Month: December 2020

“With the amount of traffic that we were expecting this year, it was of heightened importance” to figure out how to grow subscriptions revenue as well, said Scott Rosenfield, site director at Wired.

As a result, Cyber Monday and Black Friday ended up being the second and third biggest days for subscription sign-ups of the year, respectively, with each being approximately three times the daily average for the month of November. The first largest day for subscriptions was Jan. 2, which a company spokesperson said was not for any single reason, but the beginnings of the corona-bump and the CES coverage driving conversions.

“Wired has a lot of different business models that we have to juggle and work together. We have affiliate revenue, but we’re also trying to grow the paywall and these stories really contribute to our subscription model,” said Rosenfield.

In general, U.S. shoppers spent over $10.8 billion online this year during Cyber Monday on Nov. 30, a 15% increase over last year, according to Adobe Analytics. And commerce content monetization platform Skimlinks, which works with several publishers including Condé Nast, reported that it saw a 60% year-over-year increase in traffic on Black Friday 2020 versus the 2019 shopping holiday and recorded over 5 million clicks on the affiliate links it powers.

Wired’s affiliate content — which consists of best deal round-ups, gift guides and product reviews — is not a part of the publication’s digital paywall. Even if a reader reaches their article limit, they can still access these pages. But for subscriptions, the e-commerce pages used display ads and contextual marketing in the stories themselves to promote the publications’ own subscription deal: $5 for the first year.

“You can have an open model on the right types of stories that perform quite well,” Rosenfield said. “You don’t just have to put stories behind a hard paywall to drive subscriptions.”

As of earlier this year, 20% of Wired’s revenue came from non-advertising related sources, which includes its affiliate, subscriptions and licensing businesses. Now, subscriptions and affiliate revenues make up about 30% of the publication’s overall revenue, according to a company spokesperson. And each year since 2018, its affiliate business has doubled in revenue.

“A lot of the success we’ve seen this year, and in Q4 in particular, is because we expanded that team and built up the infrastructure and set all the pieces in place on the chess board so that when we hit this time of the year we’re ready to roll,” said Rosenfield.

Last year, the affiliate content team prioritized hiring, rounding out the product reviews team to number nine people and the gear team (news and analysis) to roster three staffers. And despite the product reviews themselves not being the largest converter of transactions — the deals coverage and gift guides hold that title —Rosenfield said that the reviews help to bolster the validity of recommendations, which is more likely to gain readers’ trust.

“If Wired is recommending this running shoe, it’s because they’ve tested it,” he said. It’s not on the list just because it’s a good sale.

Traffic to Wired.com increased by more than 180% during Black Friday and Cyber Monday versus the same days last year and the most popular article visited was its Absolute Best Deals post, which accounted for about 3 million clicks, according to Rosenfield. According to the Condé Nast media kit, Wired sees approximately 12.7 million unique monthly readers, so that one post accounted for one-quarter of the site’s monthly traffic.

Absolute Best Deals was also one of the top performers for converting readers on subscriptions, as well, he added.

“It’s a no-brainer strategy” to use Black Friday and Cyber Monday content to also sell subscriptions, said Chris Erwin, founder of commerce consulting firm Rockwater. That’s because it’s about monetizing the audience in every possible way. If a publisher is seeing a surge in traffic come to its commerce or content channels, then it makes sense to spread that audience to other areas of the businesses as well and engage and monetize them through subscriptions or use that surge to sell advertising, he said.  

“Every publisher for them to survive [needs] to build its audience as big as possible across a distributed network. That is the path to sustainability. That is the way to make it work,” Erwin said.

More than a half-decade later, he still sees a lack of TV and streaming shows starring Latinx people and created by Latinx people but now experiences it from the other side of the pitch meeting. “When you’re selling Latino stuff in Hollywood, things are definitely improving, but it’s not the easiest thing in the world. I think a lot of it is because people don’t know our community,” said Dávila.

In December 2013, Dávila left Bravo to co-found Campanario Entertainment. The production company aims to help fill the Latinx gap in Hollywood by creating programs like “Selena: The Series,” a scripted show that premieres on Netflix today (Dec. 4.). Despite the show being about the late Mexican-American icon who previously inspired a hit movie starring Jennifer Lopez, Dávila ran into a roadblock when pitching the project to potential buyers — although one buyer with a global platform did grasp the value of inclusivity. “Netflix got it right away, but there were others who didn’t understand it. They didn’t understand who Selena was, that she was American,” he said.

Hollywood’s diversity problem has been longstanding and well-documented. From actors wearing blackface in 1915’s “Birth of a Nation” to the #OscarsSoWhite outcry in 2015 through to today, Black people, indigenous people and people of color have been underrepresented in movies as well as TV and streaming shows. That is true of the industry’s executives as well as the people working on- and off-camera. 

According to UCLA’s Hollywood Diversity Report on the TV industry published on Oct. 22, 92% of the TV industry’s CEO and chair positions and 84% of its senior executive roles are held by white people. Meanwhile, in the 2018-19 TV season, white people accounted for more than four-fifths of scripted show creators, and less than three out of 10 lead characters in broadcast TV scripted shows are played by people of color.

And that is actually an improvement in the nine years since UCLA started tracking the level of diversity in TV and movies in 2011, said Dr. Ana-Christina Ramón, director of research and civic engagement at UCLA’s social sciences division and one of the diversity report’s co-authors.

“Most of that comes from African-American/Black representation. Their numbers have increased, which is great. But other groups, such as the Latinx community and Asians, the numbers haven’t changed as much,” Ramón said. “There might have been a little bit of improvement, but especially for the Latinx community in particular, it’s hovered around 5%, on average, over the entire time.”

According to a study published by Nielsen on Dec. 2, Hispanic/Latinx people represent 18.8% of the population but only represented 5.5% of the top recurring cast members on shows across broadcast TV, cable TV and streaming in 2019. However, that study found that Hispanic/Latinx representation was higher for streaming shows (10.1%) than broadcast (5.1%) or cable TV shows (3.0%) and noted that Hispanic/Latinx households had among highest cord-cutting rates in the U.S.

One obstacle facing producers like Dávila who are pitching shows involving Latinx characters is that buyers often bucket those projects as Latinx shows. In other words, the buyers worry the shows will only appeal to Latinx viewers. “The unfortunate thing is a lot of the executives really stereotype the community as a whole. I’ve talked to executives in the past [who said] the Latinx market is a niche market. They don’t understand it’s actually part of the mainstream,” Ramón said.

What these buyers miss is that the Latinx audience is not a monolith and that the Latinx experience is not only accessible — or of interest to — Latinx audiences. The subject of “Selena: The Series” evinces as much. Not only was the real Selena born in America and did not grow up speaking Spanish, but the Jennifer Lopez film opened at No. 2 at the box office behind the Jim Carrey-starring “Liar Liar” and raked in $11 million in its opening weekend.

With “Selena: The Series,” Dávila hopes to provide more evidence for the mainstream appeal of programs created by and starring Latinx people. The potential for that appeal to expand beyond Latinx and non-Latinx people in the U.S., but in other parts of the world was likely not lost on Netflix.

“The coolest thing about being on Netflix is we premiere in Japan and Denmark and Egypt on day one,” said Dávila. “All these different cultures around the world will be able to see how the Mexican-American experience is unique but it’s also really universal.”

The next earliest ship date for one of Caraway’s cookware sets is December 20 (the individual items in the set, which are packed and stored separately from the sets, are still available for purchase however, as of press time).

“Some products are already sold out for the 2020 year, and only ship after the holiday season,” reads a section on Caraway’s website about “how to get your cookware faster.” The statement goes on: “for products shipping in December, order now to avoid the holiday shipping frenzy and increase the chance of receiving yours in time! First come, first served.”

It’s the cost of doing business in 2020. Despite reporting record sales, direct-to-consumer brands still have a number of logistical headaches to contend with during the busiest shopping season. For starters, some of them have been having trouble securing enough raw materials and inventory all year, and thus won’t have some of their best-selling products in stock in time for the holidays. Second, items are taking longer to ship as warehouses and carriers are having to fulfill and deliver more packages than ever before.

Founders who spoke with Modern Retail said they’ve had to quickly adapt their marketing. In an attempt to get ahead of any negative experiences, they are trying to post as many messages as possible on their websites and social media pages about potential shipping delays. And in some cases, they’re incentivizing customers to order early.

A year of supply chain woes
“Our Instagram isn’t full of memes,” but rather, supply chain updates, Karen Young, founder of shaving and skincare brand Oui the People joked. Last week, Oui the People posted an email that it received from one of the warehouses it works with, to alert customers to potential shipping delays in the weeks ahead.

“We are reaching out to share a very concerning trend we are starting to see in the labor market due to the spiking cases of Covid-19,” the email from the warehouse states. The email goes on to state that as coronavirus cases continue to rise around the country, fewer warehouse employees are showing up for shifts. “In California, for example out of 1,000 people scheduled to start on Monday, we only had 150 that actually started,” the note stated.

Young said that when the warehouse sent that email last week, it was estimating packages might take five days to be shipped out after an order was placed. Conditions have since stabilized, and now it’s taking less than 24 hours to get packages sent out — which is the amount of time it normally takes. But, Young wanted to post the email in hopes that it would still convince people to shop early, and to be sympathetic about any delays.

It’s not the first time Young has had to send out updates encouraging customers to be patient — it’s taken longer than usual this year for the company to get shipments of its razors, which are manufactured in Germany. So much so, that a couple weeks ago, Oui the People added an “in stock now” section to its websites. “[A customer] is not sitting there thinking, ‘oh I wonder if Covid has had an impact on their supply chain, I wonder if they are having trouble getting bottle caps,’ said Young. “It’s up to us to identify and share those issues that we are having with [the customer].”

Still, the supply chain issues haven’t  hampered Oui the People’s growth — Young said that sales are up more than 100% year-over-year.

Preparing to make cutoffs
Now, the biggest issue that DTC startups are going to have to contend with is how to get orders to people in time for Christmas, if the purchase is intending to be a gift.

Matthew Hertz, co-founder of logistics consulting firm second Second Marathon, said that he’s advising startups to consider December 11 as the cutoff for when orders need to be placed by, if they want customers to receive it by December 25.  That’s slightly earlier than FedEx and UPS advise — FedEx’s website states that ground orders need to be placed by December 15 in order to be received by December 25, only a day earlier than last year. But, Hertz advises caution because many startups are resource-constrained.

“Many [startups] don’t have sufficient logic in their backend to say hey, ‘we ship from New Jersey, the customer is also in New Jersey, that is a much shorter transit time than that same customer who might be in California,’” said Hertz. “So they create these blanket rules, that the final date for standard shipping is X.”

Young said that right now, Oui the People hasn’t yet given a cutoff date as to when orders need to be placed in order to arrive by Christmas — but it’s offering free sitewide shipping until December 15.

Caraway co-founder Jordan Nathan told Modern Retail that his brand was “pretty much on backorder” from April to August. But past customer responses to these snafus informed him that long ship times and out-of-stocks probably won’t severely hamper Caraway’s holiday sales. “We’ve seen customer interest in buying as far buying six weeks out,” Nathan said.

If an item is on backorder or the company is experiencing longer-than-expected wait times, Caraway tries to communicate that “three or four or five” different times on the website — on the home page, on the customer chat box and on product order pages, Nathan said. And to incentivize people to buy early, Caraway has run some Facebook ads encouraging customers to get on the backorder list before the next shipment sells out. Or, encouraging customers to buy a gift card if the item they want is currently out of stock.

“Being on backorder isn’t always a bad thing,” Nathan said. “With good messaging you can minimize those [negative] impacts.”