Month: October 2019

The program, which SmartNews calls SmartView First, has been open to new participants since September, after small tests that began in the second quarter of this year. Rather than offer publishers a cut of ad revenue, SmartNews offers tiered revenue payouts based on a publisher’s monthly page views within the app. The tiers vary from publisher to publisher, said Rich Jaroslovsky, SmartNews’s vp of content, but the payouts can be meaningful: annual payouts range from high five figures to over six figures, according to multiple sources participating in the program.

“There’s clarity around what you’ll make,” said a source at one participating publisher. “I think publishers like seeing that. It helped us pull the trigger.”

The prospect of publishers getting paid for content seems to be in the air a bit recently. On Friday, Facebook will unveil Facebook News, a product that will pay one-quarter of its participants up to $3 million a year to feature their content in a news-only section of Facebook. Snapchat is also having conversations with publisher partners about building a kind of news-only section of its app, that it would pay publishers for. Earlier this spring, Apple launched Apple News+, a subscription product built around magazine publishers’ content that pays 50% of its revenues to publishers based on reader consumption.

The licensing fees aren’t the only source of revenue publishers can earn from SmartNews. Participants are also allowed to sell display ads against their content and keep 100% of the revenue. Jaroslovsky said he encourages publishers to use that display inventory the way that publishers are increasingly using their display inventory inside Apple News: To promote newsletters, for example, or podcasts.

“A lot of publishers have their own funnels they’d like to fill,” Jaroslovsky said. “I find myself encouraging them, [saying], ‘If the revenue from that ad is not critical to you, use it for something else.’”

When SmartNews originally launched in Japan five years ago, one of its key features was something called Smart view, a fast-loading preview of publisher articles designed for people using the app in places with limited bandwidth, such as subway cars. Users could choose to read content either in smart mode, which strips out almost everything besides text — including ads — or read the publisher’s mobile web version of the story. Publishers are able to sell ads that appear in the smart previews of their stories; otherwise, SmartNews sells the inventory programmatically.

Not everybody has reacted warmly to the program. A source at one publisher not using SmartView First said participating would be condoning a practice that they saw as problematic.

“I’d argue that they’ve already been hosting our content, in some ways even ripping off the content, already,” said an executive at one publisher that is not participating. “We look at it as blessing what we see as a shady business practice.”

SmartNews drives a small chunk of the internet’s overall referral traffic. It was responsible for 0.6% of the referral traffic measured this past month across Parsely’s network, ahead of Yahoo News (0.5%) and LinkedIn (0.3%), but behind Flipboard (1.4%). SmartNews claims it has been downloaded more than 50 million times, and the app reliably sits among the top five news apps in the Google Play store, hovering among the top 15 in Apple’s App Store. Last month, SmartNews claimed it had a global monthly active user base of 20 million. One SmartView First participant reported seeing 5%-10% audience growth, month over month, in SmartNews.

SmartNews allows publishers to put audience measurement pixels, including Google Analytics and Comscore, on their SmartView First pages, which means that the audience can be counted, though the sources contacted for this story say that revenue they earn from the deal will come from the licensing, rather than any mobile ad inventory deals.

“I feel like their long-term strategy is moving publishers natively to their app,” said a source at one publisher now using SmartView First. “And the ones that don’t will get deprioritized.”

Jaroslovsky said that the SmartNews algorithm does not directly privilege SmartView First content, it does prioritize content that people engage with more and longer, two things that the proprietary format helps with.

While fewer than 10% of the 370 U.S. publishers distributing their content through SmartNews are signed up for SmartView First, Jaroslovsky said he hopes to grow the program responsibly.

“We are very focused on building the SmartView First program in a sustainable way,” he said. “We’ve seen some competitors or would-be competitors come in, toss around a lot of money in a short period of time, and then vanish. Others have sought to build their own businesses at the expense of, rather than in partnership with, publishers. Neither makes sense to us. Our goal is to build a program where everyone’s interests — users, publishers, and SmartNews’ — are respected, and incentives are aligned.”

The post ‘There’s clarity around what you’ll make’: SmartNews is paying publishers to be on its platform appeared first on Digiday.

But media buyers and digital analysts don’t believe the death of the political TV ad is upon us. Instead, they see the increased use of digital ads now by 2020 candidates — especially by President Trump — as using digital advertising as an online focus group of sorts.

“What we’re seeing now is that digital is the testbed, the momentum-gatherer for these candidates and these campaign platforms,” said Alex Funk, vp of strategic development at 3Q Digital. “We’re going to see a lot more TV as we get closer, but until then, digital strategists will have candidates diversify across a number of different platforms.”

The digital ads serve as a quick and relatively cheap way for candidates to test out campaign messages, platforms and even a myriad of creative executions for those ads to see what works and what doesn’t. The feedback from voters online from those digital ads can then be used to craft the television campaigns, which typically flood the airwaves six to eight weeks before Election Day, and even help presidential hopefuls figure out where they need to spend more time with voters.

“It’s a data capture game,” said Nick Venezia, managing director of Social Outlier, a digital shop that has worked on digital advertising for political campaigns. “You have to start telling a story with messaging people can get behind now so that people will buy it later.”

The shift to digital advertising in politics has been happening over the last decade — media buyers and digital strategists cite President Barack Obama’s use of Facebook ads in 2008 as a turning point — but digital spending is expected to reach unprecedented levels during this election. Overall, Kantar predicts that $6 billion will be spent on paid advertising during the 2020 election, with 20% or $1.2 billion going to digital, 53% or 3.2 billion going to broadcast television and 20% or $1.2 billion going to cable television. All told, television will account for 73% of the political ad spending in 2020 versus the 20% expected on digital, per Kantar.

“There’s just more spending in general,” said Carat’s svp of strategy and head of insights, Haley Paas. “It’s not even an election year, and we’re already seeing unprecedented levels of spending for a presidential election the year before. So, people are going to get more and more creative with the things that they do in order to stand out, especially looking at owned, earned and paid in order to drive action like we’re seeing Trump do already.”

Digital experimentation
President Trump is testing various messages and creative formats on platforms like Facebook, Google and YouTube, with dozens of variations for each ad, according to a recent report by The New York Times. This ability to experiment with messaging, see reactions in real-time and tweak as needed is part of the reason why presidential candidates are spending more on digital ads now. The digital ads can serve as an online focus group not only showing candidates what works and what doesn’t with those exact ads, but it can give them a trove of data to refer to later in the election cycle to see what kind of stories resonate with voters.

For example, on Twitter on Oct. 9, Team Trump ran two different versions of the same ad. While the copy was the same, the font and overall design of both ads were quite different. One had a picture of President Trump waving with a light blue background and an overlay of the flag in white with the text, “Do you approve of President Trump? Take the survey.” The second featured a picture of President Trump speaking with a crowd behind him, the color scheme of the photo much darker than the first ad.

Algorithmically, candidates benefit from experimentation. “The more messages you put out the better your campaign does,” said Matthew Rednor, founder and CEO of Decoded Advertising. “We’re seeing that for clients there’s a tipping point where actually once you’re over five messages, once you’re in the 50-to-60 range, your CPAs start to drop and your ads start to perform better. Also, TV is not an agile enough channel to allow you to put out that many messages.” 

Feedback loop
The feedback candidates get from digital advertising, especially on social platforms will help identify the messages to promote and the areas to target more heavily. Obviously, the ability to segment those messages to different groups as well as gain real-time feedback that candidates get makes digital advertising more attractive now. But it also helps in getting people to follow a call to action much more easily than on television.

“When you’re working with limited funds, you’re trying to get the most bang for your buck,” said Paas. “If you’re looking to get donations, support and drive a call to action, we know it’s a lot harder to do that immediately through television, whereas with the Facebook ad, you click and you’re right on a page to donate. So it’s much more of a seamless experience from an audience perspective and probably has a much higher ROI for them from a donation.”

Trump, in particular, likely has a better metric than most candidates for what works and what doesn’t with paid advertising, as the president uses much of those ads to drive voters to buy campaign merchandise. While other candidates hawk merchandise, they don’t seem to use as many of their ads to do so.

“That Trump is selling [merch] off his ads gives him a real feedback loop that is the closest signal that we’ll have to seeing intent to vote versus any other signal,” said Rednor. “People don’t vote for a long time. A like, comment, share, that doesn’t necessarily translate to the polls but that he’s connecting his advertising to commerce, which is how you would with any other brand, he has a real feedback loop to see if people are actually going to buy his gear and figure out which messages will move people to take action.”

It’s not all paid
But how candidates experiment with messages online isn’t always through paid executions. With tighter budgets until the Democratic nominee is named next July, some Democratic hopefuls are using earned and owned strategies to stand out online. For example, Bernie Sanders has used celebrities like rapper Cardi B and unexpected appearances like on Joe Rogan’s podcast to get the word out online. Meanwhile, Elizabeth Warren has taken nearly 70,000 selfies with fans and Andrew Yang held a 10-hour Ask Me Anything session on Reddit.

“What we’re seeing now is the media strategists on these campaigns are really understanding the power of paid, owned and earned working together,” said Paas.

Using earned and owned strategies to find out what appeals to voters not only helps inform the paid strategy now but will come in handy once the Democratic nominee is named. While Democratic hopefuls aren’t spending as much digitally on paid ads as President Trump, buyers and analysts believe that spending will increase once there are fewer candidates in the field. There will likely be a dramatic increase in digital ads from the Democrats expected next July following the announcement of the Democratic candidate at the Democratic National Convention.

“Right now, it’s very segmented,” said Venezia. “Each candidate is picking their own media buyer or agencies. We aren’t yet seeing the whole weight of the Democratic party. Once the Democratic candidate is named, all the big guns will come out to play in digital. Then they can afford it. It hasn’t yet become the collective of media buyers that it will be.”  

 Television comes later
Another reason digital is currently beating out television is simply due to timing, as it’s still very early in the election cycle. Typically, much of the spending on broadcast television is done six to eight weeks before an election, according to a television expert who said that early in an election cycle it’s expected that campaigns will spend more on digital than television. They added that as the election nears more dollars will go to TV.

“There is pretty decent investment in digital channels already,” said Shann Biglione, evp of Americans and global strategy at platformGSK. “Growth is there but not a tipping year. You can’t reach everyone with Facebook. You can still reach more people with TV, and that remains an important consideration.”

The post ‘Digital is the testbed’: Why the 2020 election is focused on online advertising appeared first on Digiday.

Each law is different yet all are intrinsically linked by common factors. To avoid mining through the legal jargon, we’ve broken down the essentials of what you need to know about the differences and similarities between GDPR and the ePrivacy Regulation.

Who the laws affect
This is one of the areas that separates the laws. GDPR was set up to govern the use of personal data across every single sector, from medical, health, finance, charity sectors to publishers, advertisers and marketers. That makes it a far broader law than the ePrivacy Regulation which is focused purely on governing the use of cookies. That means the potential fallout is far more worrisome for any businesses that use cookies for advertising. News publisher trade groups warn the regulation will be catastrophic in its present form. (Trade groups, it should be said, always issue dire warnings about regulations.) The ePrivacy Regulation also applies specifically to messenger services like WhatsApp, Skype, Facebook Messenger, which telco companies have lobbied should face the same regulations they do.

The rules of consent
The key difference between GDPR and the ePrivacy Regulation is the latter requires “informed consent” to drop cookies. GDPR has wiggle room, with six legal bases given to collect and use people’s data. Two mains ones are used within advertising: legitimate interest and consent. All consent must be informed and freely given, so users need to understand what and to whom they’re consenting to. Although, the ePrivacy Regulation has no “explicit” consent stipulation, which GDPR reserves for processing particularly sensitive data like sexuality, political leaning, ethnic origin.

RIP cookies
This is where the rubber meets the road. The ePrivacy Regulation is all about the cookies. Some rules still need to be worked out around treating different types of cookies differently. But as the rules stand, third-party cookies will be severely restricted.

“Online news content is freely accessible to all because of its underlying cookie-based advertisement business model,” said Iacob Gammeltoft, policy adviser at News Media Europe. “If advertisement cookies are undermined, journalism could ultimately be pushed behind paywalls, making it only available to those who can afford it.”

The consent gatekeepers
Under GDPR, publishers and any company that has a direct relationship with the end consumer also controls the consent-request process. They can choose how they communicate their consent needs to consumers, which ad tech partners they are willing to disclose to the user in order to gain consent and for what specific purposes, like ad targeting, campaign measurement or analytics. Under the ePrivacy Regulation proposals, it’s the browsers that are the gatekeepers. Consumers must set their preferences in their browser settings, essentially cutting out the publisher from the dialogue. There has been to-ing and fro-ing on this for months, with the result that this article has been deleted from the current version. But according to policy advisor sources, a large number of European Union member states want to reintroduce it. That has sent shivers down the spine of publishers across Europe.

“It [ePrivacy] would also further promote the development of so-called walled-gardens, strengthening the position of dominant players,” said Gammeltoft. “As for the proposal to introduce browser settings, it brings about more issues than it claims to solve, it is both inconsistent with the GDPR and technically difficult to implement.”

Expected timeframe
GDPR took years to implement, and it will be years still before the full extent of its enforcement will manifest, as data protection regulators slowly make their way through cases. It’s looking likely that the ePrivacy Regulation will also come under the remit of country-specific data regulators, and there is no set timeline yet as the final parts are still being finalized. Bottom line: Despite the dire warnings, it will be years before any of the ePrivacy Regulation is fully enforced. The fines will be in line with GDPR: 4% of global annual revenue or €20 million ($22 million), whichever is higher.

The post Everything you need to know about Europe’s data privacy regulations appeared first on Digiday.

“I knew that the world of quick, disposable content for immaterial views was never going to be a business model and a way to grow real community and real audience. It always comes back to creating valuable franchises and IP,” said Kohn. Overtime’s original programming slate has grown from more than 20 shows as of February 2019 to now more than 40 shows, 25 of which are currently in production, according to Kohn.

Overtime is following a familiar playbook. Sports publishers like Bleacher Report and Barstool Sports have invested in producing original shows as a way to separate themselves from every other publisher pushing highlight clips into people’s feeds.

“The original programming really gives these publishers the ability to create their own voice and the proper tone of how they want to reach consumers. And something that’s endemic to them, as opposed to getting lost in that white space in the swirl of sharing the same content that you’re seeing across a number of great publishers,” said Chip Johnson, vp of Publicis Sport & Entertainment.

Overtime had already differentiated itself by focusing its attention on high school basketball instead of the NBA or college. The publisher gained popularity by posting clips of prep stars like Zion Williamson, who is now in the NBA. The aim of its original programming is to reinforce that identity.

Overtime raised $23 million in funding in February to add to its video team as well as its original programming slate. Overtime’s content team has grown from 15 employees a year ago to 50 today, 30 of whom work solely on its original shows. In total, the company has 95 employees, up from 34 in October 2018. The company declined to say how much revenue it has generated this year or whether it is profitable, but it did say that revenue has increased fivefold in 2019.

The original shows account for a majority of the company’s revenue, though it also operates a commerce business. Overtime’s sponsorship-and-advertising revenue and its commerce revenue each amount to seven-figure businesses, according to a spokesperson.

Instagram remains Overtime’s most popular platform by total viewership, but its videos appear to perform better on YouTube, which has been the primary distribution for its original shows along with Snapchat. In September 2019, Overtime’s videos received 180.2 million views on Instagram, a 61% increase year-over-year, versus 24.8 million views on YouTube, a 43% increase year-over-year, according to data from Tubular Labs. However, Overtime posts significantly more videos to Instagram than YouTube. In September, it uploaded 1,472 videos to Instagram and 71 videos to YouTube. Taking into account the total number of videos uploaded and views generated, Overtime averages more than twice as many views per video on YouTube than Instagram: 349,296 views per video on YouTube versus 122,418 views per video on Instagram.

Overtime has built its show franchises by basing many of the series on the athletes highlighted in its social videos that resonated the most with its followers. The publisher saw high engagement in Instagram posts that featured sibling high school basketball stars Jaden and Julian Newman, and in April 2019 it premiered a 10-episode documentary series about the Newman family that averaged 6 million views per episode across Instagram, Snapchat and YouTube, according to the company. On Oct. 19, the company debuted a second season sponsored by Boost Mobile.

Overtime has worked to strike a balance between producing shows that are of a higher quality than the user-generated clips it is known for without straying too far from the feel of those videos that earned its audiences’ attention in the first place. Overtime spends slightly more than $500 but less than $1,000 per minute to produce its original shows, said Kohn. According to an Overtime spokesperson, the company’s average per-minute video production cost is around $600 when including the cost of the short highlight videos. For comparison, the daily programming that Quibi is commissioning for its short-form mobile streaming service costs around $10,000 per minute, Digiday has previously reported.

Overtime has seen that if its programming is too TV-like, viewers are more likely to tune out. In the debut season of “Hello Newmans,” the first two episodes featured a longer opening sequence that “was designed for digital but kind of the length of a TV open,” but the viewership retention for those episodes was “not nearly as strong,” said Kohn. Overtime tightened the open for the following episodes to more quickly get viewers to the actual focus of the episode and saw retention improve, he said. After making the change, Overtime saw a 30% reduction in viewership drop-off within the first 30 seconds of episodes, according to an Overtime spokesperson.

“We always want the DNA of our content to feel young. We want a raw feeling. A raw feeling does not always mean that the video quality is bad. Raw is a feeling, not a necessarily a look,” said Kohn.

To help ensure its original shows retain the characteristics of the social videos that built its audience, 25 of the 30 employees that are dedicated to its original shows are what the company describes as “digital natives” whose backgrounds are in producing videos for Instagram and Snapchat. It augments those employees with staff members who have previously worked on producing reality TV shows and can work with the younger employees to blend the digital storytelling techniques with a more professional production quality.

That blending can be particularly important for ensuring that Overtime’s shows share enough qualities with its social videos to interest its audience, such as the quick-cut editing style commonly found on YouTube videos and Instagram Stories. A 10- or 12-minute episode of “Hello Newmans” can feature as many as eight scenes, which Kohn estimated to be twice or triple the pace of a traditional TV show.

Overtime is starting to make its way into Hollywood productions. Overtime is currently developing “a few shows that we plan to take out to the Netflix, HBO and Showtimes of the world,” said Kohn. The company expects that it will co-produce “a few projects” over the next 12 months with outside production companies, he said.

The post Overtime wants to go from viral Instagram sports highlights to franchises appeared first on Digiday.

On Google AMP becoming a meaningful traffic generator: “Google AMP is fantastic for us — news and search are massive drivers of eyeballs — 50% of our mobile traffic is AMP.”

On testing whether slowing down page load times would affect users’ likelihood to bounce off a site: “Every 1-second of page-load time was worth to us multiple millions of subscription revenue.”

On how to position your “premium” content: “By calling content ‘premium’ you indirectly say you also create content that is un-premium.”

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