Author: rssmasher

The in-app waterfall is drying up. On Monday, Oath released a new version of Super Auction, its replacement technology for the ad network mediation role that mobile networks have traditionally fulfilled. Previously, ONE by AOL would host an auction for AOL’s own demand through its software development kit and send the top bid to the… Continue reading »

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At the Digiday Retail Summit event last month in Austin, Texas, we sat down with 53 retail executives to hear how they approach marketing on Amazon. Check out our earlier research on European publishers’ adoption of programmatic advertising here. Learn more about our upcoming events here.

Quick takeaways:

• Only 20 percent of retailers in Digiday’s survey advertise on Amazon.
• None are spending more than 50 percent of their marketing budget on Amazon.
• Twenty-seven percent said they plan to advertise on Amazon in the coming year.
• Zero percent said they had recently purchased an ad on Amazon Spark.

Retailers take a cautious approach to advertising on Amazon
Amazon’s advertising business is off to a roaring start, already driving $1.7 billion in revenue. Despite this rapid growth, retailers are spending marketing dollars on Amazon cautiously, if at all. According to Digiday’s survey, 80 percent aren’t marketing on Amazon, and only 2 percent are spending a quarter or more of their marketing budget on the platform.

Only 27 percent of retailers say they will spend money on Amazon in 2018, a 35 percent increase from 2017.

Part of the reason why more retailers won’t advertise on Amazon is that a significant number of them avoid selling their products directly on the platform. Digiday research conducted in July found that only 38 percent of retailers were directly selling products on Amazon.

Beauty and fashion brands like Estée Lauder-owned companies MAC and Clinique particularly avoid selling products on Amazon. For such retailers, the question is whether they want their products to be associated with commonplace items bought in bulk on Amazon. As one anonymous attendee explained at a Glossy Forum earlier this month: “If I’m a customer, a lot of the time I want to buy my toilet paper on Amazon. For us, the question is: Do I want to be in the same cart as toilet paper? It’s the toilet paper question; that’s the biggest recurring theme.”

No one ad format stands out on Amazon
Marketers have several options of ad formats they can purchase on Amazon. Among the respondents, no particular ad format stood out as the most popular. And although respondents could select multiple answers, only one retailer noted that it purchased multiple ad formats.

Perhaps unsurprising was that zero percent had purchased advertising on Amazon Spark. Spark, Amazon’s influencer platform, has struggled to grow its user base, and many of its influencers question whether it provides any return on investment at all and are unsure if they will continue using it.

While Spark might not see strong interest from retailers, other areas will, particularly search. Amazon has pushed advertisers to spend heavily on search ads through Amazon Marketing Services. GroupM, which handles media buying for major brands like Unilever, noted that client spending on Amazon’s search ads was up 10 to 15 times in 2017 from the year prior. One anonymous executive at the Glossy Forum noted the growing importance of Amazon’s search ads. “Eighty percent of our [product] searches began on Amazon,” this person said. “The searches are really outweighing the searches happening on Google.”

The post Digiday Research: Only 20 percent of retailers are advertising on Amazon appeared first on Digiday.

“Data-Driven Thinking” is written by members of the media community and contains fresh ideas on the digital revolution in media. Today’s column is written by Andrew Shebbeare, co-founder and chief product officer at Essence. One can’t fail to notice the headlines about big brands taking their money back to traditional channels, grumbling that the programmatic… Continue reading »

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“On TV And Video” is a column exploring opportunities and challenges in advanced TV and video. Today’s column is written by Bryan Noguchi, media director at Caffelli. So, can I ask an open question about the six-second TV spot? I know both networks and advertisers have been playing with them over the past year, and I… Continue reading »

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Here’s today’s AdExchanger.com news round-up… Want it by email? Sign up here. Once More Into The… Facebook suspended the accounts and admin rights of SCL Group and its subsidiary Cambridge Analytica, the data vendor for the 2016 political runs of Ted Cruz and, later, Donald Trump. The offense: breaking company policy by collecting and storing data… Continue reading »

The post Facebook In Hot Water Again; Meredith Plans Sale Of Some Time Inc. Titles appeared first on AdExchanger.

Advertisers are realizing that taking control of their media planning and buying is easier said than done.

Big brands increasingly to want to in-house their media strategy. As senior marketers realize how much they’re overspending on online media, hiring media directors, building media divisions and owning ad tech are viewed as a way to establish control over what gets spent. The reality, as those marketers are finding, is that in-housing comes with challenges.

The need for talent has been flagged as the biggest barrier for advertisers looking to exert greater control over how their media is bought, according to a study by marketing consultancy ID Comms of 130 media, marketing and procurement executives. Advertisers, on average, rated accessing the best talent at 2.5 out of 3 (3 being the most important need), while agencies scored it 2.3.

Where it gets tricky for advertisers is convincing executives to ignore the lack of variety and clear career progression on the client side, and leave their agencies. As beleaguered as the media agency model is, it’s still growing at a level that affords traders and planners scale that most advertisers can’t match. “Moving buying in-house is not a simple process, and the truth is that there are many questions that those brands that take this step will have to answer,” said Susy Pyzer-Knapp, a consultant at ID Comms. “The biggest of these will be how they attract the talent they need to ensure they have access to the best tools and smartest trading strategies.”

The recruitment challenge isn’t helped by the fact that many advertisers are still figuring out a long-term media strategy — and therefore struggle to justify the cost. It took five years for L’Oréal’s media director Gayle Noah to get two more specialists on her team in the U.K. and Ireland, for example.

Like Graeme Adams, head of media at telecommunications firm BT, found when he joined the company in 2011, just because advertisers want media specialists doesn’t mean they are ready to view it as a long-term investment. On a scale of 1 to 10 — 1 indicating the media buy dictates the plan and 10 indicating the plan dictates the buy — procurement respondents believe the media buy dictates the plan (5.3), while marketing respondents, believe the media plan defines the buy (7.3), per ID Comms. The disconnect spotlights the inconsistent priorities within the industry, with some marketers focusing on quality, while others chase cost.

Until they can address the talent and cost issues of in-housing media, advertisers are looking beyond agencies for help. A recent survey by the World Federation of Advertisers of 56 advertisers that spend more than $90 billion (£64.6 billion) in annual marketing spend revealed 6 in 10 (59 percent) are working with independent advisers for media consulting. The service remains a new area, per the report: 61 percent of respondents use independent advisers occasionally or sporadically; 14 percent use their agencies or other suppliers for similar services; 20 percent defer to their own media expertise; and 7 percent don’t see the need for media management.

“Media management is a complex art, and many multinational marketers use advisers to help them navigate a constantly changing ecosystem,” said Matt Green, global lead for media and digital at the WFA. “The role that advisers play has become wider and more sophisticated, as marketers seek to maximize the value of their media activity and align their external partners with their business goals.”

It’s why language-learning company Rosetta Stone has its own in-house team instead of an agency. Caitlin Romig, senior manager of digital marketing, oversees a team of seven specialists across social, mobile, partnerships, display, paid and remarketing, and she has never worked with a media agency in her seven years at the company. “We don’t have the budgets of Unilever or Coca-Cola, so we’re a performance-based marketer, and everything that we do ties back to finite data,” she said. “It’s important that we’re not sharing that data outwardly with an agency that could potentially work with a competitor down the line.”

The post ‘Not a simple process’: Marketers struggle to recruit in-house media talent appeared first on Digiday.

A U.S. TV company recently signed a deal with Netflix for a new original drama series. Under the terms of the arrangement, both the TV company and Netflix are funding the show and collaborating on distribution: The TV company will release it in the U.S., and Netflix will get global streaming distribution rights. The TV company retains the ownership rights to the show, which means it can find other licensing partners for the program in the U.S. and abroad.

But under the terms of the deal, the TV company also has to wait a certain period of time before it can license the show elsewhere. And with Netflix available in more than 190 countries globally, there aren’t many international TV networks and distributors that would want a show that’s already streaming in their markets.

“It’s still a win-win because [the U.S. TV company] is paying less to make the show and gets the marketing benefit of doing a ‘Netflix Original,’ but if you are part of a larger company that wants to make TV money internationally, those kinds of deals can constrain you,” said a source familiar with the deal.

This example, in a nutshell, presents a conundrum that many TV producers, including studios and networks, face when selling projects to Netflix. As a global streaming platform, Netflix wants worldwide distribution rights — and increasingly is willing to fund the total cost of a show in order to grab ownership. With Netflix’s stature in entertainment, there is a ton of value in a producer being able to say they’ve made a Netflix original series. But Netflix’s deal terms mean it’s getting less and less likely that producers can count on receiving ancillary revenue streams, which can include everything from licensing to even merchandising.

Netflix declined to comment for this story.

Within the film and TV business, Netflix is a giant. Earlier this month, the company announced that it plans to distribute 700 original projects globally, including TV shows, movies and stand-up specials. These will be supported by an $8 billion content budget for 2018, which dwarfs the budgets of other digital platforms including Hulu, which spent $2.5 billion on content in 2017, and Apple and Facebook, both of which plan to spend $1 billion on content in 2018. Netflix is more in line with traditional media conglomerates such as NBCUniversal, which spent $10.2 billion on non-sports content in 2017, Time Warner ($8 billion) and Disney ($7.8 billion), according to Recode.

Producing for Netflix or even licensing an existing show to Netflix has its advantages. Netflix has a global reach with 118 million subscribers; it’s often willing to pay more or buy more episodes than competitive bidders; it’s generally more hands-off in the creative process with production partners; and there is a marketing value to saying you’re producing a Netflix original series, a library that includes buzzy shows such as “Stranger Things” and “The Crown.”

“I was an agent for seven years. I saw clients go through the arduous development process with traditional networks,” said Joseph LaBracio, evp of alternative programming at Condé Nast Entertainment, which has multiple shows with Netflix. “That has not been the experience at Netflix. It’s a culture that gives the people making the shows the creative room to take chances.”

But for legacy TV studios and production companies, which have over the decades built a business that allows them to make money by not only producing shows for a fee, but finding additional revenue through licensing and syndication, a Netflix deal is a particular challenge.

While all deals can vary, Netflix increasingly wants ownership over its original series. If a production partner can successfully negotiate some ownership over the program, Netflix will typically nab a global streaming license that can be anywhere from five to 15 years or more. (Seven to 10 years is the most common, according to one source; another Netflix seller said a general contract that Netflix uses with major studios such as Warner Bros., Lionsgate and Sony has licensing terms at 10 years.)

“If I am one of the more traditional production companies, this becomes both an opportunity and a threat,” said an executive at a major U.S. TV studio. “Netflix is paying market or above-market prices. The upfront fee is usually meaningful, and we get to create the show we want. But the downside is, if I do have a global hit, it’s unlikely that I would see the full value that I would have seen if that was made for a traditional buyer.”

The other issue is that international buyers are more hesitant to acquire shows that have already aired or are airing on Netflix.

“Everybody in the world is scared of Netflix, and Netflix has made it clear to them that they should be scared,” said a veteran TV executive who has distributed shows on Netflix. “The challenge is in how do you make the business terms work in this scenario. And the truth is, if anyone told you they know how it works, they’re lying.”

The other option, of course, is to accept Netflix’s ownership of the show and essentially become a producer for hire. For independent producers — and especially digital media publishers that have sold Netflix shows, including Vox Media and Condé Nast Entertainment — this is an attractive route since it promises some revenue and grants entry into Netflix’s club.

“Netflix gives creative control and production flexibility. Producers also aren’t saddled with the pressure for their shows to perform under traditional television ratings metrics,” said Peter Csathy, founder of media consulting firm Creatv Media. “Given those advantages, it’s hard to say no to Netflix.”

Of course, unlike major TV studios and networks, digital publishers have a lot less leverage — at least right now — when it comes to pitching and selling shows to Netflix.

“Because we are newer, we’re not going to be in the position to say that we are owning [the show],” said LaBracio, in a previous interview with Digiday.

Meanwhile, Netflix is not the only distributor that’s increasingly seeking ownership of shows or greater control over distribution. Many U.S. TV networks seek that as well, studio sources said. But even here, there are benefits to working with TV networks that Netflix doesn’t offer.

“Cable networks are generally not global; they might have international units, but they’re not global,” said the veteran TV executive “With cable, one of my participation rights in the pot, in the aftermarket, is them licensing the show across the world. If Netflix takes global rights, they’re not going to license anything across the world — so what’s my participation worth with them? It’s only worth what they’ve paid me in the immediate term.”

For more on the future of TV and video, subscribe to Digiday’s weekly Video Briefing email. 

The post Netflix’s deal terms pose a conundrum for TV studios appeared first on Digiday.

Condé Nast has left the co-sales ad partnership formed by NBCUniversal and Vox Media after less than a year.

The prestige publisher of Vogue, Vanity Fair and others announced the pact with NBCU and Vox Media in March 2017. They pitched it as a way for advertisers to reach more than 200 million consumers and 99 percent of the country’s millennials. The companies also listed two other benefits for advertisers: the ability to use Condé Nast’s data product, Spire; and two new ad formats focused on mobile video and branded content.

The original 2017 announcement didn’t describe the partnership as finite; however, Vox Media said three campaigns resulted from the Condé Nast deal, using ad products created just for the partnership, and as such, the partnership fulfilled its objective. “The specific approach was to take these to market, and then the partnership would end,” said Ryan Pauley, gm of Concert, Vox Media and NBCU’s ad platform.

Condé Nast wouldn’t comment on why it left the partnership, but said it would partner again with Concert under the right circumstances.

Pauley said Vox Media is happy with the overall performance of Concert, whose buys run across Vox Media, NBCU and a handful of smaller publishers, including Brit + Co, Entrepreneur, Funny or Die and a few more that are expected to be announced soon. Pauley said Concert tripled its sales from 2016 to 2017 with 200 clients served and is on track to double sales this year. He did not say the amount of sales that means, however.

“We’re already pacing well,” he said. “We launched [Concert] with the intention to build an opportunity for marketers to invest in a premium, brand-safe, highly contextually relevant environment for the web, which is much different from a Facebook or Google environment.”

These sales alliances are like a new spin on ad sales networks of days gone by, but with premium, direct-sold inventory and the publishers leaning on each other to grow their share of the digital ad pie that’s increasingly going to a few tech giants. Then-Condé Nast sales chief Jim Norton touted the Concert partnership as a way to get “scale that can rival the likes of Google and YouTube, Facebook and Instagram.” Similar pacts have been announced between National Geographic, Mashable and others; PopSugar and Complex; and Bustle and Coveteur. Trevor Fellows, evp of digital sales and partnerships at NBCU, said Concert deals are best suited to custom content clients because the publishers take a lot of the work out of the creation and distribution process. “It’s easy, and so many clients are looking to take out friction,” he said.

Digiday spoke to several ad buyers who said these kinds of alliances are interesting to advertisers that want to make sure their ad messages only show up in high-quality, uncontroversial environments. “It does feel a little retro,” said Ben Kunz, evp of marketing and content at Mediassociates. “But it’s simple, too. In a world where [Procter & Gamble’s] Marc Pritchard is saying it’s time to cut off the long tail, they’re tapping into that desire.”

Still, the idea of publishers co-selling has its limits, and not just because Facebook already has more than 2 billion monthly active users and superior data. The publishers have to find other publishers with similar audiences and approaches to advertising. To make the economics work, they have to charge the advertisers a premium for the one-stop shopping approach, but not so much that the advertisers don’t just buy directly from each publisher. In the case of Condé Nast, the need to split the revenue and do extra work on the back end eroded the profit margins, sources close to the arrangement said. It didn’t help that Norton, who championed the deal, was pushed out of Condé Nast last September.

Buyers today also are demanding that campaigns meet business objectives, not just audience targets.

“The story needs to be way more than just reach,” said Emma Witkowski, a digital investment lead at Mindshare North America. “They need to focus on audience data and insights and how is it going to impact my business.”

The post Conde Nast is out of its sales partnership with NBCU and Vox Media appeared first on Digiday.

Advertisers wanting to reach social media users in China have few options, with platforms like Facebook and Snapchat being blocked there. That’s made Tencent-owned WeChat, with around 980 million monthly active users around the world, a must-have platform for brands trying to woo Chinese consumers.

“Ad demand for WeChat is definitely increasing. It was already popular in China two years ago, but it took some time for Western advertisers to understand that WeChat is not a Facebook copycat — it’s really something on its own,” says Thomas Graziani, co-founder of WalktheChat, a marketing agency that specializes in WeChat. “Tencent has also done some international PR to build WeChat’s brand awareness, which also helps drive the ad demand.”

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