Month: April 2023

Editorial executives previously told Digiday in February they were encouraging employees in their newsrooms to familiarize themselves with generative AI and chatbots like ChatGPT to see if the technology could help them perform their jobs better.

Now, some companies have formalized teams to lead AI-driven experiments and projects:

• BuzzFeed has a “brain trust” of about a dozen people that formed in December 2022, a spokesperson said. While it’s an “informal” and “fluid” group, the team consists of CEO Jonah Peretti, svp of editorial Jess Probus and founding editor and executive director of growth trends Peggy Wang. It also includes representatives from the tech and engineering departments, including a machine learning specialist.
• BridgeTower Media has a seven-person team that was put together in mid-March by David Saabye, svp of digital product management at the B2B media company, to focus on AI experimentation and guidelines. 
• Forbes also formed a seven-person group in March charged with discussing and establishing AI-related policies, a spokesperson said. The group includes representatives from the company’s corporate communications, human resources, legal, data privacy, editorial and cybersecurity teams. 
• Ingenio hired director of growth, Geoff Skow, a year ago to oversee AI initiatives. Skow works with a team of five people from editorial, engineering and UX design to determine how to use generative AI to grow Ingenio’s audience, said president of media Josh Jaffe.
• Trusted Media Brands put together a team of nine people a month ago, led by chief technology officer Nick Contardo and chief business officer Cameron Saless. The group was formed to “talk to other leaders at this company to hear what they think about [AI and machine learning] and how this could impact them and what we could do with it,” Contardo said.

TMB’s task force is discussing one or two “mid-size” AI projects the company can invest in over the next six months, Contardo told Digiday, but holistically has three purposes: sharing AI learnings between departments, determining which AI initiatives to test and deciding on company policy around the usage of generative AI and ML technology. The team is made up of managers from several teams, including business development, editorial and sales and marketing.

“Our approach isn’t going to be to take things like AI or ML and replace employees,” Contardo said. Instead, the focus is to streamline certain operations and see if advancements in the technology can improve the surfacing of content to readers, he added. 

AI experiments “have been bubbling up organically throughout” BridgeTower Media, Saabye said. The focus of the new task force is to “identify [the] use cases, put some structure behind them, and then at the same time build out the policy… essentially, the safety rails of how this can be used at the company,” he said.

Most of BridgeTower’s AI team are managers and come from its creative and production, SEO and web development, editorial, marketing, data businesses and legal council departments. “They represent the core parts of the business where we see an opportunity for some AI functions to have a material effect,” said Saabye.

The team is focused on three things when it comes to the use of AI: “cost savings, increased velocity and new products,” Saabye said. In other words, looking at how AI can replace third-party vendors and bring down the company’s operational costs, as well as using it to boost productivity by conducting tasks faster and better than before, such as highlighting key trends within a story to improve SEO. Lastly, the BridgeTower team is experimenting with AI tools to see if they can create products to analyze trends or large data sets.

The BridgeTower team is also tasked with determining the quality, safety and ethics around the use of generative AI, Saabye added. 

“We are looking at having the company’s stamp of approval on what you can do today and how you can use it. And then just like you do with data privacy, having that be a regular function of the organization to continually assess and evaluate your policy and your actions,” Saabye said. “That’s why we have legal represented on [the team] as well. It’s not that we’re constantly concerned about doing something illegal, so much as there are so many unknowns particularly in the areas of IP [and] government regulations in this area.”

But a number of publishers are still taking a more organic approach to testing AI internally. Noah Weissman, evp of content at Team Whistle, is leading AI efforts at the company, but not with a formalized team. Each manager is leading tests within their own departments, he said.  

“Our head of talent [has] a very different use case than our head of production. But it is an absolute innovation and strategy mandate to use it,” Weissman said. “It’s my job as one of the leaders on our team to make sure that people are adopting it so that we don’t get left behind in the past.”

Gannett doesn’t have a dedicated AI-focused group, but the company’s head of product, Renn Turiano, is overseeing AI efforts with managers across the company, a spokesperson said. Chris Lloyd, vp and gm at Gannett’s product review site Reviewed, is looking at AI opportunities for affiliate revenue, for example.

Not all media executives are convinced that generative AI technology will be the solution to the media industry’s ailments, however, even if their leadership is entirely onboard. 

“My CEO is fucking obsessed with AI… but I’m not totally convinced,” said one publishing executive on the condition of anonymity.

The platform has three main focuses: AI-powered asset management, performance analytics and instant creative adjustments, said Lindsay Hong, Locaria’s COO, who was part of the team that developed the platform.

“It all kind of came together at sort of the right time,” Hong told Digiday. “We realized that there’s an opportunity here to use performance to inform that creative post-production process to create the assets that matter, rather than content for content sake.”

With increasingly large volumes of assets and content and a growing number of channels, Hong said it is a challenge to bring together all the production teams, studio and creative smarts to manage spending and media. The goal is to form the team and start building and iterating the platform later this year.

“What we’re doing now is refining right down to really strong cases,” Hong said. “We already have existing clients who are interested in this, so we’re really working closely with them to understand exactly where they see the most value within the larger martech ecosystem.”

One of Smart Assets’ capabilities lets users make changes to their creative components immediately, based on data insights across platforms. For example, a user might prefer seeing red clothing on TikTok and blue clothing on Instagram — so the platform can make those changes in real time.

AI content recommendations is something many social platforms rely on as well. Emily Andras, associate creative of the U.S. at influencer marketing agency Billion Dollar Boy, said AI is increasingly being used to optimize social media feeds.

“We’ll see platforms leaning into AI content recommendations to populate your feed — trying to push user engagement and make a stronger bid for your eyes and your likes,” Andras said.

In Smart Assets, the AI is able to read the content of the brand’s library and categorizes attributions, using performance data to guide the creative process by optimizing and forecasting. The aim is to improve overall media performance by providing data-driven insights, as well as allow brands and agencies to work together closely on their creative and media teams.

“It’s very real within marketing organizations that you have a disconnect between the performance side and the creative side of the business,” said Elspeth Rollert, CMO at Stagwell Marketing Cloud. “One of the things that struck us really quickly when we looked at Smart Assets was, you have folks who understand the performance side and then the connection to the Brand Performance Network.”

The competition for 2023 will begin later this year, with a winner announced in the start of 2024. Some of the past winners included: WonderCave, a peer-to-peer texting solution for brands (in 2021), ARound, the augmented reality platform partnering with sports teams and live events (in 2020), PRophet, a generative and predictive AI tool for drafting content (2019), and Harris Brand Platform, a brand management software (2018).

Of course, that speed of change does have an impact on how marketers feel about social platforms. “Due to all of the changes in the social landscape over the past year plus, brands are more considerate in where and how they are investing on social to build long-term growth,” wrote Christina Miller, head of social media at VMLY&R London in an email. “But [they] still believe it’s the place to do so.”

Natalie Gomez, director of integrated strategy at Zambezi, echoed that sentiment, and noted that the constant change forces the agency to be “constantly doing POVs” about various social platforms for clients. “A lot of the times, it’s just proceed with caution,” said Gomez. “From a paid standpoint, you can always have the discussion of reevaluating spend and reallocating spend from one platform to another.”

TikTok 

Marketers and agency execs say that TikTok’s continued growth, ability to get on the For You page even with a low follower count and preference for less polished content continue to be positives for the platform despite the potential ban. Even if marketers aren’t spending time actively posting on the platform, it can also be a place for consumer research. “It’s a good way to get a sense of what the cultural zeitgeist is saying,” said Cass Cervi, strategist at creative shop No Fixed Address. “So even if you’re not super on it, it’s good to be listening.”

But marketers aren’t completely discounting the potential for the platform to be banned. And some are left reassessing how much effort they should continue to dedicate to the platform.

“Uncertainties and challenges with data and privacy continue to emerge across the globe for TikTok, making it hard to know if investing in building a following on the platform is worth it, or if that might all go away in the near future,” said Miller.

Of course, the potential ban isn’t TikTok’s only issue. Marketers say that some of the initial ease of massive engagement on TikTok isn’t there anymore and that the effort needed to put into TikTok can be a big ask for marketers, especially those who aren’t set up to pump out content as quickly as it is needed for a strong TikTok presence. “Creatively, brands often are not set up to create TikTok-style content (both in-house and with agencies),” said Miller. “It requires a shift in investment  and production which can prove to be a challenge for many brands — without content, being relevant on the platform is near impossible.” 

Facebook

Marketers chasing the attention of Gen Z may not turn to Facebook as the platform has older demographics but they shouldn’t write it off either, according to marketers and agency execs, who say that overall Meta’s offering still takes the top spot for social media marketing. 

“Meta I think is still the strongest player just because it has the ability to reach people across Facebook and Instagram,” said Erica Patrick, svp and head of paid social at Mediahub. Brendan Gahan, chief social officer and partner at Mekanism, echoed that sentiment. “It’s the most effective from a performance standpoint,” said Gahan.

As for Facebook, specifically, marketers say that its pros are that it is efficient and effective. The cons, however, include an aging user base, limited organic discovery and fewer creative innovation opportunities. Marketers also pointed to the ongoing issues with Facebook’s ads manager as well as its issues with its ad reps, all issues that have been complaints for buyers for years and continue to be with some marketers saying that recent layoffs have exacerbated those issues.

Instagram

While Instagram’s constant algorithm changes can be annoying for creators, marketers and agency execs say the platform is still a staple in the budget because it’s consistent, reliable and delivers results marketers want. “We call it kind of like the new homepage,” said Cervi. “It’s where most people are looking to find out more about your brand’s general identity, what you are, what you look like. People go on the Instagram page first before the website at this point. So it’s just a good one to have because it creates legitimacy.” 

Even so, Instagram’s algorithm changes and flip-flops in focus continues to be an issue. “Instagram has gone through a bit of an identity crisis over the past year — chasing platforms like TikTok and BeReal to keep up with the latest trends and functionalities that users are craving,” said Miller. “It’s led to frustration from users and has caused brands to question their strategies and how to create to remain relevant on the platform.” 

Miller continued: “It’s not quite clear yet how this will all end — whether we’ll see a Reels-focused future, or if Instagram will remain a place for image-posts and video alike, but the uncertainty is challenging for brand strategies.” 

Twitter

Efforts to court advertisers to start spending again on Twitter have been ongoing. Whether those efforts will be fruitful enough to get marketers to return to or make the platform a significant focus remains to be seen. The tumultuous nature of the platform following Elon Musk’s takeover has marketers still questioning efforts, though the platform’s push around the Super Bowl did have some marketers returning to the platform.

At the same time, the partnership with DoubleVerify to boost brand safety efforts also had some marketers reconsidering their Twitter spend, per marketers and agency execs. Even so, “It tends to be a little bit more of a risky platform to be on,” said Cervi. “It’s another example of a place that requires a lot of community management.”

The uncertainty around the future of the platform is another issue for marketers. “We still don’t have a great sense of what comes next,” said Patrick.

3 Questions with Laura Rueckel, CMO at Freddy’s Frozen Custard & Steakburgers 

Freddy’s recently went through a digital transformation, including launching an app. Why do it now? 

To me, if you weren’t to do it, you’re losing [market] share. You’re losing business on the table and you’re giving it to competitors. The guests, the consumer, is in that direction, regardless. Sure, the choice could have been made not to do it. But then that would be acknowledging that we’re limiting the brand and limiting the experience to a certain subset of people, which is not what we want to do. Like any brand, you want to make sure that you’re constantly recruiting new users to the brand. Let’s face it, you’ve got a whole bunch of Gen Z and younger who are extremely heavy in this environment, digitally. We wanted to make sure that we had those offerings for those guests that want to interact with us in that way.  

How does the app impact business goals? 

The fun part of this for marketers is being able to have data that helps us learn more about our guests, and learn more about what they’re buying, when they’re buying so that ultimately, we can give them more of what they want. The more we learn about their behavior, the more we can target those messages.

What does the rest of Freddy’s marketing strategy look like? 

Like several brands, the biggest thing that we are focused on is brand awareness. This goes from a marketing standpoint and from a development standpoint. Because as of right now, there are still areas of the country where we are relatively unknown. There are others where we’re the hometown favorite. But we’re growing in awareness nationally. So that’s a big objective–to make sure that we are relevant as a brand and starting to shift to a true national brand. The other is just making sure that we’re continuing to drive guests and we’re continuing to drive those transactions. We want traffic in our restaurants. — Kimeko McCoy

By the numbers

With the increased use of social media, worries about social media’s impact on mental health, especially when it comes to younger generations, have been ongoing. HigherVisibility conducted a survey of consumers about how the growth of social media has and will affect them in the future to assess Gen Z’s attitude toward social media in the U.S. and how it impacts their lives. Find more details from the report below:

• Nearly 7 in 10 Gen Zers (68.81%) in the U.S. spend over an hour on social media each day
• Almost 3 in 4 Gen Zers find themselves ‘mindlessly scrolling’ while online 
• Over half of Gen Zers in America (55.96%) are worried about the future of what life may look like due to the rise of social media and technology — Julian Cannon

Quote of the week

“We’ve made it to the promised land, but the promised land looks a bit like where we’ve just been in the sense that there’s huge fragmentation across the digital media landscape. We made it to the future [but] the future has its own challenges that we need to work through.”

— Andrew LaFond, ‪vp and executive director of media and connections at R/GA, when asked about the streaming boom and the difficulties for advertisers that come with it

What we’ve covered

• It takes a village: A look at the hidden teams behind successful creators
• Wrestlemania could harness larger advertiser network after Endeavor acquisition
• What marketers need to know about ByteDance-owned Lemon8 — and its link to TikTok

Where those concerns originate from is The Trade Desk’s efforts to consolidate its buying power into fewer but better paths to programmatic inventory. This is commonly referred to as the “GPID” initiative and it goes back 18 months or so. 

But those attitudes have hardened over the last 12 months as the ad tech vendor set out to build its own direct routes to programmatic inventory via OpenPath alongside GPID. 

Speculation is never far from moves like this — a company crossing the proverbial rubicon. Time and again the industry has seen how these moves become opportunities for disintermediation. To be fair, The Trade Desk hasn’t done this. In fact, it has gone to great lengths not to upset the apple cart. That said, what it has done leaves a lot to the imagination. 

Here’s why: Let’s say The Trade Desk identifies all supply paths that sell the same ad slot on a news site. It then decides that the fair market price for that ad slot is a dollar. And then it measures its chances of winning the chance to buy that ad at that price point in each supply path. 

So when it bids a dollar via exchange one it wins 20% of the time, when it does the same via its own paths to programmatic inventory it wins 22% of the time, and when it bids a dollar via exchange two it wins 1% of time. Something is clearly wrong with that last exchange. Maybe it has an astronomically high take rate that makes the dollar price per thousand impressions gross bid uncompetitive on a net basis. Or maybe there’s some sort of technical failure that makes the auction for that ad slot malfunction more often than not. 

Either way, The Trade Desk doesn’t care. All it cares about is being able to buy inventory at a fair price through that path. If it can’t then that path gets deprioritized. 

Rejection like this is hard to swallow at the best of times, let alone when the rejected can’t accept why.

“There’s not a lot of clarity on how a path gets prioritized but from what I can gather The Trade Desk’s bidding algorithms seem to favor those paths to ad inventory that have a low take rate including its own,” said one ad tech exec who traded anonymity for candor on what little clarity they’ve been able to get into how The Trade Desk spends its ad dollars. “This essentially means I may have to handicap my margin to compete, which will drive down my revenue and potentially challenge my business.”

That makes The Trade Desk’s intent (arguably) more ruthless than nefarious. 

After all, OpenPath has a low take rate and a team of execs who are working hard to optimize a direct path to publisher inventory. Of course, it’s going to buy more ads from this supply path — it’s one of its most efficient ways to buy ads. SSPs and ad exchanges may not like it because every bid not won by them is a fee not taken. But The Trade Desk is under no obligation to support all of them. There are few businesses that are expected to behave this way. 

“What’s interesting to me is the expectation that the DSP — in this case The Trade Desk, but it applies to any DSP — needs to explain ‘why’ they are using Path A versus Path B? Do SSPs explain why they choose to work with certain DSPs, but not others?,” said Mike O’Sullivan, co-founder of ad tech tracker Sincera. “Undifferentiated offerings suffering from price erosion isn’t a “Trade Desk” initiated trend. It’s the prevailing trend of programmatic.”

But is what The Trade Desk is doing fair? Some ad tech execs say no. 

“There’s a technical advantage The Trade Desk has over us now as well as a commercial one when it comes to giving advertisers a reason to buy more publisher ads from their own path rather than ours,” said an ad tech exec who would only talk to Digiday anonymously due to concerns of jeopardizing their relationship with The Trade Desk. “When you have influence over how ads aren’t just bought but also sold there will always be the cynics who say it has created the potential for bias.”

The bias being that The Trade Desk could eventually start to push more money toward its own paths to programmatic inventory over others even when it may not be in the best interests of its advertisers.

To be clear, this isn’t happening. On the contrary, The Trade Desk’s attempts to consolidate its spending around where it can get the best efficiencies haven’t cost publishers money they were already making from other ad tech vendors.

This is how The Trade Desk’s vp of inventory development at The Trade Desk Will Doherty put it to Digiday: “The money will transact to more and more premium publishers. But it will just do so through fewer paths. When that starts to happen the overall efficiency of the market rewards the edges, in this case buyers and publishers.”

What Doherty is saying is that The Trade Desk is indifferent to all supply paths because price in exchange for ad quality clears the market.

“It’s the purest form of SPO possible,” said Tom Triscari, an economist at consulting firm Lemonade Projects, who wrote an analysis on the systemic issues that have led The Trade Desk to this point. ”Sellers that sell worthless inventory for a living are worried and they should be. They have lived fat and happy for a long time now. Either get legit or die. That’s the result of indifferent pricing. It’s about time. Assume TTD intent is legit too.”

So why the heartburn from the naysayers? Additive as The Trade Desk’s consolidation efforts are now, they could also give it a lot of leverage down the road. 

It’s a bit like when ad execs used to give Google’s ad tech (DV360) for placing bids on programmatic inventory a hard time for running on its own ad exchange even though the media giant insisted the two technologies were agnostic.

And therein is the real issue for some ad execs. They’re grappling with some learned skepticism. 

“I don’t really care that The Trade Desk wants to go vertical and exert more control over the programmatic market because that’s the name of the game these days,” said an ad tech exec who spoke on condition of anonymity. “What they’re doing isn’t illegal. The reason I’m bothered is at times it reminds me of how Google has behaved.” 

It’s an interesting point given The Trade Desk sees itself as the antithesis to Google. But it’s arguably a bit of a stretch. There’s no technical advantage gained by The Trade Desk as a result of what it’s doing. It can’t fiddle with the auction mechanics of OpenPath to win more bids any more or less than when it bids via normal programmatic marketplaces.

That’s not to say all the furore over The Trade Desk is moot. Should it reach a point where publishers rely on the ad dollars from the advertisers that use it then it could use that influence to get them to do things they wouldn’t have otherwise. There’s nothing that’s happened to say this paranoia will manifest. 

The problem The Trade Desk has, however, is convincing the cynics there’s not a sting in the tail. It’s hard to change the narrative once it has established itself. There could be far bigger implications to this issue if it is not addressed. 

The ire of regulators, for starters. Increasingly, they want the largest ads businesses to be able to demonstrate that they’re able to responsibly manage conflicts of interests. Hence, the emergence of the Competition and Transparency in Digital Advertising (CTDA) Act, which specifically targets vertical integration in the ad industry. To the untrained eye, it could seem like The Trade Desk is doing just that. It may not be operating a traditional SSP, and it isn’t subverting their existing commercial deals with publishers, but it has hit them.

“My perspective on this topic is informed by my curiosity about CTDA Act which, if passed, would treat The Trade Desk like a digital advertising exchange and like a sell-side brokerage and would, therefore, bar the company from running OpenPath,” said Nikhil Lai, a senior analyst at Forrester. “Specifically, the Act’s rules about how companies must avoid conflicts of interest would limit the viability of OpenPath, which The Trade Desk can use to favor its integrations with publishers at the expense of SSPs.”