Topic: Advertising

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    Gmail Will Stop Scanning Emails to Target Ads Due to Enterprise Confusion (Jun 23, 2017)

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    Some YouTube Advertisers Still Staying Away (Jun 21, 2017)

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    Spotify Tests New Sponsored Songs Ad Unit to Place Songs in User Playlists (Jun 19, 2017)

    Any service which becomes central enough to its users’ lives eventually has aspects which become essentially intimate to the user: what feel like private places where the user feels extremely comfortable, and where intrusions of content, ads, or other unwanted outside elements feel like a violation. I suspect users’ own playlists on Spotify feel like just such a place to its loyal users, and so the news that Spotify is testing a “Sponsored Song” ad unit in which songs are literally placed into users’ playlists should be concerning. Almost every ad-based business model eventually engages in such violations, either temporarily or permanently, because the drive is always to push the boundaries of ad load and the places where ads can show – the most valuable real estate is also often the most invasive, and each ad platform has to draw its own line between what is and isn’t acceptable in the pursuit of ad dollars. Spotify’s recently leaked full results for 2016 show that its ad-based business is loss-making even on a gross margin basis, while its subscription business is profitable on that same basis, so there’s always going to be a push to squeeze more ad revenue out of each user. I’ve recently finished a piece for Variety which will publish in the next couple of weeks in which I argue that Spotify should in fact ditch its free tier and go subscription-only, because of all the tradeoffs the ad-based business forces, especially in its relationships with labels. But these types of encroachments into what should be sacrosanct aspects of the user experience are another example of the risks of the free tier, especially relative to the small rewards – just 10% of Spotify’s revenue in 2016.

    via TechCrunch

    Facebook Shares Data Showing Usage Spikes During TV Commercials (Jun 8, 2017)

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    Snap Acquires Offline Attribution Company Placed (Jun 5, 2017)

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    Some Advertisers are Moving Spend from Google and Facebook to Amazon (Jun 2, 2017)

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    Google Confirms Plans to Block Some Ads in Chrome in Future (Jun 1, 2017)

    There were reports a while back that Google was planning to incorporate some limited ad blocking features into its Chrome browser, and Google has now confirmed those reports and explained exactly what it’s planning. As the reports suggested, Google isn’t planning to implement a broad ad blocker but rather will block just those ads deemed annoying by the Coalition for Better Ads, of which Google is a member. It sounds like Google has started reaching out to publishers to explain the forthcoming change and will be providing detailed guidance on how they can ensure their sites are in compliance. As I said when the earlier reports surfaced, it’s smart for Google to be part of the push for limited ad blockers even if that may seem counterintuitive, because if it can focus that activity on egregious ads rather than all ads indiscriminately, it has a much better shot at protecting its own massive ad revenue than if others take more of a blanket approach. We can be certain that none of Google’s own sites or ad formats will be affected by this filter, but we can also guess that there will be something of an outcry from publishers feeling that Google is favoring itself while disadvantaging others. It’s going to be fascinating to watch this play out over the next few months.

    via AdAge

    YouTube Clarifies Content Policies for Creators and Advertisers (Jun 1, 2017)

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    Waze Expands Carpool Service to All of California, May Start Showing Ads (May 31, 2017)

    One of the best recent examples of the fragmentation that still exists within Alphabet and even within Google specifically is the fact that Waze, the navigation app acquired by Google a couple of years ago, has been working on what’s effectively a ride sharing service, and that it’s been doing so entirely independently of any other part of Alphabet or Google that’s working on related services and technology. It grew entirely out of Waze engineers’ desire to do something interesting rather than out of any strategic imperative from Alphabet management, which means that Alphabet’s Waymo has launched a test of a self-driving ride sharing service while Waze is expanding its Carpool service and the two have nothing to do with each other. To focus on Waze for a minute, it had previously launched its Carpool service in the Bay Area, and now is expanding it to the rest of California. But it’s still more of a true ride sharing service than most of the other services that get painted with that label – this is intended purely as a way for people to literally share rides to places one of them is already driving to, and to help split the driver’s gas money. As such, it also hasn’t generated revenue for Waze, which has merely passed along the entire IRS mileage rate to the driver, so it needs to find some other way to make money, and it looks like that might at least in part be showing ads to users of its app. It’s ironic, then, that even though the interesting disruptive transportation technology has no connection to the rest of Google or Alphabet, but its business model might end up borrowing quite a bit from its parent.

    via Recode

    Google Execs Say Assistant Will Monetize Through E-Commerce and Ads (May 24, 2017)

    Though the original headline on this piece focuses on the e-commerce aspect, the actual content of the article makes clear that Google has every intention of serving up ads too. Google launched Shopping on Home a while back, so hearing that Google intends to monetize through e-commerce isn’t a huge surprise, but it’s interesting to hear confirmation from Google that this is its main focus, because though this is obviously a strength and a motivator for Amazon in this space, it clearly isn’t Google’s main focus. However, as I said, advertising is clearly a big part of that picture too, and it sounds like ads will mostly be served up as they are in other Google search products: alongside organic results when people are looking for something specific. The big question, then, is how that’s done – the first screen of classic Google search results has now been taken over by ads, something that only takes a scroll to get past, but that same experience on a voice device that majors on providing a single answer won’t fly. Linear interfaces like voice assistants can’t take up users’ time with ads before they get to the organic results. So despite these comments, there’s still lots we don’t know about how Google is going to make additional money from Home. And then there’s the point I made previously about the fact that charging real money for a device like this breaks the usual implied contract of free services coming with ads – users won’t have the same expectation of an ad-supported business model on a device like Home that they do with a free online service.

    via Recode

    Google Expands In-Store Sales Attribution to More Ad Types (May 23, 2017)

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    Big TV Networks Trash Google and Facebook While Aping Their Techniques (May 19, 2017)

    I’ve been watching the news from the recent TV upfronts and waiting for the definitive article that summarizes what’s been said and done, and while I’m not convinced this is it, it does a good job of characterizing the basic trends at issue. The two big underlying trends are the continuing decline of live linear viewing of traditional TV and the massive growth of online advertising, which could be presumed to have put an enormous dent in TV ad spending but actually haven’t. However, the TV companies still see online advertising platforms as a big threat, and spent an unusual amount of time during the upfronts trashing Facebook and Google (though mostly not by name) while talking up their own massive reach. At the same time, though, these companies are increasingly mimicking the very same things that make Facebook and Google’s ad platforms attractive: detailed targeting of ads and tracking of what happens after viewers see them. At the same time, the TV networks seem somewhat lost on the content side, rebooting old shows and formats, latching onto new gimmicks like live musicals, and generally showing a lack of imagination in protecting and rejuvenating their brands. Meanwhile, the strongest audiences on traditional TV are live sports fans and older generations watching procedural franchises like CSI and NCIS. And of course the big online platforms are investing in lots of both traditional sports content and some new formats of their own. Therefore, though each side would like to paint itself as providing unique value, the two are increasing converging on a similar set of content and ad capabilities, while the audience continues to shift from traditional linear TV to a host of online and streaming alternatives, which will inevitably pull ad dollars that way too.

    via LA Times

    ★ EU Fines Facebook 110m Euros Over Misleading WhatsApp Deal Info (May 18, 2017)

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    Facebook Announces Yet Another Measurement Screwup (May 16, 2017)

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    Snapchat Debuts Sponsored Filters For the Rear-Facing Camera (May 15, 2017)

    When Facebook announced its AR strategy at F8 a few weeks back, a key component was filters for the rear-facing camera. At least in demos, those filters looked more impressive than what Snapchat had until then offered for the back camera on a phone, interacting in sophisticated ways with real-world elements in much the way Snapchat’s selfie filters do with faces. But the other big difference between Facebook and Snapchat’s approaches to filters is that for now at least Facebook treats them as an open developer platform, while at Snapchat they’re first-party only other than for advertisers. And today Snapchat announced that it will be debuting its first sponsored rear-facing filters, starting with a promotion for a teen romance movie. That’s clearly a new place for Snapchat to put ads within its interface, which will be handy as its user growth continues to be slow. But it also means that Snapchat’s rear-facing filters will continue to be a very narrow, curated experience with the occasional ad, while Facebook’s equivalent may in time offer a much richer, broader set of filters for the rear-facing camera. I would guess that Facebook will in time offer monetization options for developers too (and therefore take a cut) but for now the business models remain quite different, which means that even though from a feature perspective the two will compete, Facebook won’t be offering brands equivalent ad products to the ones Snapchat offers.

    via Bloomberg

    Some UK Advertisers Still Staying Off YouTube (May 12, 2017)

    As a reminder, the boycott of YouTube and Google which began a couple of months ago kicked off in the UK, where some high-profile press coverage of major brands’ ads showing up next to undesirable content caused some brands to pull their advertising from YouTube and in some cases Google’s other platforms. Although the hubbub over the boycott both there and here seems to have died down considerably, especially after Alphabet itself played down the impact in its recent earnings call, there are still advertisers which are staying off Google’s platforms in the UK. This article lists several ongoing holdouts including Channel 4, Marks & Spencer, Toyota, Tesco, and Pepsi, while others including McDonalds and RBS have returned. The quotes from marketers in the article makes clear that this is still about more than just dodgy content and extends to other frustrations advertisers have with online ad platforms, and that they’re using the boycott as a way to apply pressure to achieve those other aims.

    via Marketing Week

    ★ Snap Inc Reports More Slow User Growth, Growing Losses, Minimal Spectacles Sales (May 10, 2017)

    Snap, owner of the Snapchat app, today reported its first earnings as a public company, and it was a somewhat unique experience. Its press release, linked below, is entirely devoid of commentary, and although its call had a little more of that in prepared remarks, it was mostly focused on its evolving ad products. The results themselves are more of the same from the S-1 filing, which I suggested at the time was lousy preparation for an IPO because it featured significantly slowing user growth and a lack of clarity about the future. This first quarter of public earnings reinforces that perception, with more slower growth than last year. Massive stock-based compensation related to the IPO dramatically distorts the margin picture, but even stripping out SBC leaves a worsening margin picture as costs in several categories rose faster than revenue. Evan Spiegel and the other executives on the call seemed keener to talk trash about competitors, notably Facebook, than in really answering investors’ pressing questions about user growth, and that’s reflected in the stock price, which has dived since the release. The bombastic tone would have been justifiable if the company’s growth hadn’t slowed significantly since the introduction of Instagram Stories with no signs of recovery, but in the current context it feels like naivety or denial instead. Snap’s management argues that measures of engagement and “creation” are more important than user growth metrics. However, it provides very few of those, and then not consistently or with enough granularity to measure them over time. The conclusion from all of this is that Snap’s future is that of a niche company dominating narrow segments of the population rather than a company with broad mass market appeal, and that has significant implications for its valuation. Two other points worth making: the company provided enough data in today’s call to suggest it sold fewer than 100k Spectacles units since launch, confirming the perception that it’s been seen as an experiment than a meaningful new part of its business. Secondly, it continues to suggest that its sub-par Android app has hurt growth, and that recent improvements have moved the needle, though the numbers in question have moved so little that this isn’t going to turn around the growth trend.

    via Snap Inc.

    Facebook Will Suppress Content from Sites with Bad Ads in News Feed (May 10, 2017)

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    ★ YouTube Announces Six New Original Content Series For Its Free Service (May 4, 2017)

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    Snapchat Opens Self-Service Ad Buying Tool for Smaller Businesses (May 4, 2017)

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