Month: May 2021

Klarna — the buy now, pay later fintech company — is trying to build its user base by becoming part of the culture conversation.

The Swedish-based platform already has a significant base of 90 million global shoppers with 18 million specifically in the U.S., which Klarna CMO David Sandström said is the company’s fastest growing market. With access to that many consumers, the past year has been a treasure trove of new data on online shopping behavior, given the pandemic wildly increasing the number of people transacting on the internet.

That said, with more online shoppers, there has been an additional need for Klarna to put its checkout option (paying in up to four payments, versus one) in front of significantly more people, which Sandström said in the latest episode of the Digiday Podcast, led to his team accelerating its advertising strategy in the second half of 2020. Its marketing team has been tasked with leading that charge by getting creative on emerging social media platforms as well as working with media brands and celebrities to tap into its preexisting, trusted audiences and fanbases.

Here are a few highlights from the conversation, which have been lightly edited for length and clarity.

As older generations adopt online shopping, Klarna adapts its marketing strategy

We don’t try to address an older target audience with our broader brand campaigns like with a Super Bowl ad, or when we do things with Snoop and Lady Gaga. But rather make sure that we’re crystal clear at the point of purchase. The other thing is, I think the digital media space lends itself quite well to start segmenting based on media. So here in Europe, probably in the U.S. as well, we have a fair amount of news pages online that cater to this exact target audience 55-plus. They are even newspapers called News55, just due to the fact that they cater to them. So really adapting our messaging and communication to this target audience, not only in the content, but actually in the choice of media, that’s been important as well.

Social shopping has not yet achieved the best user experience

[What] they’re going to fix, it’s just a matter of time, is the ability to check out on TikTok. That experience is subpar right now, but in all honesty, it’s subpar in almost any social platform. It’s subpar on Insta, it’s subpar on Facebook, it’s not a good experience, I was actually shocked by the quality of Instagram shopping when it came. I am not sure that they nailed it, to be honest.

Marketing on emerging platforms

My philosophy when it comes to social is that the platform that caters to the creators in the best way is going to win. That is why I think that Facebook has failed in the last couple of years because my mother is basically a top creator on Facebook. So for brands, I do think not being associated with the platform itself, not being associated with the capabilities, but actually harnessing the immense creativity and imagination that these people hold [is the key]. It is beyond astonishing the imagination that you see on TikTok. Any kind of brand brief now says, “We want to start a TikTok challenge,” but having the opportunity and possibility to actually start something like that with the help of creators — and inserting your brand in a pop-cultural discussion — at least for now, that is the holy grail.

“[SPL is] a wonderful thing that just doesn’t work most of the time,” said Dan Cullen-Shute, CEO of independent agency Creature London. “When we get to genuine equality between what people are paid and how they’re being supported, then it becomes a no-brainer.” 

SPL in the U.K. allows both new parents to share a year of leave at a set government rate of around £152 ($215) a week. But it has been heavily criticized for all its complex requirements, including cross-company communication among the primary caregivers’ respective HR departments. Only 4% of qualifying families have taken up the offer, while many others find it financially unviable, according to charity Maternity Action. 

In Norway, it’s a different story. Here the majority of parents share parental leave, with both entitled to a combined 49 weeks fully paid leave, and 15 weeks of this allocated to each parent individually. Kim Ydse Krogstad, country manager of Norwegian media agency group North Alliance, has taken two rounds of 10-week-long SPL alongside his wife, a newspaper editor.

“The most important driver for the increased uptake of SPL in Norway is clear legislation defining a minimum share for the father. Also, companies should cover the difference up to full pay,” he said.

But many believe the U.K. version is in desperate need of an overhaul. Creature’s Cullen-Shute wanted to take SPL following the birth of his son in 2015, but being the higher wage earner meant it wasn’t viable. 

The agency has since enhanced its SPL so employees who have worked there more than a year can take 13 weeks full pay before reverting to statutory, and those with four years service can access 26 weeks full pay — on par with its maternity leave. It’s a new policy, and uptake has been low, which Cullen-Shute attributes to the complexity of SPL, and the concept needing a “rebrand” for it to make more sense to employees. Employers should also raise awareness of what’s offered to increase uptake, he added. 

That’s why he advocates for all new parents to receive the same leave regardless of gender and perceived status as a primary or secondary carer, which Creature is working on. 

Such a system is already in place at companies like insurer Aviva, which offers six months full pay to all parents, with 84% of new fathers taking this up. Netflix, Twitter and Facebook also offer equal parental leave, at 52, 22, and 17 weeks paid leave respectively.

Others believe that offering an equal parental leave policy won’t be enough to shake prevailing cultural norms around men and women’s roles. “It doesn’t change years of expectations. More thought needs to be given to societal change so decisions can be taken collectively among partners, versus leaning on policies,” said Hannah Johnson, managing director of creative agency Blue State, who recently returned from a 10-week paid maternity leave, with her self-employed husband taking over until the baby turned nine months old.

That’s why it’s just as important for agencies to normalize parental leave return on a part-time basis without a dip in seniority, argues Annabel Mackie, managing partner at M&C Saatchi. The agency offers 20 weeks maternity leave at full pay, a paternity package of two weeks at full pay and a four day week for the next 18 weeks at full pay, as well as statutory SPL — uptake of which is low, compared with the paternity package, Mackie said, without providing exact figures.

“I felt this acutely when I came back from having my first child as a senior account director,” said Mackie. “I ran a large team of women in their 20s, and I wanted to show them I could do my job part-time and flexibly. I’ve since worked four-day and three-day weeks, from home and in the office, and I’m now a managing partner. Those women who worked underneath me could see that. Are there enough dads that have done the same?”

In the U.S., a growing number of agencies are seeing the value in matching maternity and paternity leave, despite the lack of nationally legislated paid parental leave.

In January, Georgia-based independent agency Fitzco introduced 12 weeks of fully paid maternity and paternity leave, after its buyback from IPG last year. “Taking my full leave was not only important to me — I wanted to help set a precedent for future parents at Fitzco. I was later gratified to hear this did help others feel more comfortable taking their full leave,” said David Berngartt, a senior producer at the agency.

Similarly, Ohio-based digital marketing and PR agency Geben Communication offers 10 weeks of fully paid leave for all new parents. “This helps ensure the burden of care doesn’t fall solely on my wife — my job has allowed me to take the time to be with my new son,” said Devin Hughes, vp of client services.

It’s a sentiment echoed by the agency’s founder and president, Heather Whaling, who believes federal, funded legislation is “critical” to bridge the gap between businesses which can’t self-fund this benefit.

“It’s also important that the legislation includes men and women. This recognizes the different shapes family may take, while also sending an important signal that women shouldn’t be the de facto caregiver,” said Whaling.

“Paid leave is too important to be relegated to a perk in talent wars. It’s good for families and good for business,” she added.

Officine Générale, a French brand that just received a funding round for expanding in the U.S., is opening an office in New York this month. It plans to open 10 stores in the country over the next three years. Founder Pierre Mahéo, who is based in Paris, said that even though he typically visits New York around once a month, he and his team felt they couldn’t get a solid handle on the market without some sort of office space in the area.

“Having an office in another region is really important,” Mahéo said. “For European brands, if you want to sell in the U.S., you should recruit American people. There’s a culture that they understand, even if you visit the country all the time, that you won’t get unless you have a permanent presence there.”

Not only can an office be good for the culture, but it can also serve practical needs like housing excess inventory and samples.

But even brands based in the U.S. are finding reasons to invest in office spaces. For companies with multiple brands under one umbrella, the drive is to keep the business strategy unified. Suzy Biszantz, president of Favorite Daughter, Hervé Léger, Hudson and Joe’s Jeans, which are all part of Centric Brands Group, told Glossy that she signed a year-long lease in April on a large office complex in the Arts District of Los Angeles. Employees for those four brands will work from there, saving operational time and allowing for easier sharing of resources.

The four brands have taken over the five-story building — each has a dedicated space and even its own entrance. They’ve been operating from the new office for about a month now. Previously, all four brands had small separate offices around the country. At least one of those separate offices, Joe’s Jeans headquarters in Compton, will remain open, while the others will close.

“The building is truly built for design collaboration and content creation with an array of indoor and outdoor spaces for teams to meet and engage, allowing the ability to navigate through Covid-related concerns in a safe way,” Biszantz said.

Mickey Drexler, former CEO of J. Crew and Gap and currently executive chairman of Alex Mill, said that for an established, large apparel brand, some sort of physical office space is a practical necessity, given the reality of how product is developed. Sending dozens of iterative samples of a product around the country to all the people who need to approve it can be wasteful and time-consuming, Drexler said. 

“New York is important in our world,” Drexler said on the Glossy Podcast in mid-May. “There are some jobs, like maybe IT or something, where it’s less important. But I find, for apparel, there’s an amount of spontaneity and creativity in an office. You see someone, you can call them over. But a lot of big fashion companies I know are coming back to the office by Labor Day.”

Designer Hillary Taymour, founder of Collina Strada, echoed Drexler’s statement, telling Glossy that she and her team have been back in the office since June.

Both Mahéo and Biszantz declined to say how much they’re paying for their new office leases, but rent prices for offices have dropped since the pandemic as companies like Airbnb have closed headquarters they’ve deemed no longer necessary. According to Bloomberg, New York office rent prices have fallen 14% since the pandemic began, dwarfing drops in other cities including London, Hong Kong and Singapore.

And it’s getting easier to negotiate for those offices. According to Globe Street, landlords in the U.S. are seeing an increase in requests for short-term leases and, desperate for tenants to fill empty spaces, they’re often complying.

“Landlords are much more flexible with their lease models right now,” said Stephan Schambach, CEO of retail platform NewStore. “They want any deal they can get.”

“If you think about how depressed everyone has been this last year with lockdown, quarantine, with everything people have been rightfully concerned with, as things are beginning to open back up they’re excited and optimistic about that,” said Todd Kaplan, vp of marketing for Pepsi, adding that the brand wanted to “capture post-pandemic optimism” and that the marketing shows the “fun and playfulness that people are looking for right now.” 

Now that vaccination numbers are on the rise and Covid levels are lowering throughout the country there’s even more of a focus on this return of socialization within marketing messages. Briefs from brands are generally focused on “people coming together after a spell of being away,” said an agency copywriter on the condition on anonymity.

“You will see a lot more exuberance in advertising this summer,” said Barry Lowenthal, CEO of Media Kitchen. “People are so excited to get out and get back to normal. You’ll see that passion and excitement in the advertising.” 

Major marketers aren’t the only ones leaning into messages of return. Direct-to-consumer brands are also having to tweak messaging to reflect the changing moment. Katya Constantine, CEO of performance marketing agency DigiShop Media said that clients are taking “return” approach to advertising with celebratory messaging. 

Brandon Doyle, founder of Wallaroo Media, another agency that works with DTC brands, said he has seen a shift in content specific to people gathering as well as spending more time outside. Messaging that still focuses on working from home “isn’t working this year and we’ve had to shift messaging on quite a few brands.” 

Even as brands key on socializing and “emerging optimism” in their messaging, Dia Simms, CEO of tequila brand Lobos 1707, cautions that brands must be “honest and respectful of what we’ve just been through” as they do so.

3 Questions with Buffer’s vp of finance Caryn Hubbard

This year, Buffer has lowered its gender pay gap from 15% to 5% in 2019. How did your team manage to do that and are there plans to continue to close that gap?

Lowering the unadjusted gender pay gap is the outcome of several years of work and challenging conversations. There is no one thing we can point to, but rather acceptance of challenging our biases, inviting various perspectives to the table for discussions, and awareness of how important recruiting and hiring strategies are to impact systemic issues such as this.

What was the process to address this?

We worked to broaden gender diversity on the Buffer team. ​​In 2018, we had 21 teammates who identify as female and 48 teammates who identified as male. A lack of overall gender diversity was a factor for us as we had fewer teammates who identify as women in higher-paying, technical roles. We focused more on awareness of bias in promotions and stretch opportunities. This year, the gap is much narrower with 39 who identify as women and 44 who identify as men.

​​We also continued to diversity our hiring pipeline. When we first ran this report, it really highlighted for us that we didn’t have enough women in the higher-paying, technical roles on our team. For that reason, our People team was sure to actively promote our open technical positions on websites like TechLadies, 2020Shift, Women Who Code, and Power To Fly, among others so that we weren’t simply relying on our existing network, which wasn’t as diverse as we’d like.

​​We started tracking the gender pay gap more regularly. Previously, we tracked the pay gap annually, however as a fairly small team, one individual joining or leaving the team could have a significant impact on our analysis. We paid closer attention to this information by monitoring the data monthly instead of annually to get a better picture of how the quality of our recruiting efforts, hiring decisions, and overall management was impacting the gap. Weaving this awareness into relevant decisions led to higher impact outcomes, giving us more confidence that frequent data analysis is measuring real progress instead of revealing the results due to the movement of any one high-earning individual.

​​Over the years, Buffer has shared information on its gender pay gap publicly. Why is that transparency important?

​​​​We believe that transparency breeds trust, holds us accountable and can push our industry forward. We committed to continuing to share our gender pay gap — even as it was worsening — with the hope that this transparency would help publicly document our journey with equal pay and help other businesses who might be going through the same thing. It’s more difficult to have uncomfortable conversations, and we want to normalize having hard conversations.

​​​​In retrospect, monitoring the data even when it’s easier to look away, provides a measurement of progress. We can now point to specific moments throughout this journey that can help other small businesses or even large companies who want to push through the same challenges. — Kimeko McCoy

By the numbers

Gen-Z favorite TikTok is increasingly becoming a staple of ad spend in the brand playbook, with some brands and agencies prioritizing TikTokers over Instagram. In fact, the short-form video platform is reportedly launching a pilot program to help brands recruit talent. That could make the idea of becoming a TikTok influencer a viable career path for Gen-Z, but is it top of mind for the young generation?

Recently, talent cloud company iCIMS released research with insights from college students and recruiting professionals to find out how Gen-Z and entry level employees are thinking about the job hunt. Find details below: 

• Despite the fact that the majority of 18- to 24-year-olds are very likely to report using popular video-based social sites in their personal lives, including Instagram (76%), Snapchat (75%) or TikTok (55%); they are not as comfortable with video playing a part in their professional lives.
• The vast majority of college seniors (80%) prefer in-person interviews over video chats, believing that’s how they best present themselves to a potential employer. — Kimeko McCoy

Quote of the week

“Right now, I think it’s a gradual move back to the energy and sociability we felt from beer and alcohol pre-pandemic. We’re seeing more sociability in advertising video and photography.”

— Brian O’Connell, Fortnight Collective agency’s strategy director, told Kimeko McCoy when asked how alcohol brands were marketing a return of the bar scene.

What we’ve covered

• Max Willens, senior editor, research and features, dug into why Twitter’s revved up product focus is getting advertisers’ attention.
• Michael Burgi, senior editor, media buying and planning, profiled influencer marketing shop People First Marketing.
• Commerce reporter Erika Wheless tracked how brands are using Covid-19 vaccine giveaways to scoop up consumer data.

This interview has been lightly edited for clarity.

R/GA isn’t a stranger to cultural commentary (i.e. a very outspoken Twitter handle). A lot of agencies and shops came out with diversity pledges and statements. How did R/GA handle it and how’s it going? 

The key thing is we didn’t make any pledges. We didn’t say we’re going to have X amount of leaders in a certain position. We just felt that it was words without actions and it’s very easy to make a pledge and lose the momentum and it kind of dies down. We wanted a framework [the Make Change playbook] to follow and guide us. I’m most proud of the fact that we’ve been releasing our diversity data every quarter as we said we would. In 2021, we tried to focus even more so on the pillars [stated in Make Change] that are about making education and conversation part of our culture, making sure we’re transparent, making sure we’re providing space for people to have those conversations.

As a Black woman, how did the events of 2020 (and the many revelations made in this industry) change the way you work or think about DE&I?

A year ago, or two years ago, nobody would know that we’re feeling the pain that we’re feeling from this event. It would be a pain that we’re feeling ourselves. And to be acknowledged — that ‘We see you. We understand that this is a painful experience that you’ve been going through and we’re seeing it’— that’s [what] we’ve been living in. Over the last year, the idea of racial reckoning has dominated conversations. This is not [within] the last year. This has been going on for eternity. It’s just more people are aware and seeing it, and we’re holding people accountable.

Going back to Make Change, its roll out last August launched you from the product team to becoming vp and global executive director of culture and operations. Talk to me about the role.

As a producer and an operator, I’ve always been about taking a project, seeing it through and delivering it. [Make Change is] beautiful on paper, but how are we really going to make it happen? We have to have a timeframe, check points, milestones, KPIs, support, guidance. And I said this is what I want to do. Racial inequality is a systematic problem, so we created a new role within our operations department to guide initiatives as they relate to business priorities and infrastructure. Embedding DE&I into our everyday operations and how we work. Having worked within production and operations at R/GA across multiple offices for eight years it was the perfect fit for me. For this role, my biggest aim is that I am not the head of diversity. That’s the job of everyone.

Was there a similar role before? How is this new role different?

R/GA hired its first global executive director of diversity, equity and inclusion in August 2018. This role was sunsetted on Carl Desir’s departure in September 2020. My role is concerned with ensuring R/GA’s inner workings are synchronized with its collective beliefs, values and culture. I sit in the business operations department reporting to the Global COO. However, I still work closely with talent and all other departments at R/GA. I work to enact company change initiatives that bridge organizational silos and align with business needs, client requirements and talent priorities. This new positioning and shifted focus from [diversity, equity and inclusion] in HR to a culture and operations role helps decentralize and democratize the role of equity, diversity, and inclusion at R/GA by making [diversity, equity and inclusion] efforts the job of each person within the organization.

DE&I tends to be a space women of color take and there’s always the threat of tokenism. Thoughts on that?

It should be something that people want to be part of and there’s enough to go around. If everyone’s involved, then there isn’t any sort of tokenism. I loved being part of the conversation and I want to be part of the conversation. And I’m not the only person that’s ever part of the conversation.

As the industry sifts through a growing catalog of alternative identifiers that rely on publishers’ first-party data to succeed, many publishers feel not only inundated but hesitant to give up their data ー and rightfully so. For too long, publishers have been commoditized as a source of inventory and data for the ecosystem. In reality, the ecosystem should exist to serve publishers and their marketer partners. Content providers have borne the brunt of the changes made to the advertising business for decades.

The exit of third-party cookies and other flawed identifiers is the rallying cry for publishers to take control of their destiny. As they vet the identity solutions and technology partners that can help them achieve this, only those giving publishers complete control over their data while protecting consumer privacy are worth the attention.

Cracking the identity code will take multiple tools

The fact is, there is no silver bullet for publisher monetization in the post-cookie world. 

Contextual works across all browsers but has limitations around its effectiveness and ability to measure. It’s a tired method that results in limited CPMs on Safari/Firefox today. Browser-based cohorts, such as FLOC, only work on an individual browser, and they’re still in the early stages — so much is unknown. Importantly, it’s known that they’ll be controlled by a browser, not by the publisher. Fingerprinting is being presented as a solution with scale but uses nefarious techniques and has been condemned by the browser and privacy community. There’s no value in relying on an identifier that results in the same or worse privacy concerns as the third-party cookie.

Importantly, publishers must also consider the walled gardens as marketers look not only at the open internet but also anywhere consumers spend their time. The walled gardens don’t rely on contextual data and have incredible authentication rates. They’ve shown time and time again that marketer dollars follow people-based addressability. 

This is why publishers must put people-based addressability at the top of the list. Authenticated users are the people with whom a publisher has a trusted relationship — this is the gold standard for publishers and at parity with the walled gardens’ offerings.  Enabling people-based inventory not only improves monetization and keeps publishers in control of their data but is the mechanism publishers can brandish to help marketers maximize reach and return on ad spend. In fact, even at low levels of authentication — 10%–30% — the impact can be disproportionately valuable to a publisher’s bottom line.  

Microsoft Advertising is among the stakeholders that have seen this value firsthand, increasing CPMs on authenticated impressions by over 40% in initial tests when using LiveRamp’s Authenticated Traffic Solution (ATS). 

“TV viewers are now well-integrated into streaming environments, which are fragmented across a wide variety of device platforms for advertisers,” said Mark Rotblat, Chief Revenue Officer at Tubi. “This makes the marketer’s challenge of reaching and measuring a target audience multi-dimensional, and having a people-based identifier is important to ensure that advertising campaigns are relevant across channels and devices. LiveRamp helps enable authenticated, first-party relationships with our viewers so we can continue to deliver impactful experiences, at scale.”

Adding Apple, IDFA, and ATT to the party

Another prevalent challenge publishers face is the introduction of Apple’s app tracking transparency (ATT) framework, which requires app developers to ask users for permission to track and share their Identifier for Advertisers (IDFA) — Apple’s mobile ID. It’s now a necessary step for precise mobile in-app advertising and measurement. As iOS 14.5 continues to roll out, publishers will need to secure ATT consent to continue connecting their inventory to marketer data. 

As a result, mobile publishers must optimize their ATT consent rates and explain the value exchange to the consumer. Otherwise, they’ll likely see a drop in advertiser interest and revenue. The good news is that publishers will benefit from even low levels of authentication. 

In all cases, once ATT consent is given, mobile app developers still need a neutral and transparent infrastructure that will enable them to maintain and scale their business while upholding consumer privacy standards. For many, authenticated identity is this foundation. It enables all ecosystem stakeholders to use the same identity across display, mobile in-app and CTV, and, for publishers, to create addressability at scale while maintaining a one-to-one relationship with consumers. 

Putting power back in the right hands

Once publishers have authentication —  and, if applicable, ATT consent — it’s important that they own and control the new relationship with the consumer. For far too long, publishers have ceded control of identity and their first-party relationships to the browsers or other platforms that have profited and built segments using publisher data collected via the third-party cookie. The industry wants that to change, and here is how publishers, large, medium and small, can control their own destiny. 

The first is to control identity and data. The skepticism from publishers is valid. Publishers are seeking a sustainable, foolproof way to share their data with advertisers without the fear of it spilling over into the rest of the ecosystem. People-based, encrypted and encoded identifiers can be made fully responsive to publisher controls, allowing for secure transmission only to intended platforms. If a publisher only wants to use their identity for direct deals, that’s OK. If a publisher wants to use their identity for private marketplace deals, that’s OK too. If publishers want to use their identity for open exchange, that’s also all right. It’s up to the publisher — they’re in the driver’s seat. Publishers, marketers and their technology partners must still make responsible data governance decisions, but authenticated solutions give those decisions teeth and keep the control with the publisher.

The second step is to choose a better solution than third-party cookies — i.e., an authenticated solution that is neutral, omnichannel, offers global capabilities and ensures control. If the solution the team is vetting meets these criteria, then it is on the right path to effectively maintain the addressability enterprises need with the privacy and security features consumers deserve. And as a result, publishers make more money, marketers generate higher returns and consumers gain greater control and transparency over their data.