Month: September 2020

The ACC and Big 12 conferences have already started playing games, the SEC will open its season on Sept. 26, and the Big Ten is set to start up on Oct. 24, though some have only released conference-only schedules. Not only does college football’s staggered return avoid adding to the current glut of live sports that is likely cannibalizing viewership for individual leagues and games, but also it has the potential — along with the MLB playoffs and the NFL’s regular season — to plug the viewership and inventory gap once the current sports overload abates.

“You’re basically shifting the total supply. How they’ve rescheduled has evened out the supply,” said Tom McGovern, president of Optimum Sports, Omnicom Media Group’s sports marketing agency.

Typically, advertisers prefer the owed impressions to run in similar inventory. So an NBA advertiser would want ads running in other NBA games or, short of that, in other major sports like the NFL and college football. TV network groups like Disney and Fox, for example, would be able to provide so-called “make-goods” by offering their college football inventory to advertisers who did not reach the guaranteed number of viewers for ads running during the networks’ NBA or MLB games.

Some TV networks have already been able to provide make-goods to advertisers. The higher viewership of the NFL as well as the NBA’s and NHL’s playoffs increase supply, and the MLB playoffs should further add to the mix when they start on Sept. 29. Networks have also pulled back inventory from the so-called “scatter” market, in which inventory unclaimed by upfront advertisers is sold.

However, there are challenges in making up for the shortfalls. For example, WarnerMedia’s sports inventory largely centers on NBA and MLB games, so ad buyers owed by WarnerMedia expect their make-goods will need to be carried over to the leagues’ next seasons unless advertisers are comfortable wiping their debt with ads running against CNN’s news programming during election season, which is likely to attract a lot of eyeballs.

Additionally, agency executives don’t believe that the higher viewership that the NBA Finals and MLB playoffs are likely to attract will be enough to make up for the mounting volume of viewership shortfalls, with even the NFL down compared to expectations. “There’s just a lot of under-delivery, a lot of make-goods,” said Tim Hill, evp of integrated investment at UM Worldwide.

“The big impact, in terms of making good, will be how college football shakes out,” said one agency executive, who asked not to be named.

But, there are questions as to what extent advertisers can expect to receive make-goods for college football — as well as NFL — games. For starters, TV networks may have sold most of their football inventory to satisfy the pent-up advertiser demand since sports went on hiatus in the spring. 

“Do they even have the [available inventory] within the NFL or NCAA football to give towards the NBA or NHL deals? But also, if they’re even willing to do that, NCAA football and NFL are at a different price point than NBA or NHL. Some partners may be willing to make up under-delivery within those two properties, and some may not,” said Jimmy Spano, svp and group director of national video activation at Dentsu Aegis Network’s Carat.

Finally, this being 2020, there is the necessary caveat that the situation could change. “Audiences will be there if games are played,” said a second agency executive. As of press time, 18 college football games have already been canceled or postponed because of players testing positive for coronavirus. In light of that, several agency executives qualified their sentiments about the impact of college football’s return on the TV ad market.

“There’s still a lot to be ironed out,” said Cara Lewis, evp and managing director of video investment at Dentsu’s Amplifi. With college football games continuing to be canceled or postponed, as happened this week with Notre Dame’s matchup against Wake Forest, “it’s going to be a lot of week-to-week what’s happening,” she said.

Trump campaign ads in particular, these sources say, have slipped through the defenses because they were classified as consumer electronics ads, or because they were labeled as ads for totally different brands, such as Kraft Heinz. One source said its ad ops team got fooled by a pro-Trump ad that featured images of Joe Biden and Kamala Harris.

And with many of the ads aimed at readers located in swing states, where publishers do not maintain local ad operations teams, most publishers don’t find out the ads are running until an irate reader sends them screenshots.

Compared to the enormous scale of ads sold programmatically, the number of ads that gets through is small. But with political polarization at an all-time high — and ad spend through the roof as well — even the occasional ad has consequences, not just with left- or right-leaning readers but with staffers too, who see the ads as bad for the publisher brand.

“Every time there’s a [problematic] PAC ad, there’s a Slack uproar,” said Jim Spanfeller, the CEO of G/O Media, who said that G/O’s ad ops teams has been dealing with the problem all year.

“I don’t think it’s a conscious effort from the PACs or the campaigns to get their messaging onto sites like ours [through deceit],” Spanfeller added. “It’s just the vagaries of programmatic media buying.”

Digital political ad spending this election season is expected to soar past $1.3 billion, according to eMarketer estimates. While more than three quarters of that money is expected to go to Facebook and Google, hundreds of millions of dollars have been up for grabs, much of it programmatically, not just on display, but much more than normal on connected TV and OTT, where advertisers can deliver TV-quality spots efficiently.

Some news publishers, including Reuters and Bloomberg, have policies against accepting political advertising. But most publishers with programmatic businesses cannot say no to the infusion the ads provide every two years — especially in a year when the coronavirus-induced downturn which has hit publishers’ bottom lines hard.

And this year, unlike so many other advertising categories, politics have delivered: Revenue heads at two different publishers contacted for this story said they were ahead of their original revenue projections for political spending.

And publishers have benefited, to some extent, from Google announcing last year that it would not allow political advertisers to use custom audiences on campaigns run on its platform, driving more revenue into programmatic video markets, said eMarketer analyst Nicole Perrin.

“Our editorial leadership isn’t happy about it, but we’ll take political advertising of all sorts,” one chief revenue officer said. “It’s going to polarize most of our audience, [so] we try to minimize it as much as possible.”

For this election cycle in particular, that has meant requiring exchanges grant them creative review of all political ads that they might run. Back in August, WarnerMedia’s advertising platform Xandr announced that it had launched compliance features for political advertisers which would include a human review of every political ad it distributed.

But these countermeasures don’t work every time. In order to figure out which ads to evaluate, publishers rely on metadata from the ad delivered by demand sources, and the ads are sometimes incorrectly labeled. Justin Wohl, the chief revenue officer of Salon, said he’s seen Trump campaign ads classified as Business & Industrial, Computers & Consumer Electronics, Finance, Law & Government and News, Books & Publications.

Efforts to block the ads at the domain level don’t always work either:  A full third of the ads served to Salon through AdX since July have come from unknown advertiser domains, Wohl said.

“With as many demand partners as there are in a typical programmatic stack, blocking every possible attempt through every possible channel is exceedingly difficult,” said Salon’s Wohl. “Especially when there’s deception and mislabeling going into the buys in the first place.”

Sources including Wohl acknowledged that both left and right could be hiding their domains or miscategorizing their ads, but: “The right-leaning ads are the ones that lead to angry emails from readers,” Wohl added, “so they’re much more so on our radar.” 

To be sure, many DTC startups are still resisting holding sales.  And it’s not the first time that startups have replaced emails with text messaging. But for those that are hosting sales, particularly during Black Friday and Cyber Monday, they are concerned about making sure that their sale stands out at a time when nearly every other retail company will also be running sales. And they believe that SMS is one way to do so, as customers are more likely to have given their email address to retail companies instead of their phone number. But, many customers aren’t yet accustomed to receiving text messages from retail companies, so those that do decided to text customers risk alienating those who think it is too spammy.

SMS use is already accelerating. According to marketing platform Omnisend the number of text messages e-commerce companies who use its software sent to customers increased by 239% year-over-year during the second quarter of this year. However, Omnisend’s clients still only sent 1.8 million text messages, compared to 2.4 billion emails during the second quarter.

“You have provided your email address to most e-commerce companies, but I think this is the really only the beginning stages of providing your phone number and getting your promos and communications via text message,” said Bilinsky.

Like many other DTC brands, Lensabl offers a first-time discount for customers of up to 20% off. Previously, when customers reached Lensabl’s home page for the first time, they would see a pop-up asking them to sign up for Lensabl’s email list in order to get the 20% off discount. About two months ago, however, Lensable tweaked the pop-up and gave customers the option of either giving their email address or texting the brand to receive the discount code. Bilinsky said that since then, about 40% of customers have opted to receive the discount via text instead of email.

“On days when we send out a text, we see the highest conversion of the week or of the month and I will say it probably converts twice as good as we see email on conversion with similar promos at this point,” Bilinsky said.

Now, Lensabl will send out about two emails a week to customers and two text messages per month, Bilinsky said. In the lead up to the holidays, Bilinsky said that the company is looking at sending one text message per week to customers. For Black Friday and Cyber Monday, the company won’t have a site-wide sale, but rather unique discounts for each of its products: prescription lenses, eyeglass frames and contact lenses.

But Lensabl walks a tightrope trying to figure out how to increase the number of text messages it sends customers without convincing users to unsubscribe. “[Text] is an invasive channel by nature,” he said.

Thinx, meanwhile, has been using text as a customer service line for the last seven months. Customers can opt to receive notifications via text when they place an order. For a sale the company ran at the end of 2019, it tested using text message to notify a limited cohort of customers about the sale. But the August sale marked the first time Thinx promoted a sale across its entire SMS list. During that most recent promotion, Thinx reported a click-through rate of more than 11% among customers whom it texted about the sale.

“We have more people signed up for our emails, so that was still a much larger revenue driver during the sale, but overall we were very happy with these results,” Hastings said.

Going forward, Hastings said that Thinx plans to text customers for about six to eight different initiatives throughout the year.

“If you’re signed up for our list, you will be hearing from us via SMS this holiday season, but our goal is to make sure we don’t feel like we’re spamming people and that every message is valuable and contains new information,” he added.

But despite more people having the chance to vote ahead of November 3, a large portion of those ballots legally cannot be counted until election day, according to Lindsey Cormack, an assistant professor of political science at the Stevens Institute of Technology. What’s more, depending on the state, some mail-in ballots are still valid if postmarked by the election day itself, further delaying the finally tally.

It’s likely we will know who the next president is by the December holiday season, Cormack said. But that means news publishers have upwards of a month-and-a-half before they are able to make their call. It also means that they have a month-and-a-half to compete for traffic as audiences search for the latest election updates online.

“We are planning for a long election night that could last weeks,” said Paul Volpe, executive editor of Politico.

Broadcast news publishers like CNN, Fox News and NBC are focusing on making their digital experiences during that time more engaging and interactive, with the expectation being that most people will not be glued to their televisions for weeks on end. Digital publishers like Politico, Reuters and The Washington Post have started testing new strategies for driving audiences to their respective sites, including launching new platforms and leaning further into a social media strategy. Some publishers, including The Economist, expect election coverage will be a boon for overall growth.

“One of the centralized themes for this election cycle is personalization,” said Anna Brand, senior editor for news projects at NBC News.

To accomplish this, she said her team has begun testing localized news alerts and emails based on the state that audiences are in, including app notifications promoting the publisher’s Plan The Vote interactive telling people where and how to vote this year.

These mobile state-by-state push alerts had total open rates of up to 16% for each notification, which is three times the normal total open rate for push notifications, according to a company spokesperson. And to continue that engagement hike, Catherine Kim, global head of digital news for NBC News Group, said her team will double down on local alerts as the election nears, and likely, passes November 3.

Reuters has been leaning on a tailored social media strategy for each of its channels to drive traffic back to its election content, with The Economic Dream Team Twitter poll series and its Instagram Stories being two highly performing areas within that strategy for garnering viewer engagements.

According to the publications’ digital news director, Arlyn Gajilan, posts around the time of the primaries on the mobile-based social media platforms were the second-highest source of traffic to U.S. election stories from February to April. 

And for Politico, the publisher soft launched a new downloadable newsletter called Politico Minutes around the time of the conventions with latest updates in a “swipeable” format optimized for mobile users. That platform will be picked back up during the election as well, according to Volpe.

“Easily more than 60% of our users will come to us on mobile for election night,” said Manav Tanneeru, CNN’s senior director of product. And those users will be looking for very specific results out of the more than 500 national, state and local races that will take place on Nov. 3.

Tanneeru said that with that in mind, both CNN’s Election Center, which houses everything from polling data to election results, and its Facts First fact-checking platform are prioritizing simple, state-by-state and issue-by-issue navigation that works for mobile as well.

Aside from personalization, publishers are building out more interactive digital products to inform readers of the possible outcomes and boost engagement.

NBC News and CNN are giving its audience the chance to control over the presidential election’s outcomes — hypothetically. Both publishers have a “Road to 270” map that allows audiences to test different scenarios for how states will vote. And NBC News has a “Swing The Vote” interactive interface where viewers can play with the possibilities of outcomes based on the turn out rates from various demographics.

In all of this, news publishers “can show their chops” with the new and interactive ways to display election results, said Stevens Institute of Technology’s Cormack. “The competition for views will be steep,” but this is a way for publishers to keep people engaged on their site compared to the endless number of sites reporting on the results and getting updated information all at the same time, she said.

The other major focus for news publishers during this election is clearly outlining basic information. Several publishers have built out their own voting hubs with information on where and how people can vote based on their state.

The Washington Post, for one, created an information hub with 51 unique URLs for its readers to share state-specific voting information with their friends and family, said Cameron Barr, a managing editor for The Washington Post.

Cormack added that unlike past years’ debates and election nights, people will be unable to or discouraged from attending viewing parties and election celebrations as well due to the coronavirus.

Knowing that its audience found that to be a significant part of the election experience, Fox News launched a second-screen experience that connects the network’s live broadcast with its digital platform, which was first reported by Deadline. The experience will include both a cheer monitor and an audience monitor that allow viewers to connect with each other and the broadcast hosts. Audiences are also able to track the most important races to them personally with its My Races function, and share those links with their friends and family.

Fox News Digital editor-in-chief Porter Berry summed up the sentiment of the 2020 goal for news publishers: to “offer the most personalized hub yet for the American people on election night.”

And likely beyond.

“The latest console battle between Sony and Microsoft is asymmetrical in every sense,” said Gareth Sutcliffe, a consultant at Enders Analysis. “Microsoft is building a subscription business around a long-term archive of games that will play our over a range of consoles, whereas Sony is sticking with what it what it knows has worked in the past.”

Neither Playstation or Xbox responded to requests for comment by the time this article was published.

But the differences don’t stop there. Both companies have diverged on how they’ve hyped their respective consoles to date. 

Sony is steadily ramping up its marketing for the PlayStation 5 two months out from its launch, leaving nothing to chance as it tries to shore up a part of its business that made up more than 30% of its total revenue and more than half of its profit in its most recent quarter. 

Meanwhile, Xbox has taken a more conservative approach to introducing its latest iteration to the market. Rather than prioritize hardcore gamers at launch, Microsoft’s limited advertising to date suggests its sights are set on those casual gamers who make their decisions after launch.

Between Aug. 1 and Sept 21., PlayStation spent $16.6 million on TV ads in the U.S., according to an analysis of iSpot.tv data, prepared for Digiday. Interestingly, none of those ads really focused on the PlayStation 5 console. Instead, the console manufacturer has chosen to draw attention to the fact that new PlayStation 4 titles like the Marvel’s Avengers game will also be available on the PlayStation 5. 

That said, Sony launched a TV ad from creative agency adam&eveDDB earlier this week to showcase the immersive experiences the new console will bring to gamers. 

In contrast, Xbox hasn’t bought any TV ads to promote its upcoming console. Between Aug. 1 and Sept. 21, it spent nothing on TV ads in the U.S., per iSpot.tv. In fact, Xbox has done very little advertising on TV in 2020. So far this year it has spent $4.7 million on TV ads — and most of that advertising was concentrated on the first four months of the year. Sony, on the other hand, has spent $53.7 million on TV advertising over the same period. 

It’s a similar dynamic on YouTube too. 

PlayStation has leaned more heavily into video promotion around the PS5 using YouTube videos. 

Eight of PlayStation’s top 10 videos on the year had at least some sort of PS5 tie-in, and the reveal trailer for the PS5 console has around 32.8 million views — the most of any video from PlayStation this year, according to Tubular Labs. Across global YouTube pages, PlayStation’s published over 700 videos tied to PS5, making up over 25% of PlayStation’s YouTube views for the year.

In comparison, Xbox hasn’t focused its YouTube video strategy all that heavily on next-gen consoles. However, the Xbox Series S trailer was the most-viewed YouTube video the brand’s published all year (6.3 million views).

While Xbox is likely to make its presence felt in the run-up to its launch in November, it will only be up to a point. Based on how its positioned the latest console to date, Microsoft isn’t so much selling a piece of hardware as it is selling a entertainment subscriptions model with the latest Xbox. That’s a tricky proposition to land for any marketer. 

Take the pre-orders for the console. Gamers could go to a retailer and pay £449.99 ($637) for the console or they could pay £28.99 ($36.99) per month to Microsoft with no upfront costs for both the console and 24 months access to Game Plus Ultimate, the Netflix-style subscription service that will give gamers access to over a hundred games from previous Xbox consoles as well as all future Microsoft published games and those produced by Electronic Arts. 

“Sony wants consumers to buy into a specific console in the PS5, whereas Microsoft is encouraging consumers to engage with the Xbox ecosystem in any way they choose,” said TJ Erickson, editor-in-chief at gaming title Generation Xbox.

It goes some way to explaining why Xbox has been very careful in how it promotes its latest incarnation. Even on social media, the console manufacturer has kept advertising at a minimum in recent weeks. Hardly any ads on Facebook, Instagram and Twitter were bought by the brand between July and August, per Pathmatics (see graph). 

Even so, to confuse Microsoft’s lack of advertising up to this point with passiveness would be to ignore one key factor.

“People will be able to own the latest Xbox console and have access to a big library of games for less per month than the average PlayStation tier one game,” said Sutcliffe. 

It’s a far more aggressive point of differentiation than Microsoft is actively signalling in the marketplace now. But that’s not to say Microsoft won’t play the price card when its marketers feel the time is right. 

“Microsoft is delivering tremendous value with a creative new model and their partnership with EA Play through Game Pass takes that even further,” said Colin Leirvik, who leads the gaming business at strategy consultants Greenberg. “However, he added, Microsoft is also creating more and more complexity for mid-curve adopters and giving at least some early adopters the option to use their PC to opt-out of purchasing an Xbox, which could lead to cannibalization.”