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Industry Research

Industry-Research | Revenue

How to combat ad fraud spikes during the holiday season

The holiday shopping season was once a time of packed stores and crowded gallerias. These days, people are much more likely to stay home and do their shopping from the comfort of their couches. In particular, IAS found that this year, nearly all holiday shopping will be online, specifically on ecommerce and retail sites. So, while audiences watch nostalgic holiday movies, they’ll also be on their phones researching gifts to purchase for their loved ones. 

Unfortunately, consumers aren’t the only ones online — fraudsters also have their sights set on holiday traffic. Invalid traffic (IVT), which includes malicious fraud as well as general non-human activity, has the potential to steal valuable impressions. Since it looks like Cyber Monday will become Cyber Season, publishers should optimize their inventory to both support marketers and thwart fraudsters. 

Unwrapping holiday ad fraud

Shopping online offers a convenience that brick and mortar stores lack: information. In their search for the perfect gift, IAS found that consumers turn to search engines, review sites, and online advertisements. Consumers look to advertisements for guidance, and are most interested in ads they see on well-known and respected sites. IAS research shows that retail sites are especially prone to fraud, witnessing spikes around popular shopping dates like Cyber Monday.

At the same time, holiday season campaigns tend to be short and sweet, only meant to appear in consumers’ feeds for a few months. Longer campaigns give advertisers more time to review and optimize campaign performance. However, during this time, advertisers rely on premium inventory to achieve the ambitious KPIs associated with holiday campaigns. This puts additional pressure on digital publishers to optimize their inventory to minimize risk and maximize performance.

Putting fraudsters on the naughty list

A recent survey of U.S. consumers found that 51% of respondents plan to start their holiday shopping earlier this year. To mitigate fraudulent activity, publishers should also prepare early by optimizing their inventory. Bots can be given instructions to visit premium sites, pick up desirable cookies, and then visit fraudulent sites to monetize. In order to protect the value of their inventory, here are some key reminders for publishers looking to prepare for the holiday season. 

Make a list and check it twice 

✓ Figure out where site traffic originates 

  • The first step in identifying fraud is recognizing where traffic originates. For example, traffic that is sourced from a supplier has a higher possibility of attracting fraudulent bot traffic. Suitable ad environments are powerful, and transparency helps to build a strong relationship between publisher and advertiser. 

✓ Confirm how visitors are attracted

  • If traffic is sourced, there is a higher possibility of fraudulent bot activity. If most traffic comes from data centers, rather than residential or corporate networks, publishers should confirm that there are no software tools being run in those data centers that hit their website. Running tools that drive traffic may result in invalid traffic per industry group standards.

✓ Not all invalid traffic is malicious

  • Some cybersecurity, testing, and analytics solutions employ methods that can trigger fraud detection models from ad verification vendors. For example, some bots are designed to crawl the internet and gather information or generate simulations. Publishers should work with their ad verification vendors to further analyze their inventory and consider adding known data center IPs to an exclusion list. 

Happy holidays

In order to protect the value of their inventory, the publisher needs to analyze traffic patterns and optimize their content appropriately. 

In conclusion, the web is rife with invalid traffic. Some traffic — consumers, crawlers, etc — is such a helpful gift to marketers that it should with a bow. However, there’s a great deal of malicious invalid traffic, the lumps of coal in the industry’s stockings. Such activity on publisher pages can threaten the trusted relationship you’ve built with your advertising partners and cost you real dollars. 

The holiday shopping season is right around the corner, and safe inventory is the best gift to give to your partners. If you’ve detected invalid traffic on your site, then it’s likely that your advertiser partners have too. No need to ring the alarm just yet though. Being proactive and well-informed can go a long way toward ensuring that you and your advertisers present a unified front against fraud.

Industry-Research | Revenue

Publishers show digital growth amidst pandemic closures and consolidations

Digital subscriptions have helped shape a stronger business for publishers. FIPP’s latest Global Digital Subscriptions Snapshot (Q3 2020) shows that subscriptions are serving to support publishers during the pandemic. In fact, research by Press Gazette reports that during the Covid-19 crisis the largest newspaper groups in the US and UK gained more than one million new digital subscriptions. Not only are large publishers faring well but smaller, regional and specialist brands are also showing record subscriptions.

Despite positive performances in digital subscriptions, Covid-19 brings with it challenges to the industry. Zenith Media expects a 9% decline in internet ad spend this year. The agency estimates a 6% recovery in 2021, driven by the rescheduled Tokyo Olympics.

On a global front, the middle east and Africa will be hardest hit with a 20% decline in advertising revenue. Western Europe anticipates a 15% decline and Latin American a 13% decline in ad spend. The Asia Pacific, Central and Eastern Europe markets are estimated to decline by 8%, respectively. North America expects to register the smallest decline (7%) due to the large spend on political advertising this year.

FIPP Q3 findings:                                            

News publishers’ subscription growth

  • The Athletic reports 1 million subscribers as of September 2020. Unfortunately, with only a few new subscribers in Q1 2020 and cancellation of live sporting events, the company laid off approximately 8% of its staff. In addition, there were pay cuts across the company to offset expenses.
  • Caixin Media in Beijing grew subscriptions by 70%, adding 210,000 new subscribers for a total of 510,000 this year. It’s the first media company in China to place all of its content behind a hard paywall.
  • Dow Jones reports that digital revenue now accounts for 71% of total revenue, up from 63% compared to the same time period last year. Total subscriptions, across print and digital products, is at 3.8 million, driven by a 28% increase in digital subscriptions. Interestingly, 2.2 million of the Wall Street Journal’s 3 million subscriptions are digital-only. Across the entire Dow Jones group, digital subscriptions account for 67% of subscription revenues.
  • Gannett is centering their business around digital transformation. To date they are close to one million paid digital subscribers.
  • The New York Times’s added 669,000 new digital subscriptions in 2Q 2020 for a total 5.7 million digital subscriber. In fact, for the first time ever, digital revenue now exceeds its print revenue. Overall, the company’s operating profit of $52.1 million is down 6.2% compared to same time period one year ago.

Magazine closures

  • South Africa magazine closures:
    • Associated Media – company closure
    • Caxton – selling off 80 titles
    • Media 24 – closed 2 of 5 titles
  • UK magazine closures:
    • Immediate Media – closed 11 titles
    • Bauer Media UK – closed 10 titles
    • Broadly – exited New Zealand, closed 8 titles and consolidated with Australian Mercury Capital
    • PLC – closed 6 titles
    • T1 media was acquired by Future

Streaming growth

  • Netflix consistently delivers content with new productions and licensing deals to the consumer market. As of Q2 2020, there are a 193 million subscribers globally.
  • Amazon Prime Video, part of Amazon Prime, is very successful in the SVOD market. Subscribers reached 150 million globally.  The company does not break out Prime Video from Amazon Prime. The company does not provide details on active users of Prime Video. However, the Kantar Entertainment on Demand Report offers a third-party analysis SVOD users. The Kantar Q2 2020 analysis shows that Amazon Prime Video subscriptions account for 23% of all SVOD subscriptions. That marks a 14% increase from the prior quarter. 
  • China’s merger discussions between Tencent Holdings and iQIYI could establish the world’s largest streaming service with more than 231 million paying subscribers.
  • Disney+ is exceeding all expectation with currently has more than 60.5 million subscribers.
  • Apple TV+ claims 10 million subscribers. However, many subscribers are part of a 1-year free trial offer because they are users of the hardware. Further, Bloomberg estimates that about half of Apple TV+ subscribers never used the service.

The coronavirus’ impact on the advertising industry further strained publisher revenues and forced several to close their doors and others to consolidate. The pandemic also showcased the consumers’ need for trusted news and entertainment content. This need feeds into the relationship of publisher and consumer. Its why consumers value the content and are willing to pay for it.

Industry-Research

Parks’ latest OTT Market Tracker digs into Disney’s decision to skip theatrical premieres

New research from Parks Associates’ OTT Video Market Tracker shows that through Q3 2020, the number of OTT video services in the U.S. has more than doubled since 2014. The market now includes nearly 300 different services. The rate of closure has also declined. It reached a peak in 2018 when 19 services left the market. However, only six have ceased operations in 2020 so far.

Notably, Parks’ latest report examines the impact of Covid-19 on the longstanding practice of theatrical windowing. Many studios have put off premieres until 2021. However, Disney opted to debut two films on VOD, except in markets where its Disney+ service had not yet launched.

Impact on theaters and OTT competitors

As the report points out, Disney+’s Premier Access program initially bypasses all of the major services in the OTT space. It provides a single direct access point to viewing a piece of premium and exclusive content. As such, it not only directly competes with theaters but leading OTT services as well. It looks like Disney’s Premier Access concept is impacting the transactional VOD system and customers alike.

Disney’s strategy with Premier Access is two-pronged:

  • Drive incremental revenue among existing Disney+ subscribers. They are much more likely than non-subscribers to pay a premium on top of their monthly subscription fee to get exclusive access to a Disney-produced first-run movie;
  • Drive incremental Disney+ subscriptions among households with younger children who are interested in seeing a blockbuster title from Disney but do not yet subscribe to the service.

Long-term industry impact

Other subscription-based OTT services that produce and distribute original movies, such as Netflix and Amazon, have circumvented the traditional content windowing process with movie theaters, physical media, and other VOD platforms for years. Whichever path Disney takes for its upcoming blockbuster titles, the precedent has been set with the development of its Premier Access program.

The full financial picture has not yet emerged, despite the early success of Disney+. It will be interesting to see whether other studios follow suit and test major OTT premieres. And, of course, the entire industry is watching to see whether this was a short-term strategy to address the impact of Covid-19 or becomes a transformative trend in the film and video industry in the long term.

Industry-Research

Covid-19 presents opportunities for audience-focused publishers

A life-changing event is when something happens that reshapes everything in your life. And many people see the pandemic as a life-changing event. We’ve altered our work environment, transformed our social behavior, and changed our media habits. However, according to Damien Radcliffe’s new report The Publisher’s Guide to Navigating Covid-19, some Covid-era changes will become new norms. To capitalize on these opportunities, publishers need to emphasize their audience-first focus.

Key findings:

Renewed consumer focus

Businesses across different sectors are reporting negative financial impact due to Covid-19. The most significant revenue declines to date, according to WARC, are travel and tourism (-31%), leisure and entertainment (-29%), finance services (-18%), and retail (-15%).

Within the entertainment sector, the media business is showing financial declines for the year. GroupM expects the US advertising market performance to decline 13% this year (excluding political advertising for 2020’s presidential and other elections). WARC estimates advertising growth for three specific media platforms: social media, online video and search. The hardest hit medium will be newspapers. PwC’s Global Entertainment and Media Outlook 2020-2024 report estimates newspaper advertising (print and online) in the U.K. will register a decline of 27% over the next five years Global Entertainment and Media Outlook 2020-2024 report estimates newspaper advertising (print and online) in the U.K. will register a decline of 27% over the next five years.

With a downturn in advertising, publishers see the importance of a renewed focus on the audience. By doing so, they can accelerate their efforts to establish new revenue streams to lessen their dependency on advertising — an industry imperative that has come into even sharper focus of late. Finding the right path to fulfill audience needs can help publisher identify new revenue opportunities.

Audience-first directs path to new revenue

By all reports, consumption of content increased during the pandemic. In part, working from home during Covid-19 offered the audience more opportunities to consume content. There were marked rises in internet usage and streaming video viewing. Even local news publishers are benefitting from consumer interest in information relating to Covid-19 in their neighborhood.

Further, record traffic metrics and increased subscriptions illustrate a strong and trusted relationship between publisher and consumer. Publishers are also experiencing churn improvement according to Piano, a digital analytics company. Piano’s data analysis shows that U.S. publishers’ churn rate is flat and European publishers’ churn rate declined 34%.

Unfortunately, increased media usage alone does not equate to increased revenue. However, an engaged audience, producing less churn, can help direct a path to subscriptions, new product launches, and other monetization opportunities.

Getting back to normal

Even amidst the ongoing pandemic, consumers are trying to return to some sense of normal. According to a GlobalWebIndex (GWI) survey of more than 17,000 internet users in 20 countries, consumers no longer want to see Covid-related ad messaging. Further, Pew Research reports that 71% of US consumers say they need to take a break from news about the coronavirus. A full 43% report that news leaves them emotionally drained. Consumers are seeking out new content as a pathway to escapism.

Without a doubt, the pandemic has profoundly impacted consumer media habits. The increase in content consumption and subscriptions, cannot be taken for granted. Consumer boredom and discretionary income can easily change given today’s social and economic vulnerabilities. By renewing their audience-first strategy allows publishers will be able to focus on avenues for new revenue.

Industry-Research

Learning from past events to prepare for election day coverage

As the U.S. presidential election nears, it’s logical that global publishers want to understand the strategies that can encourage stronger reader engagement. Pivotal, high traffic events that truly showcase their content only come along so often.

With that in mind, we looked back at our analysis of reader engagement trends during major events — including the 2016 U.S. presidential election and Brexit vote — to see how audiences tend to interact with this type of unique content. More on our research, along with its implications for publishers, below.

Honing in on audience behaviors before, during, and after events

For the sake of this research, we wanted to put ourselves in the position of publishers for this upcoming election. More specifically, we analyzed data around three major timeframes: before, during, and after the event. These tend to offer the opportunity to reach and engage more readers.

Thinking about pre-election content strategies 

There’s no doubt that direct, search, and social traffic have a significant role to play in audience development efforts during major events. However, it’s just as important to understand when they can be most effective.

Our data suggests that the majority of referral traffic in the days leading up to an event will be coming from search, as we show below. This aligns with reader behaviors we saw during the 2016 election. Search traffic was highest leading up to and during the election. In contrast, social traffic didn’t increase until hours later, when reactions (emotions, hot takes, opinions) to the news are more likely to dominate those channels. As such, we see this as a critical opportunity to reevaluate SEO and referral linking strategies in order to maximize traffic during the event. 

How audiences seek and interact with content during events

We’ve also seen that loyal readers will likely come directly to publishers once a story breaks or more details emerge. Meanwhile, the majority of newer visitors will find coverage amid a search results page. This is where pre-election SEO efforts should pay off. It could be the difference between content being seen first or buried among other outlets’ coverage.

This is also where publishers can start to get promotional channels such as social media involved. It’s critical that all visitors, new or loyal, are made aware of a publisher’s stated differentiators during major news events. That could be a “dedication to the facts” or a local angle on the event. Publishers have the ability to gain new visitors without alienating their direct, loyal readers. 

Building trust with new and returning readers is important any time. However, now you have a chance during periods of higher-than-usual traffic. Loyal readers consume more than double the content of non-loyal readers. So, the experience you provide today will increase the likelihood they come back again.

Prioritize experimentation with different article formats. When we recently conducted research across COVID-19 related content, we found that the up-to-the-minute appeal of live blogs garnered significant reader attention. We also saw that pattern reflected in our 2019 Most Engaging Stories, where live blogs during major events such as Brexit were among the top articles.

Social media as a means of engaging readers post-event

The two previous sections highlighted search optimizations as a point of emphasis before and during the election. When it comes to post-event engagement tactics, our analysis suggests that social media offers a strong opportunity as traffic picks up again in the event aftermath.

Let’s use Brexit as an example. We analyzed multiple articles and angles that covered the same topic across Google search and Facebook. We found that the coverage and subsequent audience behaviors aligned with the reader behaviors we’ve outlined thus far.

For instance, we see that the most successful stories on Facebook tend to have an emotional, rather than informative, lens. Only a few highly emotional topics, like “Regrets and anger about results,” received significant engagement via Facebook. More factual topics such as “What happens if UK votes to leave” received much more significant engagement via Google search.

Therefore, we’ve seen the benefits of experimenting around sentiment on social media versus a singular “news you can use” strategy that works well in search. This approach can help attract new audiences in the post-event phase of election coverage.

Key takeaways: Planning for election coverage traffic increases

As publishers determine their election engagement strategy, here’s some key takeaways based on our research:

1. Optimize for search sooner rather than later

Consider posting search-friendly content before the election. This way, there’s no doubt that it will be indexed by Google or any other search engine of choice. Meanwhile, review linking strategies to ensure that content is being updated or iterated upon for the best reader journey possible.

2. Lean into coverage strengths

The election will have multiple angles. Even though our research suggests that audiences tend to gravitate towards factual pieces, it shouldn’t limit publishers to a single angle on any piece of content. Give readers the unique storytelling angles and formats they can’t get anywhere else. 

3. Get social when it counts 

Our data suggests that social media traffic will begin to gain traction as long as 12-24 hours after the event. Consider the timing and messaging of content and invest accordingly to have the greatest differentiation and impact on that referral traffic.

When preparing for the election, or any major event for that matter, we see a clear advantage to getting ahead on pre-coverage search and post-coverage social tactics based on the reader interactions we’ve seen before and after the fact. This should also give teams time and flexibility to iterate and experiment during the event, as reader behaviors can rapidly change when it comes to the diverse audiences landing on publishers’ sites.

Industry-Research

Climate change news coverage has declined. The audience for it has not.

It’s 2020, and things have gotten to the point that we may not have the bandwidth to pay attention to all the existential threats we’re facing at once.

In March, the coronavirus pandemic reached a global scale. News organizations around the world focused their coverage on the deadly outbreak and readership reached record levels. But while all this was going on, the climate change crisis continued its steady march. 

News coverage is inherently limited given the resources media organizations have to allocate. And audience attention is a finite resource. So, it’s natural to worry that focus on one crisis may reduce much-needed focus on another. 

However, the data show a more complicated story.

On a high level, U.S. media coverage of climate change has declined since March. Fewer new articles have been published and fewer articles are being read overall. Readership has not followed, however. In fact, the number of readers and amount of page views has not dropped off.

These patterns indicate that there is an opportunity. News publishers can expect higher-than-normal traffic for continued investment in climate change coverage.

(Image via Taboola Newsroom)

This chart shows data from the network of Taboola’s news publisher partners. These include thousands of news websites in the U.S. They range from those belonging to large TV networks to local newspaper chains to digitally native publications and many more. Essentially, it’s a uniquely broad representation of what U.S. news consumers are reading about on the internet.

There’s a lot happening so let’s look at the lines one-by-one.

Articles read and written

The yellow line represents the number of articles consumed by U.S. readers that week which mention “climate change.” There’s a clear drop beginning several weeks before U.S. readers fully turned their attention to coronavirus, which is the green highlighted portion of the graph beginning the week of March 9.

The likely reason articles began dropping a few weeks prior is because news organizations had already begun shifting resources to coronavirus coverage. The number of articles consumed about climate change eventually drops to around 2,000 per week. That is a level below anything we saw in the previous year.

One thing to be very clear about is that our data shows the number of articles being consumed, not the amount of new articles. The drop indicates that there are fewer new articles because news consumers tend to focus on recent updates.

We can confirm this with data from a tool built by MIT and Harvard researchers called Media Cloud. It shows the percentage of new articles per week about topics on a large selection of major U.S. news sites. Media Cloud also shows the production of articles about climate change dropped from the 1.5% – 2% range to consistently under 1% as of early March.

Coverage concerns

Before moving on, it’s worth noting that even 2% to 3% of articles likely isn’t a suitable level of coverage for something dire as climate change. Remember, this topic impacts a wide range of news topics such as public race, health, housing, income inequality, transportation, animal preservation, and much more.

(Image via Media Cloud)

In fact, hundreds of news organizations tried to address this very issue late last year when they joined together in a coordinated effort to increase climate coverage. You can see a spike in both the Taboola and Media Cloud charts in late September 2019, when the Covering Climate Now launched.

For comparison’s sake, the chart below shows what it looks like when the news media rallies its full resources to cover a topic. Significantly, more than half of the articles published—nearly 70% some weeks—mentioned coronavirus from late March until June.

Weekly readers

Returning to our original topic, let’s dig into how coronavirus affected the number of people reading about climate change.

Unlike with articles, the number of weekly readers remains relatively consistent with what we saw in the months ahead of the U.S. outbreaks.

The weekly reader count remains in the 14 million to 20 million range. It hasn’t quite reached 20 million in the past few months. But that could be seasonal as we can see the same was the case during the summer 2019 months.

These numbers align with the findings of a report published in May by researchers at Yale University and George Mason University entitled “Climate Change in the American Mind.” In the survey of Americans taken in April, the researchers found record-tying levels of acceptance that global warming is a serious problem. They also report extremely high levels of concern and interest.

As noted in a New York Times report about the research, author John Schwartz notes that this survey defies a psychological phenomenon called the “finite pool of worry.” This suggests that concern about climate change may wane amid coronavirus because people only have so much attention and energy to dedicate to crises.

Schwartz also found the research defied the expectations of other academics. University of Rhode Island environmental communications professor Sunshine Menezes commented:

“I’m excited by these findings. Taken together, the report’s findings indicate that Americans are reaching, or maybe even have reached, a turning point. They see climate change in their backyards, they recognize the unequal impacts, they increasingly recognize the urgency of adaptation measures, and they want news coverage that tackles consequences and solutions.”

Page views per week

The story for weekly page views was similar to the one for readers. The weekly totals remained relatively similar after coronavirus took over the news. We saw a range of 30 million to 50 million page views per week about climate change remain steady. If you’re an audience growth strategist for a news website, your ears should be perking up right now.

(Image via Taboola Newsroom)

With fewer articles in circulation about climate change and a consistent audience with a consistent appetite for coverage, supply and demand suggests there’s an opportunity to take advantage of the dearth of new articles.

This chart shows how the amount of page views per article mentioning climate change has increased significantly in the coronavirus era.

The founders of Covering Climate Now picked up on this trend anecdotally in a report they published in June entitled “The Climate Emergency Won’t Wait for the Press to Play Catch-up.”

“The public sees the urgency and actually wants more climate news. Even during the peak of coronavirus coverage in April, some of the world’s biggest news organizations told us that their audiences had little appetite for stories that weren’t about the virus, with one exception: climate change, which continued to generate significant traffic.”

Advertising | Industry-Research

The industries surprising us with their ad spend in correlation to Covid-19

There is no doubt that Covid-19 had a negative effect across industries. However, some sectors, including Consumer Packaged Goods (CPG) and bicycle brands, have actually done well during this time. Throughout the pandemic, these industries have experienced significant and unprecedented increases in sales. With those increases, the same industries upped their advertising spending as well. 

Here at MediaRadar we took a deep dive looking for industries that have increased ad spend levels in response to Covid-19, as well as those working towards a recovery. Back in June, we analyzed how the ad industry fared during the pandemic, highlighting the industries that had just begun bouncing back. Now, three months later, we’ve reassessed how those industries, plus others, are progressing. Based on what we’ve found, things are continuing to look up. 

Industries that increased ad spend

Pet brands – Pet adoptions experienced a dramatic increase during the pandemic. In fact, the Humane Society noted that in March and April there was a 34% year-over-year (YoY) increase in the number of pet adoptions. Capitalizing on this trend, pet brands (i.e. pet food, grooming supplies, etc.) upped their advertising, with the most recent weeks spend gap showing that pet brands’ ad spending has jumped 52%, YoY. 

Bicycles – Covid-19 caused many to avoid public transit. It also afforded people more time to take bike rides for leisure and as alternative exercise to gyms. These are just some of the reasons why consumer interest in bicycles significantly spiked during the pandemic. Since March, ad spending from bicycle brands is up 56%, YoY. As a matter of fact, the N.P.D. Group, a market research company recently reported that in March, sales of commuter bikes was up 66%, YoY, and sales of leisure bikes was up an incredible 121%, YoY. 

CPG products – As consumers have become extra cautious, and care more than ever about cleanliness, bath and shower products, such as body wash, soap and hand sanitizer have increased marketing efforts. Since March began, ad spend from bath and shower products is up 81%, YoY. Unilever reported that in Q2 of 2020, body wash sales increased 12%, hand soap sales increased 155% and hand sanitizer sales increase was off the charts. Ad spend from home fragrance brands are also up 51%, YoY. Since March began, every week except for one, ad spend in the CPG category is up when compared to its 2019 counterpart. If you’re going to be stuck at home all day, it might as well smell nice.

Commercial furniture –  It probably comes as no shock that as the world was forced to work from home. Thanks to Covid-induced lockdowns, the commercial furniture category saw an extreme increase in ad spend. According to a survey by YouGov, 54% of office workers didn’t have any sort of home office set-up before the pandemic. With everyone now purchasing office furniture for their homes, commercial furniture ads, normally reserved for the world of B2B, have entered the B2C sphere. Year-to-date, ad spend from commercial furniture brands is up 225%, YoY, with no signs of slowing down. 

As reported on DCN in June, additional industries to increase their advertising spend in response to Covid-19 include RVs, food subscription boxes, video games, skincare and childrens toys. Each of these industries is still outspending their 2019 levels, with food subscription boxes jumping 235% and RV’s jumping 378%, YoY, since April, respectively. 

Industries on the Mend 

Automotive – The automotive market continues to slowly but surely recover, as ad spend nears levels similar to last year (2019). During the week of August 10th, automotive ad spend was down just 8%, YoY; the industry’s best mark since the pandemic began. For automakers who are still reporting sales, results are getting better by the month. While Toyota’s sales were down YoY in July, they were still at their highest point since the pandemic began. Also in July, Kia and Hyundai were both roughly flat, while Mazda’s sales were up 3.4%, YoY.

Hospitality – Hotel brands seem to have found a new equilibrium for weekly advertising. Since mid-June, ad spend levels have consistently remained around $4M per week. While this is up nearly four times when compared to April and May, it remains down by about two thirds, YoY. According to STR, a hospitality industry data firm, US hotel occupancy for the week ending August 15th was at 50.2%. While this remains down 30%, YoY, it was the 17th week of increases in the past 18 weeks. 

Bars & Restaurants – Bars and Restaurants are seeing ad spend slowly return to levels consistent with last year (2019), with national chains being the main drivers of the recovery. During the week of August 10th, ad spend was down only 10%, YoY, its best level since mid-March. According to NPD, customer transactions at major restaurant chains were down 44%, YoY, in mid-April, its worst point. But, after 21 weeks of being down double digits, sales were down just 9% during the week of August 10th, signifying major improvement. 

Electronics – Consumer electronics experienced a major spike in sales during the early days of the pandemic, however, it quickly fell off. Best Buy reported a surge in sales as consumers transitioned to work from home, with online sales alone up 242% in Q2, YoY. However, Best Buy’s executives were quick to say this was a temporary spike as people adjusted to quarantine life. During the week of June 8th, after ad spending hit a low point of -70%, YoY, spend has been recovering and is now down only 20%, YoY, with sub-categories including cell phones, computers and WiFi equipment helping to drive the recovery. Back-to-school may have provided another boost, as parents are much more likely to be shopping for computers and tech instead of clothes or backpacks this year. 

Shock and recovery

The early days of the pandemic were a shock to the entire country, as well as most of the ad industry. While the road to recovery will not be easy or fast for every industry, our data does show that many are making strides. And while it may not always be the usual players buying up ad space, we’ve found that advertising remains an important part of any industry’s strategy, so long as they have products they can sell.

Industry-Research

Despite Covid-19 setback, PwC forecasts modest media and entertainment growth

Consumer behavior was transformed by the shelter in place lifestyle during the pandemic. Stay at home policies not only impacted the way we work and shop but also how we consume media. We’ve seen significant changes in consumer media habits as well as those of media infrastructure. Closures of movie theaters and shutting down film and television productions altered our entertainment sources.

To access the effects of the coronavirus and adjust the entertainment and media (E&M) forecasts, PwC delayed the release of its annual Global Entertainment & Media Outlook. The new assessment comes with the realization that for consumers, E&M is centered in the home. It’s now more remote, more virtual and more streamed. PwC estimates that in 2020 the E&M world declines by 5.6% or $120 billion in absolute terms compared to 2019. However, they project the sector grows by 6.4% in 2021. Further, overall revenue grows 2.8% at a compound annual growth rate from 2019 to 2024.

Additional findings:

  • Overall, advertising is expected to recover slowly through 2024. Digital advertising is the important vehicle with mobile advertising revenue as its growth story. Mobile ad revenue is expected to grow at 88.4% with a 60% share of revenue.
  • Cord-cutting continues to rise especially in North America and new over-the-top (OTT) services challenge the global dominance of streaming giants. pWC forecasts the OTT market to almost double in size from $46.4 billion in 2019 to $86.8 billion in 2024.
  • Subscription video-on-demand (SVOD) revenue is expected to exceed box office revenue this year. It’s projected to rise more than twice the size of box office revenue by 2024. Related, global cinema revenues are expected to drop plunge 66% in 2020 and is unlikely to regain momentum.
  • Newspaper revenue declines continue through 2024 declining advertising revenue combined with high paper production and distribution costs.
  • Consumer magazine competition continues to increase from major tech players, magazine aggregators and digital publishers.

Covid-19 fast-tracked many new business strategies for media companies. This shift amplifies the need for media businesses to closely follow changes in consumer media behavior. The ability to pivot operations to meet consumer needs helps generate and diversity revenue opportunities.

Industry-Research

Americans are critical of news institutions. That’s not all bad

Good and honest journalism informs the public, increases knowledge, and offers a healthy dialogue on democracy. And, to hold journalists to that standard, Americans believe their wariness of the news media is healthy for society. They think it is a good practice to keep their guard up when obtaining news and information in order to help determine fact from fiction.

Recent findings from a a year-long Pew Research Center study shows that close to two-thirds (63%) of U.S consumers think it’s best if society questions the news media. Nevertheless, half (51%) of consumers are confident that journalists act in the best interests of the public. While this still leaves many consumers less confident, a full three-quarters of Americans believe their level of confidence in journalists can improve.

Trust and transparency

Accurate news information is critical for news organizations. Six in ten consumers expect the news they receive to be correct. However, more than two-thirds (69%) of consumers believe news organization try to cover up their errors. This underscores a distrust of the news media. Many think mistakes occur due to careless reporting (55%), the race to break a story (53%), and a direct intent to mislead (44%). Transparency in corrections is an opportunity to grow consumer trust. Just over half of American’s say that seeing corrections from news organizations makes them more confident in that outlet.

There’s a high correlation between consumer trust and the transparency of a news source. Trust and transparency work together offering a system of checks and balances in accountability. This Pew analysis makes it clear that consumers are concerned with news organizations’ answerability.

Close to three-quarters of consumers (72%) think that the news media does a poor job explaining their source of their money. Sixty percent of consumers report news organizations are not forthcoming about conflicts of interest. In addition, more than half of consumers think the news media lacks transparency in telling audiences how they choose their sources (57%) and whether a story is fact or opinion (55%).

Consumer connection

A personal connection with news stories often leads to positive attitudes toward the news media. Further, more than half (55%) of consumers feel that it is important to connect with their news sources.

However, 59% of Americans report that news organizations do not understand people like them. And 57% believe that their news outlets do not value them. This results in close to two-thirds (63%) of consumers lacking loyalty to their news outlets. Importantly, those who feel that their news source values them, are much more likely to think their news is accurate and to think their news outlet is transparent.

Diverse representation in the newsroom is critical today. Notably, Black adults are more likely than white adults to say different aspects of personal connections with news organizations are somewhat important. They also are far more likely to say it is important to see themselves both in news coverage and in the newsroom.

This Pew analysis highlights the value of consumers and the news media building a connection with one another. Authentic consumer criticism of the news organizations and their journalists can help better inform conversations. It allows for thorough examinations of the facts and provides assurance of truth in journalism.

Industry-Research

Publisher revenue down 2.3% with revenue diversification alleviating ad declines

Digital publishing revenue declined 2.3% year over year against Q1 2019, according to the latest quarterly Digital Publishers Revenue Index (DPRI) from the Association of Online Publishers (AOP) and Deloitte. During the first three months of the year, income from subscriptions experienced strong growth of almost 20%. However, display and recruiting advertising both suffered significant declines, falling by 22.5% and 12.8% respectively in Q1 2020.

Diversification

Publisher revenue diversification efforts helped offset the ongoing decline in digital ad revenue for publishers, as the duopoly continues to account for the vast majority of growth in this sector. This decline was, of course, intensified by the pandemic.

On a 12-month rolling basis, subscriptions and miscellaneous revenues performed strongly, growing by 18.8% and 25.9% respectively. Online video revenue grew by 10.7% and sponsorship experienced a slight increase of 3.2%. Growth in these areas however failed to offset the substantial reduction in revenue from display advertising formats — down by 17.1% year-over-year. Overall, digital revenue fell by 4.0% on a 12-month rolling basis.

Despite downturns across multiple revenue areas, the B2B sector was able to maintain revenue by growing sponsorship (10.9%), online video (10.6%) and subscription (2.3%) income.

Priorities

A growing number of AOP board members reported prioritizing non-advertising revenue growth and cost reduction strategies. According to the DPRI, almost 90% of publishers cited non-advertising revenue growth as a high priority for the next 12 months, up from 78% who said the same in Q2 2019. Meanwhile, 78% of publishers identified cost reduction as a high priority for the next 12 months, up from 44% who were focusing on this area in Q2 2019. None of the publishers surveyed reported seeing expansion by acquisition as a strategic priority over the next 12 months, reflecting their need to focus on existing business operations.

As Richard Reeves, Managing Director, AOP, commented, “Ten years ago, display advertising made up 58% of digital publisher revenue and subscriptions only 7%. Subscriptions now account for 22% of total revenue; with display advertising having shrunk to 42%. As income from display continues to decline, the shift towards subscriptions and other diverse revenue sources is only set to grow, accelerated in part by the pandemic. The publishers that adapt to this change will be the ones that have the most to gain when the storm passes.”

Advertising | Industry-Research | Perspectives | Video

Get your ad message right so that new TV audiences tune in

In a world turned upside down, TV – in all its current forms – serves as a vital anchor. It is a trusted provider of news and information, as well as a continual source of entertainment and comfort. It unifies families and friends through shared viewing experiences – even when they are in different locations. And it facilitates new routines, which helps people through these testing times.  

TV consumption has spiked, with a Thinkbox.tv weekly viewing report from May 2020 revealing UK viewing is up 21% year-on-year. Even as the country begins to return to a socially distanced version of normal, staying home will be the default position for many. And this will prolong consumers’ reliance on TV.

This trend is positive for advertisers. This is particularly true as 54% of consumers are paying as much or more attention to ads than they were before lockdown began, according to a recent FreeWheel survey. But to make the most of these larger audiences, advertisers need to understand the changing habits, preferences, and expectations of consumers. This will allow them to make informed decisions around messaging, tone, and delivery channel.   

Match the messaging to the moment

Ad messaging needs to relate to what is happening during current times, to be contextually relevant and to resonate with consumers.

Our survey revealed that the vast majority of UK consumers want advertising to be relevant. Three quarters of respondents feel that brands should acknowledge the present situation in their ads. Ads can be used to reinforce preventative measures such as social distancing and hand washing. They can also show customers that brands are there to help them with lockdown related challenges.   

From Nationwide to NatWest, financial services businesses are recognizing the current situation in their advertising. They are reinforcing their support for customers and outlining how they can still access services from home. Supermarkets have also brought the current context into their messaging, such as the Co-op’s campaign to support food redistribution charity FareShare.       

Set the right tone for the vertical   

Just because consumers want ads to relate to the current situation in some way, that doesn’t mean messaging needs to be sad or negative. In fact, humor should play a central role in advertising. True to form – the majority of Brits (58%) say they want to see ads that make them laugh. Many brands have taken a fun and light-hearted approach to messaging such as Maltesers with its “Look on the light side” campaign and Hotels.com with its humorous “Just stay home”’ messaging.   

Setting the right tone often depends on the vertical in which a brand operates. Despite ongoing uncertainty, a quarter of consumers want to see TV ads relating to travel. They also want emotive ads that make them dream, providing beacons of positivity in challenging times. Just because viewers can’t go to their dream destination right now doesn’t mean travel brands shouldn’t maintain awareness and advertisements.

Online search data reveals that millions of travelers are in escapism mode, discovering and dreaming of life without restrictions. So, reaching out to these consumers now can make all the difference in the medium to long-term. Sandals Resorts is one travel brand continuing to spend on TV ads. They acknowledge the reality of the current situation, but remind viewers that their holiday havens are ready and waiting.

Choose the right delivery channels

The term “TV” now encompasses a wide range of delivery channels. These include traditional linear TV, broadcaster video-on-demand (BVOD), and subscription streaming services. Much media attention is currently given to the rise of video streaming. However, FreeWheel’s survey found that linear TV is still the most watched type of platform, with 34% of consumers selecting this as their first choice compared with 26% for paid streaming services and 14% for catch-up TV.

In the current climate, audiences rely on broadcast TV for important updates, with over 27 million viewers watching the Prime Minister’s “road map to recovery” announcement on Sunday 10th May 2020 and almost 13 million viewers watching the Queen’s VE day address. Primetime remains a significant moment for people to connect with others. In France, primetime audiences broke the all-time viewers record on Monday 13th April 2020: 36.7 million watched French President Emmanuel Macron’s speech, on TV and online. That represents a 94.4% market share according to Mediamétrie.

Advertisers can make use of multiple channels to reach consumers when they are fully engaged in TV content. And they can use different platforms to reach different audiences or demographics. As TV content across all channels becomes more addressable, advertisers will be able to target audience segments defined by specific criteria, regardless of the platform they are using or the content they are watching.    

Tune in

In these unprecedented times, consumers are turning to TV – in all its forms – for information, entertainment, and routine. And they want to hear from brands; only 8% say that it should be a priority for brands to stop advertising. Armed with important consumer insights, brands can make use of a boom in media consumption to reach and engage TV audiences with useful, appropriate and contextually relevant messaging. Media and brands have an important role to play, they have demonstrated that they can be agile, reinvent themselves and be creative. In future, companies that listen to viewers are more likely to better match viewers’ user journey, expectations, and needs.

Industry-Research

Covid-19’s community connection sparks engagement with local media

The Covid-19 pandemic and the work-from-home lifestyle are affecting consumers’ media consumption behavior, including engagement with local news. From streaming music to OTT viewing, multitasking with media during the work day is a definite. An analysis from Nielsen’s Remote Workers Consumer Survey shows a larger share of media time is now spent on digital and connected TV devices. The Nielsen survey included 1,000 adults who worked from home prior to and during the coronavirus.

Consumers report their top three workday activities include listening to music (AM/FM and streaming), viewing OTT content and increased social media activity.

Local news consumption

While drive time to work decreased, consumption of local news did not. In fact, news (47%) as a content category leads in viewership compared to comedy (40%) and movies (36%).

Not only did the consumption of local news via digital media increase, it also increased across traditional channels. As concerns and restrictions grew, news briefs were a daily reality in the early days of the coronavirus. Consumers tuned to local news outlets to stay informed. A separate Nielsen viewership analysis between early February and early March registered notable spikes in local news viewing.

Viewing data from Nielsen’s Local People Meter (LPM) in 25 of the largest markets showed viewership in local news increased. Most notably, viewership increased among Persons 2+(7%), among Persons 2-17 (20%) and among Persons 25-54 (10%). Clearly, local news is present in peoples’ daily routines. Increases in local viewership respectively tracked increase Covid-19 positive case levels.

In addition, a study from NewsWhip shows local news sites such as dallasnews.com, wsmv.com, wcvb.com and wndu.com rank highest in user engagement among top news and entertainment media brands. And local sites such as oregonlive.com and wfla.com rank alongside national and international news sites in top related coronavirus articles.

Quality and quantity

Consumers are also seeking out established media brands for information on the public health crisis and the economic consequences. Interestingly, the desire for virus related news and the latest facts are curbing interest in opinionated and partisan sites.

Further, supporting the Nielsen survey and viewership data is a study from Horowitz Research. The findings here show that more than half of US consumers (58%) report accessing more local news during the pandemic than before (38%). Nearly a third of consumers (29%) also report they now consume more local public radio and local/regional newspapers. The increase in local news consumptions is most noticeable among persons 18-34. More than half of this demographic (53%) report they are watching more local news since the Covid-19 crisis.

Working from home offers choice in content consumption. The change in business workplace to the work at home environment offers a new connection point in digital media. Access to local digital news sites provides a strong  community focus and serves hyperlocal needs. It also offers marketers an active environment to engage with consumers and integrate at a local level.  

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