Anyone who’s been buying digital advertising for more than a minute has been faced with the daunting question from marketing and non-marketing executives alike: “So, how much of this advertising is actually legit, anyhow?”
The industry has been hounded by issues relating to viewability, engagement, and outright fraud for the past couple of years, and the general business press regularly covers the subject matter. So the very same executives who authorized TV, print and radio advertising budgets without raising question one only a few years ago – when the “half of my marketing budget is well-spent, but I’m not sure which half” maxim was fully embraced – now regularly engage in forensic assessments of ad buys. Such is the life of the digital marketer.
So it is helpful that companies like Integral Ad Science (though not an entirely objective player in the digital marketing ecosystem) working to keep track of developments via its bi-annual Media Quality Reports.
However, depending on one’s point-of-view, the data can be considered a sign of improving conditions, or confirmation that we marketers knowingly *throw away* 10% or more of our budgets to fraud, deception, and advertising malpractice.
Here’s a look at IAS’s most recent report, which offers an analysis of “hundreds of billions” online display and video ad impressions during the first half of this year:
Conditions Are Improving. Though there continues to be a good deal of waste in the system, the overall state of online advertising is showing signs of improvement. For example, the U.S. market saw a significant drop in “objectionable content” impressions during the first half of 2016 versus the previous period (9.5% versus 14.0%). Most industry experts agree this is due to more sophisticated tools and digital ad buying practices, as one would expect in a growing and evolving industry sector.
Buying Direct Has Its Benefits. The incidence of ad fraud when buying advertising direct from publishers is dramatically lower than when buying programmatically (2.2% versus 8.3% in the U.S.), though it’s also typically more expensive, making the equation palatable for most marketers.
Viewability & Clutter Are Continuing Concerns. Fewer than half of all display ads – regardless of how purchased – get viewed for more than five seconds, and more than 10% of ad impressions are jammed onto pages with more than four ads on the page. These issues are compounded via mobile devices, which we cited in a recent article on the pros and cons of programmatic as “just a messy consumer experience”.
Bigger & Vertical Are Better. Large format, vertically-oriented display ad formats (300×600, 300×1050, 160×600) all tend to have better viewability than their smaller, rectangular and square counterparts – being viewed for more than five seconds about half the time.
Global Video Ads Are Best Purchased Direct. Viewability of video via programmatic means are only viewable at a 3-in-10 ratio, versus nearly 7-in-10 via publisher direct. This metric constitutes the biggest relative weakness of programmatic in the study.
While IAS’s analysis of the first half of 2016 has many encouraging findings, it’s also clear that the programmatic marketing industry has plenty of opportunities for improvements in the coming months and years.
To state that marketers continue to be challenged by the ever-expanding digital marketing ecosystem is neither pejorative nor insightful. Indeed, the marketplace is aggressively evolving, as evidenced by both the sector’s growth—20%+ growth last year (IAB) and its prediction to overcome TV advertising this year (eMarketer)—and the number of vendors rushing to get in on the action (the ad tech market increased to more than 3,500 in 2016 from about 2,000 the previous year, according to Scott Brinker at ChiefMarTech.com.
Marketers are spending more than ever on the digital channel, and there are a plethora of vendors competing to ostensibly help these marketers spend their budgets more efficiently. Thus, as the saying goes, “If you aren’t confused, you aren’t paying attention”.
But it’s the job of think tanks like Forrester Research to help their clients sort through marketplace complexities and make smart decisions to help their organizations succeed. And it’s with this goal in mind, the firm recently published “The Forrester Wave: Marketing Measurement & Optimization Solutions, Q4 2016”. Chock full of recommendations for B2C marketing professionals, who are seeking to stretch budgets to the limit and outmaneuver competitors, this study provides analysis of companies that provide analytics and measurement solutions. The report is based on an examination of 10 vendors and surveys with 77 marketing professionals.
Here are some key takeaways, organized into two groups of findings: undisputed and to be determined (TBD):
Undisputed: Consumers are interacting with brands in varied ways. The report emphasizes this new market reality by explaining “Empowered consumers easily absorb information from all forms of media and multiple devices, and hey comfortably straddle the digital/traditional media divide”. While this new reality presents marketers with many new channels to engage with prospects and customers—a good thing—it also makes performance tracking increasingly difficult—a big challenge.
Undisputed: Marketers are under more pressure than ever to be accountable for their budgets and demonstrate ROI. The rise of digital advertising, which will account for nearly 50% of total marketing budgets in a couple of years, has mostly been a boon for marketers, with one glaring exception: scrutiny. Since its very early days, major industry players have been touting digital marketing for its ability to be “100% trackable”. So it comes as no surprise that “today’s complex marketing environment challenges marketers to meet the C-suite’s demands for accountability.” And the right measurement solution can solve this potentially massive headache for CMOs.
Undisputed: Marketers require strategic advisory partners that can help them make sense of data and act upon the analysis in meaningful ways. Translation: while vendors need to be able to tout quality technology and toolkits, it’s more important for them to be able to offer consultative support, to help clients “interpret model results” and to “provide recommendations” based on the analysis.
To Be Determined: The Realistic Viability of Unified Marketing Impact Analytics (UMIA). The UMIA methodology—coined by Forrester in this study for the first time—involves combining traditional techniques such as marketing mix modeling and digital attribution into a single technique. While Forrester reports high customer satisfaction from this study’s survey respondents that manage such an environment (about 40 in total), we think the sample size is too small today to make a blanket judgment about the approach. Though the concept is certainly appealing, many industry experts consider it to be at best too raw, and at worst not applicable: “It’s like using the same assessment metrics to measure the performance of a jet plane versus a row boat…it just doesn’t make sense”.
To Be Determined: The Impact of New Entrants, Big Players & Market Consolidation. It’s notable that the only widely-known brands included in the Forrester study are the result of acquisitions: Google/Adometry and AOL/Converto. In the face of rapid growth over the past decade, brands have been racing to adopt and integrate the digital channel, not necessarily optimize its performance.The reality is that for all its real and perceived flaws, the digital channel remains more cost effective than alternatives in most industry sectors. As more and more dollars are allocated to digital, and more attention is given to performance optimization, it’s likely that new entrants will impact the sector—think Facebook, Adobe, etc.—and given the dearth of any category killers today, the marketplace could look very different in 24-36 months.
The programmatic display advertising marketplace in the U.S. will total $22 billion this year, up nearly 40% compared to 2015, According to eMarketer. Perhaps more importantly, these kinds of media buys will account for more than two thirds of the entire U.S. display marketplace.
Programmatic media buying—broadly defined as the use of technology and algorithms to effect the sale, purchase, and delivery of advertising, and specifically digital ads in this case (think: the Google Display Network, RTBs, and PMPs)—has grown dramatically in recent years. Indeed, eMarketer has gone so far as to claim that “Programmatic is extremely efficient and unparalleled in its ability to pair rich audience data with ad inventory and targeting.” As such, marketers are rushing to incorporate it into their marketing plans.
Given its meteoric rise in the digital marketing scene over the past 36 months, though, it should come as no surprise that there’s a good deal of misunderstanding surrounding what the tactic can and cannot do, and where marketers need to tread carefully. In its second year examining the issues, ExchangeWire and OpenX combined to publish “The evolving perception of online marketing quality in programmatic advertising” last month.
Here are some of the key takeaways:
Marketers have a love-hate relationship with programmatic. While advertisers are spending more than ever on programmatic, they also report having less confidence in the tactic than they did last year, and believe fraud rates are 5X what they deem acceptable. This kind of volatility is common across most digital tactics—and makes sense, given the newness of the category, its relatively low cost (compared to TV, radio, and high-end print), and complexity. Even when it’s working, it’s still going to cause a bit of angst.
Marketers are concerned about viewability and fraud. Among the most experienced users of programmatic—U.S. advertisers—only 3-in-10 survey respondents say that marketplace quality is a ‘very serious’ issue, while more than 90% of respondents in EMEA and APAC believe that’s the case. These are two high-profile issues that the industry needs to get under control—fast. But even with major media outlets keeping the issues in the news, experienced marketers know that a tactic like programmatic (warts and all) is going to continue to generate favorable ROI for the foreseeable future.
Programmatic offers value. While in 2015, 95% of survey respondents believed that programmatic advertising offered good value for the money, that percentage dipped slightly to 86% in 2016. But one interviewee explained: “Programmatic has become a victim of tall poppy syndrome where everyone is trying to knock it off the perch; people have increased their knowledge of the tactic, and more aware of its pros and cons – so as it becomes much more mainstream, I think the satisfaction number has only one way to go, and that’s down”.
The programmatic silver bullet train is nearing the end of the line. Just as is the case with any hot, new tactic or channel, there are lots of easy wins to be had in the early days. But as programmatic becomes increasingly popular and pervasive, it will become more difficult—not less—to implement successful programs. Vendors are rushing to invest in their programmatic offerings, making it more difficult for advertisers to determine the best fit for their organizations (RTB? PMP?), and publishers—the providers of inventory—are scrambling to find their way in this new world, too. Not to mention the onslaught of mobile into the mix, which will account for about 70% of U.S. activity this year and which one expert describes as “just a messy consumer experience”.
To say that programmatic advertising is wreaking havoc in the digital marketing sector would be an understatement. But marketers that maintain a steady hand on the wheel as they roll out programmatic strategies and resist panicking or over-correcting in the face of inevitable bumps-in-the-road and sharp turns will be amply rewarded.
Tim Bourgeois is the executive editor at ChiefDigitalOfficer.net, a global community of senior digital and marketing professionals. Follow him @ChiefDigOfficer and connect with him on LinkedIn.
In what seems to be a timely intersection with the furor over rebates, fraud, and lack of transparency in the online advertising community, a recent survey from Deloitte, Industry Index, and Flashtalking “Confined by the Garden Walls” highlights the increasingly volatile but interdependent relationship between the biggest advertisers and walled platforms – namely, Google and Facebook. Its findings “illustrate the disconnect between what clients want from their advertising platforms and what they can expect to get.”
Despite the fact that rebate issue continues to get regular coverage by major media outlets like The Wall Street Journal and Ad Age, few advertisers are rushing to openly join the conversation. In the same vein, conclusions from the study highlight the ongoing struggle to understand the dramatic contradictions at play. To wit: While “only 22% of brands noted discomfort with Google’s data policies,” at the same time, “95% think data transparency at a user level is important or very important.”
While it’s easy to highlight the obvious conflicts at work here, making sense of the situation is more nuanced. Our take:
Consolidated Market Conditions Dramatically Favor Digital Giants. In Q1 of this year, Google and Facebook combined to realize 85% of online advertising market share. So it’s not surprising that the two companies don’t have to negotiate terms and conditions much. This situation won’t persist forever – with Bing investing significantly in its platform, and Verizon’s acquisitions of AOL and Yahoo! expected to impact the marketplace – but it’ll continue to be a bumpy couple of years for large digital advertisers, absent of significant regulatory changes, which seem unlikely.
The “Lure of Ease” Has Very Strong Appeal. Few brands have been able to construct digital marketing operations over the past decade that can provide the requisite scale. This will happen in due course, as “marketers at top brands have long realized that to own your customers you have to own your data”. And they’re investing furiously in marketing infrastructure to get there. In the meantime, they need to continue to nurture uneasy alliances with the digital behemoths in order to feed their own massive marketing engines.
Even With Challenges, Digital Preferable to Alternatives. Sure, brands are forecast to spend a smidge more on digital advertising this year than TV, for the first time, to capture $72 billion (36.8% share) in the U.S. marketplace – which is forecast to total $195 billion in 2016. But that means they will spend more than $120 billion on TV, radio, print, and out-of-home – all of which are generally considered to be inferior when it comes to ROI precision or user data access.
Alternatives Do Exist, But Require Work. Without question, Google and Facebook offer incomparable digital advertising scale and targeting – one-stop shopping at previously unimaginable heights. And their brands are of course blue chips, and no one appreciates top brands like marketers do. But taking a scrappy approach to digital marketing can pay dividends. Going off-brand allows advertisers to strike better deals, and not just lower prices, but also much greater transparency and data control. This is approach requires legwork and explanation up-and-across the organization about avoiding the recognizable brands, and might not even perform as well in the final analysis, but in some (possibly many) situations, a beat-up pickup truck can do the job almost as well as a shiny new Cadillac – and for a fraction of the cost.
Tim Bourgeois (@ChiefDigOfficer) is a partner at East Coast Catalyst, a Boston-based digital consulting company specializing in working with clients on strategic roadmaps, digital marketing audits, and online marketing optimization programs.
“What if we stopped focusing so much on traffic, and started focusing on experience?” I’m asked this question frequently. It’s a complex, divisive challenge for newsrooms, one I eagerly indulge.
I work directly with media companies of all shapes and sizes. I offer consultation on everything from using data to support editorial intuition, experimenting with audience development projects and honing tagging strategies. The best newsroom strategies start with someone saying to me: “It would be so interesting if we could…” and “What would happen if we tried…”. Data can provide the foundation for sussing out those new ideas while mitigating risk.
When I start to talk to clients about using engaged time, or any metric for that matter, the key is to set goals. What does success look like? But this prompts new questions: How do we stack up? Is this kind of engagement normal? Is it good? For us? For anyone?
There is no reliable comScore or Alexa rating for attention, thanks in no small part to various ways of measuring “time on site.” So if a publisher is eager to change the way they think about their audience, and their success, where could they start? I tried to find out.
How does Parse.ly measure engaged time?
First, let’s clarify exactly what we’re talking about, because Parse.ly measures engaged time differently than other analytics platforms. On your site, a visitor is considered “engaged” if they 1.) Have a browser tab open, and 2.) take an action (scroll, click, mouse-over) at least once every ten seconds.
Analysis 1: How do we find an average engaged time for all content?
I first set up an exploratory analysis across our network, to see if I could identify any clear patterns. Over time, I started to see the same sites consistently outperform other outlets in average engaged time per visitor. What initially struck me though was actually the lack of pattern: each site seemed so diverse in voice and size.
To identify what made them competitive, I needed to understand the bigger picture of engaged time across Parse.ly’s network. To do this, I sampled user experiences at random for content published within one month from 300 anonymized domains to first understand, “how many seconds can you expect a typical reader to remain engaged with a story?”
Here we see how attentiveness is distributed across Parse.ly’s network. This graph shows what we can expect for “normal” attention time from any given reader, to any given article for each of the sampled domains. You can see a majority of our publishers attract an audience willing to invest roughly 40-60 seconds of their time on an article, though plenty of publishers can expect a more invested audience.
This provided a starting point for benchmarking engaged time, especially for my clients. Any Parse.ly user can easily find in their dashboard where their site, section or article falls on this curve. Teams can check to see if their stories and authors fall above or below the norm for their audience.
Understanding the context here is crucial though; not every article needs to outperform the average of the Entire Internet. There are better questions to ask. Where does your article fit in relation to what is expected for its section? How does that section perform in relation to the site as a whole?
Of course, there’s one more comparison that everyone wants to make: how does my site stack to the competition?
Analysis 2: How do we find the averaged engaged time for similar content?
This question helps you contextualize whether your work gets more attention than pieces that are similar to it and potentially predict how other topics, outside of your core competencies, might perform. For example, if you don’t normally write technology feature, it could help to understand the engaged time benchmark for tech publishing leaders. Here, we break down the analysis above further to understand how long a reader could be engaged on similar content.
Broken out by publisher type, it’s easy to see how nuanced attentiveness is across different types of content. I found it noteworthy that local news sites command more engagement than major news outlets, even with undoubtedly fewer resources.
I mentioned earlier when I began investigating engagement, I was struck by how, month after month, the same set of publishers kept leading the pack, albeit with no discernible pattern among them. Broadening the analysis to the network, broken down by these categories, most of these names resurfaced at the top of their respective categories. A pattern finally became clear: the most engaging sites within each type of publisher were highly recognizable brand names.
Also, now that we’ve broken out engaged time averages across Parse.ly’s network, it’s easy to see how using homogenized data from a heterogenous group of sites to set benchmarks could do more harm than good. Certainly, the same concept applies within the newsroom; measuring the average engaged time on an article against what is expected for that vertical or topic will provide better context.
What do we know about engaged readers?
We’ll continue to explore other patterns within the most engaging experiences. In the meantime, here’s a reminder of what we do know:
Facebook vs Twitter. We already know from a recent study with Pew Research that, in an increasingly mobile ecosystem, referral sources on mobile were an important factor in determining engaged time. Their research found that Tumblr and Twitter generate highly engaged audiences, while Facebook audiences were less engaged.
Readers can be highly engaged on mobile, though infrequently. In another section of the same report, we distinguished between long-form articles with 1000+ words and short-form articles. Long-form consistently outperformed short-form, though visitors to either do not frequently go on to other articles.
In the analysis conducted for this post, we found no correlation between page views and engaged time. A large audience is not necessarily an attentive one.
How to navigate this brave new world
We’ve found ourselves in somewhat uncharted territory in an effort to shift away from primary traffic metrics like page views and unique visitors. How do we define what makes something “good” anymore? Why should we care about engaged time at all?
As I found in this analysis, the engaged time metric provides us an interesting exploration in how we can set a more relevant benchmark. In clinging to familiar traffic indicators like page views, perhaps we have systematically neglected not only the experience of our readers, but the nuance of our reporting. But coupling traffic metrics with engaged time helps us understand which articles create the most impact.
If your post gets hundreds of thousands of viral views, but no one sticks around to read it, did you really manage to convey anything meaningful? Increasing your newsroom’s dedication to understanding the relevancy of engagement in all its forms will lead to a deeper, better audience strategy.
Kelsey Arendt is a Customer Success Manager at Parse.ly. Previously, she worked with The Guardian’s commercial team where she managed a variety of projects for marketing and sales, including developing analytic support for sponsored campaigns and partner hubs. Kelsey is a Midwestern transplant to New York City, and is a passionate hiker, musician, and homebrewer.
The relationship between Facebook and the news media industry is increasingly complex, requires context, and has room for improvement, according to a new report released today by the International News Media Association (INMA). The 79-page report, “The Facebook-Media Relationship Status: It’s Complicated,” offers an executive-level overview of how the social media giant intersects with news publishers as of late 2016.
The report cites Mark Zuckerberg’s widely-reported remark that Facebook is not a media company, but rather a sort of Uber for the content industry. In other words, Zuckerberg believes that because his company doesn’t create content, it isn’t in the content business. However, as the report points out, from content aggregation to distribution and myriad “editorial” decisions (be they algorithmic or human), the distinction is blurry at best.
The report attempts to help better define Facebook’s role in the ecosystem as well as examine the market position of all of its platforms (Messenger, Instagram, and WhatsApp.) It provides an overview of major social media usage trends and patterns worldwide. And finally, the report takes a hard look at Facebook’s complicated relationship with the news industry (including a deep dive into the way in which its News Feed algorithms work), and analyzes different strategies that media companies use with regards to Facebook in an effort to help others do so strategically.
Among the takeaway’s from INMA’s report:
Software really is eating the world.
New technologies make traditional market-entry barriers disappear.
Value propositions are no longer defined by the industry but rather by customers and their changing needs. Thus, user experience becomes a competitive advantage.
New business realities blur distinctions between partners and rivals.
News media consumers no longer form a mass market but rather networks of individuals.
Users are flooded with content. News has become a commodity.
Data is becoming the new oil.
As Emily Bell pointed out in a recent Columbia Journalism Review article, “Facebook is being taken somewhere it never wanted to go.” Yet, while it may not have sought to be a pivotal media cog, the report points out that “clearly, Facebook needs to be a thoughtful partner to the news media industry — and vice versa. That is a partnership that should be based on transparency and mutual support.”
Top social media platforms registered strong revenue gains in Q2 2016, however, CPM increases varied according to the Salesforce Advertising Index Report for Q2 2016. Further, growth in mobile usage contributed to an overall increase in mobile’s share of revenue among social media platforms.
Facebook, often referred to as the king of social media, reported $6.4 billion in total revenue with a 59% year-over-year increase and $6.2 billion in ad revenue with a 63% increase year-over-year in Q2 2016. Mobile ad revenue for Facebook accounted for 84% of total ad revenue. Further, Facebook’s global CPM at $6.33 for Q2 2016 increased 65% from a year ago. CPM growth ranked highest in France and Canada at 130% followed by the U.S at 70% year-over-year.
Instagram’s mobile footprint is strong as well. Instagram users identify mobile as their most important device for getting online. In Q2 2016, Instagram’s global CPM registered at $6.30, an increase of 42% quarter-over-quarter.
Twitter reported total revenue of $602 million, a 20% increase year-over-year. Their advertising revenue totaled $535 million, an increase of 18% year-over-year. Twitter’s mobile advertising revenue accounted for 89% of total advertising revenue. Interestingly, while total advertising revenues increased, their global CPM at $4.29 declined by18% compared to a year ago.
LinkedIn’s Global CPM for Q2 2016 was $20.43, a 13% increase year over year. LinkedIn is known as a strong B2B platform with 60% of its total revenue generated from sponsored content.
Social media delivers a large and dedicated audience for advertisers, especially on mobile devices. Just as social networks drive mobile advertising’s growth, mobile drives advertising on social networks. Social media also continues to evolve with the addition of LIVE and VR playground to further build more immersive content and new opportunities to engage consumers.
New findings build on comScore’s “The Halo Effect” independent research
New York, NY—(September 27, 2016)—Digital Content Next (DCN) today released new findings it commissioned from comScore’s July 2016 research, “The Halo Effect”. The follow-up analysis of the original data found that video ads served on premium sites yielded 68% higher brand lift than video on non-premium sites and drove even higher brand lift when looking at sales funnel brand metrics. Overall, DCN sites outperformed non-DCN sites by 176%.
Additional findings from the follow-up study:
Gender: Ads on premium publisher sites had an overall stronger impact on men however women were particularly responsive to ads for mid-funnel metrics including brand consideration, brand loyalty, category usage intent, category favorability, brand favorability and recommendation intent.
Household Income: Households with an income of $75K or less showed more brand lift at the mid-funnel phase and households with an income of more than $75K, generated an average lift at one impression over two times the magnitude of a non-premium publisher.
Millennials: video ads on premium publisher sites are almost twice as effective with millennials.
“We wanted to dig further into the results of comScore’s ‘The Halo Effect’ research to understand brand lift for different demos and for video advertising in particular,” said DCN CEO Jason Kint. “We now have further proof that advertising on premium publisher sites drives higher brand lift for both display and video advertising.”
Key findings from comScore’s initial “The Halo Effect” research confirmed that the contextual environment in which the ad exposure occurs is an important driver of more than 50% higher effectiveness, and also showed:
Display ads on DCN publisher sites had an average of 67% higher brand lift than non-DCN publishers, confirming that premium sites deliver premium performance.
Premium publishers are 3x more effective in driving mid-funnel brand lift metrics, such as favorability, consideration and intent to recommend.
Premium publisher effectiveness is driven in part by higher viewability rates, which include lower levels of invalid traffic.
Consumers’ trust in the media fell to its lowest point this year. Only 32% of consumers said that they have “a great deal” or “a fair amount” of trust in mass media versus 68% who stated “not very much” or “not at all” reports Gallup Poll Social Series: Governance. While Gallup has seen consumer confidence in media decline in the last 10 years, this year’s findings represent an 8% declined compared to a year ago. Gallup’s survey definition of mass media includes newspapers, television and radio. It is important to note that digital and news and information from the internet were not included in their definition of mass media in the survey.
The collapse in trust is most significant among young and middle-aged adults. Interestingly, those who associate with being a Republican had a more negative view of the media than those who associate with being a Democrat.
In a recent article, The Atlantic offered a few hypotheses as to why consumer trust is declining in media. Their first hypothesis emphasizes the lack of sophisticated journalism in the marketplace. The articles and programs which should inform and provide insightful dialogues are no more than a show and tell of political bantering. Another likely factor that it is an election year. Lack of media trust is cyclical and declines are registered every election year. Media trust fell in 2004, and in 2008, and again in 2012, and now it’s at an all-time low in 2016.
The third possibility could be that public faith in financial, social and political institutions such as the church, the medical system, the presidency, the Supreme Court, banks, big business, and Congress has also fallen this year impacting overall trust scores. The fourth and final hypothesis from The Atlantic is the intense media competition. In an effort to capture consumer attention, there’s more hype than ever before and some journalists are willing to take exaggerate positions on a topic throwing aside their objectivity commitment to remain on neutral grounds. Consumers distrust this type of media behavior.
Still others have suggested the decline in media trust is due to the overwhelming media options including one-sided and sensationalist approaches. As The Washington Post’s Executive Editor Marty Baron stated, “What distinguishes journalism and plain old content, is that we are digging beyond the surface. We are trying to find out why something happened, what are the consequences, who is affected – those deeper issues as opposed to just the bare-bones facts.” As the media landscape has expanded with so much user generated content including blogs, vlogs and social media, the trustworthiness of professional journalism is much harder to find among the clutter—but it has never been more important.
Sixty-nine percent of young millennials use at least one method of piracy (download, stream or mobile). Even more alarming, however, is the finding that 24% of those surveyed believe that both downloading and streaming piracy are legal, according to the report Millennials at the Gate from creative advertising agency Anatomy Media, which looks at the streaming, piracy and ad blocking behaviors of young (18-24) adults.
Other key findings include:
2 out of 3 young adults use an ad blocker
3 out of 5 young adults who stream content use a shared password or cable log-in
60% stream content without paying for it
While more than half say they share their parents’ log-in (58%), only 13% of those actually live with their family
According to the report, millennials use ad blockers “to assert control over their user experience, reduce their data usage and get access to their desired content faster.” However, they believe that millennials will accept advertising as long as it is “restrained, targeted and relevant.” Thus, Anatomy urges a focus on user experience overall.
Mobile isn’t just causing a seachange in consumer behavior by increasing our demand for formats and features that are easy and enjoyable to access on smartphones and tablets. Mobile is also causing a seismic shift in advertising spend allocation, a surprise trend documented in the Zenith Advertising Expenditure Forecast released earlier this month.
The forecast, upgraded from numbers the company published in June, still expects mobile advertising to overtake desktop–but the new forecast predicts this will happen much sooner.
In fact, forecasts for mobile growth this year are upgraded from 46% to 48%, and next year from 29% to 33%. While it may only amount to a few percentage points, the impact on the total is tremendous. Zenith now expects mobile ad spend to exceed desktop by $8 billion in 2017, up from the $2 billion that was predicted in June.
Overall, desktop is going to suffer a steep drop in 2017 – one from which it will not likely recover as Zenith further forecasts mobile to account for 60% of all internet advertising in 2018, up from it’s previous forecast of 58%.
Why is the shift to mobile causing desktop advertising to shrink faster than newspapers, magazines and TV? The answer is inextricably intertwined with consumer behavior and people’s preference for experience over interruption.
At one level, mobile ad spend is merely following the trajectory it must if brands and marketers are determined to be where their customers are. People are spending more time on mobile devices, so ad dollars must follow. This brings us back to the most “clipped” slide in the annual Mobile Internet Trends Report deck from Mary Meeker, Internet guru and partner at venture capital fund Kleiner Perkins Caufiled & Byers. In it Meeker pointed out the gap between time spend on media (specifically mobile) and percentage of media spend.
But the exodus of ad spend is also fueled by the hard truth that consumers are annoyed by banner ads, and reaching in increasing numbers to ad blockers in order to tune out interruptive display advertising on desktop (as well as mobile).
Another driver causing the rapid decline of desktop ad spend in no doubt the surge in social media and native advertising. Reams of research and campaign results shows social and mobile is an unbeatable combination–particularly since social media is a perfect fit with the fiercely personal nature of our mobile devices and aligned with how we spend the majority of our time on mobile (namely, engaging in social media conversations and the contextual ads that show up in our feeds).
Mobile is where we focus our time and attention, so it makes business sense for ad spend to shift to our “first” screen. However, the rise in mobile spend doesn’t mean the death of desktop. Zenith is bullish about the outlook for other desktop formats such as video, a format that it notes has “benefited from the transition to programmatic buying, which allows agencies to target audiences more efficiently and more effectively, with personalized creative.”
In a world where experience trumps–well– everything, all ad formats can count on being a line on the budget as long as they are highly engaging, not annoying, and highly relevant.
Peggy Anne Salz is the Content Marketing Strategist and Chief Analyst of Mobile Groove, a top 50 influential technology site providing custom research to the global mobile industry and consulting to tech startups. She is a frequent contributor to Forbes on the topic of mobile marketing, engagement and apps. Her work also regularly appears in a range of publications from Venture Beat to Harvard Business Review. Peggy is a top 30 Mobile Marketing influencer and a nine-time author based in Europe. Follow her @peggyanne.
Mobile usage now represents almost two out of every three digital media minutes as we continue to see more and more consumer usage shift from desktop to mobile. In all, time spent in digital media grew 53% over the past three years, attributed to the surge in usage of mobile apps (+111%) and of mobile web (+62%) reports comScore’s newly released 2016 U.S. Mobile App Report.
Interestingly, the smartphone app is the biggest driver of digital media engagement, resulting in an 80% increase in mobile’s share of time spent over the past three years. However, while the mobile app audience spends more time on apps, comparing users of Top 1000 Apps vs. users of Top 1000 Mobile Web Properties, the mobile web audience is almost three times bigger than the app audience. Intriguingly, almost half of all smartphone users do not download any apps. Among the half of smartphone users that do download apps, they average 3.5 downloads per person per month. Industry experts forecast that by 2017, there will be 268 billion apps downloaded.
It’s difficult to build to build a mobile app audience. However, once the app users are engaged, they are an extremely loyal audience. To illustrate this point, app users spend more than three hours per month on the Top 1000 apps on average whereas mobile web visitors spend less than 10 minutes per month on the Top 1000 web properties. Males 18-44 tend to be the heavy app downloaders with approximately 5 new apps each month.
While all demographics are using their smartphones apps more now, persons 55-64 registered the greatest year-over-year increase at 37%. Further, all U.S. consumers, especially persons 18-24, spend the largest share of their web time on smartphone apps except for adults 65-plus, where screen size mostly likely acts as an inhibitor. In contrast, tablet app usage is down across all demographics.
Facebook and Google are a strong hold in the app marketplace; 7 of the Top 25 apps, based on unique visitors, are owned by these two companies. Of the Top 25 apps, the three leading categories, based on unique visitors, are Utilities (9), Social (6) and Entertainment (6 – tied). Facebook, the largest social platform accounts for 76% of all time spent on social apps. App position on smartphone correlates to usage. Not surprisingly, apps with easy access on the home screen showed strong audience reach. Smartphone users spend approximately 45% of their app time on their #1 most used app, and about 73% on of that time of their Top 3 apps.
Mobile devices are consumers’ constant companions. It’s where audiences are spending most of their time online. Since mobile users are spending more time on their apps, it’s important for digital publishers to continue to develop a platform strategy to attract and transition their large web audiences to loyal app users. Further, as the app market continues to expand “smart” device utilization (think loT like exercise trackers, home and car alarm systems, etc.) expands, it will only become more difficult to break through to the consumer’s screen.