Month: October 2019

Both platforms secured rights to show the most lucrative football league in the world. And yet, those deals were smaller than many anticipated. They were emblematic of how circumspect the platforms are to spend millions on rights to the most popular sports in the most mature markets where the monetization potential is high risk with short windows of opportunity. Rights that would’ve been regarded as targets for big platforms two years ago, like the British broadcast rights to show the Champions League football tournament, seem to have dropped off their radars. The platforms are no longer in contention for the most expensive rights.

“There’s no shortage of sports content across social networks, but the behavioral data shows consumption tends to be in a shallow way. They don’t lend themselves well to long-form content consumption,” said Phil Stephan, director at sports marketing agency Two Circles. “Users don’t engage with content for longer than a few minutes, and this will be a hard behavior to break if they look to push long-form live content on their platforms.”

Facebook has no plans to place any big bids on sports rights in the near future, said director of global sports partnerships Peter Hutton. Rather the strategy — at least for now — is to work with broadcasters, not become a big rival to them. Last month, the social network signed a deal with Fox Sports to create exclusive content for Facebook Watch, for example. Although, despite its work with sports broadcasters, Facebook hasn’t ruled out rivaling them completely. When the social network has bought rights to show big sports, whether it’s La Liga in India or the Premier League in Thailand, Vietnam, Cambodia and Laos, it’s been in emerging markets where the cost of acquiring the rights is outweighed by Facebook’s ability to reach the largest audiences in those markets.

“Streaming sports isn’t just about the direct advertising or sponsorship return, but also how we can help the rights holder monetize their audience,” he said. “It’s not a question of us versus broadcasters. We can be a free-to-air funnel for audiences and can benefit broadcasters when it comes to how they find their next audiences and commercial revenues.”

It’s a stark contrast to where Facebook was a year ago. Back then, the social network was big on acquiring sports content — both live and original. A rumored £10 million ($13 million) deal to fund a reality show featuring football star Cristiano Ronaldo never materialized, while similar deals were cut at the last minute.

“We were working on an original content deal with Facebook last year, and in a short space of time, they went from being unbelievably keen to get the deal done to telling us their strategy had changed,” said a sports exec on condition of anonymity. “Now, the focus is on programming that someone else has already built the brand for and taken all the risk. Effectively, they want the content around the main event on their platform, not the event itself.”

Twitter’s position has also changed in the sports world. Twitter was arguably the first of its peers to go big on sports broadcasts in 2016 when it bought the rights to show the NFL’s Thursday Night Games. Since the season-long deal ended, Twitter hasn’t pushed for big sports rights in the same way again. The money opportunity just isn’t there now richer rivals have entered the picture.

“We’re not in this game to turn over any tables in the broadcast market,” said Theo Luke, director of content partnerships in EMEA at Twitter. The micro-blogging site isn’t big enough to compete for the rights to broadcast major sports, said Luke.

Instead, Twitter wants to get broadcasters to put the rights they’ve bid for on the platform, rather than buy them itself. Deals to show sports footage from Fox Sports, TSN, Sportsnet, CBC Sports and Eurosport have been announced so far this year.

“Our model is designed to be sympathetic to broadcasters,” said Luke. Twitter has 950 content partnerships worldwide and its payouts to them increased by 60% year over year, said Luke. “The focus is to find those opportunities where we can work with a partner on those live sports that we know there are strong conversations happening around,” he added.

But live sports broadcasting is still inherently tied to an interruptive advertising model, arguably more so than any other area of entertainment. To reap the commercial opportunity, the tech platforms need to be able to sell a chunk of ads at halftime in between overs, sets or rounds depending on the sport. The cost-per-thousand impressions for those is so low, however, that it’s difficult to see how the likes of Facebook and Google could ever offset the huge investments needed to buy rights for major sports that tend to be country-specific, have little or no shelf life and have a limited appeal outside of a dedicated fan base. By comparison, though tastes may change and zeitgeists come and go, documentaries, dramas and comedies are abundantly more evergreen.

Additionally, the value to advertisers of sports on tech platforms is largely reliant on being hyper-targeted and topics like “football” or “tennis” are just too disparate and broad. Certainly, there could be targeting based on other user data, but that raises questions about the technology’s ability to serve that in real time as well as how it works with major tournament sponsorship deals, said Tom Gladstone, head of strategy for Engine’s sport and brand experience divisions.

Over-the-top players like Amazon Prime, Disney and Dazn are in the ascendancy but, when it comes to sports rights, they’re competing with an industry in linear TV that’s arguably in a tailspin for a product that’s arguably at a lifetime peak in cost. For example, the 2018 auction for domestic EPL rights resulted in a 10% drop in revenues between 2019 and 2022, the largest decline since the introduction of live football on pay-TV, per Enders Analysis. Not really a burgeoning area for Facebook and Google to bother jumping into. Meanwhile, Amazon has merely started to test the waters, quietly scoping the market for sports rights this year, but with no major sign of investment. In March, the tech platform was on the hunt for a sports exec to lead rights negotiations for sports content in Europe.

These sports will still be here in five to 15 years’ time, so why compete today with competitors who may not be in the future.

The post Tech platforms like Facebook and Twitter cool interest in broadcasting live sports appeared first on Digiday.

Still, most advertisers view Facebook Watch as being in an experimental stage, and they want more answers about content quality, brand safety, delivery and discovery. They also wonder how Watch can compete in the increasingly heated streaming wars.

“Advertisers are less likely to invest in Facebook Watch and newer things because they’re just like, ‘Well, the other stuff hasn’t worked as effectively as I was told it would, so what’s my confidence that this would as well?’ And the price tag that they’re expecting is pretty high. When you take into account it’s a walled garden and you’re getting limited to no measurement back, you’re kind of like, what am I doing here?” said one ad agency executive.

With regard to brand safety, Facebook’s head of North American agency partnerships, Erik Geisler, told agency executives gathered for a Watch event this week in New York City that every single video monetized through In-Stream Reserve goes through human review — not just an algorithm.

Still, not all ad agency executives are convinced that’s enough. Jordan Jacobson, vp and head of social media at iProspect, said that while advertisers can exclude up to 3,000 publishers in Reserve, Facebook keeps adding more, so it’s hard to be completely confident about brand safety. And there are still pieces of content that brands may not want to be associated with.

Another ad agency executive told Digiday that clients who paused their video ads on Facebook did so because they felt they didn’t have “enough control over where their ad appears and being able to suppress the channels or the videos they don’t want to be associated with.”

“Until there is more of a bespoke whitelisting opportunity, there will always be some concerns around brand safety,” said Carly Carlson, director of social for PMG.

At the event, Geisler also said Facebook won’t monetize any videos that are under three minutes in length and that it won’t place an ad before one minute to ensure viewers are truly engaged. He said 70% of ads from In-Stream Reserve were viewed to completion with the sound on.

But Facebook could still work on improving the ad experience, said Carlson. “The inventory [on Facebook Watch] has [a] strong potential to be high quality and premium; however, the user experience of unskippable In-Stream Reserve ads can be annoying to a user, potentially leading to high abandonment of the content.”

Those concerns aside, Facebook’s overall sales pitch to advertisers hasn’t changed much since the upfronts: That Facebook has the scale of audience, the quality content, the right ad experience, the delivery rates and the brand-safety measures to make Facebook Watch a must-buy. Buyers are still wondering exactly who’s watching Facebook Watch, what type of content you can find there and whether Facebook is willing to invest the money to promote Watch to users.

During Wednesday’s event, Facebook emphasized the scale of its audience as well as the fact that it skews younger. Previously, the company has said 43% of people in the U.S. who watch In-Stream Reserve eligible content are aged 18 to 34, compared to just 29% of TV viewers in the same age demographic. Facebook said that as of June 2019, there are now more than 720 million people monthly and 140 million daily who spend at least one minute in Watch and, on average, daily visitors spend more than 26 minutes in Watch each day on a global level. By contrast, Netflix has more than 150 million subscribers worldwide and Hulu has more than 28 million subscribers globally.

Examining 12 recent In-Stream Reserve video ad campaigns, Facebook said that it drove 10.2% incremental reach relative to TV for targeted demographics in aggregate and that the Facebook Watch audience is younger, with those 12 campaigns reaching people ages 18 to 24, on average, 22.7% of the time, compared to 7.2% with TV for the same demographic.

Agency executives said those demographic details match up with what they’re finding in their clients’ experiments with Facebook Watch.

“Facebook is not your only option. Is there more benefit to reaching an audience there than reaching someone watching a movie on a TV screen?” said Jesse Math, ForwardPMX vp of display and paid social.

Facebook’s Geisler said there are more cord-cutters and “cord-nevers” than ever before, and while Facebook does value content, it’s placing more emphasis on reaching audiences where they are and how they prefer to consume content instead of commissioning shows that are made for specific audiences.

“What we’re more focused on is, who do you want to reach? We’ll put shows in front of them that we think are great,” Geisler said. “We need to be more focused on the people watching content; we can’t just focus on the content. We need to ask ourselves how audiences and consumers are changing and how do you find them?”

However, the quality of content still matters to advertisers, said Jacobson. “The PMGs, the Microsofts, the Hiltons of the world, they 100% care about how premium the content is that they’re surrounding themselves with,” he said, before adding that Facebook Watch remains a “tough sell” for those companies.

“I don’t think we have enough data to support that viewership of Watch is anywhere comparable to any of their competitors whether you’re talking network TV or Hulu or Amazon or demanding attention away from it, even on mobile devices,” Jacobson said, adding that Facebook Watch’s content is “mostly reality, mostly low production and not as much high-quality scripted shows that I know about.”

Facebook still hasn’t made any headway in getting advertisers to sponsor its Facebook Originals programming, although publishers have tried to get their shows sponsored since 2017.

“We’re not in the active sponsorships right now,” said Geisler. “We’re going to be testing them next year. True sponsorship is not something we’re actively pursuing it right now.”

Sponsorship of shows isn’t something most advertisers are ready to commit to at this time, but PMG’s Carlson said her clients would be if they could create custom content. “Our clients want to feel like they are a true part of content with premium video partners, not just [being] an ad buy within the middle. I would love for Facebook to provide a way for brands to truly integrate into the story of a piece of content, rather than just a standard video ad unit.”

“They need to have an ad campaign behind it and behind the shows so you see them,” said Jacobson. “If I didn’t work in this industry I wouldn’t know ‘The Real World’ came back on Watch. I feel like I hear them talking about Facebook Watch, but I don’t see them putting their money where their mouth is. Are they making this a scalable, comparable platform to everyone else in this space?”

Senior Reporter Tim Peterson contributed to this article.

The post Inside Facebook’s bid to woo TV advertisers appeared first on Digiday.

The challenge runs through Nov. 2 and has already garnered more than 105 million views, encouraging TikTok users to show how they transform from being too sick to “so sick” and ready to celebrate Halloween.

The ad campaign came together in about a month, and TikTok helped connect Mucinex to three of the four creators who developed sponsored posts for the challenge. One of the sponsored posts from creator @ourfire, whom Mucinex found via the TikTok Creator Marketplace, has received 862,500 likes and 1,321 comments.

The sponsored posts from creators capitalize on a popular type of TikTok post that showcases a transformation, and they feature an original sound that Mucinex’s ad agency, McCann, found especially for the campaign.

“I really thought music and dance would be the primary source of trends on TikTok and that’s a big part of the trends, but there are so many other things people are engaging with on the platform, like transformation videos and humorous videos,” said Elyse Altabet, marketing director for Mucinex. “They have a lot to offer to different advertisers in terms of insights and engaging new audiences.”

Mucinex wouldn’t disclose how much it spent on this hashtag challenge, one of five advertising products TikTok currently offers. According to Kantar, Mucinex has spent $29.56 million in the first half of 2019 on media spend; last year, it spent a total of $58.34 million on advertising.

However, a recently leaked TikTok pitch deck from June 2019 priced a six-day hashtag challenge package at $150,000. In that same deck, a recent hashtag challenge from clothing brand Guess Jeans, #inmydenim, amassed 10.4 million views and got 6,000 people to create videos with the hashtag. A TikTok spokesperson said that, for now, access to the Creator Marketplace is included for companies running campaigns on TikTok.

For Mucinex, in particular, Altabet said they were looking for creators with high levels of engagement and mix in terms of their styles, with regard to how many graphics they use or how many artistic overlays or changes they incorporated.

“This allowed all types of users to feel engaged and participate as part of the challenge, and the marketplace helped us navigate and find the right creators for us in a short time period,” she said. Getting in touch with creators and working with them on the videos, she said, was “very seamless.”

Instead of buying an ad package with TikTok like Mucinex did, Kind, the snack bar company, recently launched its first-ever TikTok campaign on Oct. 24 to promote its newest product, the Simple Crunch bar. Unlike Mucinex, Kind created the majority of campaign content in-house within three to four weeks, and found four creators to partner with to develop videos.

“Within the first 24 hours, the campaign received nearly 20 million organic views,” said Jessica Goon, vp of digital marketing at Kind. “We also received a 34% increase in traffic to the Simple Crunch page in relation to the campaign being live for one week.”

Goon said Kind decided to find creators on its own, instead of using TikTok’s Creator Marketplace, because, “We’ve historically identified all creators and influencers in-house and wanted to continue to do so to ensure the right brand fit.”

The inaugural post features Kind CEO Daniel Lubetzky and promotes the #kindsimplecrunchcontest where users who use the hashtag in posts featuring the new bar can win a trip for two to New York City. One sponsored post from creator @zachking, a play on Grant Wood’s famous American Gothic painting, has gotten 3.6 million likes and 5,500 comments.

Both Altabet and Goon said their respective experiences in using TikTok to promote their brands and products weren’t wildly different from campaigns they’ve run on other platforms but said they are looking to do more on TikTok going forward.

Kind didn’t buy any ad packages from TikTok for this campaign, but Goon hasn’t ruled out doing so in the future. “This campaign is just the beginning for us. We will always consider the platform’s offerings, like the Creator Marketplace, when developing a program.” Last year, Kind spent $28.74 million on advertising and in the first half of 2019, it spent $13 million, according to Kantar.

Mucinex, too, is already thinking of other ways it can run more campaigns on TikTok. “It’s a wonderful learning opportunity for us to really understand the platform and think about how we drive engagement in new and fun ways. The experience already has given us lots of ideas for what we can do in the future,” Altabet said.

The post How Mucinex enlisted TikTok creators to push cold medicine appeared first on Digiday.

“What Future does with those brands is the most interesting aspect of this,” said Alice Pickthall, senior media analyst at Enders Analysis. “[Future’s] strategy has been calculated thus far. It’s very data-driven. It’s done a phenomenal job in applying that strategy to other brands.”

Agency sources say that Future is known for its strong digital clout thanks to launching several digital-only brands. While for TI Media, digital has been more an area of development. Future has also built proprietary tech and price comparison widgets which let audiences compare items on Future’s sites, like T3 and TechGadget, from other retails across the web. As well as adding a solid revenue line for the magazine publisher, this gives it useful data points to inform content and commerce decisions.

Future has been on a turnaround effort for the last six years, restructuring and selling off assets, partly driven by the appointment of CEO, Zillah Byng-Thorne, who has also held non-exec board director seats at Paddy Power Betfair and Trainline International.

According to Alex DeGroote, an independent media analyst, Future has spent over £350 million ($453 million) on acquisitions over the last four years, from £5 million ($6.5 million) in 2016 to £180 million ($233 million) in 2019. The current market valuation stands at £1.3 billion ($1.7 billion).

“It is the industry consolidator, one of the publishing big boys now,” said DeGroote, adding that tech platform and publisher Purch and TI Media have been the bigger deals. The group is supported by shareholders and banks who provide Future with credit, so raising funds has not been an issue.

Purch, which it acquired in 2018, was a way for the publisher to build its audience and revenue in the U.S., which seems to be paying off. According to DeGroote, over 50% of revenue comes from the U.S., with media — including commerce and digital ads — accounting for 70% and magazine sales accounting for 30%.

“It’s a rare example of a U.K. media company that appears to be succeeding in the U.S.,” he said. “Zillah is seen as having the magic touch. At a time when nearly every other media exec is scratching their head over business models, she and her team have a clear strategy and are ambitious.”

Media companies have higher valuations when portfolios include a line of recurring reader revenue, like subscriptions. But Future hasn’t gone deep into digital subs, yet. Instead, revenue is made from commerce, display ads and sponsorships. Its focus has been to look at how it can generate the most value out of the reader, rather than serving ads, which other publishers seem to be putting into practice now too, according to media analysts.

“The entire model is to take a category and work out how to monetize readers in the most circular and holistic ways,” said Pickthall. “Often, traditional publishers approach serving content and building a brand. Future looks at things in a circular way at how best to optimize and appeal to readers, whether that’s e-commerce or even B2B.”

There’s also been a keen eye on keeping costs down. A simplistic example of how the company is more conservative than others is by looking at its address, said Pickthall: Future’s HQ in Paddington, London, has a lower sense of swag to House of Hearst, the rival magazine publisher’s prime retail space in Leicester Square, London. “Internally, the mindset is ‘maximize what you have,’” said Pickthall.

Agencies also welcome the move. “In a publishing sector which usually has negative headlines, this is a positive one,” said Dan Wood, joint head of MediaCom, Beyond Advertising. “The magazine industry in the U.K. is vast, consolidation is needed to safeguard its long-term future. We welcome and support this.”

Future, because of its focus on niche specialist brands, has typically had a lot of direct sales relationships with advertisers. In the lifestyle categories, solid agency relationships are necessary. One agency source at a holding group said that the group’s spend with Future, compared with TI Media was tiny, due to TI Media building very collaborative relationships over time with U.K. agencies.

As with all acquisitions, cost synergies will be the focus over the coming months. According to LinkedIn, the number of employees at Future has grown slightly since 2017 from 1,300 to 1,500, mostly based on London and Bath, South West England.

“Future stands out in terms of other magazine publishers,” said Pickthall. “Not just from their acquisition pathway, which has been forceful, but the way it looks at monetizing brands and maximizing their assets. It’s clearly leading.”

The post Why Future has turned into a media consolidator appeared first on Digiday.