Articles by: "Rande Price, Research VP – DCN"

Social media must step up its game against disinformation

May 22, 2019 Rande Price, Research VP – DCN

Disinformation comes in all shapes and sizes. Whether it takes the form of a text-based article, a meme, a video or photo – they are designed to go viral across message boards, websites and social platforms like Facebook, Twitter and YouTube. And, its polluting the internet. In fact, an Oxford Internet Institute study found that in the 30 days leading up to the 2018 U.S. midterm elections, a full 25% of Facebook and Twitter shares contained misleading and deceptive information claiming to be real news. Addressing concerns about domestic disinformation, Paul Barrett, of the NYU Stern Center for Business and Human Rights, identified the steps social platforms need to take to stop the problem in a new report, Tackling Domestic Disinformation: What the Social Media Companies Need to Do.

Disinformation epidemic

In the Report Barrett cites a MIT study that analyzed every English-language news story distributed on Twitter over an 11-year period and then verified the content of each story as either true or false. The study found that, on average, false news is 70//5 more likely to be retweeted than true news. Where are all these falsehoods coming from? A Knight Foundation study found that 65% of fake and conspiracy news links on Twitter could be traced back to just 10 large disinformation websites (e.g. Infowars).

First Amendment

Domestic disinformation is a constant in today’s digital experience. While there are many who call for its removal, others believe that it’s difficult to differentiate it from ordinary political communication protected by the First Amendment. Importantly, Barrett does not suggest that the government determine what content should be removed from social media. He believes social platforms can make better choices determining if content is accurate, and also how they promote and rank it.

Practices in place

Social platforms use machine learning to improve their ability to identify false stories, photographs, and videos. In addition, while Facebook previously flagged content to warn readers that it was potentially false, they now offer “Related Articles,” a feature that provides factually-reliable context about misleading stories. YouTube offers a similar program. When a user searches for topics that YouTube identifies as “subject to misinformation,” they preface video results with a link to information from reliable third parties. Even with these efforts, disinformation remains available on these platforms for anyone to view and share. Social platforms’ current practices are not enough in their fight to reduce disinformation.

Barrett’s recommendations:

Remove false content. Content that is proven to be untrue should be removed from social media sites, not just demoted or annotated.
Clarify the principles for content removal. Offer insight and transparency into what constitutes facts and rational argument versus the manipulation of information for disinformation purposes.
Hire a senior executive who has company-wide responsibility for combating false information.
Establish a more robust appeals process. Offer an opportunity for an appeal to a person or people not involved in the initial content removal decision.
Step up efforts to purge bot networks. Increase efforts to eliminate automated accounts that imitate human behavior online.
Retool algorithms to reduce monetization of disinformation. Doing so will diminish the incentive and therefore the amplification of fake news.
Provide more data for academic research. The platforms have an ethical and social responsibility to provide data they possess to facilitate studies and tracking of disinformation.
Increase industry-wide cooperation. Establish a data exchange and offer best practices across platforms to ensure common challenges are addressed.
Support initiatives for digital media literacy. Teaching people to identify digital literacy and how to be more discriminating of online content should remain a priority.
Sponsor more fact-checking and explore new approaches to authenticate news content. Continue fact checking efforts, a crucial first step to distinguish between truth and falsehoods.
Support narrow, targeted government regulation. Identify specific content regulations similar to the degree of disclosure for online political advertising currently required for traditional broadcast media.

Barnett concludes that “neither the First Amendment nor international principles protect the lies on social media.” It’s essential for social platforms to step up their role in self-governing to ensure disinformation is not monetized or worse, used to manipulate people and trigger violence. Importantly, humans must remain in control of platforms, overseeing the impact of AI in all its forms. Scrutiny and transparency are key in uniting efforts to dismantle the prongs of disinformation.

Industry-Research

Ad fraud growth slows for the first time in four years

May 8, 2019 Rande Price, Research VP – DCN

White Ops and the Association of National Advertisers (ANA) once again measure bot fraud in the digital advertising ecosystem in their fourth study, 2018-2019 Bot Baseline. They found that illegitimate traffic sourcing is declining and that the marketplace is working better than ever before to fight digital fraud.

Importantly, this year fraud is down 11% from 2017, accounting for a $5.8 billion revenue loss globally. The rates for desktop ad fraud are the lowest historically: 11% in 2014, 9% in 2016–17, and 8% in 2018–19. Fraud attempts account for approximately 20 to 35 percent of all ad impressions. However, actual fraud happens in a much smaller percentage. Still, ad fraud continues to be a problem, taking shape in new, creative, and hard-to-detect forms.

Successful implementation

The digital ad fraud fight has had help from the Trustworthy Accountability Group (TAG). TAG provides best practices to reduce fraud activity and encourages transparency among participants. TAG also requires the use of ads.txt, which helps reduce domain spoofing. The fact that traffic sourcing has become more difficult and expensive is helping to reduce retail bot buying on the web. However, to keep the numbers moving in the right direction, marketers and agencies must ensure that all ad spending is highly scrutinize and comes with a high level of validatability.

Challenges Ahead

Less than Half of All Impressions Are Fully, Transparently Validatable

In fact, validatability is critical moving forward. White Ops reviewed more than 50 billion third-party ad server impressions in this study. Less than half of the impressions meet the highest standard of third-party validatability. Some impressions do not support a dynamic fraud detection tag via JavaScript, others offer limited third-party validatability by design (e.g. walled gardens). Selling media under conditions that do not support high third-party validation offers opportunities for fake inventory.

Best practices

Increased ad fraud awareness has made it a higher priority among marketers, which has helped slow its growth. It’s important that everyone in the supply chain talks to vendors to find out how they measure for invalid traffic (e.g. using general detection methods, or uses sophisticated IVT detection methods, etc.).

Other best practices include:

Work with vendors who have implemented ads.txt.
Use an MRC-accredited anti-fraud vendor.
Decline to buy a “tonnage” of inventory.
Include language on non-human traffic in your terms and conditions to ensure your company only pays for non-SIVT or non-IVT impressions.

Fraudulent impressions are now detected before they are paid for due to DSPs and SSPs filtering out these bid requests. Unfortunately, fraud continues to evolve in new formats. However, if the industry continues its efforts to make this practice unprofitable, there is less incentive to supply ad fraud.

Advertising | Industry-Research

Better machine decision-making, rethinking digital ads, and smart cities will improve the health of the internet

May 1, 2019 Rande Price, Research VP – DCN

Mozilla’s newly released 2019 Internet Health Report offers insights from more than 200 experts examining what’s key to a healthier internet. The report is an open source compilation of research that tracks the internet and general technological progress. The findings center on three key areas: the need for better machine decision-making, rethinking digital ads, and the rise of smart cities.

Better machine learning

Machine learning and artificial intelligence (AI) are the next generation of computing. They enable more powerful automation, prediction, and personalization. As AI intelligence works its way into our daily lives, we need to question the ethical decisions and potential risks associated with it.

Industry experts are concerned that the large tech companies that control social media and e-commerce, are also shaping the AI agenda. Given Facebook’s, Amazon’s and Google’s ability to gather large quantities of training data, they are developing powerful AI technologies. An ethical assessment of their algorithms is important to ensure the consumer’s fundamental rights are protected.

Rethinking digital ads

Digital ads monetize online content and services and are the key driver of the advertising economy. Many researchers contributing to this report are alarmed by Google and Facebook’s combined control of approximately 84% of the global digital ad market outside of China. Their access to user data as a source of global market power in business negotiations is a major concern. Targeted ads used by these companies exploit their users. A scandal uncovered a few months ago included ads on Facebook demographically targeted to exclude people of a certain race from housing ads. Another example, also on Facebook, allowed advertisers to use available data on the service to create an affinity group to target ads to “Jew Haters.”

Some brands and marketers are stepping away from YouTube and Facebook but many still purchase their inventory for targeting campaigns. As a result of these scandals and others, users want to take control of their data. New software initiatives are being explored to offer a decentralized solution, giving consumers control over who has access to their personal data.

Rise of smart cities

Smart cities exist when the internet and connected devices are applied to solving problems from energy efficiency, transportation to government services. Similar to rethinking digital ads, collecting neighborhood data must be thought about carefully. Smart cities face challenges with regards to establishing policies and processes to guide the usage of local data with regards to privacy and transparency.

Steps to a healthier internet future

Many of today’s biggest internet companies still access users’ clicks, likes, friends, emails and downloads to fuel their business models. However, some companies are thinking about alternative business models and new technologies to give users control of their data. One such initiative is Purpose Foundation. It promotes “steward-ownership,” a legal structure to prioritize a mission over profit revenue model. It involves users in the ownership of the company to ensure consumers benefit in the economic growth. Importantly, involving consumers in internet innovation and safeguarding personal data are key steps to a healthier internet.

Industry-Research

Internet growth accelerates and social continues to climb, but there are changes brewing

April 24, 2019 Rande Price, Research VP – DCN

New global insights from the Digital in 2019 report show internet penetration is accelerating. More than 360 million people came online for the first time in 2018. New users are growing at a rate of more than 11 per second or one million new users each day. The report, from Hootsuite and We Are Social, is based on a selection of reliable third-party sources.

Mobile is the key driver of internet growth. Smartphones now account for two-thirds of global mobile connections. Approximately 5.5 billion smartphones are in use across the world each day. Additional key global findings include:

There are 4.4 billion internet users in 2019, an increase of 366 million or 9% percent compared to 2018.
There are 5.11 billion unique mobile users in the world today, up 100 million (2%) in the past year.
There are 3.5 billion social media users, an increase of 288 million or 9% versus same time last year.
There are 3.3 billion people use social media on mobile devices, up 297 million new users or 10% compared to 2018.

Internet users , on average, spend 6 hours and 42 minutes online each day, on par with one year ago. Users appear to follow similar usage patterns worldwide; Google sites dominate, Google.com ranking #1 and YouTube at #3 and in between is Facebook at #2.

Social media

Social media users grew to 3.5 billion users in 2019, driving global penetration to 45%. GlobalWebIndex reports that the average social media user now spends 2 hours and 16 minutes each day on social platforms, up slightly (one minute) compared to last year. Roughly one-third of the total internet time is spent on social media.

Social usage appears to be dominated by Facebook and Instagram. Despite numerous data breaches and privacy practice violations, Facebook remains the top-ranking platform with 2.3 billion monthly active users (MAU) worldwide. Instagram, owned by Facebook, also has a strong audience base with 895 million actives uses, growing by more than 4% in the last three months.

Twitter and Snapchat both showed declines in their global users. Twitter’s total addressable audience at 250.8 million fell 1.5% and Snapchat’s 306.5 million total addressable audience declined 10% since October 2018.

What’s next

We Are Social predicts more attrition and consolidations in social platforms, especially for Twitter and Snapchat. The report also predicts that social platforms will continue to evolve and center on decentralization and privacy. One example of this is a new innovative platform called Solid. The platform does not live in any one place. The user registers an identity and gets a POD on a Solid server, anywhere in the world. Users decides what data to store on their POD which can include almost anything from documents, photos, calendar events to recipes. The user controls the destiny of the information, where it’s stored, who can access it and who write comments about it. As global consumers grow more tech savvier, they take hold of their social reigns and manage the controls.

As the internet becomes more pervasive, it continues to shape global culture. Moving forward, internet growth will come mainly from developing countries. The internet powerhouses, Google, Facebook and Amazon, will look to user-friendly interfaces to serve these new users. Voice controlled devices will serve well, especially for those countries with lower levels of literacy.

Industry-Research

How well are digital brands meeting consumers’ hierarchy of digital needs?

April 17, 2019 Rande Price, Research VP – DCN

Innovation fails when it does not meet the needs of people. In its new report, Digital Society Index 2019: Human Needs in a Digital World, Dentsu Aegis Network examines just how well digital technology is working for all people in society. The research, conducted with Oxford Economics, surveyed over 43,000 people in 24 countries across three key dimensions of the digital economy: dynamism (its strength), inclusion (its range of access) and trust (in data usage).

Overall, the research shows the digital economy as a glass half full. A number of countries show a positive balance between dynamism, inclusion, and trust. Importantly, for these countries, the future of the digital economy is viewed in a positive light. However, the misuse of data (64%) is a hot button driving declining trust in technology.

In fact, the decline in consumer trust helped drive the UK’s overall Digital Society Index ranking drop from first to fifth. Other factors include that consumers in the UK think that technology companies do not pay enough taxes (36%) and are establishing an unbalanced society by creating excessive wealth (28%).

In order for digital technology companies to build a positive digital economy, Dentsu developed a new framework, based on Abraham Maslow’s work on the hierarchy of needs. It examines products and services across people’s needs. The framework includes four perspectives: basic needs, psychological needs, self-fulfillment needs, and societal needs.

The Digital Needs Model

Basic needs are the necessary preconditions for people to engage with digital products and services. Dentus identifies basic needs as access to a quality digital infrastructure (internet and mobile connections) as well as the trust that personal data will be used responsibly by businesses and the government. Less than half (49%) of consumers worldwide (and 43% in the US) believe their basic needs of people are being met.

Psychological needs include the impact of digital technologies on consumers’ health and well-being. It’s about the healthy balance of personal technology on the overall quality of life. Digital tech is helping people manage their lives from shopping to doctor health monitoring online. However, technology can be a double-edged sword, allowing for errands and efficiencies as well as the increase in obsessive online behavior.

Self-fulfillment needs center on having the skills, education and opportunities to find rewarding work. Consumers show concern about their fulfilment in terms of learning new digital skills for educational or career purposes. Less than half of all consumers (45%) feel they are prepared in their usage of digital technology. These research findings suggest that employers are not doing the best job in training their employees. One in three people cannot recall the last digital training (if any) they received. Importantly, companies need to build people’s digital skills and employability to establish positive personal fulfillment.

Societal needs offer opportunities for technology to help close the digital divide. Consumers are optimistic that digital technology can aid in positive changes in the world. In fact, just less than half of those surveyed believe that digital technology will enhance society to help solve key global problems.

Consumer Behavior

Dentsu’s research also presents behavior of new digital consumers. These digital natives are more likely to take control of their online footprint by installing ad blockers, controlling the amount of data shared and limiting time spent online. Still they are active online consumers. They are also the most likely to shop online, use an app to take a taxi or stream music.

It’s important for companies and brands to understand the digital audience in terms of their attitudes towards the digital economy. Dentsu’s digital needs model offers a framework to inform product and service strategies from marketing to communications. The digital marketplace must strive to guide technology’s development to ensure consumers are not left behind by digital growth.

Industry-Research

Community connection drives local news engagement, though support lags

April 10, 2019 Rande Price, Research VP – DCN

Financially, it’s not the best of times for many local news companies in the U.S. Revenue losses continue as local publishers’ transition to digital platforms. While financial sustainability remains in question, overall findings from the new Pew Research Center survey show that consumers are engaged with local news. The favorite go-to for local news is TV (41%) with online access following closely behind (37%). About one in ten prefer a printed newspaper (13%) or radio (8%) for their local news.

Unfortunately, despite their reliance on local news, Pew’s research also reveals that consumers are not aware their financial woes. Seventy-one percent of U.S. adults think that their local news media is doing very or somewhat well. Yet only 14% directly pay a local news source either through subscription, donation or membership.

Digital access

Going online for local news is a common practice for nearly all Americans. A full 89% get some of their local news digitally. This breaks down almost equally between those accessing websites and apps (26%) and social media (25%) I

Mobile is a big driver of reading local news online. Just over half (51%) of those surveyed consume local news on mobile devices, 27% on desktop/laptop, and 19% use both mobile and desktop. News alerts also factor highly into usage. Forty-two percent of consumers consume local news alerts on their mobile phones.

Community focus

Local news plays an important role in the community. Eighty-five percent report that it is important (very/somewhat) for local journalists to understand the history of the community. Eighty-one percent think it’s important (very/somewhat) for local journalists to be personally engaged in the community.

In all, almost two-thirds of consumers (63%) report that local journalists are in touch with their community. However, far fewer (37%) feel that local journalists are influential in the community. Not surprisingly, people who view their local journalists as connected to the area give their local news media higher ratings than those who do not.

The survey shows a key function of local journalism is to provide news to help local residents navigate their daily lives. Top news topics important to daily live include weather (70%), crime (44%), traffic (41%) and news about changing prices (37%).

Strong performance

The majority of consumers report that their local media is doing well on the job. Seventy-one percent say local media is reporting the news accurately, providing “news that you use daily” (67%), “keeping an eye on local political leaders” (66%), and “reporting news thoroughly” (65%).

Local news often tells the inside stories of communities. It plays a unique role ensuring news is relevant for a local audience. Importantly, innovation is in the works for local digital news. A number of industry initiatives are underway. Google recently announced their Local Experiments Project, a new partnership with McClatchy to fund the creation of three local digital-only, multi-platform publications. Facebook is also investing $300 million in journalism projects including a non-profit venture that focuses exclusively on local reporting. In each of these initiatives, publishers are part of the digital transformation of local news to ensure the presence of community engagement.

DCN-Research

Consumers are unaware of many of Google’s data practices

April 5, 2019 Rande Price, Research VP – DCN

Numerous privacy scandals fueled the need for increased examination of tech companies’ data tracking practices. For years now, the practice of data collection, data mining techniques and practices and the potential violations of consumer privacy have been questioned. However, it wasn’t until the Facebook and the Cambridge Analytica scandal that consumers realized the value of their personal data.

Cambridge Analytica was by no means an isolated case. Last summer, an Associated Press investigation found that Google’s location tracking is never really disabled. Tracking continued, even if you turn it off in a number of Google apps, including Maps, Search, and others. Further, research from Professor Douglas Schmidt of Vanderbilt University found that Google engaged in “passive” data-collection often without the user’s knowledge. His study also showed that Google utilized data collected from other sources to de-anonymize user data. This is why DCN wrote this column, “It isn’t just about Facebook, it’s about Google, too” in the Washington Post when Facebook first faced Capitol Hill. It’s also why the description, Surveillance Advertising, has now stuck to describe Google and Facebook’s businesses.

With consumers on alert, news of Google’s violation of personal data practices are not fading. Understanding that trust is a result of delivering on expectations, DCN surveyed a nationally-representative sample* to find out just exactly what people expect from Google. As with a similar study we conducted last year that measured consumer expectations of Facebook, the results were unsettling.

Google uses personal data to tailor and micro-target ads, from which most of its $135 billion revenue comes. Unfortunately, our findings show that many of Google’s data practices deviate from consumer expectations. We recognize and find it even more significant that expectations are likely at an all-time low after the year that was 2018.

We asked consumers if they are aware that Google’s data practices include the following. Here’s how many said no:

Google’s personal data collection practices affects more than two billion consumers who use devices that run Google’s Android operating software and hundreds of millions more of iPhone users who rely on Google for maps or search. Most of them expect Google to collect some data about them in exchange for use of services. However, as our research shows, an alarming number of consumers are unaware that Google tracks their activities across the web on other sites and platforms, even when they turn off the tracking defaults. With new laws in Europe, California and federal discussion about how to bring similar protections to the rest of America, it’s critical to understand what consumers actually demand, align expectations to those demands and rebuild trust in our industry. The public shouldn’t expect anything less.

*ORC International Online CARAVAN®, 1004 Adults 18+, March 21-24, 2019.

Industry-Research | Revenue

Paywalls and events are among the many strategies publishers are taking to diversify revenue

March 26, 2019 Rande Price, Research VP – DCN

Innovation is the key driver of sustainability and financial viability. This is why successful publishers are developing and testing new products, offerings and revenue models. A new report, 50 Ways to Make Media Pay, by Professor Damian Radcliffe of Oregon University in partnership What’s New in Publishing, offers an overview of 50 different revenue opportunities. It’s a collection of strategies—from paywalls to advertising tools, events, and commerce. Some are new ideas while others are not. It’s the collection and the variety of the revenue diversification options and the links to publishers executing these strategies that make this report so valuable.

Professor Radcliffe highlights the pivot to paywalls and a focus on reader revenue as a new norm. The New York Times, The Washington Post, The Financial Times, The Wall Street Journal, The New Yorker, and Bloomberg are some of those offering subscription products. Following its move to put Wired behind a metered paywall, Conde Nast has announced plans to follow suit with its other magazine brands.

One thing that paywalls offer (in addition to recurring revenue) is the opportunity and flexibility of real time learning.

Paywall Types

Publishers are experimenting with a number of different types of paywalls:

Hard paywalls will not allow consumers access to content without a subscription. Both The Financial Times and The Wall Street Journal use hard paywalls.

Metered paywalls allow users to read a set number of free articles before the user must pay the publisher (subscribe). Reducing the amount of content that audiences’ accesses for free is one way to try and drive consumers into paying for the content.

Hybrid paywalls offer some free content to users while other sections are secure behind a hard or metered paywall.

Vertical-only paywalls allow subscribers to pay for a standalone access to a vertical like sports, entertainment or food section.

Geo-location paywalls use IP addresses to identify users’ locations. Different locations may have different paywall limitations. A local audience may have more access and free articles than a user outside the local (target) area. This type of audience identification is often attractive to advertisers targeting a local audience.

Print and digital bundling began as a method to build digital subscribers. Originally, it offered loyal print subscribers, especially newspaper, a discount for digital access. Now, the tables are turned. In order to get the print product in front of more eyeballs, many offer free (or heavily discounted) print access to digital subscribers.

Online surveys offer a trade-off of user information for free content. There’s a consumer willingly to answer questions about themselves for free access. User information is a valuable commodity, especially to advertisers.

There’s also the pay-as-you-go strategy of micropayments. This approach enables readers to consume content one article at a time. Blendle, a journalism startup in the Netherlands, partners with many leading Dutch publishers to offer a micropayment plan.

Memberships offer new opportunities for publishers. It’s particularly relevant to a mission driven publication. Memberships offer the newsroom a chance to build a closer relationship with its members (readers). Memberships often offer access to bonus content and special events. Slate Plus is successful using this membership model.

Events

In addition,events are a solid revenue source for publishers. They can also act as a great marketing tool to attract new audiences and subscribers. Events allow for live interactions between the publisher and its audiences. A number of publishers are quite good at hosting an invite only industry offering with high level networking opportunities. (Think of Digiday’s Recode and FT’s Ignition.)

Live events and recordings include big ticket interviews of industry or popular icons (e.g. Hillary and Bill Clinton and Michelle Obama). Popular radio show events offer consumers the chance to watch a taping of the show in a live studio setting. Two radio shows, This American Life and Radiolab, completed successful live tours across the U.S.

Happy hours and socials are great vehicles to attract and build an engaged reader community. At these events, attendees have an opportunity to talk to journalists about a relevant and/or current topic. Events can be lucrative for small publishers too. Billy Penn, a Philadelphia based digital news outlet, reports that events constituted 80% of its revenue.

Publishers need to evaluate the brand relevance and potential of each revenue strategy. What works for one publisher, may not work for another. Experimentation is key to learning the best approaches for publishers to monetizing their content and first party relationship with their audiences.

Industry-Research | Innovation

Smart speakers offer publishers new revenue opportunities

March 20, 2019 Rande Price, Research VP – DCN

Publishers are using voice technology, such as smart speakers (e.g. Alexa and Google Home), to create new connections with their audiences, particularly younger consumers. It’s also a great way to develop new revenue opportunities. According to the new INMA report, Audio Opportunities for News Media, publishers are building audio resources to allow dynamic content or ads insertion into voice-enabled devices.

The report includes a number of market estimates of ownership and media usage. For example, according to the International Data Corporation, smart speaker adoption will grow worldwide from 99.8 million in 2018 to 230.5 million in 2022.

INMA’s research also cites TMG Media, which reports that one-third (33%) of those owning an audio device, own more than one. Media habits of audio device owners show that 45% are listening to less radio, 38% are using their smartphones less, 32% are reading fewer magazines and newspapers and 29% are watching less TV.

In addition, Edison Research and NPR found that 43 million Americans own a smart speaker. This audience is open to new media experiences. In fact, 81% of them are open to new smart speakers features created by brands. Twenty-two percent of these users also like brands that create skills/features on smart speakers, stronger than any brand activity on TV, radio, and podcasts.

Case Studies

A few news publishers are building their audio assets internally or using third party on-demand audio platforms to distribute their new content to audiences (full detailed case studies in report).

The Financial Times

The Financial Times (FT) debuted its News Briefing, a daily news offering, optimized specifically for smart speakers. They also produced an interactive documentary, FT Hidden Cities Berlin, in partnership with Google and available exclusively on Google Home. FT estimates at least 60% of their listeners are non-subscribers to their print and/or digital products. FT views the usage of smart speakers as a new opportunity to experiment with content to grow subscribers. Further, smart speaker listeners are a younger audience, often a difficult segment for FT to target.

Alastair Mackie, head of audio for commercial at the FT believes that creating content for the smart speaker allows FT to be innovative and engaging while present itself as a digital first’ media company.

The New York Times

The New York Times’ T Brand Studio produces ad-sponsored and stand-alone podcasts. It launched The Daily, a 20-plus minute daily news podcast and radio show, in 2017. It’s widely popular and a strong advertising vehicle in the marketplace. New audio content in the works at The Times includes a daily flash briefing, an interactive news quiz, and enhanced coverage of its Sunday newspaper. Sebastian Tomich, global head of advertising and marketing solutions, thinks smart speakers offer a great opportunity to test audio content and learn about audience engagement while generating revenue.

The Times is also investing in teaching consumers how to use audio commands with step-by-step instructions.

Audio smart speakers are changing consumer habits and news media companies are beginning to invest in audio tech to produce on-demand audio content. They believe it offers great branding and marketing opportunities and can help generate additional advertising revenue. It’s a ripe time to invest in audio content as smart speaker owners are spending more time listening to on-demand news, music, podcasts, and books.

Industry-Research

Audio audiences are on the rise

March 12, 2019 Rande Price, Research VP – DCN

Podcasts helped reinvented the audio audience, attracting new listeners to a robust supply of binge-worthy news and entertainment content. Now consumers can listen to what they want, when and where they want. While podcasts had been around for over a decade, in 2014 they received an explosion of attention in the marketplace (with the incredible success of Serial and the debut of Apple’s podcast App).

Today more than 50% of people have listened to a podcast. In fact, according to the 2019 Infinite Dial Study by Edison Research and Triton Digital, at least one-third of the U.S. population reports listening to a podcast in the last month, up from 26% a year ago. That’s an estimate of 90 million people each month. Monthly podcast listening increased across all age groups year-over-year. Interestingly, adults 55+ report a significant increase in podcast listening from 33% in 2018 to 40% in 2019. Other demographics show smaller increases, persons, age 12-24 from 88% to 91%, and persons 25-54 from 73% to 74%.

Weekly podcast listening is up to 22% from a year ago (17%) among persons 12+, or 62 million people each week. Podcast listeners listen to approximately seven podcasts a week.

In addition, there are now 189 million listeners to online audio which includes listening to AM/FM radio stations online and/or listening to streamed audio content available only on the. In fact, online audio doubled since 2012 increasing from one-third to two-thirds of the U.S. population. Weekly listening to online audio is also growing, now at 60% from 57% last year. Weekly time spent listening to online audio shows a strong increase from 13 minutes 40 seconds to 16 minutes until 43 seconds.

Podcasting is not the only audio opportunity content creators should be focused on these days. Smart speaker ownership has reached 23 million, up from only 7 million two years ago. Amazon Alexa dominates the market (16 million) followed by Google Home (7 million). Audiobook listening is also on the rise, with million people saying that they’ve listened to one, up from 44 million in 2018. And while AM/FM radio still dominates in-car audio, both Online audio and Podcasts rose slightly. Audio is an opportunity that smart publishers are listening to.

As Tom Standage, head of digital strategy and deputy editor at The Economist, put it: “The commercial model for podcasts is really good, much better than video pre-roll, which is a horrible business. Video is expensive to make, and the CPMs are low. Advertisers want to reach podcast listeners.”

Industry-Research

Password mooching costs streaming services millions in monthly revenue

March 6, 2019 Rande Price, Research VP – DCN

Subscription mooching is a common practice in today’s streaming ecosystem where people borrow subscribers’ logins to access services like Netflix and Hulu rather than paying for them. To understand the magnitude of password sharing, the website, Cordcutting.com conducted a survey of over 1,000 people ages 18 to 81 to examine who is really paying for streaming subscription services. The new report, Subscription Mooching, shows that nearly 20% of users of the major streaming services are borrowing logins from subscribers.

According to the research, 19% of Hulu viewers use someone else’s login, as do 17% of Amazon Prime Video viewers, and 15% of Netflix viewers. Not surprisingly, parents are the most frequent source of shared passwords for Netflix and Amazon Prime (32% each, respectively) while significant others are the main source of password sharing for Hulu (26%).

The television landscape is changing with only 7% of viewers subscribing to cable TV and 30% subscribing exclusively to video streaming services for their media consumption. In total, approximately 68% of people use cable TV and 92% use a video streaming service.

Lost revenues

Of course, many streaming services allow simultaneous streaming on multiple devices. However, each treats the sharing of account credentials differently.

The amount that moochers avoid paying varies. On average, people borrow a Netflix subscription login for 26 months. At the lowest subscription plan price of $7.99 a month, a person can save $207. Interestingly, a login is borrowed for Amazon Prime Video for approximately 16 months, saving on average $144. A login borrowed for Hulu is used the shortest amount of time, approximately 11 months, saving an individual $88.

While sharing an account login can provide a consumer savings, it comes at a substantial loss for the streaming services. The research uses the difference between the total number of subscribers and the total number of users in order to project the potential revenue loss. According to this report, Netflix is losing approximately $192 million every month or $2.3 billion a year. Hulu and Amazon Prime Video average between $40 and $45 million in estimated losses each month or approximately $0.5 million per year, respectively.

Converting the Moochers

Trial usage appears to be a good source of conversion. Approximately 59% of people are willing to pay for their own Netflix subscription if they are no longer able to access a shared login. While significantly less than Netflix, 38% of Hulu and 28% of Amazon Prime users are willing to subscribe if they are no long able to access a borrowed login.

Login sharing does offer some retention value. It’s hard for consumers to cancel their subscription if they know others are relying on them for access. Marketing and retention factors aside, streaming services need to address password sharing in order to grow their market share, especially among millennial and generation X audiences.

Industry-Research

Understanding the role of relevance in news consumption

February 27, 2019 Rande Price, Research VP – DCN

Today’s consumers navigate a high-choice multiplatform environment to find their news content. Understanding their news consumption habits – what’s relevant to them, and why they read what they do – is a complex process. However, while data rankings show which stories are clicked on, shared, and liked the most, there’s little information about why consumers choose to read the content they do. Kim Christian Schrøder’s new report from The Reuters Institute for the Study of Journalism, What do News Readers Really Want to Read about?, delves into the process by which consumers choose the news the consume. The research evaluates the ways in which people are drawn to news, how it helps them make sense of their lives, and shapes their views of the world.

Relevance is a key driver in consumer decision-making on news content. Ultimately, perceived relevance determines whether consumers end up engaging with a particular news story.

Examples of relevance include if the news is:

The factors that drive and define news relevance.

personally relatable, the potential impact on one’s own life and family
socially shared or sharable
stories that speaks to a more general, perhaps civic nature
known news brand
familiar, the headline and/or sub headline provides enough information

Understanding the role of relevance helps explain why important news stories may not always rank according to national interest. Article rankings are often algorithmically charged by the number of “likes” and “shares.” While social indicators often increase visibility, they are not necessarily reliable factors of relatability and quality content.

The four clusters of news readers

In addition to identifying relevance as an important driver, the research also classifies four distinct clusters of news readers according to news preference.

People with political and civic interest in news. This segment is mainly interested in stories about health, education, and the environment.
People with a social-humanitarian interest in news. This cluster like stories with a humanitarian perspective on the world. They also gravitate to news reports on soft politics (e.g. Britain’s royal family).
People with a cultural interest in news. This segment values news stories about children, health, educational issues, and environmental protection. However, they dismiss clickbait articles designed to lure them into reading human-interest and celebrity focused stories.
People who seek (political) depth stories. This segment likes their news from a mixture of general and more specialized news sources. They are big readers and selective in their news sources.

Schrøder provides insight into what drives audience choice when it comes to news consumption. Understanding relevance and its impact on how readers build their personal media selection is an important step in identifying consumers’ news preference. Further, the identification of consumer news clusters offers four distinct reader groups of content preference without imposing the standard news categories. Both set of findings heighten our understanding of how consumers select their news content.