RETAIL REDOUX:  Traditional Retail is undergoing a transformation as we speak.  For the pessimistic set the term for this is Retailpocalypse, where most B&M retailers will eventually die off and be replaced with eCommerce rivals.  But if you erase the lines of physical and digital retail, you get a much more vibrant view of where Retail is headed.  Business Insider does a nice job of cataloging 25 retailers who are changing the game in the attached link.  Not surprisingly, eCommerce giants like Amazon (#1) and Wayfair (#17) are on the list.  But so are B&M mainstays like Ulta (#2) and TJ Maxx (#3) – these guys are thriving by defining a niche and competing better than anyone else is their swim lanes.  Or what about the German grocer Lidl (#6), who aims to disrupt the US grocery industry by offering mostly private label products at up to 50% off the brand names.  And finally, think of tech publishers like Instagram (#8) and Apple (#13), who are redefining how retail trends are socialized and how the ensuing purchases are made.  So no, Retail isn’t dying.  But the game, and the definition of what it means to be a “Retailer”, is changing before our eyes.

SNAPCHAT’S STRUGGLES MOUNT:  Once the darling of Social digital, Snapchat is starting to find itself squeezed from all sides.  Instagram has poached users by successfully cloning some of Snapchat’s most compelling features, and ad revenue growth is becoming trickier as clients go “one and done” on the platform because they can’t track results from their initial campaigns.  All of these challenges have been noted on Wall Street.  In a fairly startling move, Snapchat’s IPO underwriter Morgan Stanley has already downgraded the stock below its IPO price.  Think about that for a minute . . . your own investment bank who brokered your IPO shares just this past March has already downgraded you!  And then there’s a more subtle but insidious problem facing Snapchat.  Content publishers are migrating to Instagram because its more lucrative for them.  Unlike Snapchat, who segregates publisher content in their “Discover” section, Instagram includes 3^rd party content in their “Stories” feature and even allows links to external sites within the content.  These publisher-friendly features make it easier to monetize content placed on Instagram than Snapchat.  And as you know, publishers’ resources will always follow the money.

WHY ROGER FEDERER KEEPS GETTING BETTER:  Yesterday, at the age of 35, Roger Federer won his 8^th Wimbledon Men’s Singles Championship and his 19^th overall Grand Slam title.  Beyond the sheer number of wins, the remarkable thing about this is Federer’s ability to stay at the top of his sport for the past dozen years.  So what makes him so good?  Some of the answers can be found in this article from the tennis site 138mph.com.  Their hypothesis is simple.  While Federer starts with many of the ingredients needed to succeed (natural skill, commitment to fitness, mental toughness, etc.), the thing that sets him apart from the competition is his willingness to adopt his game to the situation.  As he’s aged Federer, like everyone, has gotten slower afoot.  So he’s less likely to hang in there through long points where he must run all over the court – for contrast think Raphael Nadal.  Upon realizing this Federer decided to alter his game by striking the ball earlier on the return and playing closer to the net.  The result is an aggressive style where the ball is literally on top of his opponents before they can react.  How is this change working?  Not only does Federer continue to win, but he’s actually separating from this competition.  In this year’s Wimbledon tournament he didn’t lose a single set in seven matches (that’s 21-0 in sets).  So what can Roger Federer’s dominance teach us in the business world?  For me it’s that no matter how old you are or successful you’ve been, you must be willing to reinvent yourself to fit your current situation instead of just relying on what’s made you successful in the past.  If you can do this you just might release your inner-Federer!

Have a great Monday guys!

SPOTIFY TAKING DATA TOO FAR:  Over the past year Spotify has been touting its ability to gain insights into listeners’ lives based on the music they like.  Now they’ve hubbed these insights into a platform called spotify.me.  So does this insight engine identify listener traits as well as they say it does?  According to the author of the attached Mashable article, the answer is a resounding no.  The example sited is pretty ridiculous.  Since 74% of the test subject’s music is deemed “energetic”, then they must be a cooking enthusiast who likes “soundtrack souffles and possibly even bbq”.  What?!?  No amount of musical data in the world can help you infer specific personal traits like this.  And the worst part is that Spotify tries to monetize these insights through their Spotify For Brands platform.  By selling insights which are basically prettied up guesses, Spotify is effectively defrauding brands who think they’re paying for super-premium targeting, and serving irrelevant ads to unsuspecting listeners who are incorrectly profiled.  #notcoolspotify

THE GENERATIONAL SHIFT IN MEDIA CONSUMPTION:  Nielsen is out with its Total Audience Report, which is a quarterly report card of how much time listeners spend using different media types.  To me the most interesting data cuts show how the different generations consume media – graphic below.  Even if you take out Gen Z, the comparison between Millennials and Gen X/Boomers is stark.  Millennials spend much more time on a mobile device and 30-40% less time consuming traditional media like TV and Radio.  Even Radio’s time, which appears to be holding steady YoY, isn’t what it seems.  During the back half of 2016 Nielsen started rolling the broadcasters’ stream listening into the overall radio total, which created an artificial bump up.  Regardless of how you move the peas around the plate, traditional media will continue to suffer an erosion of time spent as younger consumers age up into the key buying demos.  Here’s a download of the full report for your viewing pleasure.  total-audience-report-q1-2017

SELLING IN A PROGRAMMATIC ERA:  If you’re like me, the first time you heard the concept of programmatic buying you thought of eventual job irrelevancy as machines eventually took over the sale process.  But as it turns out skilled humans still need to guide the technology in a way that’s meaningful to client/agencies . . . and that still sounds an awful lot like sales.  In fact, the joke about programmatic actually being “program-manual” is pretty spot on.  So as a sales professional the challenge of programmatic is less about if you’ll still have a job, and more about the new skill set needed to compete in a programmatic age.  I think the attached LinkedIn Post, from an article which originally appeared in Mobile Marketing Magazine, accurately frames up the challenge.  Maybe give this one a read over the weekend and ask yourself how well you’re growing your programmatic muscles to be able to compete on tomorrow’s digital media battlefield.

Have a great Friday (and weekend) guys!

PROXIMITY BASED ATTRIBUTION TAKES OFF:  Over the past few years marketers have used consumers’ latitude/longitude cell coordinates to serve ads.  The execution here is pretty simple – if you’re within range of a store an ad for that retailer can be served to your mobile device.  But what about harnessing the power of proximity in reverse to prove an ad campaign drives foot traffic?  That’s the gist of the new partnership between Pandora and Foursquare.  The attached AdWeek link includes details of how the program works along with some early successes.  This type of tracking works especially well for brands whose primary KPI is foot traffic.  A good example is an account like Subway, who can now measure how often Pandora listeners visit a store after being exposed to an ad compared to those who were not exposed.  Sufficed to say, this is a powerful new tool for marketers to use as they try to link mobile ads to foot traffic.

TRADITIONAL TV SLOW TO PICK UP DIGITAL ADVANCEMENTS:  eMarketer is featuring some fairly interesting stats on the state of linear TV in the attached link.  While there’s a decent amount of buzz around Addressable (targeted) TV and Programmatic buying, neither is taking a significant bite out of the overall TV revenue pie yet.  Addressable TV is still hard to scale – at 72M data-linked addressable set tops in the US there’s only about a 30% reach of the population, which is limiting to reach-based TV campaigns.  And Programmatic buying still seems to be swim-laned to OLV, with only 5% of traditional TV being transacted this way.  Both buckets are starting to grow though, as illustrated in the two charts below.  So it’s worth keeping an eye on this trend over the next few years.

NN SUPPORTERS TAKE TO THE STREETS:  Finally, in case you missed it yesterday an “Internet-Wide Day of Action to Save Net Neutrality”.  The day was marked by a few real life protests, like the one pictured below at the FCC HQ in DC.  But mostly this went online, as 80,000+ publishers wielded the power of their collective audience to rally against the FCC’s plan to dismantle NN.  Overall the public relations push back seems to be working.  Over the last two months over half a million public comments have been filed with the FCC, which have been overwhelmingly in support of NN.  The tech industry’s positioning that it’s a power grab by Big Cable to be able to charge more for premium data delivery seems to be working.  Will this effort ultimately save NN, or at least soften the rules changes?  Only time will tell.

Have a great Thursday guys!

VOICE ENABLEMENT THE STAR OF AMAZON PRIME DAY:  While Amazon doesn’t formally release its Amazon Prime Day sales results, industry forecasts are pointing to another record breaking day.  All in yesterday’s sales revenue is expected to finish around $2.1-2.2B (that’s “B” for billion in just one day), with $1.6-1.7B coming from the US.  Trying to measure YoY growth is a little difficult since Amazon Prime Day is now 30 hours longs (started Monday night), and is in 30 countries this year compared to 10 last year.  According to the attached AdWeek article the star of this year’s APD is definitely Amazon’s Echo device.  Early estimates are that Amazon sold 3x the number of Echoes worldwide as they did on APD in 2016.  This comports with the overall surge the industry is seeing in voice-enabled device purchases, as connected home IoT technology goes mainstream.  Nice to see Voice taking such a leading role in the eCommerce-sphere!

DUOPOLY DOMINATION OR MUTUALLY DEPENDENT LOOP?:  The first thing that becomes clear upon reading the attached article from The Wrap is the utter domination that the Google/Facebook duopoly has over the print industry.  Not only does G/FB haul in more ad revenue than the entire global print industry (think about that for a minute), the print publishers are now beholden to the pair for distribution.  In other words, print publications no longer have enough readers to stay in business, so they’re forced to push their content through G/FB, which ends up making their masters even more powerful.  But behind that headline there’s another more subtle dynamic to the relationship.  In a weird way G/FB needs the print publishers for a steady stream of content almost as much as the publishers need them for distribution.  Because if the publishers cease to exist there won’t be enough content on G/FB to satisfy their audiences.  So this creates a paradox where G/FB wants to take as much print rev as possible, yet need the publications to stay in business.  So how will this play out?  There’s an interesting guess in the last paragraph of the article about G/FB buying blue chip publishers to ensure a steady stream of content.  Wouldn’t that be ironic?

SPOTIFY’S SMOKING GUN:  Over the last 24 hours the story of fake artists on Spotify has picked up traction.  According to the industry site Musically most of the top 50 pseudo-artists can be traced to small group of music producers in Sweden, which is Spotify’s home country.  The theory is that Spotify has commissioned these artist to create ambient style music to beef up the content of its “Chill” formats, which are usually just long form instrumental tracks. Technically speaking there’s nothing illegal about Spotify paying composers to create original music which is played on their platform.  But the optics of paying producers to create bulk music under several different artist names stinks.  It’s a credibility buster for the listener, because how can you be sure you’re discovering a legitimate new artist or just a song off a music production assembly line?  And it also hurts actual artist and labels who are losing royalties every time Spotify plays house maid “music”.

Have a great Wednesday guys!

#FAKEARTISTS?:  The Daily Gabe Special Investigations Unit picked up on the story yesterday about Spotify playing songs by fake artists.  While I usually don’t spend time on rumors and innuendos, this one seems to have too much detail in it to be dismissed.  So here’s what’s being alleged.  On some of Spotify’s more ambient playlist stations artists are being played millions of times who don’t seem to exist outside of Spotify.  Take the example of the artist known as “Enno Aare”, who has 17M plays on Spotify without any independent identity outside of their platform.  So why would Spotify manufacture an artist?  To save money, of course.  Because if they play a pseudo-song from a made up artist they don’t have to pay the normal royalties cost.  Spotify is vehemently denying this claim.  You can imagine the credibility buster it would be with listeners if this were proven to be true.  As it stands Spotify is in the uncomfortable position of having to prove artists they’re playing are real living people to skeptical labels who represent the actual artists.  Guessing we haven’t heard the last of this story.

TOP DIGITAL STATS:  You can tell AdWeek is just getting out of their Fourth of July doldrums with this week’s edition of the Top Digital Marketing Stats.  None of the points is too compelling except for that first one.  As you may be aware, Amazon Prime Day is happening today.  Actually it started at 6:00p last night and runs through midnight tonight, thus creating a 30 hour sales day.  I’d expect a slew of stats from this year’s event by tomorrow morning – yes, we’ll cover this diligently.  In the meantime, enjoy some meh stats from the past week.

UNDERSTANDING WHERE YOU CAME FROM HELPS YOU SEE WHERE YOU’RE GOING:  Today’s last article is more of a longer form weekend read, so maybe save it for when you have some extra time.  In 2015 makeuseof.com compiled a comprehensive chronology of the history of music consumption.  If you’re a student of music, like me, it’s a fascinating journey from the most primitive phonographs, to the dawn of Radio, to Apple’s download revolution, to the sea change of streaming.  For me there are two striking takeaways in this article.  First, the music itself is the thing.  Over the last 150 years there have been countless iterations of how music is distributed.  But the artists and the songs themselves remain the constant common denominator regardless of the distribution platform.  Secondly, it’s amazing to see how quickly things are still changing.  This article was written in 2015, but that seems like a lifetime ago.  Since then streaming has supplanted CDs and downloads as the top music consumption platform, and several of the streamers mentioned in the article are out of business as the bleeding edge of our industry begins to consolidate.  It’s a fascinating journey that’s worth the read if you work in the music industry.

Have a great Tuesday guys!

#FAKERATINGS FOLLOW UP:  On Friday when I featured a story about NBC misspelling the name of its NBC “Nitely” News to avoid having the lower-rated Memorial Day program counted in the week’s overall ratings, I wondered why the other networks weren’t howling over the scam.  So why the silence?  Apparently they all do it!  Over the past year ABC has intentionally misspelled its evening news six times, and CBS has done it 12 times.  The networks are taking advantage of a Nielsen loophole called the “titling rule”, which allows for special names of things like Christmas and Thanksgiving specials.  Obviously the rule wasn’t designed for abuse like this.  Besides being flat out unethical, the intentional renaming of shows to inflate average ratings hurts brands/agencies who overpay for TV rating points every time this happens.

SAMSUNG GETTING ITS REVENUE SWAGGER BACK:  If it’s Q2’17 earnings are any indication, it looks like Samsung has fully recovered from the Galaxy Note battery fire fiasco of 2016.  Samsung is poised to announce its quarterly earnings results this week, which will include an estimated $12B in earnings . . . in just three months.  If this total holds it will top Apple for the same period.  Most people think of Samsung as the perennial runner up to Apple in the smart phone race.  But the primary revenue driver comes from their microprocessor business – Samsung has just surpassed Intel as the world’s top chip manufacturer.  In fact, Samsung is even the top supplier of chips to Apple for its iPhones.  Just goes to show you how interconnected the entire tech industry is behind the facade of the consumer facing brands we all use every day.

BILL GATES’S CRYSTAL BALL:  One of the things I love are those look back articles from years ago when someone tries to predict what our lives will be like at some point in the distant future.  In the attached Business Insider link 15 of Bill Gates’s “20 years from now” tech predictions are revisited.  His guesstimates about how technology will be woven into the fabric of life are remarkably spot on.  In fact, almost every element of all 15 points have come to fruition.  Some of these seem pretty basic – like online monitoring of your home (#5).  But others, like the rise of mobile devices (#2) and social media (#6), have been total game changers for our society.  If you’re working at Microsoft these days you might wistfully wonder what their role in this future tech world would have been if Mr. Gates had stayed at the helm.  As for me, I’m just bummed that he didn’t call out the Jetson’s flying cars to be on road by now. . . which I’m still patiently waiting for.

Have a great day guys!

STORM (SOUND)CLOUDS GATHERING:  SoundCloud has been in the news lately.  Over the past several weeks there’s been speculation of a sale to Deezer, Spotify or even Google.  However, since none of these buyouts have come to fruition SoundCloud is now taking steps to cut costs.  Yesterday SoundCloud announced the layoffs of 173 employees, which is a startling 40% of their workforce.  The cuts include the closure of all offices except NYC and their Berlin HQ.  The issue, of course, is a lack of revenue (ad rev or subscriptions) compared to their mounting royalties costs.  When SoundCloud started they were a free music file sharing service (think Napster 2.0), who was living on the fringes of the legal music streaming ecosystem.  Then in 2015 they legitimized their business by signing formal royalties deals, which also allowed them to monetize their service and make money.  The only problem is that they’re not selling enough to stay solvent.  I know that RIFs happen from time to time in digital media, but this was feels more like a cut into bone than just a trimming of fat.

APPLE GETTING BACK INTO AD MONETIZATION?:  So this is interesting.  For all of Apple’s brilliance as a creator of world-changing devices they’re notoriously bad as an ad sales platform – think back to iAd’s closure in 2015 if you need an example.  Apple’s poor performance in ad sales has actually created a self-fulfilling circle where they spend more time/energy creating ad blockers than they do on monetization.  With this in mind consider that some of Apple’s platforms, like Apple News, have amassed impressive user scale – 47M monthly uniques in just the US.  But they aren’t selling ads to monetize this audience.  This leaves Apple at a cross roads.  Do they stick to their guns and leave potential ad rev on the table or give in to temptation and start monetizing?  Business Insider is reporting a potential strategy pivot in the attached link.  The guess is Apple will start allowing 3^rd party publishers to run ads within their content which appears in the Apple News feed. And to do this Apple will allow guest publishers to use their own AdTech (even arch enemy Google’s DoubleClick) to serve these ads.  If this comes to fruition the digital playing field could suddenly have a big new competitor to contend with.

NBC SAYS GOODNITE TO RATINGS INTEGRITY:  Finally this week, I’d like to send you off with an incredible story about NBC’s Nightly News ratings which may have you second guessing the entire TV ratings system.  Here’s what happened.  On the Monday of Memorial Day (May 26^th) NBC misspelled their embedded digital program title as “NBC Nitely News”.  Because of the misspelling Nielsen’s automated system didn’t pick up and input that day’s ratings into the weekly average.  And because holiday Mondays’ ratings are far below normal levels, the omission of Memorial Day caused NBC’s weekly average (calculated using the other days of the week) to shoot up.  What?!?  Bottom line . . . a simple misspelling skewed the national TV ratings for a whole week and most certainly impacted pricing on millions of dollars of TV buys.  The industry is wondering if this was an intentional move by NBC to scam the system.  I’m wondering how Nielsen’s system could be so shoddy that they completely missed this error.  Yikes . . . or should I say Yites!

Have a great Friday (and weekend) guys!

 

*** Editor’s Note:  After being out of the country for the past few weeks I’m excited to get back to my blog.  Hopefully you survived my summer hiatus and will enjoy some fresh posts! ***

THE GOLDEN AGE OF AUDIO IS UPON US:  Over the past few years a theory has emerged that streamed music consumed on mobile devices will increase overall consumption of audio.  Now we’re starting to see evidence of this surge, thanks to a new Buzz Angle Music study.  Over the first six months of 2017 US music consumption has increased 10% over the same period in 2016.  The key to making this calculation is a formula which equates consumption across different platforms called Total Album Project Units (TAPU).  Under TAPU one purchased album is equal to 10 downloaded songs, and is equal to 1,500 streamed song plays.  By combining all three of these consumption paths into this standardized weighting formula we now have a sense of overall music consumption, which allows for the YoY comparison.  As you can see in the graphic and link below the growth in music consumption is being completely driven by streaming, which is no surprise to anyone who works in this sector.  Expect to see this trend line continue over the next several years as we enter the Golden Age of Audio.  BuzzAngle-Music-2017-Mid-Year-U.S.-Report

Kayne Sours On Tidal:  When Jay-Z and some business associates launched Tidal in March’15 they had the stated intention of paying artists the royalties they deserved and give listeners a premium streaming experience.  Ironically, those royalties payments are at the heart of a new dispute between Tidal and Kayne West.  The attached Music Business Worldwide link outlines the Louis Vuitton Don’s claim (yes, that’s one of Kayne’s many self-given nicknames), that Tidal owes him $3M for royalties related to an exclusive release of his latest album.  Further complicating matters is the fact that Kayne owns 3% of Tidal, since he was one of its 15 founding artists.  Are you confused yet?  Not sure if this will devolve into a lawsuit on either side.  Regardless, it’s sort of a PR black eye for the streaming platform which was supposed to be the most artist friendly of all.

Pandora Gets It’s Data Cloud On:  Finally today, I know this came out last week but it’s important to highlight Pandora’s new partnership with Oracle’s Data Cloud.  This arrangement is significant since it will link exposure to an audio ad directly to sales results.  The first application of this partnership will be focused on Auto – Oracle will quantify sales metrics of Pandora listeners who’ve heard a specific ad and then made a purchase of the advertised vehicle.  This will unlock an important attribution tool for the Auto EOMs who have been trapped in last-click-attribution-hell with the lower funnel endemic publishers like Cars.com, Autotrader, etc..  Besides Auto, you can imagine how this data arrangement could be used in other categories like Retail, QSR, and Financial Services.  The term “foaming at the mouth” is used by an industry insider to describe the potential market demand in the attached AdAge link.  This feels like the first of many Audio + Data = Results stories we’ll see over the coming months.

Have a great Thursday guys!