than stellar reputation for progressive innovation. We’ll need a few more years under the belt of these venture-funded brands before we can pass final judgment.”  

The post ‘Brands start DTC’: Inside Procter & Gamble’s startup brand studio P&G Ventures appeared first on Digiday.

Other news publishers are keying in on registration walls too. Earlier this year, Hearst Newspapers put up a registration wall ahead of launching a paywall for its Connecticut newspapers, gathering up 100,000 email addresses in the process, according to Hearst Newspapers president Robertson Barrett; GateHouse Media launched a registration wall in the fall, and it has been adding it across the hundreds of titles it owns. Tribune Publishing, home to newspapers such as The Chicago Tribune, plans to test them again after a small test that ran in 2017.

A publisher using a registration wall can drive subscriber conversion rates 10 times higher for its known users compared to its anonymous users, said Michael Silberman, svp of strategy at Piano. Yet news publishers have historically been reluctant to use them, in part because they can drive readers away and put short-term pressure on a site’s traffic. Tribune Publishing abandoned a registration wall it was testing on the Hartford Courant’s after discovering that 90% of the people who hit it simply left the site.

A short-term traffic dent might be worth it. An array of moves made by browsers including Chrome, Firefox and Safari will soon limit publishers’ ability to sell ads with the help of third-party cookies, a change that has dented publishers’ monetization by as much as 25% in some markets. Laying groundwork that allows publishers to shift from third-party to first-party data will help publishers avoid further pressure on their ad revenues.

But for now, most publishers’ interest in registration walls seems tied to existing subscription efforts, rather than gathering more first-party data or closing the paywall loophole Google Chrome created this summer; Google recommended publishers use a registration wall to solve the problem of Chrome users activating Incognito mode to get around publishers’ metered paywalls.

Not every publisher is using registration walls for the same reason. Starting in the fourth quarter of 2019, Forbes will begin putting one in front of its site’s readers, offering them an ad-light experience of their divisive site in exchange for their email addresses.

The test is designed to help Forbes learn more about what its audience values, Forbes CRO Mark Howard said last week at the Digiday Publishing Summit. But the audience data gathered from those who register will help Forbes’ efforts to diversify revenues.

“We’re thinking about how we develop more products for those communities,” Howard said. “It’s about leveraging first-party data, it’s understanding the inter-connectedness of the content they’re consuming. This is the tip of the iceberg of supporting products that are not ad-supported.”

Figuring out the value exchange can be difficult. Gannett’s USA Today, for example, has tried offering visitors perks such as sweepstakes entries in exchange for registration; on USA Today Network, its collection of local news sites, the registration wall is used to unlock content after readers hit a paywall.

Even though the right value exchange will vary from site to site, each publisher should be able to come up with something.

“If your relationship is so fraught they don’t want to do a low-friction signup, you need to examine what you’re doing,” said Jason Bade, the co-founder of the paywall platform Pico.

The post ‘The tip of the iceberg’: News publishers are embracing registration walls (again) appeared first on Digiday.

“For us, the market coverage is driving a lot of [subscriber growth]. Volatility — like we’re seeing in the financial markets — is a good thing for us,” said Scott Havens, global head of digital and media distribution at Bloomberg Media. “Markets are up and down, a recession could be coming. It’s the volatility: It’s up 2% one day, then the Dow drops 500 points the next and people respond.”

News events, predictable or not, will naturally impact traffic and subscriber growth. But market and political conditions, escalating trade wars and Brexit uncertainty have combined to make the recent market volatility front-of-mind in more publishers.

There are two distinct camps of subscription publishers: those who fear a recession will hamper disposable income and have a negative impact on subscriptions and those who believe it will drive conversions as consumers are looking to trusted sources for reliable information.

“Premium and trusted news sources, particularly those providing content and insight on the financial markets, will likely benefit from a recession,” said Greg Harwood, senior director at strategy and marketing consultant Simon-Kucher & Partners. “In times of uncertainty consumers typically look for impartial and trusted advice on matters related to the economy. This will impact both acquisition and retention, exactly as the new providers saw in the run-up to the Trump election.”

Publishers specializing in finance and markets coverage will all have differentiated content in common. And access to this information is often more a need-to-have than general news. As such, there are a lot of companies paying for these subscriptions, which will all add to more healthy subscriber figures.

“We often see increases in subscribers during periods of uncertainty — Brexit and Trump are good examples — but we also see peaks on specific stories, such as Lionel Barber’s recent interview with Russian President Vladimir Putin,” said Fiona Spooner, global marketing director for business to consumer at the Financial Times. An FT spokesperson said August wasn’t a particularly “bumpy” month, but that, since January, the top topics that audiences are reading when they convert are centered on Brexit, technology news and U.S. and Canadian companies.

However, like the Trump bump which has waned for some publishers, these peaks aren’t reliable. While publishers to some extent have to roll with the punches in circumstances out of their control, there are a few ways they can capitalize on the subscription peaks that, by their nature, aren’t guaranteed to last forever.

“It’s important to capitalize on high-traffic days especially on recurring revenue products,” said Rob Ristagno, CEO and founder of management consultancy The Sterling Woods.

The post Stock market gyrations help drive paying subscribers at business publishers appeared first on Digiday.

“The middle has so much fragmentation that it becomes a bandwidth challenge,” said Condé Nast’s chief business officer Craig Kostelic. “How do you evaluate the players in the middle and understand what their capabilities are for what you’re actually buying?”

“I have conversations with clients that will spend 45-50% [of their budgets] on TV for awareness and another 45% on lower funnel activity with Google and Facebook and programmatic,” Kostelic added. “And then you occupy this space in the middle with 5-10%, where we’re trying to push more money, but it’s scrutinized more than the other 95%.”

Attribution has become more and more important to marketers, as they face increasing pressure to justify their investments. However, with Nielsen supplying television companies with standardized audience data, TV essentially has a monopoly on attribution via top of the funnel awareness. Similarly, Facebook and Google have a tight hold on last-click attribution, thanks to their own analytic tools. So for publishers trying to complete on these levels, Kostelic said, they are at a disadvantage because the data to track what makes a product move up in the consideration stage is nearly impossible to understand. 

And in a time when marketers are pressured to do more with less, platforms like TV or Google and Facebook make it exponentially easier to feel confident that your investments will reach your KPI goals based on the data they can provide, so marketers focus their budgets at the top and bottom of the funnel, leaving the middle relatively untouched. 

Catherine Warburton, chief investment officer at Assembly, said that the reason agencies are slower to adapt to multi-touch attribution is because it takes significantly more time to figure out how to collect the data from those campaigns than it does with last touch attribution. 

“Marketers aren’t necessarily staying away from that, but it’s not imminently clear that they’re working on multi-touch campaigns,” she said, noting that her agency has been focusing more on this area now that there is more available data to support these middle of the funnel touch points. 

Kostelic said he believes content-based companies are the answer to clearing up the murkiness at the consideration stage. This is because having a portfolio of brands that have developed organic relationships with consumers across many platforms gives publishing companies the assets they need to provide partners with the tools they need to solve their business challenges. However, it’s on his team to create an easy-to-follow strategy that connects the dots for marketers. 

Currently, Kostelic said that Condé has 20 to 25 advertising clients who have business challenges that the company feels it can best serve with its assets. And while it wants to expand that list, right now it holds standing meetings with each partner to discuss holistic strategies for omni-channel advertising.

“We have to make it easy and turnkey for them to be able to evaluate and articulate what our impact is,” he said. “The less we’re able to provide the ease of problem solving to partners, the more money is going to go to TV and direct-to-platform.” 

The post How publishers are tackling the mid-funnel attribution problem appeared first on Digiday.