Month: November 2019

Relaunching Zagat has been a careful exercise in balancing the brand’s storied reputation while leveraging the millennial-friendly following The Infatuation has built.

“Zagat was really the first example of user-generated content back in 1979 when [Tim and Nina Zagat] were giving friends paper surveys and having them fill out info about their favorite restaurants,” The Infatuation CEO Chris Stang said. “What does UGC look like when you take a 40-year-old iconic brand and 10 years of domain expertise we’ve built understanding this space, and what’s happened in user-generated content and build something new?”

Stang wouldn’t divulge exact details about the new Zagat product features to be released next year but did say the team will use technology and human vetting to ensure content quality. “[I want people] to feel excited about leaving their knowledge and expertise for other people,” Stang explained.

The New York-based company has kept both the Zagat and Infatuation brands separate, with a handful of full-time employees who work on Zagat. It operates in 12 cities, including London.

Stang said he sees both brands continuing to coexist and that both audiences have become wide-ranging in terms of geographic reach and demographics, and are roughly the same size.

A brand partnership deck for The Infatuation notes that its website receives 4 million monthly views and that its total social following includes 4.1 million followers. Its audience is primarily female (65%) and 72% are aged 21 to 34. The audience for Zagat is presumably older.

He also said you can expect to see reviews from both sites integrated onto the other, so users can cross-reference the opinions of The Infatuation’s reviewers with those of the crowd-sourced Zagat scores, for example.

Zagat’s reviews will also have a different voice. Whereas The Infatuation emphasizes contextual dining reviews, such as “Where to Go When You Don’t Want to Make a Big Deal About Your Anniversary,” and it features the voices of a single reviewer, Zagat’s reviews are still being crowdsourced and repackaged into snappy snippets.

This time, however, Zagat isn’t asking people to fill out surveys by hand. Instead, there’s an online survey link, and The Infatuation has created a Zagat Curators program to enlist passionate and knowledgeable diners to contribute their reviews and recommendations. In New York City, the curator group comprises 88, and is something Stang hopes to replicate in other cities over time, including internationally.

“We want to own the market,” Stang said. “We want to be the biggest restaurant recommendation company in the world.”

The Infatuation is also hiring a “stories editor” for Zagat who will contribute more “narrative-driven and editorial content” that “puts the Zagat name back out into the world.” Said Stang, “Hopefully it will reach Zagat friends and fans from past but also introduce new people who don’t yet have a relationship to the brand via great content.”

Since launching The Infatuation in 2009, Stang and his co-founder, Andrew Steinthal, have raised $33.5 million in funding, most recently with $30 million from Jeffrey Katzenberg’s WndrCo. Stang wouldn’t disclose its revenue numbers but said the company has been “in a growth phase this year and has seen very positive revenue growth as a result.”

Most of the company’s revenue comes from brand deals with companies that range from Nike and American Express to Postmates and Don Julio, a tequila maker.

Zagat is focused on developing more brand partnerships as well as seeing revenue from book sales, some of which is being driven by corporate orders. Stang said that shortly after announcing the New York City guide would be back out in print, he received inquiries about making custom orders where companies could customize the guide with their logo and gift them to clients or employees. “That was a huge revenue driver of the books in the past,” Stang said. For now, only the New York City anniversary guide is being published, but based on its reception, the company may decide to publish more guides in the future.

Stang said the team is also looking to generate revenue from the Zagat brand via events. Last year, the company hosted 65 events, including the popular EEEEEATSCON in New York and Los Angeles.

Stang said he won’t put up a paywall for Zagat’s content anytime soon, either, although the company just recently introduced a membership package for New York that gives members special access to events, expanded travel guides, discounts and The Infatuation’s popular text-based restaurant recommendation service, Text Rex, which used to be a free service but is now only free for members.

Photo credit: Emily Schindler/Zagat

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“There was an obscene amount of people, like 60,000 per day, that were visiting his stories,” said Michael Sebastian, editor-in-chief of Esquire. “It got us thinking that we should build the membership program around Charlie.” 

Since launching the micro-membership model in November 2018, the site has garnered over 10,000 subscribers, and Sebastian expects that the election year will drive up that number even higher. Additionally, in October, Pierce’s content was up 60% in views year over year.

This isn’t the first micro-membership model that Hearst has tested out. In September 2018, the company focused on its enthusiast title Runner’s World to take its first step into digital subscriptions with Runner’s World+. And earlier this year, Harper’s Bazaar launched its Bazaar Bride membership, which is priced higher at $90 per year or $5 per month, since it’s aimed at people planning their weddings and is not meant to have high retention rates. This winter, Popular Mechanics will launch its Popular Mechanics PRO, which will focus on space content.

Esquire’s competitors, like GQ, have tested out other consumer-subscription models with quarterly subscription kits, but widely, lifestyle and general interest publications haven’t gone down the digital membership route, with concerns that this category is too broad and oversaturated with options for readers to be willing to open up their wallets for just one title.

Esquire has also been experimenting with new, interactive integrations for the membership product, like a conference call model that allows members to ask questions directly to Pierce. After significant political events, subscribers are able to listen into a conversation between Pierce and his editor as they review the debates and answer subscriber questions, similar to a live podcast. 

While only two conference calls have taken place so far following the Democratic Party presidential debates this past summer, Sebastian said that he anticipated a few dozen to call in, but the two calls ended up yielding over 800 sign-ups. 

Sebastian said that he was initially worried about what a membership model would do to the site’s traffic, since Pierce’s content drove “a decent amount of traffic to our website.”

“We haven’t noticed any drop-off in traffic at all, and I think it has a lot to do with his stories being widely shared,” said Sebastian, who explained that when Pierce’s posts are posted to Facebook or other social media platforms, people coming across the content there are still able to click-through and read them since the membership product currently operates on a metered paywall with the limit being three articles per month. 

“I can absolutely see that there are 10,000 people that feel like they have a relationship with this guy,” said Gwen Vargo, director of reader revenue at The American Press Institute. “But you can’t do that with every writer.”

Vargo continued that she sees this as a burgeoning area for newspaper publishers recently with sports add-ons and other niche verticals like The New York Times Cooking and Parenting being leading examples, but these special interest memberships “are not going to support their entire business, but I’m sure it’s contributing.”  

“In a way, it’s an unbundling of the magazine subscription,” said Sebastian, adding that it gives the reader the ability to subscribe only to the sections that they’re interested in. For now, Esquire can sell a package that just highlights Pierce’s work, but in the future, Sebastian predicts that it could sell subscriptions to its other verticals, such as its Food and Drink or Style sections, and eventually, if people want to re-bundle all of the sections again, then a subscription to all of the micro-memberships can come at a premium price. 

Though there aren’t any solid plans to launch those, he anticipates that they would look slightly different from the Pierce membership, with the Food and Drink one offering things like reservations to restaurants on their Best New Restaurants list or access to its consumer-facing events.

As for a full-site membership model, however, Sebastian doesn’t think it’s likely to happen.

“The best marketing for Esquire is the reach of Esquire.com,” he said. “We get 20 million unique views per month, and 20 million is a huge marketing channel.” 

“I don’t think the number of subscriptions to the Charlie membership has matured,” said Sebastian, who continued that the brand has done very little marketing around the paid product to date. “I do think there is a ceiling for these micro memberships; however, there are not going to be multi-millions of people subscribing. Esquire, the brand, can’t build a business around one writer or even a couple of writers, but it is a part of the overall revenue model.” 

As for whether or not this personality-based membership model would work for other lifestyle publications, Vargo said it’s hard to envision since Pierce’s existing readership was so crucial. “This is kind of in the sweet spot since he has a built-in following and people are starting to pay for more vertical content in their lives, but I’m not entirely sure how applicable this can be.” 

Photo credit: Esquire

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There are two beta auction models that advertisers will be able to test for the first time across Europe in the fourth quarter: a standard cost-per-click model and what TikTok called an “optimized CPC” that lets advertisers bid with the cost-per-acquisition figure they set and pay for clicks. In a nutshell, TikTok will target ads to those people most likely to convert, per the deck. Neither buying method is advanced in nature, as evidenced by how Snapchat’s efforts are increasingly on the average revenue-per-user metric and what that means for advertisers.

TikTok did not respond to a request for comment by press time.

The deck goes on to show several ways advertisers can target TikTok users, including by age, smartphone operating system, location, interest and age. Advertisers can keep track of how their targeted campaigns perform using TikTok’s pixel, which was first tested by some buyers in the summer. While the tool should help attract those advertisers interested in instant results like a site visit, most companies already on the app like the Chicago Bulls view the app as a brand-building channel, not a performance one.

Nevertheless, third-party measurement is set to help advertisers independently verify how well their ads meet specific campaign goals. TikTok’s pitch deck highlights case studies from Vans, Burberry and Armani Exchange.

Currently, TikTok is working with several ad verification firms including Appsflyer, Doubleclick, Flashtalking and Singular, per the deck.

The inclusion of self-serve auctions in the pitch is reflective of how much TikTok’s attempts to woo buyers have changed since the first half of the year when the focus was on the size of its audience and how engaged they were. Both those aspects are still highlighted in the deck, though there’s a greater focus on the broader offering such as in-feed native video, in-feed video and branded effects, and how all of them can be measured, per the deck.

TikTok’s pitch also prioritizes hashtag challenges.

“From an advertiser perspective, the ad formats which are demonstrably brand-safe are of most interest, for example, ‘Brand Takeover’,” said Paul Kasamias, managing partner at Starcom. “This is particularly true of the larger brands to whom brand safety is paramount.”

The app is in the early phases of working with Integral Ad Science to help advertisers improve brand safety on the app, according to one media buyer on the condition of anonymity. The partnership feeds into TikTok’s wider plan to position itself as a safe platform for users and subsequently advertisers. Last month, for example, it ran a series of videos that featured some of its most popular influencers such as Steven Mckell in the U.K. and Chany Dakota in Germany to raise awareness for several in-app safety features including the ability to block certain users.

“Brands are definitely interested in TikTok,” said Lucy Loveridge, global head of talent at Gleam Futures. “The challenge for them, beyond the commercial opportunity that the platform itself offers to brands, is how to create brilliant branded creative within the formats that TikTok allows.”

Across TikTok’s key markets in Europe, it reported around 21.8 million monthly active users who opened up the app up to 11 times a day in, according to numbers from June cited in the deck. In comparison, TikTok said it had 26.5 million monthly active users in the U.S. at the start of 2019. It shows how quick the take-up of the app has been outside of the U.S. in Europe where the business has spent the last year growing its London-based team. And yet advertisers are still wrestling with how TikTok fits into their media strategy alongside social networks with similar pitches like Instagram and Snapchat. Some are more focused on publishing organic content on the app than actually buying ads, for example.

To recruit more advertisers, TikTok execs are doing more to explain what distinguishes the app’s features from its rivals.

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First Media co-founder and president Sharon Rechter confirmed the layoffs and said that 10 out of 220 employees were being let go. These cuts follow a round of layoffs in September that affected the company’s long-form video team, which numbered around seven employees, according to former employees. That round included the departure of vp of digital content Jim Cantiello.

Despite the layoffs, First Media, which has never raised outside funding, remains profitable and expects its revenue this year to be 70% higher than its 2018 revenue and plans to exceed its projected revenue by 20%, according to Rechter, who declined to share actual numbers.

In the wake of Facebook’s January 2018 News Feed algorithm change, many digital publishers, including First Media, focused on building up their owned-and-operated properties and producing long-form video series for platforms like YouTube. These efforts were meant to diversify their businesses beyond distributing editorial and branded videos on the social platform.

“Written editorial and long-form are not our strong suits, and therefore, we have decided not to focus on those. And if we’re not going to focus on those, we’re not going to sell those either,” said Rechter.

First Media had launched sites for its women’s lifestyle property Blossom and food property So Yummy in 2018 and will continue to operate those sites, said Rechter. The sites will be mainly used to host the content that First Media posts to its social accounts. “It’s mostly a brand strategy. This is not where the focus of our revenue is,” Rechter said.

So Yummy’s site received 1.3 million unique visitors in the U.S. in September 2019, according to Comscore. That’s up from 634,000 unique visitors in March 2019, the first month that Comscore began tracking the site. Comscore began tracking Blossom’s site traffic in September 2019 and tracked 59,000 unique visitors in the U.S. to the site that month.

The Nov. 1 layoffs included svp of digital advertising Conor Lehmkuhl. First Media had hired Lehmkuhl in September to fill the role of chief revenue officer Charles Gabriel, who was let go in August, according to former employees. Rechter said that Lehmkuhl was hired to drive programmatic sales for First Media’s sites and was let go because of the company’s shift in priority to third-party platforms.

Asked whether something happened to explain why the company shifted priorities so drastically within two months of hiring Lehmkuhl, she said that the company realized that its platform video businesses were significantly outperforming other departments.

Later in response to a question about the sites’ traffic, she said a technical glitch led to a “significant decrease” in traffic for October. That glitch had to do with the company switching servers and led to a 24-hour period in which the sites served ads but no content. Sites jammed with ads but little content are typically flagged as spam sites by Google’s search algorithm, which penalizes these sites by lowering their rankings in search results. Because of the 24-hour period in which First Media’s sites served ads but no content, Google temporarily penalized First Media’s sites, Rechter said. She said the sites’ traffic has been increasing following that period.

“I don’t see the sites as the core revenue driver of First Media. Our core revenue driver of the years to come are videos mostly on all the social media platforms,” said Rechter.

First Media’s focus will return to producing short-form videos for social platforms. Since September, the company has hired 15 employees, most of whom work on producing editorial and branded videos distributed on social platforms, said Rechter.

First Media’s video viewership across social platforms has fallen over the past year, according to data from Tubular Labs. Blossom received 579.3 million video views across Facebook, YouTube and Instagram in October, down 33% year over year. So Yummy’s view counts across the three platforms fell by 56% to 189.4 million views. And First Media’s beauty property Blusher received 15.8 million video views in October, a 32% drop year over year.

Rechter said that October was not a good comparison because there were two major technical reporting glitches on Facebook’s side that led Facebook to not count Blossom’s and So Yummy’s video views for a few days in October. Because of those glitches, the October view counts don’t account for more than 100 million views for Blossom and So Yummy, she said. Blossom received 498.8 million views on Facebook in October compared to 443.8 million views in September, and So Yummy received 88.6 million views on Facebook in October compared to 177.1 million views in September, according to data from Tubular Labs.

Instead of overall monthly viewership figures, Rechter said that First Media concentrates on the average number of views per video because it only produces 50 to 60 videos a month. Blossom averages 79 million views for each video that it posts, she said. She also said that First Media has expanded its distribution over the past year to include platforms such as Snapchat, Pinterest and TikTok.

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Quartz also has India and Africa editions. (The India edition is getting the new Quartz layout.)

This is part of the publisher’s strategy in growing its membership program, which launched November 2018. Now, for £48 ($61.96) readers get access to Quartz subscriber-only features, like this video series all about China as a global superpower, weekly field guides — a collection of articles on topics like the impact of 5G and lab-grown meat — and conference calls with reporters three times a week, which typically have between 50 and 100 people tuning in live. In May, to boost member numbers, Quartz introduced a metered model where readers can access three articles a month before paying to read more.

Quartz would not give any indication on how many members it has, although Seward said that, since August, each month has been its best in terms of member growth. Geographically, member numbers follow a similar pattern to its non-paying audience, according to Seward: Over half of readers come from outside the U.S., while the U.K. is its second-largest market.

“That’s a strong sign we have an offering that is meeting people’s demands and solving their problems,” said Quartz CEO Zach Seward

Building successful membership programs takes time and is getting harder as more publishers launch paid-for services. Quartz has been tinkering with different products and marketing messages to grow members. This video series on China has been particularly successful in driving members, according to Seward. Although a report from Business Insider suggests Quartz has missed internal member goals due to a confusing value proposition for members.

“What Quartz is offering is more features rather than benefits,” said Rob Ristagno, founder and CEO of consultancy the Sterling Woods Group. “Having great content is not enough. In addition, you need to carve out this niche. You need to ask, what value does the membership provide? Otherwise, it’s a content subscription in disguise.” Finding a hidden niche within an audience, like those really interested in the global impact of China’s growth, and building the membership around that would lead to quicker growth, said Ristagno.

Tailoring the homepage with more U.K.-specific content is a welcome addition for agencies. Typically and compared to other longer-established business publishers like Bloomberg, or the Financial Times, Quartz hasn’t had enough scale or U.K. content to really excite advertisers, according to buyers. In the U.K., Quartz’s audience has nearly tripled to 1.6 million unique monthly users since last year, according to Comscore, but that’s still fairly small.

WPP media buying agency Essence Global has been successfully working with Quartz on display campaigns for one of its key clients, Google, since 2017. There hasn’t been as much business-to-business client interest in the native ads and content partnerships that Quartz is known for in the U.K., according to Jahanzeb Alvi, Essence Global’s digital investment director for Europe, Middle East and Africa. Partly, this is because content is still U.S.-centric and the scale of audience doesn’t match competitors. The cost of ad packages can also be prohibitively expensive, although Alvi wouldn’t share the price range.

“When we started working with them, they told us all journalists had hands-on training in data manipulation platforms so they can cook up their own stories using data,” said Alvi. “That understanding of data and flexibility means you won’t see the same content on CNBC or The Financial Times. They are very smart people.”

To help expand its audience, the publisher launched the lifestyle-focused Quartzy at the end of 2016 and approached Essence to be early partners. Articles like “Here’s what to do with your leftover candy corn” don’t reflect the luxury lifestyle vision Quartz wanted to achieve.

“It was meant to be similar to The FT Weekend [the paper’s luxury lifestyle Saturday edition], going after the super-premium high net worth individuals,” said Alvi. “The FT is our client so we understand that space well. We listened and asked tough questions, like ‘how will they gain market share,’ that they didn’t have all the answers for because it was still very new for them.”

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