Month: May 2023

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NewFronts week and TV’s upfront season are here. And buyers and sellers alike are anxious to see how it all shakes out after a year of ups and downs in the TV ad business.

Digiday+ Research surveyed about 50 publisher professionals to find out how they expect buyers will spend during this year’s NewFronts and upfront cycle. The short answer is there’s a lot less optimism among publishers this year than there was last year.

Digiday’s survey found that publishers expect buyers to spend significantly less during this year’s NewFronts and upfront event than last year’s (although they do expect NewFronts spending to be stronger than upfront spending).

More than a third of publisher pros (35%) told Digiday that they expect buyers to spend somewhat more during this year’s NewFronts than last year’s — that’s a significant percentage. However, it is a fairly steep drop from the 45% who said the same last year. And only 2% of publishers said they expect buyers to spend significantly more during this year’s NewFronts than last year’s, down from 12% who said so last year.

Meanwhile, the percentage of publisher pros who said they expect buyers to spend somewhat less during NewFronts this year than last year saw a big jump from 2022: 29% said buyers will spend somewhat less this year, up from just 9% who said the same last year.

When it comes to upfront spending, more than one-third of publisher pros (35%) told Digiday they expect buyers to spend somewhat less this year than they did last year, up significantly from the 20% who said the same last year.

At the same time, fewer than a quarter of publishers (23%) said they expect buyers to spend somewhat more during upfronts this year, down from a third (33%) last year. And a very small 4% said they expect buyers to spend significantly more this year, compared with 13% last year.

Digiday’s survey found that there will be a big difference this year in publishers’ NewFronts offerings when it comes to upfront commitment deals. Sixty-one percent of publisher pros said they plan to offer this type of deal to buyers during this year’s NewFronts. Just 33% said the same last year.

The percentage of publishers who will offer standard ad buys during NewFronts this year also saw a jump, albeit much smaller. Last year, 62% of publisher pros told Digiday they planned to offer standard ad buys during NewFronts. This year, that percentage is up to a full three-quarters (75%).

Three-quarters of publishers also said that they plan to offer content sponsorship deals during NewFronts this year — making it the most popular type of deal to offer, tied with standard ad buys. This percentage remained fairly steady from last year, when 79% of publishers said they planned to offer content sponsorships during NewFronts.

During the upfront cycle this year, the largest percentage of publisher pros told Digiday that they expect buyers to spend somewhat more on streaming platforms than on TV networks, just as they did last year. Thirty-seven percent of publishers said somewhat more spending will go toward streaming than networks this year, compared with 38% last year.

Overall, publishers told Digiday they don’t see much changing this year when it comes to the balance between spending on streaming platforms vs. TV networks during this year’s upfronts. The biggest difference Digiday’s survey found was between the 22% of publisher pros who said they expect buyers to spend somewhat more on networks than streaming this year, compared with the 18% who said so last year.

Gen Z content creators and social media influencers are becoming a line item in the NFL’s marketing strategy. And it tapped that part of its strategy to better connect with younger audiences during the NFL Draft.

The move was part of the NFL’s push to raise awareness of the Draft and its content creators among younger viewers. Instead of concentrating solely on the newly drafted players, the NFL wanted to celebrate the Draft as a whole through cross-social platform collaboration with partners and content creators. Beyond the Draft, the NFL plans to continue leveraging social media influencers for future events, according to Ian Trombetta, the NFL’s svp of social and influencer marketing.

“We’ve been looking for ways to expand and to complement our existing influencer and celebrity strategy and that really is still the basic principles of building authentic relationships, finding ways to activate year round with these creators,” said Trombetta. He added that the NFL’s revamped youth-focused strategy aims to put a spotlight on content creators and, ultimately, move the needle in terms of NFL viewership.

It is unclear how much of the NFL’s advertising budget is allocated to this year’s NFL Draft, as Trombetta declined to share overall budget specifics. According to Sensory Tower data, the NFL spent a little over $31 million in 2022 on advertising efforts, which included social media, desktop displays and digital out-of-home.

According to Trombetta, the NFL had over 40 content creators on the ground during the week of the NFL Draft, including Leon Ondieki (who goes by @leon.ond on social media and has 4.5 million followers), Trent Simonian and Jack Byrne of @SidetalkNYC (who have 4 million followers on TikTok combined), fashion page @ThePeopleGallery (620,000 followers on TikTok), and @DudePerfect (a sports page with 59 million subscribers on YouTube).

“I think the NFL is doing what they need to do right now as they are finding creators to interact with younger audiences,” said Ondieki. “Every generation loves sports, that’s the reason why football has been going for so long.”

Creators Simonian and Byrne said that after the Draft picks were made, they went out into the crowd and interviewed fans. The NFL used the interviews in a compilation that was posted on its social media platforms.

“The biggest thing we like to do in making our content is we like to keep it engaging, meaning we like to make content that we would want to watch ourselves,” said Simonian. “We don’t want to make videos that we would want to scroll past that might look bad, that might look boring, that might not get to that so we like to be fans of our own page, essentially.”

According to Trombetta, planning out a social media strategy for the Draft is more unpredictable than the Super Bowl because social cards and graphics are planned weeks in advance of the actual Draft announcements. This is because the NFL has to combat false rumors from websites and agents trying to be the first to announce Draft picks on social media.

The NFL is only one example of a brand using influencers and content creators to drum up brand awareness among Gen Z audiences. Real estate company Windermere, fashion brand Lilly Pulitzer and CPG brand Arm & Hammer provide other examples. The strategy makes sense because the influencer and content creator industry is big business — it was expected to grow to an estimated $16.4 billion by the end of 2022, according to analytical platform Statista.

For its part, the NFL is increasing its focus on influencer marketing as its audience is becoming younger, and this younger audience is using streaming services and social media to keep up with football. (It’s unclear how much the NFL is spending on influencer marketing, as NFL executives declined to provide specific figures.)

“The influencer content provides good, street-level engagement with fans, and got them sharing and talking,” said Mitch Ratcliffe, partner at the marketing collective Metaforce. “The NFL wants to become more digital and social and it invested in staging that imported metaverse-like experiences into the event.”

In addition to the influencer-led activations, the NFL took over Kansas City, Missouri (where the Draft was held), and showcased local culture through its Draft creative, which was displayed in multiple OOH installations from the city’s airport to the actual Draft site. As previously reported in Digiday’s interview with NFL CMO Tim Ellis, it was important for the NFL to capture the vibrant street art, exposed brick and overall vibe of the city in the creative designs for the Draft. Hotel chain Marriott also displayed banners at all of its hotels during the Draft as part of its sponsorship of the event.

During the NFL Draft, Digiday was given the opportunity to tour some of the activations and the drafting activities of the players who had been selected. Here’s a view from the ground:

On Tuesday, the Writers’ Guild of America began a strike after six weeks of negotiations broke down between the guild and the Alliance of Motion Picture and Television Producers — which includes Netflix, Amazon, Apple, Disney, Discovery-Warner, NBC Universal, Paramount and Sony.

Marketers and agency execs say that they are watching the strike closely to understand what the impact may be for advertisers in the coming weeks but that it’s early days and difficult to read the tea leaves. Advertisers are already asking questions about the length of the strike, according to agency execs, who say they hope it can be resolved soon.

Production for late night television shows like The Tonight Show with Jimmy Fallon, Jimmy Kimmel Live, Late Show with Stephen Colbert, The Daily Show, Last Week Tonight with John Oliver, Real Time with Bill Maher and Saturday Night Live have shut down. It’s the first ripple effect of the strike; WGA picketers were also present at Peacock’s NewFronts presentation on Tuesday. The WGA and the AMPTP did not return a request for comment.

“As far as the upcoming slate of programming, the summer season is heavy on reality so there will be less of an impact there,” said Stacey Stewart, U.S. chief marketplace officer, UM. “We’re watching developments closely and are optimistic that the strike will be short, but we are working with media partners to understand contingency plans.”

For those advertisers who had ad deals with late night shows, agency execs are “identifying those dollars and what you’re able to do with those dollars” to pivot elsewhere, likely to digital content, explained Carrie Drinkwater, chief investment officer at MediaHub. Contingency planning and force majeure clauses in advertisers’ deals that have become more common following the pandemic “created the dynamic of being able to pivot,” noted Drinkwater, adding that when it comes to the strike, “most people thought it would happen.”

The last WGA strike occurred during the 2007-2008 and lasted 100 days before the WGA and the AMPTP reached an agreement. Since then, how television and movies are made and consumed has changed dramatically with the rise of streamers. While ad dollars have followed audiences with the shift from linear, broadcast television to streaming, the way that writers are paid for linear versus streaming differs dramatically.

“If the networks are still generating revenue — and we know they are — the writers need to be compensated for that,” said Drinkwater. “Even though consumption has shifted, it’s still being consumed.”

In a statement, the WGA said the AMPTP’s companies were in an “immovable stance.” “From their refusal to guarantee any level of weekly employment in episodic television, to the creation of a ‘day rate’ in comedy variety, to their stonewalling on free work for screenwriters and on AI for all writers, they have closed the door on their labor force and opened the door to writing as an entirely freelance profession. No such deal could ever be contemplated by this membership.”

The AMPTP said in a statement that its member companies “remain united in their desire to reach a deal that is mutually beneficial to writers and the health and longevity of the industry” and that it was “willing to engage in discussions with the WGA in an effort to break this logjam.”

The changed nature of content production from the traditional broadcast schedule of the last strike to now means that there’s a backlog of already shot content but how long that will last depends on the strike, said Jennifer Cowan, vp of entertainment at The Marketing Arm who specializes in product placement and brand integration.

“We’re looking at this as a day-by-day proposition as we’re looking at our clients and our brands who are working with shows,” Cowan said, adding, “So far [clients] are good. Every status call starts with this but if we’re [still on strike] in July that could impact us.” 

Outside of NBC’s Peacock NewFronts presentation on Tuesday in New York, a group of picketers protested the failed negotiations.

“This strike is not a stressor for advertisers,” said Kelsey Chickering, principal analyst at Forrester. “Either they will continue spending with the networks at a potentially lower negotiated cost or they will move their dollars to other ‘entertainment’ media. If consumers stop watching late night re-runs, advertisers can easily reach them on TikTok and YouTube.”

As Elon Musk’s tumultuous takeover of Twitter continues, new and emerging platforms like Spill, Spoutible, BlackTwitterApp.com and others are vying for the attention of Twitter’s users and niche cultural communities. Though it’s unclear whether these platforms will gain steam among marketers. 

Since last October, Twitter has found itself in constant controversy thanks to Musk’s push to reinstate banned accounts, the verification overhaul and an uptick in hate speech. The changes have pushed some users away from the platform, especially users of color, leaving the fate of multicultural communities like Black Twitter in limbo. That’s not to say all have flown the coop, but Musk’s changes have left many uncertain of the platform’s future.

Just last week, the so-called bird app’s latest fiasco was its overhauled verification system, which stripped certain users (including several Digiday staff members) of their legacy verification check marks. Historically free, under Musk’s regime, users are asked to pay $8 per month for verification. Creators of color are unconvinced of its value.

“With the [Twitter] verification thing going all the way left in the last few days, those platforms are going to begin to see much more traction,” said Laura Mignott, global chief experiential officer at VMLY&R Commerce. “A lot of folks are seeing the death [of Twitter] now, which is sad.”

Twitter’s fall from grace makes space for competition

Twitter’s fall from grace has created space for new social media platforms like beta-tested-Bluesky Social, Mastodon and Post.News to enter, although there hasn’t been mass adoption of a new platform just yet. Per Insider, Twitter’s rivals may be stumbling due to precarious user interfaces, security issues and uneven beta launches.(It’s unclear what user downloads or usage looks like as neither Spoutible nor BlackTwitterApp.com responded to a request for comment in time for publication.)

Oddly enough, Twitter has seen an increase in users under Musk’s reign as per previous Digiday reporting, Twitter’s daily average users has averaged around 246.8 million, with a mean average increase of 1.3 million new users each month, per data from Apptopia.

Notably, amid the controversy at Twitter, new social media platforms have been created by or centered around the voices of people of color including, BlackTwitterApp.com, Spoutible and soon-to-be-launched-app Spill, which was founded by a former Twitter employee. The app has yet to launch, but anyone interested can sign up to reserve their handle on the app’s website. 

The latter of which has piqued the interest of Danisha Lomax, head of client inclusivity and impact for North America at Digitas. As a consumer, she’s already filled out the form to reserve her handle when the platform officially launches. Currently, the app is in alpha build mode, conducting tests with small groups. However, Lomax said she’ll be soon meeting with Spill’s execs to talk about potentially capitalizing on the momentum of advertising dollars, partnerships and engagement for Spill. 

“If supply diversity is a problem we are working to solve, we have to give up and coming platforms that are run by diverse folks a space and opportunity to thrive,” Lomax said. “We’ll never play in that space of, ‘We have Black Twitter. That’s all we need.’ We know we need more.’”

Per Alphonzo Terrell, CEO of Spill, the app plans to build its own internal ad infrastructure, and has already seen interest from brands and media partners, like Digitas. Down the road, the CEO said there are plans to offer sponsored experiences, quizzes or games and other custom ad solutions.

“Our goal is to build a global platform that is the de facto place to discuss and discover culture worldwide,” Terrell said in an email to Digiday. “It’s been a wonderful validation of our thesis that connecting to culture can be both great consumers and great for business.”

The next Black Twitter won’t be built in a day

While these new platforms perhaps share similarities to Black Twitter’s multicultural communities, agency executives say there’s not much draw yet to these platforms as go-to places to observe cultural moments for a few reasons: They’ve yet to scale and reach mass adoption, TikTok has grown to serve as an alternative cultural social media hub and Twitter, thus Black Twitter, hasn’t seen its final days just yet. 

“I will say that it does seem as though there’s more appetite than just a few years ago to explore new apps,” said Brendan Gahan, chief social officer and partner at Mekanism, in an email to Digiday. “TikTok really broke up the duopoly which is why I think so many of these other social apps (BeReal, Lemon8, Clubhouse, etc) were seen as real potential partners.” (More on what marketers need to know about ByteDance-owned Lemon8 — and its link to TikTok here.)

More importantly, the phrase, “Rome wasn’t built in a day,” seems fitting here as agency executives say Black Twitter, or any of its cultural communities for that matter, didn’t spur overnight. As emerging platforms build user bases, especially celebrities or other influential figures, followers will come, they said.

“One thing though, that is unique about Black people and our culture is that we typically find homes in places that weren’t meant for us, and we usually carve out a lane,” said Gerald Gordon, senior brand manager at Creative Theory Agency. He added that the community that made Black Twitter lives in other spaces like Twitch, YouTube, TikTok and other social media platforms. It doesn’t live with the same label, but the community is there.

‘Black Twitter was the cookout’ and still is

In a way, TikTok has benefitted from Twitter’s downfall, both in terms of user attention and ad dollars, agency executives say. On the short-form-video app, historically marginalized voices have formed communities like #BlackGirlLuxury TikTok and brought light to the shooting of Ralph Yarl, a Black teen who was shot after going to pick up his siblings. 

“Black Twitter was the cookout,” said Candace Carrington, director of social media at Creative Theory Agency. “That is the piece that a lot of apps are trying to pull from Black Twitter.”

That’s not to say the app TikTok will replace Black Twitter. TikTok’s algorithm hinders real-time conversations and isn’t a fast-moving cultural megaphone as Twitter was, and to an extent, still is. TikTok also requires video content, making it a heavier lift than Twitter’s text-based content style, said Noah Mallin, chief strategy officer to IMGN Media.

“Missing the real-time factor hinders the ability to connect events like sports, concerts, and activations aimed at Black audiences in the moment,” he said in an email to Digiday. “So for marketers, the ongoing vandalization of the platform by Elon Musk is frustrating.”

Amongst agency executives, the sentiment is Black Twitter cannot be replaced. For now, at least, Twitter still holds its own when it comes to Black Twitter and other multicultural communities as far as VMLY&R Commerce’s Mignott is concerned.

“You do still see those conversations. There’s still viral memes happening. People are still communing around content and moments,” Mignott said, referring to reactions to cultural moments like Harry Belafonte’s death, Love Is Blind and the Tennessee Three, two Democratic lawmakers that were part of a trio known as the “Tennessee Three” were expelled from the House of Representatives in early April.

Mignott said, “There was never the intention that Black Twitter would come out of Twitter. There’s something to be said about how we are able to go into spaces and revolutionize spaces as opposed to being in spaces that we’re supposed to be because we’re people of color.” 

When Dollar General began building out its retail media network a few years ago, the discount retailer made a surprising realization: There was a disconnect between the audiences it was reaching and where its customers lived.

“[Marketers] are optimizing into the most efficient audiences and there’s a direct correlation to those audiences in more densely populated areas,” explained Dollar General CMO Chad Fox. “… We were optimizing into the more densely populated areas and away from the vast majority of our stores.”

Since then, the retailer has overhauled its retail media network, amassing more than 90 million customer profiles and along with them a surfeit of first-party data. Now, the retailer says it counts 51 advertising partners onboarded for 2023 — up from 21 when it launched in February 2022 — and hopes to add another 100 smaller advertisers by the start of 2024.

In an interview with Digiday, Davis talked about the company’s overall marketing strategy, a new retail media partnership with Meta, and why Dollar General is positioning itself as an “audience provider” rather than just another retail media network.

This interview has been edited for brevity and clarity.

How does Dollar General’s retail media network fit into the company’s overall marketing strategy?

We’re big fans of eating what we cook. So as we stand something up, how do you productize that and then make it available to our advertisers? … And so much of what we try to do as a marketing department is tell that story because that’s what drives consideration and keeps us top of mind, and drives traffic to the stores. So it’s a shared objective on the part of us and our vendors.

What’s a more specific example?

[Marketers] are optimizing into the most efficient audiences and there’s a direct correlation to those audiences in more densely populated areas. And so they’re unintentionally optimizing out of small-town rural America — out of roughly 30% of the country. But since 75% of our stores are in markets of 20,000 people or less, they are unintentionally optimizing out of the fastest growing brick-and-mortar retailer in the U.S. We saw this early on when we were … starting to invest in digital marketing and shifting out of the more traditional stuff, where we were optimizing into the more densely populated areas and away from the vast majority of our stores.

That was one of the big “Aha’s” that drove us to say, “Hey these folks are hard to reach, they’re hard to measure, therefore you can’t deliver the contracted impressions.” We need to invest in our first-party data and grow that out so we can measure it ourselves, whether or not it worked, and where we reach them. So we built the capability to reach the hard-to-reach and the hard-to-measure — both on-site, but especially off-site through programmatic DSPs, through paid social, through SEM — and as we figured all that out, we were able to take that to the vendor community and the advertiser community, as worded as a product as part of [Dollar General’s media network] to say, “Hey we can help you reach the hard-to-reach and the hard-to-measure.” And it’s extended unduplicated reach that’s additive to your existing plans. And as you know, reach is the ultimate goal.

How does this fit with your broader ad-tech stack?

I would say roughly 10% or 20% of a plan we put in front of an advertiser is going to be on-site and in-app. The vast majority of it is off-site, which is a bit of the inverse of what everyone else is doing. It’s important to us to be able to reach that customer where they are. We started off with our primary partner being The Trade Desk [and] the open internet was the best place to start. But as we start to bring on other partners, it’s about does it bring more reach? And Meta was a great example of that, where we can leverage our first-party data or deterministic data, we can close the loop because we have the transaction data. And we can measure both attribution and incrementality and can bring them more reach.

Some advertisers say Meta is getting too expensive to make ads for low-margin products worthwhile. What does that look like for you, especially given the low-cost nature of Dollar General’s products?

Because we’re leveraging first-party data versus model audiences and because we have transactions, we have the ability to provide the advertisers an incremental return on ad spend. So we’re able to bring them both attribution and incrementality. So as long as that iROAS as a metric is in the sweet spot of what that particular advertiser is looking for — which is different for different partners — then the CPM or the cost of the media is a bit of a moot point.

How much have privacy changes — IDFA, state laws, etc. — affected everything?

If we [and if ad-tech partners] don’t get this right, it’s an existential threat. … We have privacy meetings every single week and stay on top of what’s going on out there, grooming our first-party data. We’re making sure that not only do we have pending profiles with what we’ve heard from customers — whether it’s requesting their data or asking to delete their data — but that we’re keeping that managed. We’re also watching the data flows and the data maps very closely, and holding our partners accountable as well. It’s always putting the customer first — our intent is to deliver them the most relevant messaging that helps them remove friction from their lives and helps them save time and save money. But also honoring their request to either provide their data or to let them opt out.

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