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Diversity, Equity & Inclusion | Featured Post | Innovation | Revenue

How Vix fueled 10x audience growth with Hispanic audiences

The proliferation of on-demand platforms and services combine to drive what Nielsen calls “the most profound media disruption of the last half-century.” Record-high audience numbers and time spent using streaming services and apps add up to make 2020 the biggest year yet for streaming.

But the real growth could be in serving culturally relevant content to underserved audiences such as Hispanics, which now make up nearly 20% of the current U.S. population. It’s a demographic that demands balanced content and appreciates diverse views and voices. It’s also an audience of cord-cutters that uses streaming services, smartphones and apps. During March, Hispanics increased their weekly viewing of movies or TV shows using a streaming service by “about 8 hours.” That’s well above the numbers reported by non-Hispanics.

It will be a stretch for many mainstream content companies to bulk up on content and capabilities to cater to this mobile-first audience with culturally relevant content. But not all companies will be in catch-up mode in 2021. Vix, a free Spanish-language ad-supported video-on-demand streaming service (AVOD) company founded in 2016, has a significant head start.

Inside Vix’s success

The move to acquire Pongalo, a market-leading Hispanic AVOD, in August 2019, has established Vix as the largest Latino AVOD player in the world, growing its audience more than 10x. Today, Vix, backed by Discovery Communications and HarbourVest Capital, creates, acquires, and distributes Hispanic-focused content to audiences in the U.S., Latin America and across the globe. It counts over 20,000 hours of Latino-focused films and TV shows.

Blockbuster and premium content is a crowd-pleaser. But it’s the company’s social media footprint, which includes 100 million Facebook followers, that keeps audiences engaged. Importantly, social media is also the motor that drives customer acquisition and allows a modest 50-person ad sales team to achieve ambitious growth targets and expand efforts to Brazil. 

The company has also grown the number of partnerships (Amazon, Google and Roku). The top-ranked app (the #1 most downloaded entertainment app on Android devices in Mexico ahead of Netflix) recently became a top-five free film and TV streaming app on Roku in the U.S. Vix is the first-ever free streaming app to hit that benchmark.

Continuing our series of DCN video interviews, I talk to Rich Hull, formerly the CEO of Pongalo. Hull, now the Head of Streaming Platforms and Chief Strategy Officer at Vix, received Variety’s Dealmaker of the Year honors for his part in architecting one of the most significant media deals of 2019. He is also instrumental in growing Vix’s platforms and partners. 

In this interview, we discuss why all media companies must acknowledge the demographic revolution and the requirement to serve up culturally relevant content to 60 million Hispanics in the U.S. alone. We also debate the future of streaming, the role of personalization and the business benefit at the “collision of advertising, international and content.”

Here are three key takeaways from our talk:

Drive discoverability through platform diversity 

U.S. Hispanics are ahead of the curve when it comes to digital. They lead in the adoption of new devices and services. And they are the power users of mobile and over-index in video consumption. 

To keep pace with consumers and cater to a growing and global audience for Spanish language content, Vix has maintained a mobile-first approach. It’s all about choice and letting consumers decide for themselves how they want to consume our content, Hull says. 

To date, Vix is available on multiple platforms including Apple TV, Fire TV, Roku and connected TV devices from Samsung and Vizio. “We’ve put ourselves there so that they can discover us.” Following this strategy has allowed Vix to “punch above its weight” and leverage partnerships to build scale. Amazon counts Vix as its biggest supplier of Hispanic content, Hulls says. It’s more than an accolade. It’s also an inroad to Amazon’s Alexa, a platform Hull says is important for his company – and many others – to extend the brand and win new audiences.

Tap social media to fuel your audience growth flywheel

Social media presence boosts awareness and buzz. But there’s no reason to stop there. Vix has tapped its community to create a new kind of funnel, Hull says. The audience of 100 million Facebook followers alone is one that Vix cultivates and activates with content. “It’s a really massive audience that we can speak to and it’s a very powerful megaphone that we have,” he explains. 

At a high level, Vix works with major brands to create content and branded entertainment to amplify key messages and recruit audiences. “So we’ll do things like say: Here are the top five J-Lo movies ever made and, as it turns out, we’ve got two of them, so click here to install our streaming service.’” The outcome, he says, is a “very elegant way to drive people down the funnel.” It’s also helping Vix increase organic reach and reduce dependence on Facebook or Google or Apple search ads to target audiences.

Engage consumers by making free content the “front porch” of your offer

In the search to find the right mix between subscription models and advertising companies, Hull says companies should widen the aperture of how they view the potential of free content supported by advertising. He points to the example of NBCUniversal. Rather than compete head-on with Disney, AT&T’s WarnerMedia and others that have launched subscription-based on-demand services to compete (or at least catch up) with Netflix, NBC has launched a free, ad-supported service. Free doesn’t just bolster audience numbers, he says, “As the space evolves, where [streaming] is monetized with ads, it is also becoming a better user experience.”

In addition to challenging the viability of locking content behind a subscription wall, Hull also debunks the myth that original content is the way to win audiences. Granted, Game of Thrones and original content has paid dividends for Netflix, but it’s a competitive space where smaller players can go broke fast. Instead, Hull advises companies to keep content free, and bottom lines in the lack, by curating quality content, not creating it. “For us, it’s about volume and choice,” he says. The value is in curating content in a “very authentic way.”

Perspectives

DCN’s must reads: week of December 17, 2020

DCN’s must reads: week of December 17, 2020

Innovation | Perspectives

Focus on the future for a successful automation journey

The automation of repeatable and scalable processes, especially marketing processes, has become a competitive imperative for all brands and business. A dramatic drop in costs, combined with increasing access to technologies that underpin access to content and shopping, allows an increasing number of customers to use different channels and devices to make buying decisions. And for sellers, the ability to acquire new audiences while retaining and communicating with existing customers has enhanced the customer experience. It also permits insights to evolve rapidly.

However, it is no longer humanly possible to effectively manage digital marketing at scale. That is where automation comes in. Employing automation for digital processes helps with stabilization. It will also result in fewer opportunities for human error, fewer unproductive work hours, less burnout, and reduce training and HR costs. There are some key components that must be considered to embark on a successful automation journey, though.

The importance of creating a future state 

Before an organization can implement any kind of useful automation strategy, they must establish a well-defined and achievable set of objectives and goals for the business as a whole. This future state vision is vital for creating sustainable automation practices. Without it, only short-term issues can be solved, if anything at all. 

Of course, an organization may not yet have a full understanding of the uncertainties and wild cards of their business. Or the maturity levels of the market may differ significantly from what has already been put in place internally. Whatever the variable, businesses need to work backward from a clearly delineated future state to create a strategic plan that brings value to the entire organization.

Look at the automation journey holistically

Over the last two to three years, many Fortune 1000 companies have started to see automation as a strategic imperative. Acquiring and retaining talent is becoming very expensive, and manual tasks are becoming commoditized or simply not scaling. In addition, many of the cutting-edge technologies that help with automation, including cryptocurrency, machine learning, AI, and big data, are becoming more affordable and accessible.

This is particularly critical for organizations that tend to be stifled by legacy practices and systems. Disrupting existing processes will inevitably cause contention and create push back. This is particularly true if they’re working well in the here and now. You will be met with resistance and it will be a challenge to arbitrate. That is why impossible to pivot overnight. But if you know that these changes are necessary for your business to scale when looking at it from a future state, the challenge must be faced and taken head-on.

For these reasons, it is critical to start the journey. The best way to begin is by using hyper-automation. This approach involves looking at an organization holistically across multiple departments, identifying as many business processes as possible, and by focusing on the organization’s future state as the main objective.

Then, you’ll use a combination of tools to automate them. One type of automation will not work for each and every process. So, comprehensive tech stacks must be developed across the entire organization. A mix of technologies, packaged software, machine learning, and infrastructure will be necessary to deliver the work.

Marketing teams are not alone in this need. In fact, in some industries, the necessity has been much more obvious. Take BPOs and call centers, for example. As voice recognition software has become increasingly accessible and mainstream, these types of organizations have had to rapidly adapt in order to scale. Now, the majority have created workflows that can recognize the human voice associated with a specific account. This enables calls to bypass human interaction entirely.

Back-office automation

Many companies are also automating their “back offices,” which refers to processes that are not client-facing and do not impact the market. This low-risk approach gives organizations the opportunity to build and develop automation processes internally, without having to worry about significant revenue damage if the strategy fails. 

Human resource departments serve as a good example. Both recruitment and employee onboarding are process-driven tasks with many manual components. From posting job descriptions and mining for resumes, to handing out and filing benefit forms, automation simplifies and scales these processes. It enables large volumes to be handled faster, more efficiently, and with less error.

Building your center of excellence

Comprised of key stakeholders across all areas of an organization, a center of excellence (CoE) works across business units to provide leadership, share best practices, and improve overall efficiency. Establishing a strong CoE is a critical precursor to the automation journey. That’s because this team is responsible for developing and driving the business’s all-important future state. 

It can be helpful to think of the CoE as the gutters along the sides of a bowling lane. Their purpose is to provide the bowler (i.e. a company’s teams) with guidelines for aiming the ball (i.e. a set of tech tools) down the lane. The pins are the company’s future state. And, if the execution is successful, the ball will reach the pins without veering into the gutter. Whether there’s a strike, a spare, or a split will depend on the bowler’s aim and execution. The CoE sets the guidelines while the teams execute the plans.

In other words, the COE will map your business’s existing state and future state, and balance the transition from what’s working well in the now to the gradual adaptation of what will work in the future at scale. They’ll also take human creativity into account—your company’s “secret sauce,” so to speak—when determining what does and does not need to be automated. 

Success, organizational adaptation & measurement

Speaking of that “secret sauce,” you can use it as a general guideline for evaluating automation need. If human creativity is your organization’s secret sauce—i.e. the main ingredient driving revenue and growth—automation may not be right for you. But if you have many repetitive tasks and/or elements that have been commoditized, it’s a tactic to strongly consider.

Success metrics for implemented automation processes can be measured in two phases—internal, then external. 

In terms of the first phase, it’s okay if internal back-office processes fail because they are not impacting the market or revenues. But eventually, an organization will have to automate externally in order to have a real ROI. Based on the success of their internal automation, the organization will need to figure out how to turn their strategies outward to create front-office, market-facing processes. That’s when the automation journey becomes fully holistic and the businesses can arrive at its true future state.

It’s also important to make sure individuals across the organization are aligned with the automation journey. This is critical, as there is always resistance—especially in the case of employees who fear losing their jobs. Properly educating the workforce is essential for encouraging this mindset change. It is also critical to invest in career pathing, reskilling, and other professional development rewards.

When embarking on an automation journey, you should never lead with technology. Instead, the most critical component to consider at the outset is the future state of your business. If you put your tech needs first, it will be very difficult to create sustainable automation processes that will benefit the organization as whole. Instead, focus on creating a solid CoE that provides a framework for implementation and evaluation. Doing so will greatly improve your automation success.

Advertising | Industry-Research

Publishers accelerated diversification strategies in 2020!

As publishers reflect on 2020, most will agree that Covid-19 took center stage. The year was filled with business struggles, but it also offered some growth opportunities. What’s New in Publishing’s (WNIP) year-in-review, Media Moments 2020, identifies “diversification” as the paramount lesson from 2020. Importantly, the report makes it clear that publishers who are dependent on advertiser revenue need to rethink their strategies and include consumer revenue streams.

WNIP’s report covers the industry’s focus on “trend acceleration.” Certainly, while there has been marketplace disruption the past two decades, nothing has accelerated market shifts quite like Covid-19. Media Moments looks at 2020 to showcase these market changes and identify winning publisher strategies.

Notable 2020 highlights

Print final shift to digital

Any print publisher who survived 2020, will need to go fully digital in 2021. In fact, Poynter reports that nation­al newspaper circulation in the U.S. is down 30% since 2016 and 60 newsrooms closed recently due to the impact of Covid-19.

Launching a differentiated digital brand with fresh content is vital in this marketplace. Revenue diversification is key for sustainability. Offering virtual events, newsletters and podcasts are important touchpoints to broaden revenue opportunities as well as develop consumer loyalty.

Audio is an expending revenue source

Audio has proved to be a strong and viable business for publishers and they look to expand their audio businesses in 2021. Some have their business by producing dedicated podcast content while others grew through acquisitions. Many publishers are testing new formats for podcast integrations in content outside of news. Other examples include a new commentary format from AMC to complement their video business and Marvel’s experimenting with fictional content.

Spotify, iHeartRadio, and Apple are a few of the leading podcast platforms. While Spotify is among those building their content portfolio of content, others are building their podcasting infrastructure like iHeart.  This year alone, Spotify acquired content producers Gimlet and The Ringer. iHeart, on the other hand, acquired podcast analytics company, Voxnest. Even given the coronavirus’ negative impact on advertising spend this year, podcasting did not register large declines. PwC’s updated predictions approximate $814M for podcasting ad revenue, just 6% below PwC and IAB’s original forecast.

Publisher exercise first-party data

In January 2020, Google announced that Chrome would phase out support for third-party cookies in the browser within two years. This didn’t come as a big surprise, given that Mozilla FireFox and Apple’s Safari made similar announcements in 2019. Of course, this trend will mandate reducing digital advertising’s reliance on cookies. As a result, an already tough seller’s marketplace for publishers is getting tougher. Fortunately, many publishers acted early and started to develop first-party data strategies, benefitting from their trusted relationship with consumers.

Once again, publishers are touting the merits of contextual advertising.  And many publishers are building the tools to serve contextual advertising better than ever before. In fact, Vox Media launched Concert Ad Manager, a self-service tool for publishers to build and implement ad campaigns across the marketplace. Publishers using this tool include NBC Universal, Penske Media, Quartz, and others. This type of tool is extremely helpful to small and medium size publishers.

As the pandemic transformed our world, consumers searched for news and information to help them navigate the crisis. From dropping paywalls to record traffic, publishers responded, and they were reminded of the trust consumers place in them. By concentrating on consumer value, publishers can prioritize a consumer-first strategy and register growth in consumer revenue.

Advertising | Perspectives

Why cohorts is a privacy detour the media industry should avoid

With the end of cookies and Mobile Advertising ID’s fast approaching, there is no shortage of discussion about ways to maintain some form of user identification. We need to figure out how data-driven advertising will work within the scope of privacy regulations and technical possibilities. Lately, this debate has revolved around two very different strategic approaches: shared user IDs and cohorts.

Shared user IDs

Shared user IDs aim at solving three main issues related to third-party IDs (and their disappearance):

  • The inefficiencies related to cookie matching and the drop off between platforms using different identification framework. This renders up to 50% of web-based user data and inventory to be unusable.
  • The need for user IDs to be accessible to 3rd parties to the main web server. Instead, these will be replaced by a shared first-party ID, which the server itself provides.
  • The need for greater control around the usage of IDs and associated data, particularly concerning privacy preferences expressed by users.

On paper, shared user IDs are a very efficient and privacy compliant replacement for cookie-based IDs. Their main challenge is adoption by publishers and technology platforms as a scalable alternative to third-party identifiers. Like any currency, their value grows exponentially with usage. This implies a limited value to start with and a difficult take-off (the infamous “chicken and egg” challenge). The next few months will be critical for shared identification solutions to establish themselves as viable and scalable alternatives to third-party identifiers.

Cohorts

On the other hand “cohorts” approaches aim at grouping users into segments to avoid user-level data distribution. They have become a topic of discussion following Google Chrome’s Privacy Sandbox experiments. Cohorts have even been presented as the solution to privacy concerns. They are not.

Cohorts are merely a way to avoid the problem. The approach aggregates people’s data  to pretend that we are treating them as groups rather than individuals. However, no regulation prevents marketers and publishers from addressing individuals. Instead, it requires those individuals to be informed about the data that is collected on them, how it is processed, the purpose of that processing, and to say whether they are ok with it.

A personal approach

Is it better to harass a group of people who have seen a particular product on a website until they buy it? Or is it better to engage in conversation with a single person to understand whether they are truly interested in the product and should be shown the ad?

Personal data is not the problem; it is how we use it that matters. Circumventing privacy by grouping personal data into “cohorts” and pretending we’re off the hook is a way to trick the letter of the law. However, more importantly, it is a way to trick users from the transparency and choice they deserve. And also, maybe, this is a way to trick the Open Web into using suboptimal methods to identify people and leverage marketing data to power advertising investments.

Another critical issue is that this may provide an opening for the large platforms to – in all impunity and under the disguise of (forced) consent — to exploit the largest “personal data vacuums” ever created.

The road to a privacy-first shared user identification future is a bumpy one. Using cohorts may seem like a safe way to avoid the bumps on the road. But they are merely a detour. And as often, taking a detour is longer and less efficient. This is particularly true if that road is controlled by an entity that can raise the toll price at will.

Perspectives

DCN’s must reads: week of December 10, 2020

Here are some of the best media stories our team has read so far this week:

Featured Post | Innovation

Web accessibility isn’t just an ethical duty – it’s good business

The Covid-19 pandemic has shifted an ever-larger share of public life online. Unfortunately, however, the internet remains a largely inaccessible place for people with visual or hearing impairments. As publishers rightfully aim to become more inclusive, the 61 million American adults with disabilities are an underserved group well worth remembering.

To overworked editors and designers, provisions for web accessibility can feel extraneous and opaque. Considerations like image alt text or video subtitles often require added steps before publishing a story and may not seem like a vital imperative. But given last year’s Supreme Court ruling that essentially sets precedent that the Americans With Disabilities Act applies to online platforms, media companies should be thinking about digital accessibility.

Priorities and skill development

“Web accessibility can be very confusing. It can be daunting,” says Bryan Gould, director of accessible learning and assessment technologies at the National Center for Accessible Media. “It’s a whole other skillset to learn, potentially. And you don’t necessarily have editors who can talk to developers and designers all in the same language.”

Publishers, particularly news outlets serving the public interest, should consider making themselves as widely accessible as possible central to their mission. But the fact is that accessibility isn’t just the right thing to do, it is also good business.

Text matters

Gareth Ford Williams, head of user experience design at the BBC, has long been an advocate for accessibility in media. In 2004, he founded the national broadcaster’s first digital accessibility team.

More recently, he was part of the team that developed BBC Reith, a new uniform typeface used across the organization. With distinguishable letter shapes, legible in small sizes, Reith is meant to ease the experience for a multitude of users. These include those with visual impairments and neurological conditions like dyslexia, as well as less-advanced readers.

On top of improving accessibility, Reith has become an element of the BBC brand. Moreover, it actually saves money, eliminating the cost of licensing third-party fonts.

“Pretty much everything in accessibility has a much bigger context,” Williams says. “It is about disabilities, very much so. But it’s also about situational and environmental disabilities as well as medical disabilities.”

Williams points to video consumption statistics on social media platforms. On Facebook alone, as much as 85% of all video views occur with the sound turned off. “Captioning is expensive,” he adds. “But look at the reach opportunity. If you’re not capturing that potential, you’re undermining your own business case.”

A good look

Three years ago, Boston public radio station GBH undertook a “massive redesign” of its website, says senior editor Ellen London. Among the priorities was creating a more “visual-forward” experience. This meant a design that is accessible and appealing to a larger share of users.

The newsroom partnered with Gould’s team at NCAM, a part of the GBH organization, to develop accessibility guidelines specific to the new CMS. Provisions included sufficient contrast between text and background colors and alt text for images. Rather than simply saying “click here,” hyperlinks should be descriptive, catering to users of assistive technology like screen readers.

GBH then created a highly condensed, one-sheet checklist, which editors, reporters and producers can print and keep at their workstations. “Putting together some great resources to refer to and empowering producers and editors to get involved has worked really well for us,” says Gould. “It’s not that editors don’t want to make their content accessible, it’s just that you can’t know what you don’t know.”

Picture this

This focus on accessibility was manifested in GBH’s “Year in Pictures” feature, published at the end of 2019. Photographs representing the most important stories of the year were accompanied by concise yet thorough descriptions. These descriptions were then recorded by GBH radio reporters and uploaded as audio files.

“The whole point was to put the accessibility out where everybody can see what it is and why it’s there,” says Gould. “The idea was not just to make it accessible, but to make accessibility a feature.”

It was a learning experience for the GBH team, London says. Creating effective image descriptions proved to be more of an art than previously thought. It required careful decision-making around how to best convey the purpose, context and information in an image for someone who can’t see it.

“As an editor, I have definitely put elements like audio descriptions in more of a transactional category,” London adds. “In learning how to write and record and produce them myself, I learned how much those descriptions are part of the editorial process just like any other part of the story. That was really an eye-opener to me; it’s highly editorial.”

Identifying weaknesses

Of course, not every publisher has the benefit of a media accessibility center within its organization. While resources such as the World Wide Web Consortium’s Web Content Accessibility Guidelines exist, they are dense and difficult to understand—even for experts.

“I myself remember looking at the Web Content Accessibility Guidelines and being overwhelmed,” says Patrick Garvin, a former designer and developer at The Boston Globe. Now an adjunct professor at the Missouri School of Journalism, Garvin suggests that one of the biggest accessibility obstacles publishers face is simply awareness.

“The way to appreciate the WCAG is to first understand how people with disabilities use the web,” he says. “I think many people either are unaware of how their work is inaccessible. Or they might be aware but not sure what they can do to fix it.”

Inclusive approach

At the BBC, internal design research teams recruit users of various levels of ability for focus groups. Williams specifically recommends consulting with users who have disabilities.

“They’re brilliant people to work with, because they know the coping strategies and can teach you about the barriers that they experience,” he says.

Just as architects no longer design buildings without ramps, Williams says publishers shouldn’t build websites that exclude people.

“If you have an impairment and we don’t build things that are accessible, we are disabling you,” he says. “You’re not disabled until we gave you a barrier, and it’s our fault the barrier is there. We designed it.”

To better integrate this mission into the corporate culture, Williams established an “accessibility champions” network in 2011. Completely voluntary, that group has since grown to include about 230 BBC employees.

“They have one core function, and that’s to be the voice of the disabled user in every sprint,” he says. “They don’t have to be the person with the answers. All we expect them to do is to talk about it. It’s more cultural and structural. It gets people thinking about accessibility and dealing with it.”

Basic steps

For publishers who wish to ensure they’re at least covering the basics of accessibility, Gould recommends four key considerations. Multimedia and images should be accompanied by captions. Colors and fonts should not be distracting. There shouldn’t be motion on a page that can’t be paused or switched off.

Accessibility considerations extend off of owned and operated platforms as well. Social media strategist Alexa Heinrich suggests taking advantage of platforms’ accessibility features, limiting emojis, and avoiding text-heavy images.

On a cultural level, encouraging staffers to think about accessibility throughout the design and production process is far easier (and cheaper) than retrofitting things after the fact, says London.

“Accessibility should be treated the same way as accuracy: Everyone has a role to play in ensuring it, even if not everyone plays the same role,” adds Garvin. “The commitment to accessibility should come from the top.”

Gould believes that awareness is growing that digital accessibility is important. And he emphasizes that it doesn’t have to be expensive. “If you start planning from the beginning, you can make an accessible web experience that doesn’t really cost more. In fact, it saves you money from having to retrofit things—or deal with a lawsuit.”

When embedded into the culture of an organization, accessibility becomes a self-sustaining investment, says Williams. “It brings so much value and efficiency back into the organization, it enables accessibility in such a massive context, that it improves usability across the board,” he adds.

Perspectives | Revenue | Supporter Spotlight

Putting the value back in our industry’s opaque VAT

As 2020, without a doubt the most challenging 12 months in our lifetimes, stumbles to the finish line, one undeniable lesson learned for all publishers is the need to focus on the sustainability of revenue streams. The turbulence of the market, the unexpected upheaval from factors that are unanticipated and entirely out of our control may well have become the new normal. So now, more than ever, publishers need to choose AdTech partners wisely and select those who can demonstrate the ability to deliver a tangible contribution to the bottom line.

Value chain drain

Earlier this year the UK’s ISBA (the Incorporated Society of British Advertisers) released their Programmatic Supply Chain Transparency Study in association with the Association of Online Publishers and conducted by PwC. This groundbreaking examination of the digital industry’s programmatic advertising supply chain shines a bright light on the lack of transparency shrouding AdTech costs levied against publishers and advertisers. Estimates of these fees range anywhere from 15% to 51% of revenue lost by publishers and of non-media expenses paid by advertisers. Graeme Adams, head of media at BT Group, took part in the investigation and branded the lost cash “a big hole in the value chain.”

These unattributable “taxes” are slow leaks in the plumbing of our ecosystem. They expose both the opaqueness inherent in the marketplace and the lack of trust in advertising technology third-parties. Certainly, we all agree there needs to be a greater level of transparency and accountability throughout what has now become the world’s largest advertising segment. And studies such as these are necessary to facilitate adoption of broadly applied standards and practices. However, painting all AdTech providers with the same negative broad brush runs the real risk of our “throwing the baby out with the bathwater.”

ROI vs. ROWe

Clearly there are technology vendors out there whose contributions to the efficacy of your programmatic advertising investment or a publisher’s bottom line are rightly suspect. Indeed, there are companies whose primary goal is self-serving. While they may promise to do no harm, they often fall short of guaranteeing measurable results and fully transparent visibility into their operations.

Their compensation is not directly tied to your ability to generate incremental income. Their tools are available for you to activate without the guarantee of a return on your investment. On the other hand, there are a select group of AdTech software providers who receive compensation only when their solution delivers measurable incremental revenue and income. That’s the ultimate measure of accountability.

Vendor or partner

Therefore, working with the right AdTech third-parties can make the difference, not only on your ability to “make your numbers,” but actually become the deciding factor between the survival of your business or its demise. We would modestly suggest that one way to decide who your best options are is to understand the nuanced differences between a vendor and partner:

Vendor: A party in the supply chain that sells goods and services to companies or consumers.

      A vendor is a general term used to describe any seller of goods or services.

Partner: A person or organization you are closely aligned with in some way.

                To partner is to join with another organization in a shared activity.

In summary we recommend a very careful evaluation among the myriad of third-party solution providers. Seek partnerships based upon full transparency, a shared commitment to mutually beneficial results, incremental revenue and income contribution to your bottom-line, and a guaranteed return on your investment.

About the author

Bruce Brandfon is Chief Media Officer of Duration Media. Prior to that he was Executive Vice President of Webspectator . He was Vice President and Managing Director at Publicitas. Prior to joining Publicitas, Bruce was Vice President of Sales for the Philadelphia Media Network. He has also held leadership positions at Scientific American, Newsweek, and Time Inc. Brandfon is Director of the Board of Advisors at Planet Forward. And he’s an Adjunct Professor of Media Studies at Westchester Community College. He contributes frequently to industry publications.

Perspectives

How to survive in the consent economy

Our previous article outlining the birth of the consent economy warned that the initial waves of privacy regulation in the U.S. are growing stronger. The recent news that California voters passed Proposition 24 proves the point. It also elevates conversation around what the future may hold in terms of national regulation, especially given California’s large influence on the tech industry.

Proposition 24 is better known as the California Privacy Rights Act (CPRA) and builds upon the existing California Consumer Privacy Act (CCPA) passed in 2018. CCPA left room for interpretation, particularly around whether selling targeted ads qualified as selling California residents’ personal information. The CPRA goes one step further in expanding the rights of California’s citizens through new consent definitions among other things. 

While the CPRA won’t be enforceable until 2023, it could severely impact publisher revenue. The added uncertainty around any federal or additional state regulations coming out prior to the deadline makes immediate action a smart choice. If stricter federal regulation rolls out, it will be important to have set the groundwork that will give yourself a head start.

Anticipating what’s to come 

The European privacy regulation landscape offers parallels, that can and should be drawn from, as we face a similar trajectory.

The existing CCPA borrows heavily from the “right to be forgotten” principle enshrined in the European Union’s General Data Protection Regulation (GDPR). To make it easier for publishers to process first-party user data and to obtain consent in compliance with the rules laid down by GDPR, the IAB Europe created the Transparency & Consent Framework (TCF). 

As the shortcomings of TCF v 1.0 became apparent, TCF v 2.0 was introduced to clarify and strengthen the regulatory framework. This dialing up of control measures is exactly what we’re seeing play out in California with the passage of CPRA as an addendum to the CCPA.  

The CCPA limited “selling” data. However, the CPRA is closer in nature to the relationship between the GDPR and TCF by now including restrictions on sharing of personal information as well. Publishers will be required to allow citizens to opt-out and the CPRA. It requires that all third parties with whom a data owner may have sold or shared information be notified as well.   

This new regulation also establishes an enforcement arm. This would be the first agency dedicated to privacy rights enforcement in the U.S. The five-person board will appoint a Chief Privacy Auditor in a structure similar in nature to the GDPR’s European Data Protection Board. In this latest version, California will now have the authority to levy larger fines, which has already occurred with GDPR violations. 

The lessons learned from GDPR and CCPA can help anticipate the future. There’s no doubt that publishers are entering challenging territory with these regulatory demands and the concerns around ad blocking further compounding the path to protecting and growing revenue. Publishers should only be fearful if they are unprepared in their strategy for how to monetize both a consented and non-consented user.

Revenue diversification in the consent economy

The time is now to challenge old belief systems. With the passage and evolution of new regulations, one must begin taking the first steps in the inevitable long-term journey towards revenue diversification. The reality of garnering 100% consent has shown itself to be elusive, if not impossible. In European markets, depending on the country, we have seen anywhere from 50-80% consent adoption. With outcomes like this, having a proper plan in place will enable you to monetize both consented and non-consented traffic, starting with how your ad server is configured and building the initial infrastructure.

When a user provides consent, most of your current monetization partners and policies will be fine and won’t require additional changes. When user consent isn’t provided, a shift in tactics is required. You’ll need to work with partners that will still have the ability to serve ads when user consent is not present. And keep in mind that you should always beware any provider who requires access to your user data to do this. In these situations, contextual targeting and semantic targeting can serve as effective and compliant alternatives.

Even when ad supported situations are off the table, other options exist. A subscription-based limited- or ad free experience, as we’ve seen publishers like Business Insider and The New York Times create, offers additional revenue streams while still staying true to the essence of your brand. 

Another option is to consider ecommerce as it aligns with your brand and brand experience. Publishers like BuzzFeed, Hearst, and Meredith have taken this route through online stores, licensing agreements, and product development. These additional revenue streams increase the long-term value of your audience while still providing value. 

Welcome to the new frontier

This new frontier can be intimidating. However, publishers who successfully diversify revenue streams will be positioned best for long-term sustainability. With the user now occupying a seat at the table, the consent economy can also be seen as an opportunity for publishers. 

Respecting the wishes of the user always pays in garnering trust and attention. This balance between respecting data privacy and delivering on expectations for personalized interactions, not only protects existing revenue, but could also lead to revenue growth through new audiences. Taking the first step now sets you on the path to positioning yourself well for survival in this new consent economy. 

Featured Post | Revenue

As ecommerce surges, publishers turn to certification to cement trust

Ecommerce has been a strategic priority for publishers for a number of years. Then, in just the space of a few months,  Covid-19 accelerated the shift to digital shopping by five years. It’s no surprise that  the competition in online shopping is heating up as a result. 

Trust is a crucial component in ecommerce success. With many online shopping sites providing overwhelming choice and increasing issues with fake or incentivized reviews, consumers are turning to recommendation and comparison sites in order to help narrow down and evaluate purchase decisions. 

Publishers have benefited greatly from this. Their established audiences and high levels of trust have allowed them to build their own authority in product recommendations and gift guides, with many generating significant revenue from affiliate schemes and referrals.

However, as competition in the space increases, some publishers are looking to certification and branded seals as a way of cementing that trusted relationship between them, their audience, and the products they recommend. 

SELF launches seals after commerce surge

Conde Nast’s SELF magazine is the latest publisher to expand its commerce efforts by launching two new award seals. The title has seen ecommerce content traffic in October up 949.3% year-over-year, and the time spent with ecommerce content up 1,130.5% for new shopping.

In response to increased demand for its product recommendations, the health and beauty magazine has launched two seals. The SELF Certified seal is awarded after a thorough product analysis and review. And a product must score at least 7 out of 10 in order to be eligible for it. 

The second seal, SELF Fave, is for wellness products that the editors themselves personally use and recommend. These are  “the ones we keep coming back to, again and again, and enthusiastically rave about to anyone who will listen,” they explained.    

SELF has been creating ecommerce content for several years now. Their decision to launch the seals was as an extension of a strategy that they describe as “thriving”. “SELF editors know the wellness market better than anyone, and our audience trusts our recommendations,” SELF magazine’s Editor in Chief Carolyn Kylstra said. “Now, they know that products and services that get a SELF seal are the best of the best.”

Building additional trust

Having audience trust is particularly important in the health and wellness space, where new products are often launched with big promises, scientific-sounding tems, and celebrity endorsements. While some do what they say, others can be really misleading. Others can be more harmful than helpful. 

“People want to know that they’re buying the very best wellness products out there, and that the products are going to be genuinely helpful, rather than a lot of empty promises,” Kylstra explained. “The SELF Certified and SELF Face seals can give them more peace of mind in that regard.”

SELF’s editors play an important role in building trust alongside the new seals. As journalists, they are skilled in interviewing experts, seeking out relevant research and cutting through marketing speak in order to properly assess products. But there have also been improvements to the assessment process to support the editors.

A transparent process

In order to launch a certification scheme, publishers must first have a set of standards for products, either in reviews they publish themselves or in recommendations given by experts. At SELF, they revamped their review process to introduce added rigour.

“First, before considering a product for a SELF Certified seal, we turn to research and experts to set expectations and figure out exactly how to test the product, and what criteria we should be judging it against,” outlined Kylstra. “We publish that criteria publicly as a buying guide. So, there’s transparency with the process.”

This research and pre-testing phase means that the editor or writer carrying out the actual process will be on the lookout for specific things, rather than testing against generic catch-all standards. The SELF team have taken care in communicating these standards and what they mean to their readers, with the rating system available at the top of each review.

Product categories on SELF have their own buying guides published publicly as well. These feature expert-suggested criteria that not only helps the editorial team evaluate products, but also helps readers make their own decisions.

“Transparency is key to trust,” Kylstra emphasised. “We want to make it as clear as possible why a product gets the seal, how we tested it, and why it scored what it did. This transparency will help readers feel more confident that the product is truly as good as we say it is.”

Cementing expertise

Conde Nast is not the only publisher looking to boost their ecommerce credibility through certification and seals. Hearst UK unveiled a state-of-the-art product testing and accreditation facility in London over the summer in order to expand its famous Good Housekeeping Institute seal of approval across a wider range of titles.

“We know more than ever that what our readers are after is impartial, trusted information,” CFO Claire Blunt said at the launch. “All our readers are smart, savvy shoppers, and they want to know how best to spend their money. So our testing functionality is also about providing them with impartial, trusted insight.”

There is also an additional commercial benefit to publishers with certification. When a seal has been awarded to a product, brands can then pay to license the use of the logo in their own marketing campaigns.

As publishers compete to stand out in ecommerce, it is likely we’ll see more brands launch seals and certification as a way of gaining additional trust. But it is important to do this alongside a rigorous testing process, and to communicate clearly with readers about how products are evaluated in order to build trust in the long term.

Perspectives

DCN’s must reads: week of December 3, 2020

Here are some of the best media stories our team has read so far this week:

Perspectives | Video

What the future looks like for OTT

In 2020, the over-the-top (OTT) landscape shifted greatly, ushering in a new era for subscription-based OTT video streaming services. New players like HBO Max, Disney+, and Peacock joined the scene. All the while, service providers like Netflix, Hulu, and Amazon Prime Video continued to dominate the market. 

So, what is next? OTT services are predicted to generate just over $158 billion in ad revenue by 2024. 

As OTT experiences these major growths and investments, it brings about some key advertising questions – What are the best practices for selling advertising in this emerging channel? Which channels have the best measurement? How is OTT different from linear TV? And, more. With that, MediaRadar hosted a virtual panel to explore these recent and upcoming changes in OTT, plus what the future holds for this type of advertising.

Los Angeles Times reporter Wendy Lee moderated the discussion. And panelists included Bill Condon of Xumo, Justin Gutschmidt of Premion, and Matt Graham of Acorn TV, as well as myself. Here is a recap of some of the key insights discussed. 

Ad innovation 

While TV advertising has been largely the same for decades, OTT platforms are changing the game, offering new ways for advertisers to get their messages across. Hulu, for example, has a choose‐your‐own‐adventure‐type ad option, allowing viewers to select which of multiple ad options they would like to watch. Hulu also uses interstitial and binge ad options, a format where viewers can watch all their ads at once so they don’t have to be interrupted later. 

After a lifetime of seeing TV ads presented in one way, these new, more creative ad options feel refreshing. They also help keep audiences engaged. With more of a change in what they’re watching, most people are much less likely to get bored. In fact, Hulu claims that the options provided by their platform lead to a 150% increase in brand recall.

Targeting 

OTT advertising offers many advantages to brands looking to get more for their money, as well as more views, more click‐throughs, and more sales, and provides opportunities to get a message in front of the right people at the right time. Leveraging the audience data that OTT channels provide, advertisers are able to produce highly targeted campaigns. They can segment audiences based on geographic location, demographics, preferred content, and much more. Advertisers can also capture impression data for guiding future ad buys.

By narrowing down an ad’s audience to include only those to whom it is relevant and applicable, brands drive awareness. They also save money by not showing ads to obvious dead ends. Audiences also appreciate not being shown ads that don’t apply to them.

Consolidation 

As OTT content becomes more popular, the industry is starting to consolidate. For example, Xumo was acquired by Comcast in February 2020. According to Bill Condon of Xumo, being tied to a larger company has boded well for them. 

“Right before the pandemic hit, we were doing well. But, being tied to a larger company has been really beneficial. I’d say there’s four key areas in terms of what has been helpful to Xumo,” Condon explained.

Condon shared that distribution, discoverability, content, and data were four primary benefits of the merger for Xumo. With Comcast’s help, Xumo now reaches a wider audience and is easier for potential audience members to find. It has also seen a large increase in the content acquisition budget, and has access to more data and data processing tools. Other companies are likely to undergo similar merges and find similar benefits, moving forward. 

The number of unique OTT providers will likely decrease, now that all of the major players have introduced their OTT platforms. The average OTT consumer is willing to pay for about 3.2 platforms. Past this threshold, they are willing to accept ad-supported OTT, which major leaders already offer (i.e. Peacock and HBO Max starting next year).

What’s Next? 

At MediaRadar we track what happens to our customers and, out of those 2,400 customers we track, there was more M&A activity last quarter than any single quarter in our ten years of doing this. As for the number of OTT platforms, this consolidation is a strong sign that the industry is maturing. As the platforms band together for various benefits, we will soon learn what else they can offer. 

With many big name players already on the scene, the future of OTT advertising will be interesting. As advertisers continue to capitalize on the benefits of OTT, it is only a matter of time before we begin seeing even more of its potential and profitability play out. 

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