The discussion and debate about measurement in online advertising is rife at the moment. However, one thing is clear: For too long viewability has been used to paint an incomplete picture of ad impact.
We’ve known for a while that viewability is an imperfect metric. And, while standards have improved, the next step in online measurement for brands has been overdue. Media agencies have been working on this problem for a while. They rightly seek to build more sophisticated models in order to spend their clients’ ad dollars within environments that are truly delivering value.
Though some studies have been done, dentsu international has just released one of the most comprehensive to date. Their Attention Economy research is the product of a three year study involving multiple media partners. The goal is to truly understand the drivers of attention and create a real metric for advertisers to use going forward.
What delivers attention
Critically, the study demonstrated that attention is three times better at predicting outcomes than viewability. They uncovered four key factors that deliver attention:
1. User choice
Forced ads gain more raw attention vs. ads that are easily ignored. However, when a consumer voluntarily views an ad, it results in a significant impact on brand lift metrics, whether they viewed for 2s or 20s. Formats that earned attention yield better, and much quicker, outcomes than outcomes than forced formats.
2. Creative
The importance of creativity on ad effectiveness has been well documented. However, it was important to measure its impact within their Attention Economy framework. The study showed that ads optimized for the Teads platform gained a 49% boost in attention vs the original. This is a result of optimizing TV ads for a mobile experience. These grab attention from the start through use of techniques such as contrast, addition of text, animation, or bold colors.
3. Relevance
The dentsu study showed that placing ads within relevant context for the reader gives an uplift of Attentive Seconds Per 1,000 of 13%. Recently, IAS conducted a study with Neuroinsights in the U.S. that demonstrated 23% more detailed memory and 27% more global memory for ads that were aligned with the contextual content, compared with those that were not. We have also observed superior branding impact for ads that are contextually aligned.
4. Time in view
Finally, viewability on its own isn’t enough. However, time in view has been confirmed as an important factor for attention by the study. Both video and display ads quantifiably benefit from quality, viewable time.
Good news
All of the above is fantastic news for publishers. The study clearly shows that premium publishers drive high engagement of users with quality content. and that induces a slow scroll speed. When this is tied in with in-article, outstream video ad formats, it delivers an average of 12.2s of time in view (even higher than instream) and twice the amount of attention compared to social media.
Ever since viewability became a priority, publishers have suffered. They’ve also been forced to include ad formats that provide sub-standard user experiences, purely because media buyers are focused on it as a metric. But the quantification of attention can shift this balance. Ad buyers will increasingly be able to focus on media plans that are based on attention and deliver clear business outcomes.
This will bring back to the center stage not the importance of the quality of the content. It also aligns ads within the context that they’ve been placed.
There are many factors of digital media that are changing for the better. Advertisers, agencies and media owners are all embracing an online ecosystem that’s free from third party cookies. They are aware of its impact on both society and the environment and focused on the quality of ad experiences, rather than the quantity. Attention can be a cornerstone of this new landscape, where a range of brand metrics can be more clearly attributed to certain campaigns.
This is where premium publishers can excel, showcasing greater value to brands than ever before and securing a greater portion of online ad revenue that is currently held in silicon valley. This can be done whilst simultaneously creating even greater trust with their engaged readership and therefore helping develop a truly sustainable media ecosystem.
In the pop culture zeitgeist “Game of Thrones,” the Hand of the King bears the burden of their leaders’ whims. So too might our generation’s diversity, equity, and inclusion (DE&I) leaders when the health of an organization hinges on its leadership’s ability to foster a feeling of safety internally. That means creating an environment where employees of all levels, backgrounds, and abilities feel confident that they will not be exposed to discrimination, criticism, harassment, or any other emotional or physical harm.
Life on the front lines or cutting edge of anything can be a lonely place. But particularly heavy lies the crown of those who are the cornerstones of transforming the future of workplace culture.
With this in mind, we’d like to introduce some of the leaders on the front lines of the diversity, equity, and inclusion movement. These leaders’ each have a personal story that informs the work they do and how they got there. They also posses practical knowledge and experience that can help others make lasting change in their organizations. Over the next few months we’ll share conversations with DE&I leaders from a range of organizations to understand, and learn from, their effortsto support enduring change.
History repeats itself
Last year, organizations across the country pledged to make advancements in diversity equity and inclusion in response to the racial justice movement that arose following the murder of George Floyd. Outraged by the actions of public officers, our country began to look inward at the inequity and injustice surrounding us. Once again, it exposed the lack of representation, psychological and even physical safety existing in our communities and places of work. So, a generation of newly minted and veteran DE&I leaders were empowered – and pressed – to devise and advance equitable agendas.
Meanwhile, optimistic albeit cynical onlookers like myself (an entrepreneur and self identified corporate refugee) could not help but recall similar awakenings in the past. This isn’t the first time outrage has rippled through corporate America. Unfortunately, time and again, we’ve witnessed committed companies and leaders fade into the chorus beneath the lead notes of profits and quarterly goals.
An empathetic approach
After a year working with these leaders as an empathy training consultant, I learned that many of them have overcome a kaleidoscope of challenges themselves. I chose to lay my judgments to the side and to see them as the allies and change-leaders that they are, particularly given a lack of precedent (and often leadership) to guide them.
In an effort to support other optimistic and like-minded leaders, I decided to do my part to help unlock and share their wisdom, elevating their voices so that peers and supporters can hear them. This new project, Driving Change From the Inside, distills insights from intimate conversation with leaders at a range of organizations including NASA, NPR, Robin Hood Foundation, and Havas Group. It is about those who are leading the charge of change to correct issues of discrimination, harassment, emotional harm, and inequity.
Tactics and takeaways
The series dives into the practical tactics and best practices leaders want to learn about and enact. It also offers an intimate look at the people serving in these roles. What we find is that their success requires the passion and support of all the people around them – from the CEO and the board to the entire executive team and leadership team, and rank and file employees who share the mission and belief.
We hope that viewers and readers will open their compassion as they experience the backstory of these individuals as well as the complicated layers of their present. As one interviewee said, “we’re running the same race but with different roadblocks.”
Driving change
All of our interview subjects have attained great achievement. Their stories are remarkable, but far from over. These conversations provide insight into the work required to establish and maintain a culture that fosters the DE&I agenda, including the steps our guests have taken, the processes and procedures they’ve implemented, and the support systems they’ve needed to achieve short- and long-term goals.
In the absence of an inclusive and empathetic past to guide us, these pioneers are writing a guide book that we all can put to work in our own organizations. Through these conversations, we can begin to understand the “why” behind what leaders do that equips them to show up day after day in the arena, bloodied while projecting grace, and Driving Change From the Inside. Their experiences and insights give us hope and support as we shape the future of work with diversity and empathy at the core.
Key takeaways, highlight videos and full interviews:
Michael Tennant is a founder, writer, and movement-builder dedicated to spreading tools of empathy and helping people find their purpose. Before founding Curiosity Lab, Tennant spent 15-years becoming a media, advertising, and nonprofit executive, and delivering award-winning marketing strategies for companies like MTV, VICE, P&G, Coca-Cola, sweetgreen, and Oatly.
Tennant founded Curiosity Lab in 2017 and created the conversation card game Actually Curious. Actually Curious became a viral sensation in 2020 during Covid-19 and the rise of the racial justice movement for helping people build meaningful connections and to tackle the important topics facing our world.
He has channeled his business success and momentum into a sustained movement supporting BIPOC and other underrepresented communities through speaking, writing, leadership, mentorship, consulting, partnerships, and talent-pipeline programs.
Facebook, Instagram, and Twitter use algorithmic processing for image analysis and sharing. The platforms try to understand the content of these images, and they algorithmically detect the persons and objects within these images at the pixel level. Benjamin N. Jacobsen’s research, Regimes of recognition on algorithmic media, examines how algorithmic media shapes and controls how people see the social world. He defines the concept of regimes of recognition as the algorithmic tools, techniques, and practices that social media platform use to decide recognizability within their platforms.
The platforms use algorithms to crop images to generate engaging content. Applicable to Jacobsen’s research, the algorithm systems learn to detect and weight certain features in images rather than others. In other words, the algorithms actively generate what is recognized. He agrees with researcher Louise Amoore, who believes social platforms decide what images are interesting and recognizable. Amoore states, “they actively generate recognizability as such so that they decide what or who is recognizable as a target of interest in an occluded landscape.”
Twitter’s detection algorithm
In September 2020, consumers complained that Twitter’s image-cropping algorithm favored white faces over black faces. One example showed that the algorithms consistently cropped out images of former president Barack Obama. Experiments with stock photo models, cartoon characters, and even white and black dogs resulted in similar detection biases. Eventually, Twitter’s chief design officer, Dantley Davis, agreed there was a racial bias in the algorithm. He added, “the algorithm is not explicitly racist since it does not make its decision based on particular faces but rather on the contrasts that are calculated from the pixel values of the image.”
According to Twitter engineers Lucas Theis and Zehan Wang, the company first used facial recognition to auto-crop images. However, it often awkwardly cropped faces not centered within the picture. Twitter then moved to use deep saliency prediction networks to find the “most interesting part” of the image. Saliency maps use predefined areas of images to evaluate the pixel contrasts between different image regions. These data-trained neural networks and other algorithms find and then crop around the most engaging area of the image. Unfortunately, as the algorithms decide what is uploaded, they also determine what is nonrecognizable and set conditions for who is visible on the platform.
Deciding recognizability
The algorithm disregards socio-cultural contents and context in its processing of images. Regimes of recognition can easily make certain people non recognizable — focusing on specific features of an image and ignoring others. Algorithmic media platforms produce rules for what is visible and what is not visible.
Jacobsen questions the shaping, organizing, and automating parameters of cropping images. He sees decisions of inclusion and exclusion as a fundamental political question. Saliency detection algorithms rest on the assumption that some things deserve attention and others do not. Further, Twitter’s role in cropping people’s images (algorithmically) decides what elements in images are redundant. This begs a larger question as to why social media platforms need to edit people’s uploaded images at all?
Social media platforms algorithmically shape and organize people’s factors of attention. Twitter offers a prime example of the algorithmic processes in how it cropped out out black faces because it did not recognize the image. This sends a signal that that what is non-recognizable is unimportant. Further research is needed to examine the role (and potential biases) of algorithmic cropping, techniques, and results of these tools on other social platforms.
Privacy is rewriting the rules of adtech, causing seismic shifts to the way media is bought and sold.
Over the past 10 years, digital advertising has run on personal data and identifiers that connect consumers across domains. Today, tightening privacy regulation and heightened consumer awareness about how their data is being used has triggered global changes. We already see the effect. The third-party data that fuels digital advertising is continuing to disappear. And Snap’s shares dropped by 25% because of Apple’s App Tracking Transparency (ATT) feature in iOS 14.5, requiring consent from users to track them across apps and websites. It’s also reported that Snap, Facebook, Twitter and YouTube are set to lose nearly $10bn due to ATT.
As privacy disrupts the way digital advertising has operated for years, we’re seeing two seismic shifts in the ecosystem. Firstly, there is a transfer of power in digital advertising towards first-party data owners. Secondly, there’s a move to processing data on-device. Digital advertising increasingly requires privacy at its core. Therefore, first-party data owners will need the infrastructure to control, connect and scale their data while planning and buying campaigns.
The shift to first-party data and on-device
Data that was once accessible by ad-tech is now deprecating because of privacy. Control of this data has returned to its rightful first-party owners. This includes publishers, advertisers, and other businesses that have first-party data.
First-party data owners are able to build businesses from their data because they have a direct relationship with their users. Publishers such as Penske, Insider, Future plc, and others are launching successful first-party data platforms and packaging up their consented audiences for advertisers. For example, Future’s first party-data platform, Aperture, has increased the addressable inventory sold to advertisers by 150%. And Insider sees 19 out of its top 20 advertisers using its first-party data platform SAGA, at a 95% renewal rate.
Advertisers are also bringing their first-party data to publishers to match and model audiences and businesses like Instacart, Doordash, Uber, and Amazon see tremendous advertising opportunities because they have first-party data.
First-party data is made useful by on-device technology, but not at the expense of people’s privacy. This is because on-device makes it possible for data processing to happen in real-time. And user data stays on the user’s device instead of being sent to the cloud. It’s the direction of travel for the industry, moving adtech from an era that leaks data to a privacy-first era that protects it. In fact, other tech companies such as Apple, Facebook, and Google have and are re-architecting their technology for on-device processing.
Rebuilding for privacy
We believe that privacy is a force for good in advertising, and on-device is the future of digital advertising. However, we need to rebuild and provide first-party data owners with the necessary tools to scale.
For advertisers, the supply paths can be inefficient today because they need to build it publisher-by-publisher. Publishers also have no consistent way of making their data available to advertisers in a privacy-compliant and sustainable way. To seize the opportunities ahead of them, first-party data owners require a privacy-first infrastructure for digital advertising to be immune to any dramatic regulatory or browser-level changes,
This infrastructure will help publishers and advertisers to connect safely. It’s a way for personalized advertising to continue for first-party data owners, a place where digital advertising can continue to thrive — without the data leakage we see happening today.
Building on a privacy-first infrastructure is a long-term, sustainable strategy for publishers, advertisers and other first-party data owners. It will bring much-needed transparency, scale and privacy to digital advertising. It’s no longer the time for band-aid solutions to the impact of privacy on digital advertising. Any solution that isn’t grounded in privacy won’t stand up to oncoming regulatory, browser changes, and consumer scrutiny.
About the author
Joe Root is co-founder and CEO of Permutive. Following a BEng Computing at Imperial College and MSc Computer Sciences at Oxford, Joe started Permutive with his co-founder, Tim Spratt, joining Y Combinator in 2014.
The contents of your TikTok “For You” page, a stream of videos curated by the near-omniscient algorithm, says a lot about what you stand for, who you are, and what you like. It’s part of what draws audiences to the platform. When you open the app, you know what to expect. And, better yet, you know you’ll like it.
This type of personal experience is what digitally native audiences have come to not just enjoy, but expect, from the content they consume. If it isn’t authentic, vulnerable, and personal, they don’t want it.
So, when it came time to reimagine what video content would look like for Ascend, Harvard Business Review’s brand for young professionals, we knew we’d have to make it real. We knew we’d have to take a host-driven approach. And we knew we’d have to meet our audience where they are. On TikTok, yes, but also on YouTube, Instagram, and whatever comes next.
Appearing as on-camera hosts, being authentic in front of an audience of millions, and making sure that audience feels engaged — this is all easier said than done. Here’s how we make it work at HBR, and some tips on how to make it work for you and your audiences.
Authenticity and vulnerability are necessities.
Obviously, neither video nor social media was new for HBR in 2020. But that was the year Christine vs. Work marked the first show that we designed specifically and primarily for YouTube. This meant leaning into a host’s personality (in addition to credibility), embracing mistakes that make us human (the word “flawesome” is often applied), and creating a dialogue with our audience.
In each episode, I (Christine) address a real work dilemma, seek advice from experts, and then put that advice into practice (with varying levels of awkwardness). Although I feel like I “should” know the answers to my biggest career questions by this point in my path as a manager, I often don’t — or I’m not confident about them. In Christine vs. Work, I’m honest about that. It’s that vulnerability, which many can relate to, that earns the trust of our audience.
The same goes for Career Crush, another host-driven, YouTube-first series we launched in 2021. In this show, I (Kelsey) interview people with my “dream” careers to get to the bottom of what their jobs are really like. I dive into how much money they make, misconceptions about their roles, and whether they actually enjoy what they do for a living. Most of the time, I have no idea what it takes to get a job like theirs, and I don’t pretend that I do. After all, I’m not an expert in software engineering, or Twitch streaming, or photography. I’m still in my early career, too. So, the questions I ask and the ideas I uncover are based on things I’m genuinely curious about. That curiosity is crucial to creating a connection with our viewers.
A key element to making this work is to remember that you can’t manufacture “realness” and “authenticity.” We film in our own homes as much as the office (a necessity during lockdown), process complex emotions on camera, and are transparent about ourselves in front of a virtual global audience. It’s not always easy for us as hosts, but the human connection that forms from sharing our vulnerability is a lasting one. That’s particularly important for bridging the HBR brand to Gen Z audiences and reassuring them that we’re here for them in a world where it’s harder than ever to determine what is real and who to trust.
More voices, more perspectives.
We’ve learned, as individual hosts bringing our authentic selves to the fore, we’re not going to be everyone’s cup of tea. That’s precisely the point: We want our audience to connect with whoever they vibe with most. And, when it comes to host-driven content, that means diversifying the personalities, voices, and perspectives on our channels.
We put great care in our guest selection to fulfill that mission. In Christine vs. Work, we feature practitioners in addition to academics and thought leaders from around the world. In Career Crush, there’s no substitute for hearing first-person accounts of what it’s like working in a specific role or industry.
We also think carefully about the “faces” of Ascend. By design, our TikTok channel isn’t led by any single content creator. Although there are recurring familiar faces that deliver a regular dose of work advice and office humor, we encourage each presenting editor to lean into their distinct and authentic storytelling style. Plus, anyone in the company who wants to pitch, write, shoot, or star in a TikTok is welcome to join the party (a.k.a our weekly brainstorm). Who knows whose video will go viral next?
Lastly, we recently launched a pilot called HBR Presents on our video platforms. In this initiative, we partner with and feature talented external creators to share their expertise on topics like personal finance, early career, and email etiquette. The vision is to thoughtfully grow this creator network, expanding our offerings for an audience hungry for helpful and engaging content delivered in a relatable way.
To put it simply: You can’t have authenticity without hosts who are willing to be vulnerable. Expand your pool of hosts, make it diverse in every sense of the word, and never pair a host with a video or topic that doesn’t resonate with them. Audiences can spot an uniterested host from a mile away.
We’re listening. You matter.
What’s most exciting about our roles as hosts and producers is that we’re able to forge a connection, through our own voices, with our audience. Whatever platform or channel, we commit to reading the comments, replying as ourselves, and responding to questions and stories that others have shared with empathy and insight. We take viewer requests and incorporate them into future episodes. In addition to performance analytics and audience data, we’re able to synthesize viewer feedback to inform Ascend editorial projects across the board. With host-driven video, audiences keep coming back not just for the content, but for the hosts themselves. So creating that engagement — that direct connection — matters.
Long story short, we’re listeners, not lecturers. This philosophy defines our commitment as editors. We also represent a piece of Harvard, for an audience that demands — and deserves — a brand they can trust.
And if you find us on TikTok, Instagram, YouTube, or Ascend, our goal is that you’ll feel like this content is delightfully “for you.”
About the authors
Kelsey Alpaio is an Associate Editor at Harvard Business Review.
Christine Liu is the innovation editor at Harvard Business Publishing’s product incubator.
The classics are so well-known they’ve become punchlines: acai berry treatments, one simple trick to get rid of belly fat, get rich working from home. Newer scam ad verticals like bitcoin and crypto schemes, home solar energy savings, and nutritional supplements for diabetes sufferers are slamming consumers on every corner of the Internet.
And yet scam and deceptive advertising is simply accepted as an ugly part of digital media and advertising. And it’s only getting uglier. Since the beginning of 2021, The Media Trust has detected a 50% increase in scam campaigns hitting publisher properties. Still, too many AdTech companies and publishers look the other way as the scams roll through the programmatic pipes, hoping their audiences have the good sense not to be bamboozled.
The Media Trust detected unique scam campaigns ramping upwards throughout 2021 with a major spike in July.
Unfortunately, there have been virtually no consequences for sites running scam ads. There’s the occasional massive fine, like when the Federal Trade Commission came down hard on Clickbooth for its acai berry barrage. However, for the most part, scammers advertise with impunity and AdTech and publishers become their accomplices.
However, consequences may be coming—and the fallout may be dire—judging by the developing online regulatory situation in the UK and increasing attention elsewhere.
The scope of online safety measures
British Prime Minister Boris Johnson has promised to present the Online Safety Billbefore Christmas. The bill would require publishers, social networks, and many communication/messaging apps to deter, remove, and mitigate the spread of Illegal and harmful content—particularly when aimed at children. The bill threatens fines as high as £18 million or 10% of global revenue, and possible criminal sanctions.
Beyond content that sexually exploits children (which must be reported to law enforcement), the harmful content in question includes malicious trolling and racist abuse—with the added goal of “protect[ing] democracy,” presumably through stemming online disinformation. The UK Office of Communications (Ofcom) will enforce the proposed law, which will also give the regulatory agency the ability to completely block access to a site or platform.
However, advocates like famed British personal finance advisor Martin Lewis think the bill doesn’t go far enough. That’s because it’s laser-focused on user-generated content and doesn’t regulate online advertising—most notably scams. Lewis, whose likeness is often exploited in scam ads pushing bitcoin schemes, has been on a crusade against online scam ads for years, including forcing Facebook to settle for £3 million over a 2018 lawsuit regarding more than 1,000 scam ads featuring his appearance.
Drowning in scam ads
The data backs up Lewis’ claim that the “The UK is facing an epidemic of scam adverts.” In 2020, 410,000 cases of fraud reported to the UK police represented a 31% jump from the year prior, according to consumer group Which?, with £2.3 billion fleeced. Including anxiety and psychological damage, Which? puts the actual total suffered by UK consumers at £9 billion.
And the greatest frustration among consumers and public advocacy groups is the lack of recourse and sense that scammers act with impunity—aided by AdTech and digital media. In another Which? report, 34% of consumers said a scam they reported to Google was not taken down, while 26% said the same of Facebook.
In 2020, The National Cyber Security Centre removed more than 730,000 websites hosting scam advertising landing pages featuring the likenesses of Lewis, Richard Branson, and other celebrities. Despite that effort, The Media Trust has seen a 22% increase in these types of scam (aka “Fizzcore”) content throughout 2021 that use similar landing pages.
Fizzcore attacks, which typically feature celebrities and hawk bitcoin scams, have grown 22% over 2021 despite crackdowns.
Fizzcore is more nefarious than other scams because it employs cloaking to hide malicious creative and/or landing pages from creative audits and other detection techniques. The vast majority of these have been pushing bitcoin investment scams, often with the same Lewis and Branson content.
Personal finance advisor Martin Lewis and billionaire philanthropist Richard Branson are common faces in scam ads directed at UK citizens.
Even if online scam advertising fails to make the final Online Safety Bill, a reckoning for scam ads could come in other forms. The UK’s Department for Digital, Media, Culture and Sport (DMCS) is developing the Online Advertising Programme (OAP), a framework that enables regulators to address potential consumer harms from digital advertising, including scam ads.
And just to pile on, UK. Home Secretary Priti Patel announced a relaunched Joint Fraud Taskforce on Oct. 21. Addressing the significant rise in scams during the peak of the coronavirus pandemic, the taskforce will focus on addressing scams and fraud through private-public partnerships and refurbishing of government reporting tools.
Fallout beyond the British Isles
The ramifications of all this regulatory (buildup) ought to make the industry anxious. The Online Safety Bill would put heavy new burdens on publishers and social media in moderating user content in the UK, but the inclusion of scam ads might directly affect revenue. In the absolute worst-case scenario, publishers would need to vet all specific advertisers running on their sites as well as be familiar with all creative to avoid liability. That could mean many risk-averse publishers shut off programmatic advertising.
Scam advertisers are notoriously hard to pinpoint. They use any and every buying platform available, and then tools like cloaking in code to hide their malicious motives. When it comes to rooting out scam campaigns, the proof isn’t completely in the ad code. While creative and domain patterns can be identified and blocklisted, finding scammers also requires investigation into the elusive end-advertisers, their motives, and their histories. It’s not impossible, but it requires dedicated teams always on the pursuit.
Beyond stopping scammers cold at the source, the next best way to stem proliferation of scam ads is to bring culpability to publishers and their AdTech partners. However, publishers are the low-hanging fruit. The website was where the consumer was attacked, so they’ll always be the prime regulatory target.
Despite the intense pressure in the U,K., regulators in other countries are also most definitely paying attention and looking for a potential roadmap. In the U.S., reform of Section 230 of the Communications Decency Act—which shields online media companies from legal liability regarding user-generated content—appeals to both major political parties. Really, what politician would say no to the easy win of protecting consumers from online scams? According to the Federal Trade Commission, consumers lost $3.3 billion to fraud in 2020, up from $1.8 billion in 2019—and that’s only the 2.2 million reports filed.
Self-regulation to the rescue?
The IAB UK is conversing with the DMCS on the OAP, but ultimately the trade group believes industry self-regulation is the answer. While self-regulation on the data privacy front became a mockery of itself, self-regulation of scam ads doesn’t need to meet the same fate. First off, trade groups like the IAB need to establish stronger ad quality guidelines that offer standards for handling malvertising, scam, and other harmful ads.
In addition—or short of that—publishers need to take control of their own destinies regarding scam ads. Every ad quality provider should be identifying scam ads and enabling publishers to block them. Slapping down redirects simply isn’t enough for a bad-ad-blocker—a publisher serving scam ads is violating the trust of its audience and leaving consumers vulnerable.
Not only is blocking the scam ads the right thing for publishers to do, it is a way to get ahead of—or perhaps helping avoid—a regulatory onslaught that will have catastrophic revenue consequences. Failing to mitigate will come back to haunt the industry.
Search is a topic media companies often overlook. Most of us associate the word search with search engines like Google/Bing/DuckDuckGo. These organic channels are often how visitors (and at times internal team members), will search a content catalog. But it’s time to give some serious thought to your internal, on-page search.
There are many reasons to optimize internal search such as:
The way in which it reveals clear ROI as it complements social media and external search.
The way that it helps clarify user intent, which informs you about navigational issues and content needs.
How it allows you to reveal the depth of your catalog by exposing visitors to more content
The fact that optimized search empowers visitors to find solutions to their problems, meaning they are happier overall.
It empowers journalists to discover content on your owned channels as opposed to external ones.
The good news is that creating optimized site search may be easier than you think.
7 tips to achieve a best-in-class search and discovery experience
Tip 1 : Know your user’s intent
Your goal may be for users to consume content. However, before building the ideal path to that content, you must clarify their intent:
Are they looking to find a specific piece of content e.g. “yesterday’s premier league score”?
Are they researching a specific topic or theme e.g “eco-friendly lifestyle”?
Or are they looking for inspiration? Catching up on news?
Each user’s intent(s) are solved with different discovery patterns: search, guided discovery, or recommendations. It’s critical that you identify what your specific user’s intent and motivations are. Make sure that you spend time mapping this out, to then serve each user individually.
Tip 2 : Audit your content catalog
How many long-lasting pieces of content do you have vs. short lived items?
Among your live pieces of content, what percentage of content is actually being consumed today?
Are there opportunities to expose more content, perhaps resurfacing historical archives or adding in new partner content?
These types of questions will help you to define priorities for your discovery strategy.
On top of that, the quality of your metadata (date of publication, theme, topic, etc.) is crucial to ensure a good user experience. Be clear on the attributes that will determine how your content ranks when queried. Think about what uniquely differentiates your content catalog such as freshness, particular niches, short or snappy content, exclusivity, etc.
Tip 3: Identify your priorities, KPIs, and North Star metric
In order to build a great search and discovery experience, you need to be clear on your priorities and key metrics. Perhaps that’s to increase time spent, increasing engagement to support an ads-based model. Or it might be to increase premium subscriptions.
It’s not uncommon for media companies to run on several business models: ad-based, subscription-based, and even ecommerce. Also, priorities, goals, and primary metrics may shift and change over time. Common video industry on-demand models include AVOD (advertising-based video on-demand), SVOD (subscription video-on-demand), and TVOD (transactional video on-demand). Identifying your primary model(s) and goal(s) is critical to building great user experiences to achieve those goals.
To achieve your goals, consider:
engagement and discovery patterns like related content recommendations, or topic refinement with suggested tags.
building content discovery widgets that provide a glimpse of your content catalog from third-parties and partner websites.
personalized recommendations and other ways to engage loyal subscribers. Help them discover new content and gain more value from your platform.
Tip 4 : Build your discovery map
After identifying your goals and core metrics, you should then build a discovery map that reflects your objectives and specific needs. Here is a template and example to use.
On the X axis: describe your different content types: Fresh news and short reads, Reports and long-form, archives, niche content, etc.
On the Y axis : your various user’s or persona’s intents
In each content type box of this matrix, you then describe a “Discovery scenario”. For example, what is the preferable touchpoint (e.g “Search box” or “Discovery tab” or “Home Page”), or what is the most important ranking criteria for your content (e.g. “date of publication” and “topic”), and/or what is the CTA that compliments your North Star metric (e.g “read another article” or “sign in”)
Tip 5 : Evaluate your existing search and discovery
Next, audit your existing setup. Starting by evaluating your various discovery scenarios and note their pros and cons.
Below are examples of other items to evaluate throughout your audit. How do you manage:
typos? Ex: “I want to watch lalalnd”
broad queries? Ex: “I want to watch romantic comedies”?
natural language queries? Ex: “I want to watch Rom Coms”?
There are many more. Remember: The better you analyze your existing search & discovery shortcomings and opportunities, the better you can move faster on optimizing them.
Tip 6 : Find the right balance between AI-led and human-led curation
Curation strategies vary a lot across the media industry. While publishers often rely heavily on editorial teams, video platforms are often algorithmically curated. There is no right or wrong way to do this; finding your balance is key.
AI, for example, can be a way to surface what you have outlined in your content discovery map. Among the discovery scenarios that you have considered, think about how AI can help augment your team’s work. It can bridge gaps or free up editorial time. Finding this balance allows for increased efficiency and a focus on quality.
There are many different ways to leverage AI, here are a few. It can:
entirely power content blocks or rows leveraging various recommendation models
be used on top of manually curated blocks to dynamically reorder content, depending on their popularity
shorten the path to content by leveraging intent detection, and displaying personalized suggestions of content or categories
Tip 7 : Select the right solution for you
After following the tips outlined throughout this, you will be in a better position to select the right solution for your business and team. Your implementation may consist of building your own search and recommendation engine. It might consist of building from external platforms that are made for developers. Or perhaps you’ll buy off-the-shelf solutions.
In making these decisions, here are a few more considerations that are important at that stage.
Think through your unique requirements in terms of short- and long-term scalability. Not all solutions are equal in terms of a geographical footprint, expansion, and the ability to manage audience peaks, for example.
Similarly, understand your team’s unique situation when looking at how architectures and services selected will be built and maintained. If building things out in-house looks to be your best decision, consider what it takes to maintain, scale, and handle regular change requests and develop features and iterations.
Think about the future of discovery: What you have defined today in regards to your discovery map will likely evolve and change as quickly as consumer’s behaviors do. Consider a solution that will be future-proof, enabling you to consistently offer the most enjoyable and rewarding experience for your customers (and teams).
Our hope is that these tips will help you create the most optimized experiences for both your customers and your teams. Best of luck in planning, auditing, and creating your unique search and discovery experience. It’s worth it because effective search and discovery will help engage your site visitors and convert them into fans for the long-term.
The pandemic amplified the value proposition of video streaming — giving consumers rich menu of high-quality content. Deloitte’s new research, Digital media trends, 15th Edition, finds that consumers are enjoying the diverse diet. They report an estimated 21% boost in consumer spending on subscriptions in the first half of 2021.
Increased viewership
According to the report, almost half of all respondents (48%) spend more time on online entertainment than six months ago. While digital entertainment consumption increased during the pandemic, there are distinct differences across generations. Boomers and Gen X watch TV shows or movies at home while Gen Z plays video games and listens to music.
Subscription services
Eight in 10 (84%) respondents now pay for a subscription video-on-demand service (SVOD). The average household has four subscriptions, consistent with one year ago. Consumers prioritize their sign-ups by new original content, a broad content library, and a low enough cost to subscribe.
While SVOD services release quarterly growth numbers, the number of people who canceled, or both added and canceled, a paid SVOD service is flat at approximately 38%. Deloitte surmises that a few top-tier SVOD services keep subscribers while other services are added and canceled.
Cancellation
Subscribers report that their top reason for canceling a paid SVOD service is high costs. (Note the opportunity for ad-supported subscription tiers.) Led by Gen Z and Millennials, there’s a growing market of ad-supported video tiers. Almost two-thirds (65%) of respondents report using free ad-supported video services. In fact, according to nScreenMedia, drive ad revenue earned by virtual linear channels will double in size from $2.1 billion in 2021 to $4.1 billion in 2023.
The second most common reason people cancel a paid SVOD subscription was that they finished the show they signed up to watch. Deloitte notes that this “churn & return” behavior — canceling and resubscribing to the same service later, is most common among Millennials (47%) and Gen Z (34%). Respondents note their top reasons for resubscribing include a new release of their favorite show, managing costs, receiving a free or discounted rate, or the content they wanted to watch moved to a different service.
Recommendations
Gaming and social platforms also offer entertainment choices for consumers, especially for Gen Z and Millennials. While streaming video services will continue as a dominant force in the entertainment industry, SVOD players must focus on attracting, keeping, and maximizing subscribers’ lifetime value. Deloitte’s recommendations include:
Introduce more pricing tiers while keeping premium content for full-paying subscribers. Further, consumers like the idea of loyalty programs that offer discounts on other services and products. Specifics include membership and loyalty programs that allow users to earn access to content and VIP programs that offer exclusivity to the highest-paying tier.
Create bundling options for paid subscribers but ensure there is freedom and flexibility with each offering.
Work with creators and influencers to create social connection points to content. Being part of social conversations offers new dimensions to the subscriber experience.
Today streaming video services offer a singular experience — lean back and view quality content. They may need to evolve their ecosystem to generate stickiness among younger cohorts. Developing and experimenting with connections to social, gaming, or music platforms is essential to growing their media and entertainment ecosystem.
The subscription economy is booming. From music and movies to meals and clothing, consumers want what they want to be available when and how they want it, and without onerous upfront costs. For publishers facing the uncertainties of digital advertising — dominated by the duopoly — subscriptions offer predictable and powerful revenue streams. They also bring with them an even more intimate understanding of the audiences they serve.
One of the biggest media success stories in capturing reader revenue, The Washington Post has introduced a new mobile-first product that encourages audiences to multitask. The 7, launched in September, distills the top seven headlines into digestible snippets and delivers them daily to time-crunched audiences at the same time (at 7 am Eastern) on the channel of their choice.
Website, app, and email newsletter are just a few of the channels consumers can use to skim through the headlines (roughly 300 words in total). And, if readers don’t have time to scroll or swipe through the stories, they can opt to listen to the news instead.
But the real power of the product isn’t the multi-channel delivery. It’s the way it fits into multiple stages of the funnel, allowing The Post to attract new audiences and convert existing ones with the same content. Even if readers don’t subscribe on the spot, their continued interaction provides valuable data points (email address if readers signed up for the newsletter) that equip The Post to market and move audiences ever deeper into the funnel.
Continuing with our series of DCN video interviews, I talk to Coleen O’Lear, Head of Mobile Strategy at The Washington Post. Drawing from experience growing The Post’s digital audience and cultivating stronger reader habits, O’Lear shares how The 7 has evolved from being “an accessible, digestible on-ramp for the news” to a product that “drives exceptionally high engagement.” She also discusses the “experimental mindset” publishers must adopt to make content readily accessible and digestible, not to mention enable their success to be scalable.
WATCH OR LISTEN TO THE FULL INTERVIEW
FULL TRANSCRIPT
Peggy Anne Salz, Founder and Lead Analyst of Mobile Groove interviews Coleen O’Lear, Head of Mobile Strategy at The Washington Post:
Peggy Anne Salz: It’s a morning routine for many – wake up, reach for the phone, check the headlines. Now more than ever, we rely on trusted sources to inform our perspective on what’s happening globally, as well as close to home and the stakes have never been higher. What a responsibility then to be the steward of one of the most trusted names in news charged with making sure those headlines are what we want when we wake up and that they are there, they are there for us. And in the middle of all this, how do you infuse a nearly 150-year-old legacy brand with a sense of ‘always on’ experimentation to produce this? How can you then scale both, maybe the cool new products that I’m talking about here and the number of subscribers who pay to access them? A lot of tough questions, and we get the inside track here today on Digital Content Next, the series from DCN, which is a trade association serving the diverse needs of high-quality digital content companies globally.
I’m your host Peggy Anne Salz and my guest today is Coleen O’Lear, she is Head of Mobile Strategy at the Washington Post, which I’ve been talking about. Coleen focuses on editorial and product development aimed at growing the Post’s digital audience and cultivating stronger reader habits. She was a founding member of the emerging news products team where she shepherded complex projects and initiatives from inception to implementation, including the Washington Post’s select app By The Way, its channels on Snapchat, Apple News, and Facebook news. And most recently, The 7, which is the big part of our focus on the show today. Welcome Coleen, great to have you here.
Coleen O’Lear: Thanks so much for having me, Peggy.
Salz: So you’ve said it yourself, and I quote you it’s all about creating new and exciting ways to surface news for time-crunched readers to consume. I’m just wondering, how many ways can readers currently access the news we’re talking about on how many platforms speaking here, of course, about The 7.
O’Lear: The 7 is something that we offer in a lot of different ways for you to be able to consume it, how you want it, when you want it and where you want it. So, we offer it on the app, we offer it on the website, we offer it on social off of our owned and operated platforms, we distribute it on Apple news, we have a newsletter and an SMS experiment. People are really busy, and they have a lot of options and preferences.
So, we created The 7 to really be an accessible, digestible on-ramp for the news for busy readers who really just want a rundown of the morning’s news quickly. So, it’s something that they can really fit into their morning routine as it exists. And it’s something that they can consume, how they want it, where they want it. So maybe some days you don’t have time to read it, and some days, you would rather listen, we offer people that opportunity with The 7.
Salz: So, you launched in September, not a lot of time to make a lot of observations. But you have seen how audiences are interacting with The 7, maybe you can tell me a little bit more about what you’ve seen, you know, it’s on the app, on the email, maybe just have the headlines read to you while you’re brushing your teeth getting ready for work, what is working?
O’Lear: Yeah, I mean, there’s a lot working so far, which we’re really excited about. So, we created The 7 to really be a mobile-first platform, or mobile-first product, we really wanted you to be able to multitask with it. Like I said before, we wanted it to fit into your routine. And as we hoped, we’ve seen really high engagement across platforms, including the site and newsletter, but the majority of our users have been on the apps. And that’s a place where we can drive deeper engagement. And that’s a place where we have seen really high engagement with The 7, with the briefing itself but also, with the audio component specifically, readers have really been listening to it there and they have been completing it. So they’ve been listening to the whole thing. They’ve been reading the whole thing, and they’ve been coming back to it again.
That’s something that was really built into how we wanted to think about The 7, we wanted it to be something that added value to your day, something that told you the seven things that you needed to know and the things that you wanted to know. So we really think that that’s come across and what we’re seeing from readers so far, and we’ve even extended our experiment with The 7 by launching an SMS project. So that’s been interesting, too. And we’ve had exceptionally high engagement with that early on, that’s even newer than The 7 itself, it’s only been out for less than two weeks now. But we’ll text you every morning and send you that link. And people have really been engaged which has been exciting.
Salz: A little bit of a comeback, a little bit of a Renaissance. I haven’t been hearing much about SMS, it’s all been about messaging. And of course, you have products on messaging, as well. SMS is intriguing. Where did that come from? Just experiment, try another platform?
O’Lear: Yeah, we like to experiment with platforms like we’ve talked about before. The Washington Post is about experimenting at scale. And SMS was something that we saw an opportunity to do that with. We thought that this was a real value-added proposition with The 7, right? That it is going to cover the things that are breaking, the hardest news, the most important news of the day. But it’s also the stories that you want to know, because you want to talk about them with your friends, right? It’s that balanced diet and we thought that SMS really lends itself well to that. We started experimenting with SMS primarily around the Olympics. But we saw a lot of success with that experiment and thought that The 7 was a good vehicle to have another opportunity with SMS.
Salz: I’m going to stay with The 7 as content for a moment, because it’s fascinating. First of all, it averages around 400 words.
It’s also probably a huge responsibility to pick the seven, then to write it and wow, it’s written by human Tess Homan who has an actual byline. You know, there’s someone responsible for this, how important is that? You know, why not AI because AI is certainly up to – we’ve seen those experiments, but you chose a human and this format, what’s behind that?
O’Lear: For us, there’s really no replacement for human touch when it comes to something like The 7. It’s a very focused briefing, it’s really critical that an editor’s honed news judgement and sharp editing skills can be taken to the day of the news, right? The Washington Post publishes hundreds of stories every single day and readers rely on us to tell them what of those stories they really need to know. And with The 7, just the seven that they need to know, at any given moment, too.
So, while it does publish at 7 am Eastern, that doesn’t mean that news is going to stop just because The 7 has published right? There may be something that breaks after it has published, that is going to be the news of the day, that’s going to be one of the seven most important things. And so that’s something that we really feel a human touch an editor’s judgement needs to be on. Our readers rely on The 7 being something that they can turn to when they want to turn to it in the morning. And so Tess is able to give that a real human touch by making appropriate updates, by really keeping it tight, by making sure that the essence and the heart of what you really need to know, the background and context to why a story matters for you, is truly in The 7 every day. And I think that that’s something that, you know, AI is great, but a human is better.
Salz: So human judgement, definitely a plus here. And as you said also the appropriateness of the content and the update, the purpose of your overall strategy is to build a habit, to turn readers into subscribers. Tell me a little bit about where and how The 7 fits in, it feels like a top of the funnel play. But I’m sure there’s an impact on deeper funnel engagement. And also, I’ve read that people who engage with your app stay longer. I don’t know if the case is with The 7 and how that impacts it. But tell me a little bit about where it fits into the scheme of things?
O’Lear: So we offer different opportunities for different kinds of readers to come into the funnel at different points. So for subscribers, there’s a value-add to The 7, it makes your subscription even more worthwhile for you. And we hope that over time that leads to retention. The 7 is also something that could potentially attract or bring a new audience to The Washington Post, potentially more accessible. Maybe somebody is very driven by audio experiences or doesn’t have a lot of time, right? It’s for time-crunched readers. Well, any story from the Washington Post is typically going to take you at least five minutes to read, right? We’re covering seven stories, you’re going to be able to consume it in less than three minutes and I think that that’s important.
We really hope that that can sort of create a pathway to the post that might not have existed before. And so there are different opportunities there, you could get a newsletter, if that works best for you, you could consume it on our site or on our apps that might lead to an app download where somebody hadn’t downloaded the app before, or a subscription sign up, or a newsletter signup, or even giving us your phone number for SMS.
Salz: That’s really interesting that it can be a little bit of everything. Because at one level, it’s bundling it in as a value add for the whole package, in a sense, and the other, it’s maybe acquiring a different type of audience, maybe one that you haven’t necessarily been able to win over. But now hey, time-crunched is maybe a sort of persona with you. And this allows you to approach that segment as well. So it’s top of funnel, and it’s deeper in the funnel. What can you tell me about the audience overall?
O’Lear: Well we don’t really get into metrics specifically. So I can’t tell you in specifics about the audience, but I can say that we have heard from a lot of readers, a lot of consumers all say because they’re not all reading it they’re listening to it too and some are getting the newsletter and some are coming to us on our ONO, and they’re reading the briefing live on their site.
A common theme that is coming back is that they appreciate the thoughtfulness of The 7, they appreciate that they have an expectation, and that it’s meeting that need, that it isn’t just the seven hardest news stories of the day, it’s also the things that you want to talk to your friends about. It’s the things you want to turn to your colleague and discuss. It’s the things that you drop into the group chat and say, can you believe this happened? Or did you know the ways that Google is trapping you or the defaults on Venmo.
We’re giving you utility content that can help make your life better, and also the news of the day that’s going to affect your life. And so I think that that has truly been something that’s distinct and unique about The 7 is really showcasing the breadth of the journalism that the Washington Post has to offer.
Salz: So I’m going to look at what drives The 7 and I would call it an always-on experimental mindset at the Washington Post. I’ve been following you for quite a while looking at all the different experiments, you’re one of the very first to really take audio very seriously, right? And now we’re talking about super short-form content – three minutes. And it’s great to experiment in a sandbox, you have a great job, because that’s what you’re doing. But then there’s the question of like, okay, now we’ve nailed it, this is really exciting. Now we need to experiment at scale. So what allows you to experiment at scale?
O’Lear: Experimentation is just built into the ethos of The Washington Post, we always try to approach things in an iterative way too, what launches may not be the thing that it is, eventually, if that wasn’t working for an audience. We are constantly doing health checks on our products, and on our audience and making sure that we are really meeting them where they need us to be, that we are delivering on the value and what they need from the Washington Post.
I think that when we see that something works, we don’t hesitate to double down on it, and to apply those learnings to the other places where they may be applicable. And so if something doesn’t work, we also identify what’s causing it not to work, and we try to make modifications to be able to, like I said, just be more responsive and to be more agile. And I think that that’s part of what has helped us experiment at scale, sometimes it’s about starting something in a small way and seeing where it may apply. I mean, AR is something we’ve been doing for many years now. And really started in small but meaningful ways. And now you can find AR in our app, it is built into our native core products, because it is something that we invest in.
The takeaway, essentially, from being able to experiment at scale is to really identify the opportunities, be realistic about your resources, be realistic about the impact that you have the potential to make, and what is most valuable, both for your audience and for your company. And then look for those opportunities and pursue those.
We never launch a product without goals associated, right? Both company goals, strategic goals, but also goals for the reader, what value is it supposed to bring. And so I think that what we really try to do is be strategic and deliberate about what we choose to invest in. And if something isn’t working, we’re not afraid, like I said, to sort of react to that and to try to change things. And so I think that essentially gives us the flexibility of nothing being too precious.
Everything is always being an evolution, just because something has launched doesn’t mean that it’s final and it’s done. I think that you always have to maintain a mindset of experimenting, improving, reacting and making things better. And iteration isn’t just something that you do in the experimental phase, it is something that you continue to do after a product is fully baked for lack of a better way of putting it.
Salz: At the end of the day you are Head of Mobile Strategy. What are you bringing here? What is it that you see as your role or someone in your position? Is this about orchestration? Is this about innovation? Inspiration? What is it that keeps this going?
O’Lear: It’s all of the above? I mean, I really…
Salz: Then I love your job, Coleen.
O’Lear: I mean, it’s all of the above, it’s hard to say that you always have to be of different minds. But you do. Anybody who is a strategic thinker, also has to work in practicalities, and realities, right? And so I think that we really tried to be measured in our approach.
So, I think that you really have to take a strategic lens toward everything but then you have to think about people and the people building the products, the people consuming the products. And that’s everything from how we curate something to the UX of something. And I think that that often comes across in very clear goals, but also even in simplest terms in documentation, if you don’t lay out to your team, the workflow that they should follow and why, I think it’s much harder to get people to understand what you’re trying to do, especially when you’re trying to do things that are big or different, or potentially challenging.
Salz: I’d like to go from The 7 that we’ve been talking about to the future, right? You’re evolving your product, you’re iterating your product, you’re always doing something there. But you’re also uniting your product. What’s next at the Washington Post? What’s your next focus?
O’Lear: Yeah, one of the big things that I’m working on right now is the unification. So we have two core apps that are news apps. They were originally for different audiences but journalism has changed, audiences have changed, technology has changed. And essentially what we’re doing is we’re taking what works well and we’re using the unification process to really build what is the classic app into a core flagship product that is truly representative of the Washington Post of today. And it is a first in class experience for users. And so that user-first mentality, really making decisions with the reader front of mind, thinking about what an app of today and tomorrow should be, is really exciting.
I think that we’ve learned a lot of lessons from having two different apps with sort of a different reading experience. And from those we’ll be able to make something that really feels like it meets the needs of different kinds of consumers.
Salz: I’d like to just go into a little bit of depth there, because not everyone, for example, will know about the two apps, the two experiences, the two audiences. Give me an idea about why you’re approaching app unification the way you are and how you’re going to keep those two audiences because combining them can be very tricky. And if you have any tips to offer, I’m sure we’re all ears.
O’Lear: Ask me about tips after we’ve done the unification and I may have some more tips I can offer at that time. Right now, like I said, we’re approaching it very deliberately, and we’re listening to our readers.
One thing in that was that we were listening to our readers and we were finding out that the audiences aren’t that different, potentially you stumbled upon one app for one reason and not the other, or you liked the design effect of what was essentially started to be a more national app, the Select app. That was its original purpose, its original intention, we think that there’s a way to marry all of those things together, that we’ve evolved our thinking as the Washington Post, our journalism has evolved, readers habits have evolved. We want to take the lessons and the things that work really well in both of the apps to build one core product that is truly first in class.
So I think that we’ll be able to take a lot of the sort of curation philosophy and the design philosophy and showing you both the breadth and the depth of the Washington Post into our core app. And you can see that in the classic app, which is the longest-running of the apps, that we’ve already started to make those changes. So what you’re experiencing today and what will be our flagship app is actually closer to what you had experienced in Rainbow or the Select app, as it’s formerly known.
At the end of the day, our audience doesn’t need two apps. They need one app that is best in class, there isn’t really a reason to split audiences. I’m not saying that there isn’t a reason to have multiple apps for some publishers. But for us, we really want to invest in making our flagship app the destination for you to come on your mobile phone, on your mobile product, on your mobile device. And we think that we can take lessons from experimenting at scale on both of the apps for many years now. And do that better in one place?
Salz: Coleen, I’ve lost track, how many products does the Washington Post have?
O’Lear: So many I’ve lost track. We have dozens of newsletters, we have two apps, within the classic app, you can also consume the print product. So if you really love the print paper, you can read it as print inside the classic app, that’s a good example. The print app was something that was a distinct app that you could also download. And maybe you had the print app, and you had the classic app. Well, from the classic app, you can also get to the print app, so we’re just really making that connective tissue between our products stronger, I think.
Salz: Excellent. And I will, of course, take you up on your offer, maybe as you’re further on into the unification process, what stays, what goes, what flies, what fails, to share some of that decision-making process. Let us walk inside your mind, your thinking. In the meantime, Coleen, thanks so much for sharing and for being on Digital Content Next today.
O’Lear: Thanks so much for having me.
Salz: And of course, thank you for tuning in, taking the time, more in this series about how media companies are taking charge of change in their business. In the meantime, be sure to check out DigitalContentNext.org for great content, including a companion post to this interview with Coleen or join the conversation on Twitter @DCNorg. Until next time, I’m Peggy Anne Salz for Digital Content Next.
Google takes somewhere between 22% and 42% of all the money flowing through its ad system, according to the unredacted version of the Southern District of New York federal case, Texas v Google, which was unsealed last week. While we knew or suspected many of the revelations, surprising new details were uncovered including internal communications that expose just how big their ambitions are the and tactics they take. The case and the supporting evidence present a chilling and calculated effort by Google to squash all competition. There is much to unpack in the newly released documents, but I’ll focus on three aspects that jumped out to me.
Google fees
It has always been unclear how much Google charges when it is involved with an ad. However, the recent evidence shows that they charge on all sides of the transaction — and they charge a lot. The suit lays out the scope of Google’s ad business: “Google operates the largest electronic trading market in existence.” In fact, it appears that 75% of all ad impressions in the United States were served by Google’s Ad Manager. In Google’s words, “more daily transactions are made on AdX than on the NYSE and NASDAQ combined.” Eleven billion online ad spaces each day.
At the same time, Google owns the largest buy-side and sell-side advertising platforms. As one senior Google employee admitted, “(t)he analogy would be if Goldman or Citibank owned the NYSE.” More accurately, the analogy would be if Goldman or Citibank were a monopoly financial broker and owned the NYSE, which was a monopoly exchange.
And, because of this dominant position on all sides of the market, Google can charge monopoly rents. Most ad exchanges charge a take rate of four to five percent of ad spend. Google takes 22 to 42 percent. And, on top of that, Google charges another 10% if a publisher wants to divert inventory outside of Google’s system.
Oh, and that’s just on the sell side. The suit lays out similar predatory fees and anticompetitive practices on the buy side as well.
Header bidding, an existential threat
When “header bidding” came along, it offered publishers the ability to make their ad inventory available to multiple ad exchanges simultaneously, fostering competition and innovation. Publishers hoped it would give them greater flexibility to monetize their ad inventory and increased leverage to negotiate better deal terms – something that would have resembled a healthy marketplace. Apparently, the very notion of header bidding hit hard at Google’s core.
As noted in the evidence, Google identified header bidding as an “existential threat.” In the unsealed complaint, we see that one of Google’s most senior executives declared eliminating the threat his top priority, which merited an “all-hands on deck approach” for the leadership team.
Then, in a stunning play to protect its dominance, Google struck a covert deal with Facebook. At the time, Facebook was actively considering getting into the header bidding space, which would have put them on a direct path of competition with Google. However, both companies recognized that they had more to gain by fixing the market for themselves than by competing openly.
The unsealed evidence reveals that a senior Facebook executive understood why Google wanted the deal: “They want to kill header bidding.” That’s a clear quid pro quo around an alleged violation of Section 1 of the Sherman Act. This could translate into criminal charges, depending on how the courts see this evidence.
Google also promised that Facebook would win a certain percentage of auctions in open bidding, Google’s alternative to header bidding. In return, Facebook promised a minimum spend and bidding frequency. They also capped the number of line-items that publishers could use, which severely hindered publishers’ ability to use header bidding. Google likely figured that it would pressure publishers to use open bidding instead.
Finally, after pushback from Facebook, Google agreed to remove the ability for publishers to set a floor price for their inventory. In Google’s ad marketplace, which was already stacked against publishers, this tilted the playing field even further in favor of Google and Facebook.
AMP, the offer publishers could not refuse
Google created a new format for content creators called Accelerated Mobile Pages (AMP), which was pitched as a way to improve the consumer experience on mobile. Not coincidentally, Google announced that it would start giving priority to AMP pages in search results, which gave the Google-led project a path to fast adoption. Essentially, Google made an offer that no publisher could refuse: Use AMP or lose the ability to be found via the dominant search engine.
Despite Google’s claims, there are multiple benefits for Google’s business baked into AMP, as well as downsides for publishers:
It’s a Google domain so Google can collect even more data as a first party about a publisher’s audience;
Custom ad formats don’t work on AMP, nor does header bidding, so publishers make less money (40% less according to Google);
It’s another platform that requires resources to manage; and
The unredacted documents show that Google also inserted an artificial one-second delay into non-AMP pages in order to give AMP “a nice competitive boost.”
The takeaway
All this new evidence shines a bright light on a pattern of behavior by Google to close off competition at every turn. Suffice to say that the harm to publishers has been dramatic. Google’s goal was not to build better products or services. And it certainly wasn’t trying to improve the overall health of the advertising ecosystem.
In these unredacted transcripts, we see the details of Google’s anticompetitive strategy articulated in Google executives’ own words. Their goal was to choke out competition: by killing off a new technology that would have improved the health of digital advertising; by cutting a deal with Facebook to rig the market; and by forcing publishers to use AMP.
I expect this case will only get more attention going forward. We are likely to see additional private suits filed as competitors realize they were conned by Google (and Facebook). I suspect we will see additional states join this lawsuit or file similar suits as it is clear that consumers were harmed by a dysfunctional market.
Finally, many speculate that the Department of Justice could add its considerable weight to this fight as soon as Jonathan Kanter is confirmed as the head of the antitrust division. Given the scope and impact of this case, we welcome any and all help to fight one of the most brazen examples of anticompetitive behavior in recent memory.
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