Month: May 2021

• Connected TV platform owners Amazon, Roku, Samsung and Vizio touted the number of people their platforms reach.
• Ad-supported streaming service providers Crackle and Fox’s Tubi announced original programming line-ups.
• Presenters also pitched advanced advertising products, including a tool to manage how many times someone is exposed to a campaign and a method to retarget CTV viewers on other devices.

Roku

Roku’s NewFronts message: “start with streaming.” In other words, put your money into the streamers before traditional buys in linear TV. 

Roku says it added 14 million new accounts in 2020, according to Alison Levin, vp, ad revenue & marketing solutions at Roku. Roku provides over 40,000 free movies and TV shows to its viewers, who have a median age of 39. In the first quarter of 2021, Roku reached an estimated 70 million people in the U.S., up 103% year-over-year, according to its presentation.

To reach those people across its CTV platform, Roku once again pitched its ad-buying platform OneView and touted offering Nielsen’s reach and frequency reporting by age and gender across linear TV, streaming, desktop and mobile, according to the company. 

The OneView dashboard lets brands select the audience they want to reach (using their own customer data, Roku’s audience data or data from other providers), run their campaign on Roku’s free, ad-supported streaming TV service The Roku Channel and add in other media buys and measure performance (such as web visits, app downloads, store visits or cost per acquisition). Nielsen tags are added across advertisers’ upfronts brought into OneView, with daily reports to compare performance with other platforms or devices, for example.

“It’s been a holy grail forever for the buyers to be able to have a single metric of reach and frequency across all channels. It’s been hard to do… together we are bringing that to something that’s measurable, consistent and scalable,” Nielsen CEO David Kenny said during the presentation.

The company has also launched Roku Brand Studio to create branded content with advertisers; its launch partner is Maker’s Mark. Additionally, the company is offering to sell 15-second spots on The Roku Channel at half the cost of a 30-second spot, to make it easier to compare with traditional TV buys. Roku has also lowered its window for upfront advertisers to adjust or cancel 100% of their commitments from 14 days to two days before a campaign’s launch.

Finally, Roku has rebranded the more than 75 shows it acquired from Quibi (which went out of business) as “Roku Originals,” with programs that feature stars like Kevin Hart and Demi Lovato. Those shows will be made available for free to watch on The Roku Channel.

Crackle Plus

One of the earliest ad-supported streaming companies, Crackle Plus will roll out a redesign of the user interface for its ad-supported connected TV app Crackle in the third quarter. It will come with a content guide, better search and recommendation algorithms and a content calendar to show what’s coming to the platform soon. Its launch sponsor is Vizio. Smartphone users will be required to sign in, for ad targeting and recommendations across platforms (what you’re watching on Crackle can inform recommendations on Popcornflix, another ad-supported streamer owned by Crackle Plus).

Crackle Plus has more than doubled its content programming in the past year, adding over 200 hours of original and exclusive programming, according to Philippe Guelton, president of Crackle Plus and evp of online networks at Chicken Soup for the Soul Entertainment, Inc., which acquired Crackle from Sony in March 2019. By the end of this year, the company will add 34 new distribution outlets, including properties on Comcast’s Xfinity Flex CTV platform and streaming pay-TV service fuboTV. Crackle Plus has 30 million monthly users across platforms, according to the company. 

Crackle Plus also recently expanded their partnership with streaming brand Plex to sell advertising across their entire platform, and it announced partnerships with Bridgestone Multimedia Group to create more content in the faith and family category. Additionally, the company will launch a new AVOD platform called Chicken Soup for the Soul this fall. It will have scripted TV shows for adults and families as well as unscripted lifestyle shows and documentaries. 

Fox + Tubi 

As a free, ad-supported platform, Tubi’s Newfronts presentation focused on hammering home the fact that advertisers are the center of the Tubi revenue universe. Acquired by Fox one year ago, the platform pushed its slate of more than 30,000 owned-and-operated and acquired titles, its ad solution technology Advanced Frequency and its new slate of original content that’s launching this year. 

Advance Frequency’s aim is reducing ad repetition in programming that happens when advertisers buy from multiple aggregators. Using algorithms to scan frames, the tech tracks the number of times a company’s logo or text is repeated on screen in a household and removes redundancies, according to Tubi brand ambassador and Fox NFL reporter Erin Andrews in the presentation. For one client, this tech blocked 26 million repeat impressions, which allowed it to increase its daily reach by more than 100,000 streamers at a cost per unique reach that was 19% more efficient than a traditional campaign, she said. 

Tubi’s other major point of focus was its 140 hours of original programming that it will start launching this year. Some of these projects include Shark Month in August, seasonal movies and shows around holidays, documentaries on the British royal family and true crime, as well as animated content created with its sibling company Bento Box Entertainment. This content is also being produced using data from Tubi’s Content Intelligence tech — its algorithm that tracks what viewers watch to build profiles on its audience and provide tailored recommendations based on interests, said Adam Lewinson, the platform’s chief content officer.

Samsung

Samsung debuted three new products during its presentation: Samsung TV Plus Editorial Sponsorship, Samsung Discovery Masthead and 1st Screen Plus.

Samsung’s advertising platform Samsung Ads reaches consumers across 45 million households. Samsung TV Plus, the company’s free, ad-supported streaming TV service, saw 84% year-over-year growth in monthly active users and a 34% year-over-year increase in time spent on the service. The streamer has over 160 live channels.

Samsung TV Plus “gives advertisers all the benefits of traditional linear TV buy with all the benefits of addressability and accountability of digital,” said Tom Fochetta, svp of Samsung Ads, said during the NewFront presentation.

Samsung TV Plus Editorial Channel Sponsorship will let advertisers take over an entire streaming channel, reaching viewers via multiple ad units. “It’s our first ever opportunity to allow advertisers to own all of our owned-and-operated channels across Samsung TV Plus,” added Cathy Oh, vp, global head of marketing and analytics at Samsung Ads.

The 1st Screen Plus will serve an ad thumbnail in the first slot in the home screen menu. Hovering over that thumbnail will expand an ad on-screen. The new Discovery Masthead format (available on Samsung TV’s Universal Guide and its app store) will only allow one advertiser to run a campaign at a time via a masthead banner ad.

Vizio

Each month 12 million people across the U.S. use Vizio’s smart TV platform SmartCast, according to founder and CEO William Wang. Vizio represents 20% of the smart TV marketplace, according to the company’s presentation.

Vizio’s vp of engagement Steve DeMain introduced the company’s new personalized content initiative, Features, which uses the Vizio’s first-party viewership data to create and deliver custom content experiences for audiences and advertisers across SmartCast-powered TVs. “It helps solve the search and discovery problem that gets us all,” DeMain said. 

As part of the Features program, Vizio is launching a gaming and e-sports channel with Subnation and a short form video series with Variety, dedicated channels for the LGBTQ community as well as the categories of home and DIY, live concerts, comedy and true crime. 

Vizio also brought up some of its more advanced ad products, like True Incremental Reach, which measures the percentage of ad impressions that hit unreachable households not exposed to advertising on linear or broadcast. A new product called Household Connect enables advertisers to retarget consumers on other devices based on what they saw on Vizio TV. In other words, if a viewer is served an ad through their Vizio TV, that same advertiser can follow that viewer and serve them more ads on their mobile device, computer or other smart TVs in the same household.

Vizio also announced a partnership with Verizon Media, an effort to build upon both companies’ viewership data for opt-in smart TVs and mobile cross-device users, to create cross-platform and connected TV advertising solutions.

Amazon

Amazon’s ad-supported streaming video programming — including videos on gaming-centric streaming platform Twitch as well as free, ad-supported streaming TV service IMDb TV — reaches 120 million unique people, up from 20 million people in January 2020.

IMDb TV, in particular, has experienced a 138% increase in viewership year over year and 62% of its viewers are between 18 and 49 years old. The ad-supported streamer will continue to debut more original scripted and unscripted series, including one from Dick Wolf (the creator of the “Law & Order” and “Chicago” franchises) and another with interior designer Jeff Lewis, a makeover home design series.

Amazon’s presentation also showed off the ability for viewers to buy products directly from ads on IMDb TV, by adding it to their Amazon carts via the remote or virtual assistant Alexa.

In 2022, 15 Thursday Night Football games will air exclusively on Amazon’s Prime Video (a year earlier than previously announced), with new pregame, halftime and post game shows. 

— Kayleigh Barber contributed reporting.

The key details

• Apollo paid $5 billion for Verizon Media. Verizon will receive $4.25 billion in cash, $750 million in preferred interests and retain a 10% stake in the company. 
• Verizon Media CEO Guru Gowrappan will remain in place as CEO of the new company, now rebranded as Yahoo. 
• Verizon Media, soon to be known as Yahoo, is still about as big as it gets for a non-platform media company: It reaches close to 900 million people worldwide every month.

Cheap at half the price

Analysts scratched their heads at the price Apollo paid for Verizon Media. Though its constituent parts had lost quite a bit of value since Verizon originally acquired them — Verizon famously wrote down the value of its media business by $4.6 billion in 2018, after paying a combined $8.9 billion for AOL and Yahoo — they still generate significant revenue: Verizon Media reported $2.3 billion in revenue in the fourth quarter of 2020 alone, and it typically generates about $7 billion in revenue every year. 

Whether it was profitable revenue is another matter. The fact that Verizon never broke out profitability numbers for Verizon “might give more of an indication of why the [sale] value is below 1x revenue,” said Dave Heger, senior equity analyst at Edward Jones. 

Still, the scale of Verizon’s media business shows it has a good foundation for building. Whether that building requires substantial investment is another matter, and may be why Yahoo went to a private buyer. “I don’t think a more traditional media player would be looking at this business,” Heger added. 

A new spine for a growing portfolio

Though Yahoo’s struggles with its media brands got most of the ink, it has built meaningful momentum in and around its programmatic ecosystem. Its DSP, which many ad buyers say is positioned better than everybody besides Google and Amazon to deal with the coming cookie changes, grew revenues 43% in the fourth quarter of 2020 and has been on a deal-making, partnership-building tear all year. 

One of the key factors in Yahoo’s continued programmatic success will be how its alternate identifier, ConnectID, does. ConnectID is one of several cookie alternatives being discussed, but it is the only publisher-led one with any significant traction. Now that it belongs to Apollo, many large media companies could be compelled to take a look. Apollo Global Management owns Cox Media Group, a large linear and digital news that generated $4.3 billion in revenue in 2020, according to Dun & Bradstreet estimates. 

Apollo could also steer Gannett to embrace ConnectID. Apollo gave Gannett owner New Media Investment Group a $1.8 billion loan in 2019 to help finance the merger that created Gannett. That loan, which comes at an eye-watering 11.5% interest rate, will compel Gannett to up its revenue generation. USA Today’s chief operating officer for national sales, Michael Kuntz, told Digiday last week that Gannett is considering ConnectID, among other identifiers.

Facebook has offered the data detailing 1.65 million ads related to political, electoral and social issues served on the site between August 3, 2020, and Nov. 3, the day of the U.S. presidential election, to approved academic researchers through its Facebook Open Research and Transparency platform, or FORT.

It includes a data set showing the types of targeting methods advertisers used, such as location, demographics, interests, connections to other people or through custom targeting to specific lists of people supplied to Facebook by the advertiser — a targeting tactic employed heavily by political advertisers that want to aim ads at specific voters and lists of possible donors.

A post on the Facebook site about the data notes, “Wherever applicable, we indicate whether the targeting options were selected for inclusion or exclusion targeting.”

But details of the targeting are limited, as are other aspects of the data. For example, Facebook has instituted a minimum threshold on the number of impressions, or times a single ad was served, to be included in the data set. The limit is meant to protect people’s privacy but can have the effect of concealing political ad activity on the platform.

Much like advertisers who have long lamented a lack of transparency for measuring ad exposure and brand safety on social platforms including Facebook, academic researchers say the restrictions Facebook places on how they can tap into data and its level of intricacy is par for the course with social media platform data access in general.

In his general experience, Papakyriakopoulos said, access to data from social media platforms for academic research follows a pattern of “conscious obscurity” by design. This frustrates researchers like him who want to understand the nuances of ad campaigns served to people on Facebook, a firm whose business is built on delivering ads based on refined targeting options and makes a point of promoting what it considers to be benefits of personalized advertising.

As governments in the U.S and overseas consider new laws or reforms to old ones to address the negative impacts of social media on society, privacy, children’s mental health and elections, academic researchers want to provide analysis based on hard data to help inform those policies. “This is just a first step at providing data to study Facebook’s impact but we are constantly evolving our products to meet researchers’ needs while putting privacy first,” said a Facebook spokesperson.

‘Not planning on applying‘

The limits on Facebook’s data details are enough to dissuade Laura Edelson, a Ph.D. candidate in computer science at NYU’s Tandon School of Engineering studying online political communication, from even applying to access it. “I don’t have access to FORT and I’m not planning on applying for access right now,” she told Digiday in an email. The primary reason for her disinterest is a threshold Facebook set for whether a particular ad is included in its ad targeting data set, excluding ads with fewer than 100 impressions. The company said the restriction “is one of several steps we have taken to protect users’ privacy.” 

The constraint may seem insignificant, but Edelson said it is a big deal. Political campaigns could use Facebook’s minute ad targeting parameters to reach very small groups of people in precise geographic areas to fuel the spread of false information about an issue or candidate or suppress voting among specific groups.

Leading up to the election in September 2020, anti-disinformation organization Avaaz found ads from political groups on the right and left on Facebook featuring misleading information. Because of Facebook’s impressions threshold in its new data set, researchers could be prevented from evaluating findings like those or determining whether there were other examples of ad-enabled disinformation.

“Any conclusions drawn would be inherently skewed, and it would be difficult to say anything about ad targeting as a whole,” Edelson told Digiday.

Edelson has run into another roadblock when trying to analyze Facebook’s political ad data. Her team at the NYU Ad Observatory had built a tool to facilitate analysis of Facebook’s political ad information available through the company’s ad library API, a separate data set from what is being made available in the new ad targeting data set.

Last October as Election Day loomed, Facebook demanded that they shut down the project and delete the data associated with it because it allegedly violated the company’s terms of service regarding data scraping. Facebook confirmed that they sent the letter to NYU, but did not provide Digiday with further detail on the status of enforcing its demand regarding the project. After the election, the NYU team working on the project released its own 2020 election data gleaned through its Ad Observatory tool, but the data is no longer available. In discussing her work involving Facebook and its data, Edelson told Protocol the company deserved credit for making “a lot more data available than anyone else.”

A clean room or a walled data garden?

There are other constraints associated with this new round of Facebook data. For example, while an ad might have been delivered to someone within five miles of an exact address or latitude and longitude, Facebook would widen how it reflects those targeting parameters in the data provided to academic researchers by revealing only that it was aimed within five miles of the city that more specific location is in. In other words, a precise target like a numeric latitude-longitude in San Jose, or a place like “Acme Park (+1 mile)” would be reflected in the data merely as “San Jose (+1 mile).” By widening those location parameters shown in the data, details on the precise ways political advertisers aimed their ads could be obscured, limiting the value of the insights the analysis might provide.

And researchers complain of an arduous process requiring them to jump through bureaucratic hoops to get this new 2020 election ad data from Facebook that aren’t in place when it comes to researchers accessing data via an API or data archive — or through unsanctioned data scraping tools. They’re required to go through a verification process with school administration and sign a data agreement with the company.  “It’s a time-consuming process,” said Papakyriakopoulos, noting that he doesn’t expect to get the data anytime in the next month. 

Another restriction: Researchers cannot download the data. Instead, they must analyze it within the confines of a web app constructed by Facebook. That, said Papakyriakopoulos, limits the range of analysis he and other researchers can conduct using the data. By downloading the data set, researchers could apply different types of analysis and coding Facebook will not make available in its web interface, or they could compare the data more directly with other data sets to expand what they could learn from it.

There are obvious concerns if Facebook were to let the data flow places beyond its control, though. Not only could it be shared with people who are not approved to use it, it could potentially be tampered with in a way that reveals information about people’s identities or political campaign secrets Facebook wants to ensure stay hidden.  

Facebook argues the amount of information associated with the FORT data and other information it has provided to academic researchers in the past — terabytes and terabytes of the stuff — is far too unwieldy for most to ingest and use on their own local machines. Plus, the company emphasizes that because the research is conducted inside Facebook’s environment, the company provides compute power, the fuel necessary for the analytics engine to operate, for free.

“The Facebook Open Research and Transparency (FORT) platform allows academic researchers to access data in a ‘virtual clean room,’ built with validated privacy and security protections,” said the Facebook spokesperson. Companies including Facebook and Google have established so-called clean room environments to safeguard privacy and security for data sharing between advertisers and publishers, too.

The data limitations are similar to ones placed on another data set Papakyriakopoulos worked with as part of Facebook’s Social Science One initiative, a collaboration with academic researchers and institutions launched in 2018. That project supplied data about URLs shared by people on Facebook, along with data showing the number of people who liked the posts and their demographics, but it was aggregated at a country level. He and a team of researchers at The Technical University of Munich aimed to investigate misinformation spread during Germany’s 2017 elections using the data. 

“My team left the project,” he said, noting that the data Facebook provided his research group was not adequate for answering the questions the group put forth in its project proposal. “The project was based on false expectations,” he said. Facebook said its FORT data access effort is an expansion of the Social Science One initiative. 

Bad memories and privacy blunders

People in the academic research community trying to understand the impact of social media on elections and democratic institutions believe the public has a right to data that lives on platforms like Facebook. But the companies themselves have any number of concerns when it comes to handing over the keys to their data, from worries about protecting intellectual property to exposing information about the advertisers they rely on to support their businesses. Facebook rarely points to those concerns when it comes to explaining the reasons behind the blockades to data access it erects, however. Instead, the company focuses its justification for obstacles to data access on privacy. 

“We are committed to providing more transparency into the societal impact of Facebook’s products while protecting people’s privacy,” said the company spokesperson.

The elephant in the room though is Cambridge Analytica.

The 2016 political ad targeting scandal, which at its core involved the use of data by Cambridge Analytica, a political consultancy that originally derived data used for psychographic ad targeting from Facebook data scraped for academic research, only reinforced concerns that emerged from previous data blunders involving supposedly-anonymized Netflix and AOL data that researchers reidentified, said Eric Goldman, a professor at Santa Clara University School of Law who focuses on tech and internet law. “The internet community got the message that trying to be proactive in helping researchers was only going to backfire,” he said. “If they’re going to get tarred as privacy-invasive, no amount of payoff is worth it.”

The fallout from the Cambridge Analytica debacle, which led the Federal Trade Commission to slap a record-high fine of $5 billion on Facebook over data privacy violations, has “had a huge effect on my work,” said Rebecca Britt, an associate professor at The University of Alabama’s College of Communication and Information Sciences, who studies how people use social media to communicate about health issues. Today, in part because of Facebook’s rules prohibiting data scraping and a lack of a public Facebook API for the type of data she needs, she said, “It is very difficult to work with Facebook and Instagram data,” which she said also affects her fellow researchers in their efforts to combat misinformation.

Ultimately, said Britt of Facebook, “They’re not really a researchers-friendly space.”

“You’re going to see communication that is about reclaiming things,” said Ruth Bernstein, CEO, Yard NYC. “That lost trip, that anniversary experience that was delayed. I expect the cruise industry to lean more into this — especially with their older consumer base.” 

The focus of summer marketing is on “people getting back together safely,” said Dan Sanborn, president of Wheelhouse Labs and chief marketing officer for media, marketing and investment group, Wheelhouse, He added that lifestyle brands, especially those centered around outdoor lifestyles, like grills or even cocktails, will likely message around small gatherings.

Maggie Cadigan, director of growth at The Many, echoed that sentiment: “It’s all through the lens of experience and the collective experiences we’ve lost.”

“Direct mentions to the pandemic will reduce significantly, the overall mood tends to be more positive and campaigns will leverage the power of human connection,” noted RAPP US’ Chief Creative Officer, Moa Netto. 

That’s not to say messaging related to the pandemic will subside entirely. Marketers and agency execs say mentions of cleanliness and sanitizing spaces as well as maintaining distance and staying safe are table stakes and that language will continue in messaging.

“Overall, despite the increase in marketing activity, messaging is still very conscious of the anxiety caused by the pandemic,” said Deepthi Prakash, global director of product and marketing, TBWAWorldwide. “We’re seeing a focus on cities encouraging travel by publicizing that they will require vaccine passports and offering up bike tours or outdoor experiences. Hotels and airlines are continuing to message touchless experiences and sanitizing routines as well.”

Aside from continuing to include safety messaging and focusing on experiences, marketers and agency execs say there’s a renewed energy and optimism among marketers. 

“As a marketer, this feels like a unique moment for meaningful connection,” said Cecilia Diaz group strategy director at Droga5 New York. “Across categories, there’s a once-in-a-lifetime opportunity to be hyper-relevant amidst the long-awaited return of beloved activities — like family reunions, live sports, concerts, and responsible gatherings. Consumers are heading into what will be an era of special memories and brands can help facilitate and enhance these moments.”

3 Questions with Co-founder of Creative Spirit Laurel Rossi 

What has the pandemic taught us about the need for accessibility?

If the pandemic has taught us anything with all this working from home it’s about accessibility. From where I sit in the disability community [with Creative Spirit, a non-profit that helps with employment opportunities for people with intellectual and developmental disabilities], we’re talking about, by and large, especially the young adults, people who are all digital natives so one of the things we learned during the pandemic was that the disability community was kind of ready. The second thing was [that in] taking mobility out of the equation is super great. Now those who expend a lot of energy, effort, mental space just to get to work that kind of came out of the equation. It gave us a new appreciation for two things that have been gating issues for the disability community. The impact of that for marketers and agencies is that you learned the importance of technology and the adoption of it is super great but it also came with a tax. True mental ability to manage that much input on a screen [can be overwhelming]. The most common accommodation that we recommend is every two hours for someone to have a 15-minute break. 

As marketers and agency execs are considering coming back to the office, how should they be thinking about providing as much accessibility as possible for their employees?

What marketers and agency execs need to think about and take from this in a positive way is universally designing the workplace is super important. You don’t know if your very best talent will wash out based on the stress level that’s been imposed. We know that universally designing the workplace to eliminate stress, to create space for mental health, to create space for those individual accommodations that people don’t need to be afraid to ask for makes all the difference in the world. 

In terms of marketers and agency execs diversity, equity and inclusion initiatives, do you see those companies thinking about accessibility and people with disabilities?

We did a study and we know that 12% of companies are thinking about disability inclusion. When you’re thinking about all of those companies and employers, 12% is a pretty small number in terms of engaging. The most insightful thing we learned from the study is why they aren’t engaging: We know three things, first they think there’s no pipeline, two they need help, consulting and a partner and three companies don’t believe people with disabilities are capable of the same output as people who don’t have disabilities. If we [as marketers] represent people [with disabilities] as capable then everything changes. We’re working with organizations to improve representation and I think more is to come.

By the numbers

Some marketers have doubled down on email marketing efforts to keep up with the pandemic shift to online shopping. It makes sense, given the pandemic and remote work has increased how much time people are spending online. However, new research from the U.K.-based Data and Marketing Association reveals that more people are using email as personal storage, “where customers store information sent by brands.” Learn more about the findings below:

• Email appears to be the most popular place where customers store information sent by brands. Whether it is about account information (48%), bills (51%), offers/marketing (56%), product/service information (53%) or receipts (55%), email is significantly preferred to any other option.
• Only about half of the respondents (41%) see value in marketing emails — only one in six (15%) reporting that at least half the emails they receive are useful.
• A key finding is that more than half of consumers (58%) state that they find just a quarter of the marketing emails they receive to be relevant. Meaning that they find little to no value in around 75% of the marketing emails they receive. — Kimeko McCoy

Quote of the week

“Every client we speak to is focused on diversity and inclusivity, whether that’s how they can make sure their dollars are going toward more diverse audiences or targeting diverse owners like Black or female-owned media owners. There’s also a realization among clients that disinformation can’t have the same equal access opportunities as quality journalism when it comes to media dollars. Because if you leave that then you don’t challenge risks to things like democracy and sustainability. It’s time for advertising to really step up and do its part. We should’ve done this right the first time.”

— GroupM North America CEO Kirk McDonald’s response to Seb Joseph on socially responsible advertising.

What we’ve covered

• Marketing reporter Kimeko McCoy profiled TBWA/Chiat/Day New York’s new CEO Nancy Reyes.
• Senior media editor Tim Peterson covered how this year’s NewFronts impact the upfronts when it comes to streaming ad dollars.
• And senior brands editor Seb Joseph got his hands on Apple’s pitch deck to advertisers.

This conversation has been edited and condensed for clarity. 

The privacy landscape is changing. Google has its own potential solution with its proposal FLoC. Microsoft recently announced its own with Parakeet. Can you tell us a bit about the thinking?

From an advertiser perspective, we know we’re at this inflection point and that we need to navigate through it and we’re thinking about what this might mean in a privacy-centric world. [We have a] proposal in front of the industry — the World Wide Web Consortium, the W3C — it’s called Parakeet and it’s an acronym for Private Anonymized Requests for Ads that Keep Efficacy and Enhanced Transparency. We believe [Parakeet] improves privacy and works with existing ad tech infrastructure than, for example, what is being pitched by Chrome’s privacy sandbox. The reason for that is that Chrome’s privacy sandbox has the auction happening in the browser, which brings some challenges because it breaks how the ecosystem works and how investments are made in the ad tech stack today.

How does Parakeet differ from FLoC?

We’re trying to drive a balanced solution that returns the action to the ecosystem as it is today. This is possible in our proposal because the browser anonymizes the PII or the personal identifiable information while still passing on the information. In our proposal, the consumers still have control over their data, too. It’s not like they don’t have control but the browser doesn’t function as the auction. The browser anonymizes the information and continues to pass it through the ecosystem as the ecosystem functions today. As I said, consumers have the ability to opt in and out of the cohorts of information based on their comfort level. We’re in the early days of these discussions, of course. I wouldn’t ground it to say this is exactly how Microsoft will function or the Microsoft Edge experience but we’re having discussions with Google, we’re having discussions with lots of publishers as well as advertisers around the efficacy of wanting to keep the ecosystem somewhat intact but wanting to respect the privacy, controls and transparency that we think need to be a part of that. 

Ultimately, we’d love to see a solution as we think about the browser experience that’s consistent across the large browser ecosystems. That it’s not necessarily different in one experience as you transcend into another experience. We’ll see how we continue to sort through this in the next number of months and get there in what we expect to be a 2022 time horizon to operate and transition and see the industry through some change here.

In terms of the ad business, what is Microsoft’s point of differentiation and how are you pitching advertisers? 

We believe, and we know from what advertisers, agencies, publishers and partners tell us, that we have a unique audience. We have an audience that’s rich and significant when you think about the number of devices that operate with Windows. You’re talking about over a billion people and devices that are experiencing Windows and operating in that ecosystem on a regular basis. Anchored in that, you have a large search network that enjoys over 600 million searches every month. You have a Microsoft Edge experience, LinkedIn experience, you have a number of strong consumer services that deliver a unique audience that we believe and we know from our data that it’s an unduplicated audience on some level to what’s being experienced on the Facebook ad network or what’s being experienced in the Google ad network. So if you want to continue to build out your brand strategy, connect with your buyers and consumers, it’s an audience that’s sizable enough and material enough that you don’t want to ignore it. We continue to see data that supports that the audience converts well. 

Are you still looking to grow beyond a B2B focus? Are you pitching new kinds of advertisers that maybe you hadn’t been before? 

We are. We continue to open up — both in the managed services and unmanaged services perspective — our advertiser experiences. We’ve seen growth in a number of categories. We’ve seen growth in the retail category; we’ve seen growth in the automotive category over this past year. We’ve seen growth in a number of core verticals suggesting, whether it’s new customers we’re acquiring that are small and medium-sized businesses or whether it’s large aspects of the enterprise business, we’re seeing a lot of growth in our advertiser base which suggests they’re finding the value in the audience, in the experience and that it’s converting well from an ROI perspective for them.

We see growth in our experiences, we see growth in our query-share and our volume with search, we’ve seen growth in terms of the volume of activity with Microsoft News. That’s because, in part, digital acceleration has fostered growth in a number of areas when you think about consumer services and the time people are spending with digital applications, especially over this last year as people are at home more and spending more time with their PC. They’re certainly spending more time on mobile. So we continue to see nice growth across our consumer services which can again continue to build and foster the audience story we have to offer [to advertisers]. 

Has the last year of work-from-home for many people helped grow your audience? 

When you have people working from home, the enterprise experience, which we’ve always felt like we owned, all of a sudden was now in the home. When you bring the enterprise experience into the home all of a sudden what was a consumer home experience and an enterprise experience are beginning to blend. That gives us a continued point of leverage. What we’ve typically owned with the enterprise experience is in the home and offering a blended experience of work and life. We think that plays well for us as we think about the growth of our audience over the next number of years. … We are very committed to growing [the] consumer [side of our business]. We do believe commercial and consumer will continue to blend and we’ll continue to see more and more commitment on the consumer side in how we see our growth over the next couple of years. 

Where do you see that growth going? Are there other potential acquisitions like those of the past i.e. PromoteIQ and LinkedIn that might be coming to continue that growth?

There’s nothing that I could comment on today. But I think our track record historically suggests — you look at the last three years of our partner and acquisition activity that would suggest you’ll probably see activity the next three years. Knowing that the consumer area is an area of focus for us, suffice to say that could be an area where you see some activity but there’s nothing I could comment on today.