Month: December 2019

They have, in some cases. A big one this year was Intel, which shuttered its internal agency, Agency Inside, early this year. Vodafone, which last year said it planned to buy most of its online media itself, stumbled on the programmatic advertising piece of the puzzle and backed down from that plan. And while a lot of talk has focused on in-housing as a panacea, many marketers, like Nissan and Duracell, which do some ad buying themselves, still work with agencies for the vast majority of their execution needs. At GlaxoSmithKline, which has spent a large part of the past two years trying to figure out what an in-house approach looks like, the result is that it’s doing some planning work itself, but still working with Publicis Media for the majority of its $1.6 billion global media account.

Last year, marketers taking agency capabilities in-house elicited feelings of fear and trepidation among ad agencies. They worried that this would relegate them to being less about strategy and left to do low-level execution that brings with it low margins and less ownership over the brand. But it seems like all that is out the window. Brands have found taking agency capabilities in-house is hard, harder than expected. Digiday research found earlier this fall that 75% of marketers said they’re finding programmatic ad buying very difficult to do themselves. They also said they found traditional media buying, and even creative production difficult to do.

And hiring people is also hard: Another research survey conducted this winter found that in-housing makes it hard to retain staff, even though it may improve some speed and reduce some marketing costs.

It makes sense how happy agencies are now that that reality is taking hold. In-housing, perhaps more than any of the major shifts that have rollicked the agency business over the past few years, has the potential to really rock the foundations of the agency business. The business was built for a different reality, one focused on large scale, mostly TV campaigns, and not for the digital media age, which requires more speed, more agility and more execution. While agencies are useful for strategic expertise that can come in handy, brands taking capabilities in-house is — or could be — the most impactful blow to the business. But now the pendulum’s swinging back. As one U.K.-based marketer put it recently, “Agencies are acting like the cat that got the cream.”

Petruccelli said Arcadia has cut its display retargeting outlay by around 70%-80% in the last six months. On review, the company “didn’t believe [retargeting] was driving the revenue we were led to believe it was,” Petruccelli said. Elsewhere, recent brand-building efforts include this fall’s Topshop’s “Me, also Me” out-of-home campaign.

Referencing the 2013 research paper “The Long and Short of It” by British practitioners Les Binet and Peter Field, Petruccelli said the issue was that the team was placing “too much focus on the short term.”

The relative ease of being able to measure whether digital spending had a direct impact on e-commerce sales led to more and more of Arcadia’s budget piling into digital performance. Since 2015, digital performance spend had “roughly doubled,” according to Petruccelli, as the team focused on efforts that would drive near-immediate return on ad spend.

“Retail measures itself on last week and last year: If you think you can drive something more to tomorrow, you will do it continuously,” Petruccelli said. “The reason I think we need to get to nearer 50/50 for digital performance and brand is to drive overall sales across both [physical] retail and digital by raising our brand awareness and consideration more broadly.”

Arcadia is the latest example in wave of brands — from Adidas to Booking Holdings and Old Navy — that have recently indicated they may have spent too much on short-term digital activation at the expense of longer-term brand building.

Around three months ago, Arcadia also began working with marketing consultancy firm Ebiquity to put in place multi-mix modeling framework to get a total view of the group’s marketing performance, tying together physical and e-commerce sales, brand and digital performance marketing, and other market factors such as competitor spending.

Arcadia, which also owns fashion outlets including Miss Selfridge, Dorothy Perkins and Wallis, faces an uncertain future. The company swung to a £169.2 million ($223.3 million) loss in the 53 weeks before Sept. 1, 2018 — the company’s most recently filed accounts — from a £49.4 million ($65.2 million) profit the prior year.

Arcadia’s brands enjoyed their heyday in the ’90s and 2000s, with Topshop in particular attracting high-profile endorsements from the likes of supermodel Kate Moss. But the retail group has since faced pressure from new online entrants such as Asos and Boohoo. It is also up against stiff competition from the rise fast-fashion chains like Primark and H&M. And it faces rising costs from business rates and a large pensions deficit. Adding to the turbulence facing the company: Topshop CEO Paul Price resigned this week.

“The key issue facing Arcadia is an existential one: It’s a matter of whether they are still going to be here in their current form in six months, 12 months’ time” said retail analyst Richard Hyman. “Reinventing a brand, making a brand really cool and fashionable for young people that their moms and grandmas used to frequent — that’s not really very easy. You need more than a fancy marketing campaign to do it. … You’ve got to start at the very core, which is the product and how it’s presented.”

The study, commissioned by tech company ID5, found 81% of the sites had vendors identified as potentially causing privacy risks, either from a compliance or data-leakage perspective. It also found third-party redirects slowed sites an average of 19 seconds. Redbud also found that 58% of vendors registered with trade body the Interactive Advertising Bureau Transparency and Consent framework are not reading consent strings, which are used to ensure compliance with the General Data Protection Regulation.

“That was the most shocking stat of all,” said Adriana Tailor, head of data and insight at magazine publisher TI Media.

The report also found that 80% of sites visited had vendors dropping cookies that were not GDPR compliant. Reasons ranged from vendors simply not sharing privacy policies to not counting third-party cookies as personally identifiable data.

“Cookie matching has been a major part of the programmatic pipes that were laid down in 2008, the people who designed and built them just aren’t in the industry anymore,” said Mathieu Roche, co-founder and CEO of ID5.

ID5 expects to release data on how much money publishers leave on the table by not being able to monetize audiences from browsers restricting the use of cookies. Many publishers report that CPMs for Safari traffic are on average 30% lower than for Google Chrome traffic.

“Publishers are carrying out audits and they want to clean up what’s going on,” said Chloe Grutchfield, co-founder of Redbud. “There’s a lot of willingness to take control and encourage vendors to make appropriate changes. [Publishers] are being proactive.”

The Watch Party pages are built using a separate CMS, which the Google News Lab built for Cosmo. But if the project yields something successful, said Simon Roger, data editor for Google News Lab, Google will then take that technology and license it out to other publishers.

“If it works, we’ll try to replicate it and make the tech as widespread as possible,” Roger said. “And that’s profit for us.”

Cosmo and Google started working on their partnership approximately a year ago, shortly after Jessica Pels, Cosmo’s editor-in-chief, took on her role as editor. Pels said she pitched this second-screen content format to Google, which set out to build the product. Cosmopolitan then approached Netflix with the opportunity for “You” to be the first show to use the platform.

Pels said she chose “You” because Cosmo’s “You” content regularly hit high traffic numbers; the publisher’s second-season explainer, which went up earlier this month, had 2140% higher traffic than the brand’s average season explainer.

“It’s a kind of ‘sink into an experience’ mentality that we are looking for,” said Pels.

While right now there isn’t any exchange of money between Google and Cosmo, Pels sees the opportunity for sponsorships and advertising in the future, either for future season of “You” or different shows, movies and even live events, like Fashion Week.

“It’s an innovation play, which I think is critical in media — in many ways, I view my job as being to transform the way audiences consume content, to keep an eye on opportunities for engagement that don’t exist yet,” Pels said.

Nushin Rashidian, the Tow Center for Journalism’s lead research fellow on platforms and publishers, said that over the past five years, there has been an expansion of platform companies’ influence over publishers’ editorial content.

She said this partnership between Google and Cosmopolitan fits in with the trend of platform companies striking different deals with publishers in order to test out new tech product rollouts. In the case of the publisher, since there isn’t an exchange of capital, Rashidian said Cosmo will stand to benefit through access to new tech that they don’t currently have, giving them the opportunity to play with new innovations. 

Google, on the other hand, gets the opportunity to influence editorial.

Cosmo’s entertainment editors and writers will use their own expertise about the show, but included in the new technology are insights from Google Trends that the editors can use to see which keywords and search queries “You” audiences are most interested in learning more about. Therefore, the platform company will have influence over what Cosmo’s editorial staff writes about.

She said Facebook’s Crowdtangle is a great example of platform companies gaining editorial influence. Crowdtangle tells publishers what content is performing well on social platforms and then publishers tend to want to replicate that success through covering similar topics. Snapchat Discover and Facebook Watch are other tech extensions that reach out to publishers to create original content for the platforms. 

“Absolutely Google will have an influence in what Cosmo is producing,” Rashidian said.