Month: October 2019

When did you start media in-house tests and what do those look like?
We’re doing some programmatic in-housing. What we have been experimenting with is, can we place programmatically in a more efficient way and do we actually see that driving value? We’ve just taken a chunk off of a couple of our brands and started to do that spend ourselves to see what it looks.

What’s a chunk?
It’s a couple million dollars.

In doing a test of media in-housing, are you building up the in-house team? Has it grown over the last year and, if so, how?
It’s a little bit bigger. They’ve been doing more and more work for us. They’ve done a terrific job of pulling that group together and starting to create really the culture of an agency in-house. Kerri [Martin, chief electrofier of the Electro Creative Workshop] who runs that for us, has spent a lot of her time creating a culture around that because agencies need culture to survive, right? It can’t just be the Clorox culture; it has to be an agency within that.

Has bolstering the in-house team and capabilities changed your agency relationships? Are you working with agencies less?
We’re in an explosion of content, so it’s less about you’re doing less and more about we need to do more. So, it’s much more additive than it is you’re going to lose something and we’re going to take something. Content is exploding. We’re talking about our strategy period, which is between now and 2025. We feel like we’re going to need probably five times the content we need today. The only way we’re going to be able to do that is have great external partners, like we do with FCB and Mcgarrybowen. We’re also going to need our internal engine. We’re going to need publishers and consumers; we’re going to need all kinds of partners.

In recent years at the ANA, marketers have pushed to rein in crappy content and deal with frequency issues. This year, they’re talking about not being too noisy but being relevant when you show up for consumers and needing a lot of content to do that. Seems like a tricky duality.
There’s a difference between crappy content and a lot of content. It comes from actually knowing who you are as a brand. For us, it comes through purpose. If you actually know what you stand for and know what you’re going to do, it’s a very different way to create content as opposed to [a mentality of] we’re just going to make a lot of stuff. It requires a much stronger center for a brand.

Have you ever been served crappy content from Clorox programmatically?
Some of the crappy content Eric showed [at the ANA before] was crappy content that I made. I was on the agency side before I went to Clorox. I came to Clorox in 2016, and I actually helped him with that presentation and embedded what I know is some of the crappy work I had actually worked on. So yes, I have been. I have not only been served crappy work, I’ve put it up on a big screen and said, “Here is crappy work that I have worked on.”

You recently acquired a DTC dietary supplement, Nutranext. What is Clorox’s direct-to-consumer strategy?
We’re doing DTC. Some of our brands just naturally lend themselves more to DTC. We purchased a company called Neutranext; they have vitamins, minerals and supplements. Obviously, those are much more geared to DTC, and people are much more interested in using DTC. It’s the only single direct-to-consumer business we have. A lot of our other businesses have a DTC component as well, like Burt’s Bees. If you just think about e-commerce in general, we do about 8% of our sales direct-to-consumer through an e-commerce site. We’re really seeming to learn a lot about how to have a different kind of relationship with consumers. As you can imagine, it’s much harder when you don’t close that loop. And because much of ours is sold through retail, that ability to have relationships [through DTC is attractive]. We just know people so much better, and we can learn so much more about what do people actually want to try. So, before you take it to retail, the ability to put it DTC and then giving people kind of nice little delight things, like you can personalize a lip balm on Burt’s Bees to have your own name on it.

Do you think you’ll create a startup studio like P&G?
We haven’t done that yet. We haven’t started creating our own brands doing that yet. I would not be surprised if some day we made that choice.

Retail media seems to be a greater focus area this year, especially for Walmart and Target. That seems helpful for CPG brands to get more data on their consumers. Are you focusing more there?
We’re doing some really interesting work on our Kingsford brand right now with Walmart’s media group and trying to actually understand when is the best time to reach them and how do we reach them in more interesting ways. For example, they know when somebody just bought a grill in a Walmart. The ability to actually serve content to people when they’re learning how to grill is amazing. That’s the kind of thing that you can only do with a Walmart media group. If you look at something like Amazon, like a lot of people use Amazon for product search, whether or not they buy on Amazon, so the value of Amazon search is really high. Figuring out how to use those in ways that benefit both of us is really an interesting piece.

What about in terms of media spend, more toward retail media this year?
We don’t do a corporate allocation, for the most part, in the beginning. We actually roll it up from the brand. There’s really different opportunities for different brands. Now, overall, has our spending increased with those guys? Yeah, it definitely has. But it’s come organically from ideas that people have had in working with the platforms rather than this is how we’re going to spend our money, which we just find to be way more effective.

The post Clorox CMO Stacey Grier: ‘Some of our brands just naturally lend themselves more to DTC’ appeared first on Digiday.

Whether GroupM can be that expert depends on new CEO Christian Juhl, who took the reins from Kelly Clark at the start of the month. On the face of it, Juhl is an astute pick by WPP CEO Mark Read. He turned what was a digital agency in Essence into a digital-first media shop that’s savvy enough to earn Google’s trust as its main ad buyer. Under Juhl, Essence doubled down on hiring developers and programmatic experts in the belief it could win more business purely on the basis that it had more specialists than its rivals. Last year, Essence won 23 new clients, including Coty, British Telecom and BP.

“Buying power is a hygiene factor that all the holding groups offer to a good level,” said an Essence client on condition of anonymity. “We went with Essence because they could buy smart. It was able to show media value in a way that’s closer to our business, not abstract savings and discounts. It was value in a different way.”

A new model
Essence is known for transparent pricing models that couldn’t be further from its owner’s non-disclosed contracts. Juhl’s challenge is balancing those two models while maintaining revenues and margins when previously they were largely accrued through methods at odds with the new order for clients and agencies. As much as WPP wants GroupM remolded in Essence’s image, it must keep milking its cash cow to protect squeezed margins. The holding group last saw growth from GroupM in the U.S. three years ago.

“Juhl is young and has a proven success story behind him, but he is also ‘new’ in the group,” said a former GroupM exec. “I am sure he will have to deal with a lot of politics. GroupM is a different beast.”

It is already a tense time at GroupM, according to interviews with 10 sources, including clients, former execs and consultants who work with the team. Tensions stems from a mix of a business that’s pushing hard on cost savings and efficiencies in the name of better client service while shaking up its leadership ranks.

“There are some egos on the leadership team who have been broken or bruised due to their roles being made redundant or devoid of strategic thinking and feel like they’ve become executors of strategies that are being made without their input,” said one exec with knowledge of GroupM’s plan.

Mission: Impossible
Add to that, the structural challenges of overhauling GroupM. At its best, and even at its worst, GroupM is a tidy microcosm of advertising itself. Dated business models, taking the real-time and data-driven approach used in digital into traditional areas like TV, Closer alignment with creative to ensure customization for audiences and channels, moving from undifferentiated agency brands to client-dedicated agile teams leveraging talents and tech across the group, increasing employee retention as talent moves to Google, Facebook and Amazon as well as the consulting firms.

Welcome to the impossible job.

It’s a job that’s only possible if GroupM can somehow redefine what media value means to advertisers. And more importantly, get them to pay a premium for it. Juhl wants this value to come from its ability to be able to execute projects for advertisers globally in multiple markets simultaneously at the same level of quality. That sort of scale can’t be achieved without technology and data as Essence’s emergence has shown.

“Where we can do better than maybe GroupM has done in the past is to provide some singular solutions on a global basis and figure out what is best in class,” said Juhl. “We need to figure out how we build a layer of intelligence that can operate globally at a scale that services our agencies on things like measurement, data collection and data processing.”

This isn’t the first time GroupM has tried to pivot from media to data analytics and technology. In 2011, the Xaxis trading desk was the golden child within the holding group and in 2016 it was mPlatform. Both brands still exist within GroupM today, but they don’t enjoy the same status they once did. The problem for both agency brands was that GroupM thought the arbitrage model it had mastered for traditional media could work for biddable media and data. It had mixed results. In fact, some clients weren’t happy with how the business intended to make money from their data.

“As soon as we heard the pitch for Xaxis we said we weren’t prepared to share our data,” said a former marketing director. ”Our stance stayed the same even when they offered a transparent model through mPlatform because our trust in that part of the business was lost right at the beginning.”

Still, not every advertiser shares the same view. It is worth noting that Xaxis remains one of the fastest-growing parts of GroupM and WPP – double-digit growth in 2018 and very much on track for the same in 2019. The problem is, however, that having two business models — disclosed and undisclosed — that are polar opposite has created its own tensions with some clients, according to an exec who works with the business.

Previously the difference between Xaxis and PBU was the commercial model. Now Xaxis has a disclosed deal with Ford, it muddies the waters of what the points of differences are between them. The concerns aren’t new to Juhl, who believes some of them will be appeased once GroupM is clearer with advertisers about how it profits from their money and data.

“I wouldn’t want to be the one always trying to sell a particular data asset that we own in that scenario,” he said. “We need to be clear about when we own something, when we’re charging on outcomes and when we’re consulting to help our clients manage their data.”

Future state
Eventually, there will be clearer lines of separation between GroupM’s outcome-based business that will be built on how it uses its own data to execute projects against certain projects, and an advisory business built on publicly available data that can be bought or licensed on behalf of its clients, said Juhl.

“The vast majority of conversations I’m having with clients involve them wanting to own their own data,” said Juhl. “They want advice on how to use it, manage it and activate largely in what we call the walled gardens and their willingness to pay for those services.”

As smart as borrowing from the Essence playbook is, doing so also has its risks. There are gaps in the Essence story that could become pitfalls for GroupM. It’s digital capability is very Google stack focused, according to one exec who has seen the agency pitch. Work is also needed on the agency’s strategic ability too, said the exec. After all, media agencies do a lot more than digital optimization, which is where Essence has lead the way.

“What Essence did really well was build a global system that the client teams all understood very well and were able to represent to clients,” said Juhl. “I’d like to be in a place where GroupM comes out says ‘this is what we believe you do search globally’ or ‘this is the way we believe programmatic media needs to work’ or this is how analytics works across these environments’. We’re going to deploy those solutions globally and then allow our agencies to access those things in a way that really works for their clients.”

The post With a new leader, GroupM embarks on a turnaround plan appeared first on Digiday.

“With the bombardment of fake news, the merit of FT Schools has been access to high-quality journalism and awareness of the FT as an authoritative source,” said the FT’s global education editor Andrew Jack. “There has been a rise in expressing interest for university student subscriptions. That’s the most elegant next step.” The FT offers a student subscription priced at £2.65 ($3.27) a week, as well as enterprise-style packages for universities and higher education institutions. It’s interest in the latter, which has grown in the 18- to 20-year-old age range, said Jack. The publisher couldn’t share details on the increase in interest for subscriptions by the time of publication.

For the most part, the FT Schools initiative has used existing FT content and packaged it in relevant and thematic ways that map with the school curriculum. Two content areas it wants to expand are around career advice for life beyond school and financial literacy, hence releasing the board game. The game, called “Road to Riches,” is designed to help teach smart money management and investment without seeming dry. Students and teachers already part of the program get a free edition of the game, otherwise, it costs £28 ($34.38). Released Oct. 2., the publisher said it has had over 400 applications for the game.

To continue to gather momentum for FT Schools, it currently runs eight different writing competitions with partner organizations like the Royal Geographical Society and the Political Studies Association. Most recently, the FT partnered with the Royal Economic Society for the young economist of the year, where the winning essay is published in the FT. “For us, we also give insights into the younger generation to our existing readership,” said Jack. “They get to hear the fresh views.”

The FT has a solid subscription business of over 1 million paying readers, three-quarters of whom are digital subscribers. But a lot of these are from the corporate world, and it skews male and older — the average age across print and digital for the FT is about 48 years old. Like a lot of publishers, to foster future growth, it needs to fill the funnel.

“All news media has always had a next-generation challenge,” said Douglas McCabe, CEO of Enders Analysis. “News is often perceived by young people to be less relevant to their everyday lives. But the internet age has substantially accelerated the challenge. Young people have more ways to engage with the news agenda, but news media — and their collective take on the agenda — have become, if anything, less relevant.”

FT Schools is growing in terms of weekly page views and overall signups. However, it’s worth noting the 40,000 figure is a cumulative number since the program started — the net active number is smaller as students and teachers will have left their schools. The publisher couldn’t provide the number of active accounts before the time of writing. As students register their account with a school email address, there’s no consistent way of reaching them once they leave.

According to Jack, one economics teacher from the U.K. said his first port-of-call each day is the FT, and sets weekly homework for his students based on the two to three question suggestions and accompanying articles that are sent in FT School’s weekly newsletter.

The topics that are popular align with overall FT readership. Jack pointed to Brexit and European politics, profiles of significant technology industry leaders, big-tech regulatory issues and the climate crisis. Examiners and interviewers extol the importance of real-world application to theories from the classroom, with the initiative the FT acts as a constantly updated resource.

In the U.K., just 7% of people make an ongoing payment to news media, according to Reuters Digital News Report. Paying for news is an older characteristic. Instead of the initiative building a habit of getting quality content for free, Jack believes it has the opposite effect.

“Digital distraction and fake news are big existential threats,” he said, “but the result has been a recognition of the value of high-quality media outlets and, increasingly, the understanding that this comes with investment. That makes a legitimate case to pay.”

The post How The Financial Times is pursuing subscribers still in their teens appeared first on Digiday.