Month: October 2022

But the company’s founding CRO Rachel Oppenheim is confident that her team’s client-centric approach, which prioritizes “innovative” branded content and running ads against “experimental” editorial products, will be the wind in Semafor’s sails, she said on the latest episode of the Digiday Podcast. 

Not only that, but focusing on the pockets of advertisers’ budgets that are directed to corporate reputation building will help insulate the company from the ebbs and flows of consumer and product advertising, which for now, is not a priority in the sales team’s selling strategy. Programmatic is also not a part of Semafor’s advertising mix, once again, preferring to build relationships with clients that are hopefully long term, according to Oppenheim. 

While having launched with partners like Verizon, Mastercard and Pfizer, Semafor recently came under criticism for having gasoline manufacturer and distributor Chevron as an advertiser on the company’s Climate newsletter in its second week, to which many criticized as tone deaf and irresponsible in the coverage of climate change. 

Oppenheim said post-interview in an email to Digiday that “advertisers have no bearing on our editorial coverage and we maintain a strict separation between news and third-party advertisement.”

Below are highlights of the conversation, which have been lightly edited and condensed for clarity: 

Creating a modern media revenue team 

[There is a trend toward] orchestration amongst many different revenue streams that can ultimately fuel and feed each other. Having a really strong and healthy subscriber revenue business can fuel your advertising business; [it] can fuel your licensing business; [it] can fuel your events business. These are all different components in the same machine.

Even single revenue streams are becoming so much more cross functional and so much more interconnected and interdependent. We need to be able to coordinate with our design teams, our product teams, our audience development teams, our [communications] and PR teams all to pull off really creative, integrated programs and partnerships.

One of the superpowers of starting from scratch is being able to design a media company with cross-functional work as a bedrock of how we work, because we’re not in a world anymore, where the advertising team exists as a silo. That was another huge selling point for me of being able to come [to Semafor]. I am so clear eyed about the direction we need to go and how we need to better serve our readers, our clients, all of our different stakeholders, but it takes a very different way of working.

Relying on advertising during an economic downturn

We haven’t had to change our strategy at all, [but] I think we’ve made a couple of smart, prioritization calls about where we want to invest. Overarching[ly] we’re sensitive to it, we’re following the ad market really, really closely, but there are a couple of things that are actually insulating Semafor and have represented wind in our sails. 

We’re really focused on B2B and corporate reputation advertising. I think the audiences that we’re trying to build around represent influential, opinion leader audiences in the U.S. and around the world. Across every industry and category that we’ve been engaged with from an advertiser and partnership perspective, they’re under a lot of pressure from an economic perspective, but they’re also under a lot of pressure to drive positive brand reputation to engage critical stakeholders and to reach audiences in new ways. I think everybody is really, really honed in on the fact that innovation is a necessity in this media landscape, placing bets on new partners experimenting, you know, drilling into new platforms is incredibly important.

Going beyond traditional advertising placements

[Advertiser Hyundai] Genesis is a great example where we’re working with them across platforms, from our email newsletters to our video journalism. And we’re also working with them across premium advertising. But the real I think crown jewel in the relationship is that many of Semafor’s Newsmaker events are going to be taking place at Genesis House in New York City. We really wanted to think in a non-traditional way about how we can marry our strengths with Genesis in order to create something that’s of high value for their brand for their audiences – really to be able to combine and conquer in new ways.

“Instagram is a visual, interactive platform that allows us to not only share our 134 Happy Hours campaign, but also engage with our fans about what they missed most about happy hours with colleagues,” said John Shea, CMO of White Claw Hard Seltzer, U.S.

The brand intends to use Instagram, the channel where the brand has the most followers at over 205,000, to target working Gen Z and millennials (in the 21 to 35 age bracket).

“While White Claw generated extremely strong sales during lockdown, the brand is now attempting to capitalize on this ‘back-to-the-office’ moment and inspire social interactions that used to be more commonplace,” said Mark Walker, CEO of the media company Direct Digital Holdings. “As a result, this White Claw campaign could be part of the marketing wave that initiates the return to happy hour.”

Using digital ads, the brand is asking its followers to recall the feeling of happy hour with their colleagues and to enter a contest to win prizes via a link pinned on its Instagram account. Prizes range from branded merchandise to a $400 gift card. The grand prize winner will receive prizes including a ping pong table, a karaoke machine and a virtual reality headset. The contest launched on Oct. 20 and will run until Nov. 6.

Shea said that 100% of the ad spend went toward social with over 50% on Facebook and Instagram, but declined to share exact figures. According to Pathmatics data, the brand spent a little over $27 million so far on advertising in 2022, which is up from $20 million in 2021.

It comes two years amid the pandemic, as much of the corporate world began working from home and after a recent, independent study that White Claw commissioned that showed 74% of employees said they miss happy hours with colleagues.

White Claw collaborated with VCCP NY (creative agency), Haworth (media agency), and Zeno Group (PR agency) on this campaign. “White Claw is helping companies nationwide come together again and make up for lost time by gifting curated happy hour experiences,” said Shea.

As previously reported by Digiday, SKYY Vodka and Hilton capitalized on pandemic marketing campaigns to boost brand awareness and toward user bases who wanted to socialize in person again. “We’ve seen brands across various industries tie themselves to this ‘trend,’ whether it’s promoting products or apps that help with in-office work or industry commentary from B2B and B2C companies on ways to be more productive, ensure a smooth transition,” said Anna Crowe, CEO of Crowe PR. “Aligning your brand with a popular trend can be quite impactful, when executed well.”

In 2021, White Claw was responsible for contributing more than $1 billion to the hard seltzer category, which was more than the next two largest hard seltzer brands combined (Bud Light and Truly). 

“We’re looking forward to continuously engaging with our fans, whether it be via events or social campaigns such as this,” Shea said.

For the first time in a while, premium publishers like Bloomberg Media are operating from a position of strength. They have the context and audience marketers need to sustain personalized advertising at scale at a time when both are more difficult to come by from third-party cookies.

In fact, the opportunity is so big that Bloomberg Media went and built a data platform called “Audience Accelerator.” Like other publisher-owned data platforms, this one is wired to give marketers more insight into Bloomberg readers seeing their ads, from reading preferences to their seniority. Some advertisers have already run test campaigns on this data.

“This is a real moment for us to say to our clients ‘hey we know these users and they trust us’ and so as a result we want to cultivate those relationships in a really thoughtful way,” said Julia Beizer, chief digital officer at Bloomberg Media. “We’re not just going to share that information all over the ecosystem because that’s not what the consumer has in mind.”

Anything that dilutes this position is a risk — including ad tech vendors. These businesses can incur costs from publishers that go beyond a take rate, from knocking the user experience to undermining pricing power, even data leakage. There’s only so much publishers have been able to do to mitigate these costs. The likes of Bloomberg Media are doing more.

“We’re choosy about who we work with and we will have to see what happens in the future,” said Beizer. “Whatever happens, it will come back to us figuring out what we can do well for our users and our clients. Those two questions are our steers for figuring out how we navigate this huge change in the industry.”

Granted, not every publisher is in such a gilded position. A divorce like the one Bloomberg Media went through with Taboola sends a clear signal to the rest of the market: the publisher won’t put ad dollars before its users — a lot easier to do when you have over 450,000 paying subscribers and 5 million registered users (at last count).

“Ripping out the crap that was tarnishing the pub’s brand is the on-brand thing to do, especially now when publishers desperately need to restore the trust of their readers,” said Augustine Fou, ad fraud researcher and consultant. “All the arbitrage revenues that went to Taboola and Outbrain could have gone to the publisher instead. Pubs are taking the revenue back. Good for them.”

For now, there are no other ad tech vendors in Bloomberg Media’s sights. Should this change, resellers might be a good place to start. 

They’re the ad tech vendors that help publishers peddle inventory in private marketplaces. Currently, Bloomberg is working with 18 of them, according to what is listed in its ads.txt file. They have their uses, of course: namely additional ways to make money, whether by providing unique ad units or additional content. Some will even provide extra sales support through ties to local advertisers.

But resellers also have several risks. Essentially, they all boil down to this: publishers have to cede at least some control over their inventory to these businesses. That’s a precarious situation for any publisher. Not least because sometimes resellers use other resellers to sell a publisher’s inventory. In other words, resellers could be running several concurrent auctions via these other resellers. The more concurrent auctions, the greater the technical strain on the publisher’s site. And that’s before some of the shady practices of these vendors is considered like bid duplication.

Time will tell if (and when) Bloomberg Media makes a move on resellers or any other ad tech middlemen. Nevertheless, it’s always on the lookout. For example, the publisher talked about conducting an audit of demand-side platforms — the ad tech vendors that actually buy impressions — as recently as 2019. Whatever happens, it’s clear that the publisher has been thinking about how to exert more control over programmatic advertising — and the ad tech vendors that facilitate that — for a while.

Look at its slow then sudden pull back from selling ads in the open market, for instance. 

Over the last several years, Bloomberg Media has been pulling ads from these auctions, and dialing up efforts to capitalize on private deals. Eventually, it got to the point where it only accounted for a fraction of the ad inventory it sold — 5%, in fact. From there, it was pretty easy to decide to leave those auctions completely in January. It’s not like the money made from them would be missed.

“We’ve seen a lot of clients who were buying us from the open exchange coming directly to us, wanting to know what we’re offering and understand how to exploit that for their own clients,” said Duncan Chater, the md for commercial at Bloomberg Media Europe. “We have a very unique audience and are in a position where we can advise partners on how they can reach that audience and do so in the right environments and at the right moments.”

So while these moves — breaking up with Taboola and shutting down the open auction — are symbolic, they’re neither costly nor a big strategic gambit. 

If anything, they’re rational, calculated moves to keep readers happy, while also preventing them from wandering off site via a content recommendation firm like Taboola — all while intensifying the scarcity and subsequently driving up the price of its inventory. In short, this is much about asset protection as it is improving the user experience. 

“These decisions aren’t specific companies or even specific types of models, they’re really a philosophical shift when it comes to understanding what are the best user experiences that we can deliver,” said Beizer. “We felt that the places where we had the most control over how we can make those user experiences optimal are where we best solve our users. We struggle to do that when we have open market programmatic and some of the other companies already mentioned.”

This won’t be for everyone. Not every publisher has the direct relationships and brand cache like Bloomberg has to make a move like this stick. But the ones that do are clearly growing in number. Among them: Vox Media, The Financial Times, The New York Times, Minute Media to name a few. 

Twitter’s new owner spent the weekend replying to Hillary Clinton in a now-deleted tweet sharing misinformation and firing several Twitter executives. General Motors, a competitor of Musk’s Tesla auto company, temporarily suspended advertising on Twitter in light of the takeover, and several celebrities announced their departures from the platform. 

There are also reports that under new leadership, Twitter is planning to start charging $20 per month for account verification. Meanwhile, reports say there’s been an increase in slurs on the platform following the deal. 

While some advertisers have balked at the changes, others say Twitter’s new direction under Musk doesn’t change much, especially as Twitter wasn’t a significant portion of clients’ ad budgets. 

Twitter has long since struggled with presenting itself as a brand-safe platform, especially at the height of the 2020 election and Covid-19 pandemic. Along with other social media platforms, Twitter made a push for brand safety in hopes advertisers would find comfort (and continue to spend) amid efforts to limit harmful content and hate speech. 

“Where so much progress has been made to increase the safety of social networks, this is a huge step back,” Nathalie Ormrod, associate director of media planning for ad agency Blue State’s London division, said in an email to Digiday. Per Ormrod, Blue State works with several nonprofit organizations, and the added controversy on the platform now calls into question whether Twitter will remain a mainstay in client marketing strategy.

Media buyers are faced with a volatile digital marketing landscape, between rising CPMs and complications from data privacy crackdowns. Twitter’s controversial takeover stands to make matters worse, said Elijah Schneider, founder and CEO of marketing agency Modifly. 

“Twitter has been a pretty hostile environment the last few days,” he said. “I really think focusing on other platforms right now, as someone in paid media, makes a lot of sense.”

While the transition has brought on a renewed uncertainty from some media buyers, others say Musk is a smart businessman who may bring some of the acumen used at Tesla and SpaceX to boost Twitter’s cashflow. 

“While people may not agree with political or controversial accounts, it’s impressions and eyeballs we need for our clients,” David Song, CEO at Rosie Labs ad agency, said via email. “As long as Twitter delivers on audiences and reach, they will continue to stay on our buys.”

The controversy around Musk’s Twitter takeover may be more about reshaping the perception of Twitter than the actual platform, Brandon Biancalani, head of paid advertising at Modifly, said via email. In its current state, ad buying performance within Twitter is inconsistent, he added. 

“If there are more use cases and case studies or tangible improvements that Musk proposes, that could inspire more advertisers to be optimistic about Twitter ads,” Biancalani said.

3 Questions with Alex Griffin, CMO at Swiss sportswear brand On

What are On’s current marketing goals?

As a brand who believes in fostering and powering a community around running, we have an amazing opportunity to tell the world and prove why running is so great. With people placing focus on their bodies, how healthy they feel, or how agile they are, there is also a lesser known benefit of running, which is the benefits it provides to your brain and finding your flow state. Earlier this month we launched a 30 day challenge with influential creatives and the Flow Research Collective to determine how running can prompt the state of flow, an optimal state of consciousness where people feel and perform their best. 

What marketing channels are proving to be most effective in meeting those goals?

The most effective and positive marketing channel we’ve seen thus far is our work with local, micro influencers across channels (Instagram, TikTok, YouTube) because we find that our consumers around the world want to organically follow these personalities’ stories. In our [out of home] strategy for Dream On, we wanted to be provocative and tell people why we think running is important. Our OOH for this campaign didn’t necessarily feel like advertising and, generally, OOH gives brands the opportunity to tell their audience what they want to tell them. While it’s not always the case, we wanted to tell our audience what they wanted to hear rather than forcing a specific message. Thus, the OOH served as an extension, thematically, of what our creators were posting on their social channels.

How is On thinking about its marketing budget/ad spend as conversations around economic downturn heat up?

On is in a fortunate position as a hyper-growth brand. That means that our budgets go up every year, and even though we’re now a public company, we are still intentional on spending on things we feel are important that will help drive durable growth. The biggest challenge for us is not how much we spend, but how we focus the budget we do have. As our brand awareness grows, more and more people want to come work with us and with that, comes the difficult task of saying no, in order to continue focusing on what’s right for the overall brand.

By the numbers

The saying goes, “What goes up must come down.” It’s a fitting saying for the current state of e-commerce, according to AppsFlyer’s 2022 edition of its State of eCommerce App Marketing report.  According to the report, “eCommerce is no longer attracting the same volume of new users, and rising prices are starting to take their toll on marketing budgets and planning.” Find a breakdown below:

• E-commerce app marketers spent $6.1 billion on user acquisition, but global ad spend nosedived over 50% year over year due to rising iOS media cost, the relative return to normalcy post-Covid and other macroeconomic conditions.
• Android e-commerce app installs dropped 5% globally year over year, excluding in India, which gained significant new traffic. 
• iOS installs also took a slight 4% downturn in the same period after the surge in downloads during the Covid-19 pandemic.

Quote of the week

“That is the opposite of what we need to do to build brand safety. We need to be focused on moderation, more healthy conversations and greater trust among users and between communities, publishers and advertisers.”

— Tiffany Xingwu Wang, CMO of OpenWeb, in response to Elon Musk’s acquisition of Twitter.

What we’ve covered

• How Pepsico is putting its money where its mouth is, spotlighting Black-owned restaurants with marketing dollars
• Brands like Shake Shack are pushing to BeReal in hopes of finding the next big social media platform
• Amazon’s ad business is racking up ad dollars. Here’s how it’s pitching itself to advertisers

Overall, Digiday’s survey found that there is a heavy reliance among publishers on advertising revenue. Ninety-six percent of publisher pros told Digiday this year that they get at least some of their revenue from ad sales, with 87% saying a large portion of their revenue comes from advertising. These results are similar to last year, when 93% of publisher pros told Digiday that at least some of their revenue comes from advertising, and 82% said advertising accounts for a large portion of their revenue.

The most interesting finding from Digiday’s survey regarding holiday advertising revenue — although maybe not the most surprising — is the extent to which optimism has dropped among publishers between last year and this year.

Digiday’s survey found that publisher pros are just about split into thirds among those who think their holiday ad sales will increase, decrease or stay the same this year. The survey results don’t exactly indicate that publishers are pessimistic about their advertising revenue heading into the holiday season, but they certainly don’t indicate optimism, either.

This is a big change from last year, when publishers were very clearly optimistic about their ad revenue leading up to the holidays. In 2021, a full two-thirds of publishers (or twice as many as this year) said they expected holiday ad sales to increase significantly or somewhat, with a quarter saying they expected ad sales to increase significantly. This year, only 2% of respondents said they expect holiday ad sales to increase significantly.

A similar difference emerged among those publishers who said they expect holiday ad sales to decrease between last year and this year: 31% of respondents to this year’s survey said they expect ad sales to decrease somewhat or significantly this holiday season, compared with only 10% in 2021.

However, with all things considered, it’s important to recognize it’s not insignificant that more than a third (37%) of publishers said they do expect holiday ad sales to increase significantly or somewhat this year. Thirty-five percent of respondents do fall into the “somewhat” category, as opposed to the “significantly” category, but attitudes could be much worse as the industry faces the economic downturn along with the rest of the world.

Watler heads up TikTok’s Creative Agency Partnerships, North America division, which was launched last summer as a way for the growing platform to help creative agencies and their clients better understand how TikTok works — something that has become increasingly important given TikTok’s status as the current social media darling. 

Watler, a 40-year-old, New York native, has been described as an amazing networker and a hustler by those who have worked with her, which are attributes that come in handy when streamlining relationships between TikTok and the creative industry’s countless shops.

“Because TikTok is so new, in the sense of engaging the agencies and especially the creative agencies this way, they are leaning in,” said Alan Parker, chief innovation officer at Energy BBDO. “Krystle’s leadership and how she’s doing that is setting the standard for how we lean in to do it.”

Music to creatives’ ears

Watler’s team is small, but mighty. (TikTok declined to offer further details on the Creative Agency Partnerships’ team makeup.) It has clients from independent creative agencies, like Fable.works and Zulu Alpha Kilo, to creative agencies at holding companies, including Publicis’ Saatchi and Saatchi and Omnicom’s Energy BBDO. Recently, the team launched CAP (Creative Agency Partnerships) University, an educational resource for creative agencies that focuses on everything from collaborating with creators and pitching TikTok strategies to clients.

TikTok gained steam during the pandemic and has become a more permanent fixture in marketing budgets across the industry. Earlier this year, eMarketer reported TikTok’s ad revenue is expected to surpass Twitter and Snapchat combined, raking in more than $11 billion. By 2024, experts forecast TikTok’s ad revenue will reach $23.48 billion, giving YouTube, which is expected to take in $23.65 billion, a run for its money.

TikTok caused a major shift in how users were consuming content, forcing advertisers to adapt their creative strategies from polished, Instagram-ready videos to authentic, culturally relevant content. (Read more on that change here.) Watler and TikTok’s Creative Agency Partnerships team are there to be a beacon of light in the sea of changes.

“We will never do the work of a creative agency,” Watler said. “But we will always guide, consult and provide any and all resources that the industry needs to come up with great ideas that’s going to move culture forward, and move a brand’s business forward.”

Watler came to TikTok last July from Virtue Worldwide, the creative agency powered by Vice Media, and with more than 15 years of experience at creative agencies. Upon her arrival at TikTok, she hit the ground running, sparking a relationship with Parker and the Energy BBDO team. 

“She was like music to my ears,” he said. 

Training started almost immediately, with Watler’s team sharing TikTok insights with Energy BBDO on trending challenges, growing communities and client-specific programs. And last October, the agency rolled out a campaign with Champion athletic wear and Jalaiah Harmon, a Black TikTok dance creator who was the focal point of Black TikTokers’ strike to raise awareness around the lack of credit they received for creating viral moments and trends on social media. (Read more on that here and here.)

Per Parker, the ad with Harmon racked up 18 million views and 250 million reactions across the campaign. He added that Watler’s team was instrumental in helping Energy BBDO make “key decisions” to feature Harmon in the campaign. 

“It has sharpened, refined and allowed us to go further than we would if we’d have done it on our own,” Parker said. “Why would we not do everything that we could possibly do to get the best work? And that’s what [Watler has] enabled us to do.”

TikTok’s Creative Agency Partnership team has also helped launch work with Fable.works for WhatIF Foods, and will soon have a campaign with an auto brand for Zulu Alpha Kilo creative agency. (The agency declined to name the auto brand because the deal is still new.)

“We’re learning stuff that we instinctively were maybe not so right about,” Rick Williams, co-founder of Fable.Works, said of TikTok’s Creative Agency Partnerships’ guidance.

15 years of experience

Watler’s career is steeped in the creative industry. She has at least 15 years of experience in the creative industry at places like Virtue Worldwide, Sunday Dinner brand consultancy and ad agency Arnold Worldwide. She’s seen the advent of the internet as we know it, and goes to sleep thinking about how to help creatives pivot to what comes next, including Web3, the metaverse and a changing social media landscape, she said. 

In fact, Watler cares about creativity so much that back in the early 2000s, she left a career in finance. She walked away from a job at Goldman Sachs and took a 55% pay cut to pursue work in the creative industry. 

“During the time, everyone thought I was crazy. But now I have 15 years in and it was the best decision I could have ever made,” she said. 

Professionally, Watler said she’s putting one foot in front of the other as TikTok continues its push for growth, especially after the platform reportedly suffered an operating loss, according to The Wall Street Journal. She has her eye on CAP University, which launched in the spring and saw 11,000 people worldwide join for a five-week course, as well as TikTok’s partnership with CultureCon and the Best Use of TikTok Award in partnership with AdAge. 

“I find it to be a privilege to have this role and to help the industry that I love,” Watler said.