Month: February 2021

Poppi isn’t alone in shifting advertising and marketing dollars initially set aside for influencer dinners and in-field marketing efforts to e-commerce. Like Poppi, DTC vitamin brand Olly took its ad dollars to channels like Instacart and Amazon, said Emily Zwerner, Olly’s director of marketing communications.

More DTC brands will likely continue to grow their advertising presence on such platforms, according to some buyers. With the shift in consumer behavior, many are staying at home and cozying up to the idea of safely ordering everyday items from their phone to be delivered straight to their door. The change makes it necessary for DTC brands to be on those platforms, buyers said.

On Amazon, Olly invests a significant portion of its ad spend on search and Amazon’s DSP. With a focus on rapid growth almost a year into a global pandemic, search is key in Olly’s strategy, Zwerner said.

These DTC brands’ leaders said their investments in other e-commerce offerings wouldn’t have happened as quickly had Covid not accelerated the industry’s push for digital advertising. Before the pandemic, many brands were focused on winning brand affinity, as Digiday previously reported. But with consumers staying at home, mastering e-commerce has become top of mind for brands and buyers believing the increase in advertising on e-commerce giants like Amazon and Instacart will continue long after the pandemic.

“Additionally, as consumer behavior and media habits changed, we had to shift our investment to reflect that evolving behavior,” said Zwerner in an email.

Olly declined to share the team’s marketing budget, but Zwerner did say they’re doubling it in a “year that we’re going to put a stake in the ground and grow quickly by driving a lot of awareness in a short time period.”

Last spring, Poppi appeared on the business reality television series Shark Tank to promote its product and consumers flocked to the brand’s Amazon page, according to Ellsworth. “It really catapulted us digitally forward on Amazon,” she said.

While influencer marketing takes up the largest chunk of Poppi’s digital ad spend at 60%, the drink brand has a separate budget for Amazon, which she called “a whole other world.” The nation’s various stay-at-home orders only reprioritized ad dollars to Amazon.

“It forced us to pay attention to it earlier,” Ellsworth said. “All of that stuff in-field has had to shift digitally.”

Since then, Poppi increased its budget for search and programmatic display ads as it has seen increased sales. Poppi sales saw a notable jump since last March. In April, the brand also saw a significant jump in its conversion rate (although they declined to share specifics) on its top performing variety pack, the spokesperson said in an email.

Consumers are bound to continue valuing the convenience of online shopping, said Allison Lewis, vp of commerce media at Wunderman Thompson Commerce, who added the shift in behavior is “forever changed because of the pandemic.”

“The endless digital shelf has provided new opportunities for companies to expand their brand,” Lewis said in an email. “Creating a robust media strategy that includes Amazon is vital to continue to grow as a digital brand.”

Paramount+’s advertising pitch

In pitching advertisers on Paramount+ — which ViacomCBS will formally unveil on Feb. 24 — the media conglomerate has had to contend with the fact that the novelty of a TV network-owned standalone streamer is not so new anymore. Not only is Paramount+ technically not a new product (a rebranding of the existing CBS All Access), but the streaming ad market is not so nascent, making advertisers somewhat more discerning with which new (or new-old) streaming services they are willing to bet on.

The key hits:

• ViacomCBS’s pitch for Paramount+ has made it competitive with other streaming ad sellers.
• However, the number of ad-supported streamers on the market and the lack of insight into expected audience sizes has made some advertisers hesitant to sponsor the streamer’s launch.
• But ad buyers expect eventually they’ll need to be advertising across all of the major streamers to ensure they reach a broad audience.

In some ways, ViacomCBS has made that bet easy for advertisers, according to agency executives. For Paramount+’s launch, it is asking advertisers to pay $22 to $27 CPMs, which agency executives say makes it competitive with Hulu’s and Roku’s ad rates. “It’s more realistic for what we’re willing to pay. That’s why we didn’t get into HBO Max: we’re not buying at an $80 CPM,” said one agency executive, referring to the WarnerMedia’s initial asking price for HBO Max’s ad-supported tier that will roll out in the spring. 

Additionally, ViacomCBS has pitched co-branded units — such as being tagged in ViacomCBS’s Paramount+ marketing leading up to and over the first 10 days of the streamer’s March 4 launch — that can help to make sure advertisers get audiences’ attentions. It is also pitching opportunities for sponsors’ brands to be integrated into the platform’s programming, though in some cases the details of those content integrations, including what shows they will apply to, has not yet been determined. A ViacomCBS spokesperson declined to comment.

However, some advertisers have been hesitant to bet on Paramount+ at launch, said the agency executives. Despite being a revamp of the existing CBS All Access that will provide Paramount+ with a built-in supply of millions of subscribers — ViacomCBS has not disclosed how many subscribers the legacy streamer specifically has. Agency executives see Paramount+ as being something of a new service they expect to appeal to a broader and particularly younger audience than CBS All Access. As a result, they are curious to know how many subscribers Paramount+ will attract and to what extent it will be able to compete with the likes of Disney’s Hulu, NBCUniversal’s Peacock, WarnerMedia’s HBO Max and Discovery’s Discovery+ — not to mention Netflix and Amazon Prime Video.

“Now you’re in this world of everyone has an offering out there. Who’s going to be able garner the most of that share, and will they be able to get people to pay for an extra subscription and/or leave a subscription that they currently have been using?” said a second agency executive.

ViacomCBS has not told advertisers whether it has struck (or will be striking) a distribution deal with a wireless or internet provider like Verizon or T-Mobile to make Paramount+ available for free to that company’s customers, as Discovery, Disney, NBCUniversal and WarnerMedia did for their service’s launches. Additionally, advertisers, including brands that have signed on as launch sponsors for Paramount+, are not being given Paramount+ subscriber estimates from ViacomCBS.

More to the point, some advertisers are simply unwilling to take a flier on another ad-supported streamer at launch. Two agency executives said they had brands that were pitched launch sponsorships for Paramount+, but in both cases the clients had already done launch sponsorship deals with NBCUniversal’s Peacock or Discovery’s Discovery+ and decided that there wasn’t sufficient reason to take on another streamer.

“We try to gauge what we think the growth is going to be like, but there’s no true way to know. That’s why waiting a little bit to get into some newer platforms is a benefit,” said Frances Giordano, group director at Media Kitchen.

Nonetheless, for as fragmented as the ad-supported streaming landscape is becoming, ad buyers are beginning to resign themselves to the reality that they will likely need to be advertising across the various services to reach various audiences. With advertisers regularly running out of linear TV ad slots and increasingly seeking out streaming audiences, they are not yet anywhere near capacity when it comes to available TV-quality ad inventory.

To summarize the situation, a third agency executive recalled a conversation with an executive at one of the major ad-supported streamers. “They were asking me, ‘At what point are you just done with all these streaming services coming on? When is it too much?’” raised the agency executive. 

The agency executive’s answer? “I’m like, I don’t think it’s too much — I never said it was too much with all the cable networks either — especially at this point when you’re looking for reach and incremental reach. I’m going to turn down anybody just because there’s ‘too many.’ Right now it would be good to get a slice of all those audiences that are watching these because the audience is equally as curious.”

Confessional

“The networks can’t continue to dig this hole. It will be a key talking point in upfront conversations going forward that there has got to be better recognition of ratings going backwards.”

— Agency executive on TV networks’ falling short of viewership guarantees made to advertisers

Stay tuned: Hollywood’s production bottleneck

The entertainment and advertising industries’ return to physical production is turning into a production crunch in Los Angeles. Now that stay-at-home orders and production advisories have lifted, not only is the number of movies, TV shows, digital videos and commercials in production on the rise but so is the competition for talent and crew members and filming locations.

One producer who works on digital and branded videos said they normally need to contact at most “a couple” people when hiring a freelance gaffer for a shoot. But now “a lot of people are busy. I might have to try 10 gaffers before I find one,” this person said.

The increase in production and corresponding decrease in cast and crew members’ availability has put pressure on the production planning process. If a cast or crew member cancels the day before a shoot because an existing project is running long or because they are sick, producers cannot count on being able to quickly find a replacement because that person would need to have been tested three days before the shoot.

“We have to just plan for additional time within our production schedule and make sure that we have enough time for options for backup plans,” said a creative agency executive, who declined to delve into specifics regarding how much additional time needs to be allotted.

Numbers don’t lie

51.2 million: Number of active Roku accounts at the end of 2020.

3.8: Number of hours per day that the average Roku user spent streaming programming on the connected TV platform.

Trend watch: Connected TV apps’ anti-ad fraud adoption

The rising ad fraud in the connected TV ad market has coincided with top streaming apps implementing one way to verify the authenticity of their CTV ad inventory.

Of the 500 apps that sell the most programmatic ads on Amazon’s and Roku’s CTV platforms, 62% on Fire TV and 80% on Roku have adopted the Interactive Advertising Bureau’s app-ads.txt program, according to anti-fraud firm Pixalate. The app-ads.txt program involves an app uploading a list of the outside companies that are authorized to sell its inventory that advertisers can reference when placing their programmatic ad buys.

The broader adoption of app-ads.txt could make advertisers, particularly traditional brand advertisers, more comfortable expanding their CTV ad buys beyond purchasing inventory directly from media companies and CTV platform owners. “There are plenty of little stories popping up about fraud in that space, and we have clients who are asking questions like ‘Where am I going to be?’ and ‘Why did I end up there?’” said one agency executive.

What we’ve covered

FaZe Clan CEO’s endgame for gaming:

• The esports organization is positioning itself to be more like a Vice than a Barcelona F.C.
• Esports is a difficult business for companies managing the return on their investments, said Lee Trink.

Read more about FaZe Clan here.

How Hollywood trades are cashing in on studios vying for awards during coronavirus crisis:

• Without in-person screenings and cocktail parties, movie studios are turning to trade publications to promote projects in awards season.
• The publishers are hosting virtual events to recreate the in-person events.

Read more about Hollywood trades here.

Why Dr. Squatch sees value in Snapchat as it diversifies its media mix:

• The DTC men’s soap brand has gone from spending zero money on Snapchat to 10% of its digital ad budget.
• Dr. Squatch is pushing to diversify away from Facebook and Instagram.

Read more about Snapchat here.

What we’re reading

Nielsen will track diversity and inclusion on TV:
Already the currency for TV viewership and ad exposures, Nielsen aims to help change the level of diversity and inclusion in TV shows. The measurement giant is now tracking the gender, race and ethnicity and sexual orientations of people appearing on traditional TV and streaming shows as well as the people watching those shows, according to the Los Angeles Times. Specifically, Nielsen will measure the share of screen time among shows’ top recurring cast members and break it down by category as well as compare it against the corresponding group’s share of the general population and the show’s specific audience. Nielsen’s move should help to ensure that the attention paid to improving diversity and inclusion on TV (among other media) turns into actual change.

Broadcast TV shows’ viewership isn’t so bad:
Traditional TV viewership may be trending downward, but recent broadcast shows’ viewership hasn’t entirely fallen off a cliff, according to Vulture. CBS’s “The Equalizer,” ABC’s “Big Sky” and Fox’s “9-1-1” franchise have proven an ability to attract a large audience and, importantly, to hold their attentions week after week. That nearly 11 million people may have watched the latest episode of “The Equalizer” explains why advertiser demand for TV inventory remains so high even if the networks are struggling to accumulate enough viewers to satisfy that demand.

Alves has started using the virtual mental health service provided by her company VideoAmp, which offers coaching, therapy, meditation and other resources. “I met a therapist I loved, and I’m still working with her today, even after the three free initial sessions,” she added.

The last year has also been tough on those starting out in their career. Last year Marvin Roca Jr. looked forward to graduating, finishing his retail job and embarking on his media career. Yet as the pandemic unfolded, his optimism diminished.

“Not being able to celebrate your accomplishments puts a dampener on your self esteem. I felt isolated and voiceless. However, it was comforting to know I wasn’t the only one going through this. There’s power in not being alone and I had to find ways to harness it.”

One of those ways is via AI-based tech — Bots vs. burnout.

A recent Oracle report revealed that 90% of the 960 Gen Z workers surveyed, said Covid-19 had a negative impact on their mental health. But rather than turn to humans for solace — it’s robots they wish to confide in.

In fact, Gen Z workers are 105% more likely than other age groups to prefer robots over humans to help with mental health support, and 93% of them have demanded more tech-based support solutions at work, according to the same study.

The statistics don’t surprise Roca — now a PR and media associate at employee engagement company TINYPulse — who said he has friends who “go” to therapy, but are really speaking with an AI on a device, comforted by a sense of anonymity.

But VideoAmp’s Alves believes there’s more at play. “People don’t want to be seen as weak so they reject the idea of talking to their manager,” she said. “There’s safety in technology-based mental health assistance because you don’t have that same fear of judgement.”

And that is the real problem, said Almaz Ohene, a freelance copywriter in her early 30s who has previously worked in advertising agencies. She’s concerned an over-reliance on tech could cover more serious culture problems that lie beneath the surface.

“It worries me people are looking for AI support, rather than companies getting to a place where people can find a trusted person to talk to regarding work worries,” Ohene said. “We should be moving toward a world where people feel able to express themselves, truthfully and vulnerably.”

Her experience of the formal workplace, at agencies in particular, is of environments where “homogenous” leadership groups are concerned with maintaining the status quo, leaving little room for those who rock the boat by speaking about what’s bothering them at work. She links this to younger generations’ attraction to tech solutions to deal with issues like imposter syndrome (an internal feeling of believing that you are not as competent as others perceive you to be) and low self esteem.

“There is often a lot of toxicity within the workplace and certain dynamics, but because they essentially pay us so we can live, it sometimes feels difficult to call out problematic behavior,” Ohene said. She blames unhealthy culture for the continuance of gender and racial pay gaps, and that people feel the retribution for speaking up isn’t worth the risk.

“I’m someone who doesn’t stay quiet about injustice. And I’ve actually found myself pushed out of the traditional workplace because of that,” she added.

Naturally, mental health support varies massively depending on the company. Many agencies have worked hard to meet the increased need for mental support for staff over the last few years, not just since the onset of the pandemic. The result is that employees now have access to a wide range of personal counseling and app-based solutions.

But the general consensus is that people should have access to a mix of robot-based and human support to properly tackle mental health issues. Jacquie King, chief people officer for Grey London, is among those who prefers a hybrid approach, expressing doubt over AI replacing a trained therapist.

“I would support rolling out mental health apps for the business, but not in isolation,” she said.

The key hits:

• Facebook can avoid being subject to the new law if it has made “significant contribution to the sustainability of the Australian news industry” in the form of individual commercial agreements with publishers. 

• Publishers cannot use the fact that they are paid different sums by Facebook for their content against Facebook. 

• Facebook will have to enter arbitration only if good-faith mediation fails to resolve any negotiations it enters with an individual publisher within 60 days. 

Almost immediately following that news, the Australian media company Seven West Media announced it had signed a letter of intent to forge an agreement with Facebook, and Facebook announced it had reentered negotiations with another large Australian publisher, Nine Entertainment Co.

Digiday has reached out to Facebook to ask if the platform has any plans to bargain collectively with any of Australia’s media companies. There was no response as of deadline.

The tyranny of the majority
The phrase “significant contribution” is doing some heavy lifting. Depending on how it strikes its deals, Facebook could sign a few big agreements, make the case that it has met its requirements under the law, and avoid having to pay the rest of the Australian media a fee decided upon through arbitration. 

Facebook stated explicitly that it intends to pay small publishers, and all but the smallest professional publishers are eligible to negotiate under the code – the law sets the minimum annual revenues at $150,000 Australian dollars (about $119,000 U.S.).

“We have come to an agreement that will allow us to support the publishers we choose to, including small and local publishers,” Campbell Brown, Facebook’s vp of global news partnerships, said in a statement. “It’s always been our intention to support journalism in Australia and around the world, and we’ll continue to invest in news globally, and resist efforts by media conglomerates to advance regulatory frameworks that do not take account of the true value exchange between publishers and platforms like Facebook,” Brown’s statement read.

But there’s a version of events where Facebook can pit different publishers against each other, signing one or two large deals to get close to a certain threshold of coverage, and use the prospect of missing out to drive rates down.

Brown’s statement — “support the publishers we choose to” — veiled the threat of that possibility quite thinly.

In theory, the net result is still momentous — publishers getting paid directly by a platform simply for hosting their content. But it’s also likely one that reinforces a status quo rather than truly shaking things up.

Dominoes lined up
However this shakes out, its effects will ripple across the world as other governments weigh similar measures. The Australian Prime Minister said he’d fielded calls from leaders in India, France, the U.K. and Canada, each of which could pass similar bills later this year.