Wednesday, August 9, 2017

Amazon Disrupts Again--This Time the Advertising Industry

Facebook and Google are often referred to as an advertising duopoly because they control such a huge share of digital advertising. Basic data is given in Chapters 6 and 11 but here is an explicit comparison based on recent data from PWC/IAB. The most powerful figure of all is the 10% share of growth for “everyone else.”


 There is, however, a looming challenge to that dominance.  It is not surprising when Amazon disrupts an industry (Chapter 3), but advertising? As early as 2013 Business Insider estimated that Amazon had $835m in advertising revenue. eMarketer forecasted that U.S. ad revenue would be slightly over $1b in 2017.  All figures are estimates because Amazon does not break out its ad revenue. Google’s U.S. ad revenue is expected to be approximately $34b in 2017 while Facebook’s is expected to be more than $15b.

Amazon’s ad business is currently only a fraction of Facebook and Google’s. Why, then, do industry pundits consider it a formidable threat? Consider these recent statistics from the WWP Group:
•    55% of U.S. consumers now begin online product search at Amazon, 20% start on a search engine and 10% begin on a retail site.
•    Amazon.com and Prime Now accounted for 43% of all online sales and 53% of the sales growth in 2016.
•    63% of U.S. households are Amazon Prime members.

Those figures were quoted in a press release announcing a partnership between WWP agencies Mindshare and POSSIBLE that will provide Amazon advertising services to advertisers, joining a growing list of specialty agencies focusing on Amazon. In the U.K. only 38% of searches currently begin on Amazon, but that is enough for L’Oreal (Chapter 12) to shift some of its search budget to Amazon.

Amazon has two advertising platforms:

•    Amazon Marketing Services (with video) is a vendor-only platform that supports the advertising needs of Amazon Affiliates.



•    Amazon Advertising Services (with video) allows advertisers to “reach Amazon customers wherever they are.” Ads can be placed on Amazon itself or on a network of external sites.



https://advertising.amazon.com/ad-specs/en/landing-pages
In addition, Amazon has recently begun to offer its Sponsored Products product on the business marketplace, so it is offering targeted advertising on a third platform, this an e-commerce platform, not an advertising one.

Amazon Advertising Services is a self-service platform that allows any publisher to advertise on Amazon. Formats offered are PPC, Sponsored Products and Product Display Ads. Amazon also offers formats for eCommerce Ads, Non-Standard Media (special formats) and Mobile. The Landing Pages formats illustrated provide an example of the variety of options within each format. Their advertising platform (AAP) offers a large array of display ad formats. The important difference in the AAP is that it also allows the publisher to place ads on non-Amazon sites that create “a brand safe media environment that meets Amazon’s high brand bar and is appropriate for all audiences and ages.”  It also offers ads that appear on Amazon Kindle and Amazon Fire devices. All of this is offered as a premium service to brands and agencies under the umbrella of the Amazon Media Group.

Amazon Business is the new business marketplace launched in 2015. It is believed to be enjoying rapid growth and offers access to Sponsored Products ads and Headline Search Ads. That is the way AMS started, so it seems safe to assume that the business platform will offer more advertising options as time goes on.

This is a rather bewildering array of advertising offerings but when you look at the underlying structure of AMG it makes sense. It also seems to make sense that Amazon’s ad revenue will grow. Whether that will be the result of organic growth or of advertisers diverting some o their advertising budgets to Amazon remains to be seen. For sure, you haven’t heard the last about Amazon advertising.

Related Updates

Amazon strong competitor; can see entire customer journey
How large is Amazon's ad business?
Skills add to Alexa's ability to meet user needs
Ad growth continues
 Revenues continue to climb also in Q2
Growth of sponsored ads on Amazon

Thursday, April 27, 2017

Brand Safety Issues #2 - Facebook's Issues

As suggested in the last post, Facebook has had its own brand safety issues in recent months. Some of them are different from Google’s; one is similar.

Problem #1. The recent set of issues began in September 2016 when the Wall Street Journal publicized the fact, already revealed by Facebook, that it had been overstating one of its key video ad metrics for two years. The metric was average viewing time, highly important to video advertisers. An audit of all 220 Facebook metrics revealed four other problems with specific metrics.  In December the platform revealed that three of its audience measures had been calculated incorrectly.

The Resolution. Facebook began releasing fixes including individual metrics later in the fall.  It also announced initiatives that included more third-party metrics, a Measurement Council with members from ad agencies of metrics companies, and, in general, more transparency about how its metrics are produced.  In general, metrics are likely to provide additional problems from time to time and produce new metrics or new definitions of old metrics. This reinforces the warning at several points in the book, especially in the SMM and metrics chapters, that marketers must read and understand the metrics definitions of each platform they use—on an ongoing basis, it seems.

Problem #2. Fake News became a major issue during the 2016 election campaign, although all journalists agree that it is a persistent issue. I’ve seen references back as far as the ancient Greeks! Whenever the first fake news stories were circulated, there is no doubt that social media has given them a huge megaphone. What can—and should—social media platforms do to combat false stories masquerading as news? (See Related Links in previous post for Google actions.)

The Resolution. During the election there were claims that Facebook’s Trending news feature was left-leaning and Facebook replaced the human curators with an algorithm. That sounds like a different issue,  but part of the problem was that biased and fake stories were being shared and therefore showing up in the Trending stream.

The scope of the problem became obvious before the French elections in Spring 2017 when Facebook shut down 30,000 fake accounts that it claimed were circulating deceptive content. Before the surprise British elections to be held in June 2017 Facebook was being pressured to do more to stop fake news. It told the Guardian that it had already upgraded software as well as using human fact-checkers.

   https://thenextweb.com/facebook/2017/03/06/facebook-can-now-flag-fake-news-stories-disputed/#.tnw_6yGFqabv


Among the general steps it has taken, Facebook has partnered with third-party fact checkers and recently began flagging disputed stories. It also added a tool to make user reporting of questionable content easier.   It has also taken steps to keep sites with false or offensive content from hosting advertising.

Problem #3.

Facebook has the same problem of ads appearing on inappropriate sites as does Google/YouTube although Google’s problems dwarf reporting of the same issue on Facebook   If CNBC is correct and this problem centers on video, then Facebook’s problems in this area are likely to increase.

The Resolution.

Facebook’s response is similar to that of Google. It is trying to keep ads off fake news sites. Facebook has partnered with third-party face checkers and begun its own project to fight fake news. It has also joined the News Integrity Initiative which is to be run out of NYU’s journalism school.

None of these problems is prone to easy or quick solutions. The trust in two major social platforms has been eroded. It will be hard to reclaim it even if nothing else happens. Given the state of the world at the moment, nothing else happening seems to be an unlike scenario.

Before I leave the fascinating subject of digital advertising for now, I want to acknowledge the other huge presence that is just emerging. So look for a post on Amazon advertising soon.

Related Updates

Disney introduces safe brand network; partners with Facebook
How to identify fake news with Facebook criteria
Superposters help identify fake news
Facebook and Twitter have tools that show the ads for a particular account
Facebook email dump
Timeline of 26 Facebook data blunders in 2018 
Facebook sets aside $3b for potential fines

Wednesday, April 12, 2017

The Brand Safety Uproar - Google's Issues

Advertiser concerns about brand safely have become increasingly louder and more public in recent months. On March 23, 2017 the Wall Street Journal published an article that firmly established the issue in the mind of the digital advertising and publishing industry. The article has a good graphic explaining programmatic advertising and balanced treatment of the main issues. It was, however, only a summary of what had  been going on for several months.

•    In January 2017 P&G announced efforts to “bring transparency to the media supply chain” with CMO Marc Pritchard calling it “murky at best, fraudulent at worst.”
•    On February 9 2017 The Times of London published an investigative article under the headline “Big Brands Fund Terror Through Online Adverts” with compelling graphics. The article points out that high-traffic videos can generate substantial income through advertising and that advertisers are not pleased with the performance of their digital advertising.
•    On March 22 the WSJ published an article stating that AT&T and Verizon, along with many other consumer brands, had pulled all non-search ads from Google. The subhead of the article was “Carriers also aim to compete with Google for ad dollars.”


http://www.marketingcharts.com/online/how-much-riskier-is-programmatic-than-direct-publisher-buys-76332/
The politics of the situation are so byzantine that one author compared it to Game of Thrones. However, brand
 safety is not a new concern as shown by data presented by Marketing Charts. 

The most compelling example of corporate action to date is that of JPMorgan Chase. According to the New York Times the story begins in March 2017 when the NYT brought to the bank’s attention one of their ads appearing on a site called Hillary 4 Prison. JPMC had already made the decision to oversee its own programmatic advertising with a specially created digital agency, Roar. Apparently it was not too difficult to extend the “whitelisting” of sites practice already begun on other channels to YouTube. In short order, the bank had reduced the 400,000 sites per month on which digital ads were appearing to 5,000. No long-term results are available, but no immediate impact was apparent. The reason? According to Kristin Lemkau, CMO, “Of the 400,000 web addresses JPMorgan’s ads showed up on in a recent 30-day period. . . only 12,000, or 3 percent, led to activity beyond an impression.”

If ads do not reach the intended target audience, they are not seen as relevant and not acted upon. Further, if the viewer is not in the appropriate mind set, no action is likely to be taken. That is reminiscent of the “context” advertising research of the 1990s. A study of print advertising reported in the Journal of Advertising in 1992 summarized the relevant literature as saying, “The effectiveness of an advertisement, in other words, may depend partly on the informational context in which it is embedded,” a statement that appears to apply to all media channels.

Is that at least a part of what is going on here? It’s too early to say for sure, but the next few months should tell the story of whether large brands cutting off ads that land on “objectionable” sites will harm—or perhaps help--their marketing ROI.

Google, of course, is not sitting idly by while advertisers pull ads. A first step was to require a channel have at least 10,000 views before it can accept ads. That will demonetize sites with small fringe audiences, but it is far from a long-term solution. The company has signed with ComScore to provide brand safety reporting using its proprietary measure of the context in which ads appear.

Google is not alone in experiencing issues with the safety of its own brand. Facebook has also experienced problems in recent months. Watch this space for a recap!

Related Updates


Burger King ad Forces Google Home to Advertise the Whopper but it didn't last long. Then BK tried again.
Whitelisting 
Google Tweaks Search to Combat Fake News
Google filter for intrusive ad formats
Google warns publishers with experience tool
 P&G cuts digital advertising $; sales rise
More on P&G and brand safety 
What major brands are doing about brand safety
2017 overview; need to define brand safety
YouTube brand safety in the wake of the Japanese Suicide Forest video
Unilever to cut digital advertising
More on P&G digital ad cuts with 4 minute video
History of programmatic advertising
Take-down of a major maladvertising effort 

Tuesday, March 21, 2017

Debra's Tips for Coaching the GOMC

This post is reprinted from Zahay Teaches Digital (Marketing)

The Outline of the Challenge
For example, The Google Online Marketing Challenge is another way that instructors can give their students ‘real-world’ experiences in digital marketing. I have used many tools and techniques over the years and the Challenge has many benefits as well as some limitations. In a nutshell, students plan, implement and measure an online paid search campaign using at $250.00 AdWords budget from Google.  In the process, the challenge requires first finding a client and defining what makes the product/service unique so it can be promoted online.  The challenge can be used to reinforce the strategic marketing concepts that are taught in many classes because search keywords convey the company's unique strengths and positioning.  What follows are some tips for coaching teams in the Challenge.

1) Emphasize learning. I have coached over 40 teams, many of them quite skilled, and we have never made it to any award level.  In speaking with those who have been selected, it seems that the difference is the dedication of the team, not the skill of the coach.  If the students and you get to fly to California, that is great, but it is also unlikely. Therefore, I recommend emphasizing the team's learnings or outcomes of the project and not necessarily the prizes.  The reflection part of the post-campaign report will help in this area, or instructors may also include other reflection assignments before, during and after the campaign.  I personally grade the challenge on the caliber of the written assignments and the team’s reflection, not necessarily the results of the challenge.  We often have a presentation based on the pre-campaign report so the entire class and sometimes the client can give feedback and we all learn in the process.
2) Expect the unexpected.  Especially when you are a new coach, you may not be able to foresee difficulties.  We had a team pick a support website for a psychological disease, not realizing that Google places many restrictions on that particular advertising category.  Believe it or not, there are sites that promote this particular behavioral disorder and Google goes to great lengths to make sure that it does not encourage this type of behavior in the ad envrinoment.  Inappropriate, dangerous, dishonest or counterfeit products or services are not allowed to advertise on Google’s networks. However, if you find your team in a sticky position, make the most of the situation.  There is a lot to be learned from even negative experiences and one of the women who was on the team that had all the challenges from Google still considers it to be one of her best project experiences and uses the experience in job interviews to talk about how she has overcome adversity. https://support.google.com/adwordspolicy/answer/6008942?hl=en
3) Be prepared for mono-mania. This project can be all-consuming.  I recommend making the project the only project during the course and just having a few examinations and maybe a presentation.  Students will become completely absorbed during the running of the campaign and it is often good to give them class time to work on their campaigns and discuss problems as a group.
4) Consider timing. This project used to be confined to the Spring, which meant that after a few weeks of course intro, finding the client and working on the pre-campaign report, we were almost at Spring break.  Then we had to decide whether to run the campaign over break or how to handle the timing. Students are now allowed to run the campaign for any 21 days over a 31 day period, which means that teams can suspend their campaign over break. In any case, timing can be critical. I have run this challenge in an eight-week class, but we only had two weeks for the campaign. Instructors wishing to run the challenge in a short-form course would be wise to line up the clients before starting and have them present to the class during the first week. 
5) Try it yourself. I recommend setting up an AdWords account and writing some ads. I was fortunate to run a program where I had my own budget and we ran some ad campaigns for events. I got to learn how to do AdWords well while I was coaching my students.  Even so, I learned a lot from coaching the projects. Since the AdWords Fundamentals and other exams are now free, I recommend also taking at least the Fundamentals exam before starting as a coach.
6) Expect some challenging clients. Even if clients have the best interests of the students at heart, they get busy and sometimes can’t help as much as they would like.  Ideal clients give access to their site analytics to the team, make website changes to improve the relevance of landing pages, and stay involved in the entire process.  Less than ideal clients never return students phone calls or emails.  Make sure the client companies already have a landing page so there is something to work with if the client gets too busy to work with the students.  Involving the clients by requiring them to have some 'skin in the game' like attending class at the beginning, end and middle of the project helps with not only the student experience but the project outcome.
7) Consider two courses.  I’m not kidding. Most of us that have been doing this for a while are not trying to teach the students Internet Marketing and also have them run the Challenge.  Our approach at St. Edward’s is to get them certified in one course and teach the background and then have them participate in the Challenge or a similar project for another.
8) Realize this is not Google’s major business. Google does not make money on the GOMC.  The GOMC is a public service that also benefits Google by getting them clients and training future digital marketers to use their software.  However, sometimes Google can  be late in approving pre-campaign reports or crediting accounts with cash and sometimes students don't follow directions exactly to get their campaign credits.  Sometimes there are technical difficulties in getting things set up properly.  All of these potential problems mean that it is important to include enough time in the schedule to correct any problems or difficulties.  I always let the students decide which three weeks they wish to run their campaign during any four week period, just in case a team runs in to trouble.  I build slack time in the course schedule to accommodate unforeseen circumstances.
9) Check for special contests.  Each year, Google runs special contests along with the Challenge. These contests are sometimes for use of social media, sometimes for having a non-profit client and sometimes for being AdWords certified.  Check the challenge guidelines each year to see if your students qualify as these opportunities can be extra ways to win. 
These are just a few tips that I have for you from my years in doing the Challenge.  If you have any questions or comments you can post on this blog or email me. If you would like a copy of the complete GOMC Appendix to accompany the new Zahay and Roberts Internet Marketing text, please email me at dblatz@stedwards.edu.