Extending LTV in Hyper casual games

Last time we discussed how a game's LTV curve not only dictates the revenue margins and also the speed in which you can scale - taking less risk by acquiring more users in a short amount of time. It is a cycle hyper growth cycle - the higher the LTV, the more users you can buy, the more you can earn, and the higher the LTV. At the end of the day, it is all depends on the LTV of the game. 

Well known hyper causal game - Crossy Road

Let's focus a bit on hyper casual games and discuss some strategies on how to grow the LTV. Hyper casual games are games that are usually very simple, short lived and very easy to pick up and play. Their cumulative ARPU usually equals to their LTV. The life-time is short, roughly around D30 - D60. Only 12%-13% of players will retain after 7 days. There are 3 main ways to optimize these games - boosting retention (lifetime), optimizing interstitials ads, and refining rewarded video placements.

Since hyper casual games are so short-lived, it is too risky and most of the time, not worth the effort to monetize from IAP (in-app purchase) because IAP usually needs more than 7 days to gain momentum. Therefore, hyper casual games rely mostly on ad monetization. Boosting retention will be a key way to extend the cumulative value gained from those eye-balls. Tutorial funnel analysis, game economy and content progression tuning will be some game design tactics in attempt to extend retention. 

Ad monetization in hyper casual games falls into 2 main buckets - interstitials and rewarded videos.

Interstitials are unsolicited ads that pop-up usually after a user accomplished something in the game or did some action. These type of ads has a very strong negative correlation to retention. Therefore, it is very important to AB test them to find the sweet spot of gaining the most ARPU while minimizing impacts to retention.  As mentioned, having them pop-up after an in-game reward is given is one good strategy since there is a "cliff-hanger" / anticipation of checking out the rewards recently obtained. 

Rewarded videos on the other hand are much more forgiving. It is considered to be the secret weapons in mobile games since it is a ultra rare monetization feature that could lift both LTV and retention at the same time. Even if the placement is not fully optimized, it will not hurt your retention as long as the ad is not too long and has a proper 'x' button. If properly tuned, rewarded video can even help solve retention problem by helping players understand the game better. Because rewarded videos are user triggered, user also enjoys them more and therefore, other advertisers are paying more for them. 

TikTok Marketing

 

    TikTok is a fast growing social media platform that has become incredibly popular with younger generations, especially.  The marketing that I have seen on TikTok is quite different from the type of marketing that I see in more traditional digital marketing channels (tv / web) and even quite different than other social media advertising (Instagram / Facebook). 

    TikTok provides a unique marketing opportunity for brands that can be opportunistic for early adopters and creatives. First, TikTok's algorithm is not based on the number of followers an account has, making it very easy to go viral very quickly. TikTok is also not as saturated or as "salesy" as Instragram. This creates opportunity, particularly for newer or smaller companies. A company can run a successful marketing campaign on TikTok not only by creating viral videos themselves, but also by collaborating with an influencer, or by starting a trend that gains popularity with every day users. Chipotle is an example of a brand that did this successfully. To celebrate National Avocado Day, they challenged users to create videos of themselves dancing to celebrate their love for guacamole. More than 250,000 users uploaded videos with the hashtag #GuacDance, and Chipotle had their biggest day for guacamole sales ever*.

    Another popular trend for marketing on TikTok, is having your corporate account run by interns or junior level employees. Who better to reach a gen-z audience than a gen-z member themselves? HBO Max and Lionsgate are examples of companies that have TikToks being run by younger employees. Some of the videos make jokes about spending too much time on TikTok and asking users not to show the video to their boss. Other videos beg users to like and share the video so that the employees don't get fired. This is an interesting marketing tactic - brands using junior employees in an attempt to be more relatable to their audience.

  Overall, TikTok seems to be providing a new medium for brands to get creative with their marketing and it will be interesting to see how it develops as the app continues to grow.

*Source: https://businessrecord.com/MobileContent/Sales-Marketing/Sales-Marketing/Article/Marketing-Smart-marketing-on-TikTok/180/856/94611

    

An Unlikely Duo

Crockpot - yes, that Crockpot - is getting into the NFT game. As they approach 50 years in business, the company is looking to diversify their consumer base by entering the oh-so-young-and-cool arena of NFT's. The open auction style release will feature designs that honor their past and future and be sold on OpenSea with profits going to charity. 

As the NFT/crypto world evolves, it's so interesting to see how major corporations react to the hottest thing in technology since the iPhone. Crockpot is probably one of the most unlikely players you'd see getting in the game but, surprisingly, it's also one of the first. By using this channel to build brand awareness, Crockpot is also, somehow, showing that the company is innovative and is willing to take risks to engage and broaden their target customer. This more than likely piggy backs off of the massive amounts of cooking younger demographic groups did at home during the pandemic. It's a strong, smart play and it'll be interesting to see how much success it brings. 

Source: https://www.prnewswire.com/news-releases/the-crockpot-brand-auctioning-first-ever-nft-to-celebrate-its-50th-anniversary-301399827.html

Twitter debuts new ad features, revamped algorithm ahead of ecommerce push

As Twitter is looking to embark on e-commerce, naturally it has sought to bolster its ad campaign strategy. With a new algorithm, Twitter is now able to target larger groups of users early in the campaign process to understand the level of interest through engagement levels. This will display more relevant ads to the user and increase the likelihood of more clicks.

The goal of this effort is to increase in-app purchases on Twitter.

Article read: https://www.reuters.com/technology/twitter-debuts-new-ad-features-revamped-algorithm-ahead-ecommerce-push-2021-10-12/

The Importance of Digital Marketing in Capital Raising

Crowdfunding platforms like Kickstarter and Indiegogo were disruptors in the technology space when they launched platforms almost a decade ago to allow entrepreneurs or artists or anyone with just an idea to use a global platform to raise capital to bring their ideas to life in exchange for a reward (usually a product). 

Crowdfunding platforms gave creators direct access to global capital which was not available to them before. With the success of rewards-based platforms like these came the advent of equity crowdfunding platforms like SeedInvest and Angelist that allowed startups to raise capital in exchange for equity from non-institutional investors.

While any of these platforms afforded the opportunity for creators/entrepreneurs to target a global audience, the success or failure of campaigns (i.e to reach or exceed the raise goal) relied heavily on the marketing efforts spent to drive awareness of these campaigns. 

For product oriented campaigns, some key marketing channels to consider are:

• Social Media - Creating business pages and posting launch dates / product updates on all social channels.
• Digital Ads: Creating Facebook and Google Ads and targeting based on audience will provide a solid foundation to build on content.
• Email Marketing: Creating an audience base via newsletter signups will allow backers to stay up to date on release information and any promotional content.

Is It Too Early to Start Planning Your Holiday Campaigns?

Spoiler alert: the answer is “No!”  This year digital sales during the holiday shopping season will be bigger than ever. As noted in this Entrepreneur article: 

“Insider Intelligence’s U.S. Ecommerce Forecast sees digital sales growing by nearly 18% in 2021 compared to 2020. Brick-and-mortar retail is also predicted to grow, but only by approximately 6%. The forecasters believe that the growth will continue after the pandemic subsides as it is likely to be a permanent shift in consumer behavior.”

Every year, most retailers see a majority of their sales during the period leading up to and including Cyber Week, the days around Thanksgiving and the following Cyber Monday.  With this expected growth for e-commerce, digital marketing strategies during the holidays should be defined and developed as early as possible.  This article highlights the importance of this for a few specific channels.

• Search-engine marketing (SEM): Unlike search-engine optimization, or SEO which often has a long lead time to deliver results, it’s not too late to start optimizing SEM campaigns for holiday. As noted in the article, “Generic keywords will be useful throughout the year, but during the holiday season, it is important to narrow them further and target customers even better than normal.” 

• Email: This tends to be a large channel for retailers during most of the year and they should be designing compelling content now for their holiday communication. Inspiration is a big part of holiday shopping, including finding unique gifts or great deals, and retailers can be optimizing email content and messaging to capture customers when their intent to spend is highest.   

• Social Media: As this article states, sales this channel is expected “to increase by more than 35% this year to more than $36 billion.” This is another opportunity for retailers to target the right customers during the holiday.  To do this they need to analyze where their campaigns perform best with their target customers because the same campaign may not be effective across Facebook, Instagram, and TikTok.  

As someone who has worked in ecommerce for the last 10 years, I can confirm that retailers are thinking about holiday tactics as early as June and July every year.  Black Friday through Cyber Monday is basically the “Superbowl” of retail and companies would be best served by focusing their holiday messages on relevant content and in the right channels for their business. 

Instagram problems for teen girls

 https://www.nytimes.com/2021/10/08/opinion/instagram-teen-girls-mental-health.html

The time I was a teenage, social media wasn’t as popular as now and the situation right now does make me feel worry sometimes. Instagram is full of lots of ‘perfect images’, such as girls with flawless skin, perfect body shapes..etc. As adults, we even feel bad sometimes comparing those with ourselves, not to mention the teenagers. Major social media like Facebook and Instagram do have responsibility to promote healthier online contents, which I heard before like Instagram is considering hiding the ‘likes’. However this approach becomes more and more difficult to achieve since those likes can be turned into money and cancel it can cause huge problems. Fortunately, I still see some influencers trying to convey right message like posting ‘instagram vs reality’ to let people know no one is perfect. Its good to get motivation and pursue better version of myself from those pics, but do not let it control your life.

Digital Marketing and PE Intersection

https://www.knopnews2.com/prnewswire/2021/10/13/rlh-equity-partners-invests-leading-digital-marketing-agency-imre/

Working in the field of Private Equity focused in investments in the retail and consumer space in conjunction with having weathered through COVID, I have seen first-hand the substantial importance of digital marketing across all the portfolio companies at my private equity firm. The partners of my firm like to think that COVID pulled forward the massive growth of digital and e-comm by three to five years and in looking at the financials of our portfolio companies, e-comm is by far leading the growth in terms of the different channels further emphasizing the importance of having a digital strategy. Three years ago, most of our portfolio companies were just ramping up their respective e-comm presences and fast forward today, almost every one of our portfolio companies have a head of digital alongside a team. What I found interesting it the attached is how private equity is taking it one step further by investing directly in digital marketing companies. While I believe private equity firms including the one I work for tries to leverage synergies across portfolio companies, what better way to do so than to have a digital marketing company as a portfolio company?

Email marketing with the holiday season approaching

https://www.digitalcommerce360.com/2021/10/11/7-tips-for-engaging-consumers-during-the-holidays-with-email-marketing/ 

This article provided some great tips on how to engage customers with email marketing with the holiday season approaching. The #1 tip, which we discussed in great detail during class last week, was optimizing deliverability. Since the holiday season is such a crucial selling season, businesses need to make sure emails are making it into potential customers inboxes and not getting stuck in spam. The article also points out to strategically plan ahead for increased email volumes during the holiday season, they suggest working with email service providers to develop a schedule that doesn’t overlap with some of their other clients.

 

What will the market think of FB

I mentioned in class that Facebook might not only be exposed from a regulatory perspective, but also from a markets / valuation perspective. The below article outlines such an investment thesis quite nicely. Here are some of the main points with a hint of my own editorialization. 

First, as the article notes "it has become fashionable among Facebook critics to emphasize the company’s size and dominance while bashing its missteps" BUT how is the Company actually performing? Might its size / valuation be unsustainable? 

Two key observations:

1. Facebook has been declining among teenagers for a long time; so much so that internal research indicates a 45% daily usage rate by 2023 - "FB is for old people"
2. A shift towards pushing users into content that was likely to generate "outrage" and "anger" has perpetuated this trend (think of your crazy anti-vax uncle becoming Facebooks primary demographic)

Second, where are its users going? "Facebook’s research tells a clear story, and it’s not a happy one. Its younger users are flocking to Snapchat and TikTok, and its older users are posting anti-vaccine memes and arguing about politics. Some Facebook products are actively shrinking, while others are merely making their users angry or self-conscious." So, in the face of new entrants the push is for further radicalization? A shrinking but higher margin user base will further expose the Company to losses if those users also become disenchanted. 

Third, and to the regulatory point, what should we make of the Company targeting 12 and under demographics? The answer is simple, they are trying desperately to find a new demographic...this isn't a sign of strength or that the Company is exercising monopoly power, but that is struggling to justify its own largesse. 

https://www.nytimes.com/2021/10/04/technology/facebook-files.html 

Walmart opens Netflix Hub to leverage the social network

 Walmart opens Netflix Hub with Stranger Things, Cocomelon merchandise; Squid Game shirts coming soon

https://www.usatoday.com/story/money/shopping/2021/10/11/walmart-netflix-hub-store-exclusive-items-stranger-things/6079601001/

Walmart and Netflix are forming a strategic partnership by launching Netflix Hub, an online Netflix branded store hosted on Walmart website. The products are collectives, action figures, toys, apparel, dolls from Netflix’ popular shows. The partnership offers Netflix an opportunity to expand its branded merchandise. For Walmart, partnering with Netflix provides its customers a place to interact with their favorite show and characters, expand Walmart’s brand recognition into new section of customers who might not usually shop physically and virtually at Walmart store. In addition, the partnership allows Walmart to stay on top of the social media trend, greatly supporting its content marketing efforts and amplifying its social media impact. Similar strategic partnership model is explored by Netflix and Starbucks as well.  

 Gaming - The Next Advertising Medium

Major clothing brands, looking to access customers in the home, are turning to gaming more specifically eSports as white space for advertising. In specific, Hollister is contracting with a world champion from the internationally popular viral video game, Fortnite, to be a gaming scout.  

What is a gaming scout you ask?  

A gaming scout is a gamer who is looking for other gamers to join Team Hollister and compete under the Hollister banner in gaming competitions.  On the surface, these seems like an eye-rolling, millennial-fueled fad of the moment but when we look under the hoodie, there is more at play here.

Looking under the hood, another advertising fad that has shown staying power appears: decals and branding on Nascar cars and sports jerseys more broadly. Why does Team Nike sponsor half of NBA players?  Why does Busch sponsor Nascar?

Because their brand image benefits from the association while spreading awareness en masse, especially when someone on their team wins.

But wait, isn't eSports a tiny niche?

Not at all - over 100 million people worldwide tuned in for the league of legends final last year (more than the superbowl). Suddenly a Chief Gaming Scout is looking like it makes a lot of sense.  I'm sure many other brands will follow suit and do the same, so we Digital Marketers will be smart to follow suit to figure out how to capitalize on eSports eyeballs to drive not just awareness but leads (and ultimately conversions).  

Emails Emails Emails!

I thought this link from a #tech FT newsletter was really insightful; apparently, research is showing that by 2025, we will reach 376 billion emails sent + received worldwide! 

Seems like email is here to stay. 

And if anyone forgot our lecture from last week, email might not be sexy, but it gets the job done! By 2025, email users will amount to 4.6 billion people globally. With higher click-through-rates than other digital marketing tools, email is king!

Interestingly, I just spent the past few days unsubscribing from most of the promotional sends in my inbox - email might be better at getting us to click through, but it's also a drain on our attention. Do I feel like opening my inbox when I want to unplug? Hard no. But do I scroll through IG when I want to numb my mind for a couple (read: 25) minutes? Yes. And am I seeing content there that might not make me click in the moment, but certainly (visually at least) it stays with me. Maybe that is the seed that leads to a delightful excitement when I open my inbox and receive an email from that exact brand I was thinking of buying from... 

The data doesn't lie, but I'd bet that email is strong because the forces around it are doing a pretty good job of reinforcing the messages it brings.

https://www.statista.com/statistics/456500/daily-number-of-e-mails-worldwide/

B2B digital marketing vs. B2C

 

Before I learned about digital marketing, I thought that marketing strategy was targeting consumers. While digital marketing is not only B2C (business to consumers), but also contains B2B ( business to business). 

B2B digital marketing: 

If your company is business-to-business (B2B), your digital marketing efforts are likely to be centered around online lead generation, with the end goal being for someone to speak to a salesperson. For that reason, the role of your marketing strategy is to attract and convert the highest quality leads for your salespeople via your website and supporting digital channels.

Beyond your website, you'll probably choose to focus your efforts on business-focused channels like LinkedIn where your demographic is spending their time online.

B2C digital marketing:

If your company is business-to-consumer (B2C), depending on the price point of your products, it's likely that the goal of your digital marketing efforts is to attract people to your website and have them become customers without ever needing to speak to a salesperson.

For that reason, you're probably less likely to focus on ‘leads' in their traditional sense, and more likely to focus on building an accelerated buyer's journey, from the moment someone lands on your website, to the moment that they make a purchase. This will often mean your product features in your content higher up in the marketing funnel than it might for a B2B business, and you might need to use stronger calls-to-action (CTAs).

For B2C companies, channels like Instagram and Pinterest can often be more valuable than business-focused platforms LinkedIn.

From my own perspective, I thought about an example of B2B digital marketing. Third party administration will use B2B digital marketing more since it's clients are other business companies instead of direct consumers. I worked in an insurance technology company before. Our company needs to cooperate with other third party administration to design a new insurance product with healthy activities. TPA is responsible for providing healthy services and they are willing to add flyers or posters in the introduction page of new insurance products instead of being paid. Their purpose is making more insurance companies who will use our design to know their healthy services and use their services in other products as well. I am curious about how they quantify their outcomes through B2B digital marketing, hope I can learn more in the future.

Reference:

https://blog.hubspot.com/marketing/what-is-digital-marketing 

Digital Privacy and Who Pays for the Internet?

I missed this great piece on the tension between digital privacy and firms on Madison Avenue from Brian Chen of the New York Times when it was published late last month.

Chen summarizes the recent privacy changes implemented by FANG companies and the impact on the effectiveness of digital marketing for big and small businesses.

In April Apple implemented the ability to turn off tracking for particular apps on iOS devices. Google announced plans to block cookies to its Chrome web browser in June. And Facebook announced last month plans to target ads to users without knowing any user specific information.

These changes have come about through a willingness of governments to regulate big tech more, the most well-known example being Europe's GDPR legislation, and through shifting consumer preferences toward privacy.

However Chen rightly points out that this change impacts the effectiveness of digital marketing spend, providing the example of Georgia pastry shop Seven Sister Scones whose Facebook advertising became significantly less effective after Apple's iOS changes, resulting in a drop of monthly revenue from $40,000 to $16,000 in May.

Naturally the implications here are that if digital marketing becomes less effective, then naturally more spend is required to sustain the same conversions and revenue, and thus cost of acquisition increases.  For businesses with tight margins, this may mean switching to more traditional forms of marketing in preference to digital, or if that is untenable, price increases.  Indeed, Seven Sister Scones raised prices 25%.

In this respect, these privacy changes couldn't come at a worse time for the economy, as treasury bond yields begin to increase and inflation fears begin to take hold. 

Advertising revenue sustains a great deal of the internet, so the question becomes - if digital marketing becomes too expensive, who pays for advertising-supported digital products and services?

"I know who has done this"

Apparently, Maxine Waters’ twitter account has been hacked and erased. She “knows who did it and will take care of it.”

I am not sure I believe this, but one thing is for sure, cyber threats are real.  Nearly every company today relies on the internet in some way or another. From the basic use of a computer to store customer data to the full reliance on e-commerce, digital threats grow in scope and complexity every year, and it’s only a matter of time before some criminals target private companies and their ads.  What would it look like if criminals altered a company’s digital ads?

One of the ways to prepare for cyber threats is to better understand what threats are out there. Unfortunately, these threats are constantly evolving as criminals get smarter and more creative to stay ahead of detection.  So, keeping up with the latest cybersecurity news and trends is a must.  While companies are pumping money into digital ads, perhaps does it makes sense to allocate a portion of the budget to cyber security?

 https://www.foxnews.com/politics/maxine-waters-claims-twitter-hack-bizarre-tweet

Progressive Web Apps - PWAs

Going through digital marketing articles, I came across trends of Progressive web apps or PWAs. This is a relatively new digital marketing trend in that it started in 2018 with large companies like Twitter, The Financial Times, Flipkart, Wikipedia, and with great results. Treebo launched a PWA and saw 4 times increase in conversion rate year-over-year. Conversion rates for repeat users saw 3 times increase. Petlove's PWA resulted in a 2.8x increase in conversion and a 2.8x increase in the website’s time. According to the article, PWAs will become lucrative in 2021 and beyond for smaller businesses as well. Having a mobile site or ideally, a responsive site can help the user experience, but even then there can be hiccups. And a site that is lagging or difficult to navigate in the slightest will still leave a bitter taste in a customer’s mouth, leading to a missed opportunity or even a tarnished reputation. With the large influx of customers on mobile, Progressive Web Apps, which are an amalgamation of the benefits of browsing on a mobile browser and mobile app, are increasing in appeal. However, when it comes to reliability, a web app is only as reliable as its network connection. If you have a slow or uncertain connection, the PWA might also load or function slowly. If the network connection is strong, the PWA will perform very smoothly. A PWA that is reliable and fast will be able to keep users engaged. It does this by efficiently and quickly responding to their requests.

With PWAs, it is relatively much easier for anybody to find you as compared to traditional mobile apps for which customers have to go to the app store and search. All they need to do is search for you on Google, and they will be directed to the website. The website immediately launched into a PWA, with no downloading and no waiting. The user also does not have to factor in the usage of additional data for downloading purposes. Most importantly, you prevent the user from getting lost in the App Store and directly guide them to your official website. The web browsers also provide an option wherein you can save the PWA on your home screen as a shortcut so that you can access it instantly. The PWA will then ping you with push notifications as well, should you agree to that. So, it is safe to say that you get all the flexibility of a native app with a PWA without installing it.

Luxury brands are focusing more on digital marketing since Covid

Luxury brands traditionally focused more on physical marketing such as print, billboards and in-person events are shifting more rapidly to focus on digital marketing since the pandemic. 

Customers now expect a well thought-out and executed, and consistent omni-channel experience. 

An example of the investment into innovative digital marketing campaigns is Balenciaga releasing its fall 2021 collection in the form of an online video game, which has taken brand awareness to a new high and allowed the brand to tap into a wider audience.

https://www.thedrum.com/news/2021/09/15/the-future-luxury-marketing-according-marketers

The Impact of Covid-19 on Digital Marketing

Since Q1 2020, a majority of businesses had to rethink their marketing strategy and quick decisions needed to be made as remote work became the new normal. Firms that might have relied heavily on offline marketing had to reallocate budgets and find new ways to target audiences relying solely on technology. 

A Salesforce report that surveyed over 8000 marketers found that over 48% of respondents believed that their marketing strategy has fully or partly changed since pre-Covid. Over 91% of marketers surveyed used social media and digital ads, 86%+ used digital content, websites and applications and over 75% used email. Over 90% also use video which is the medium that seems to have gained the most traction in recent times. 

Covid-19's impact on many B2B firms for whom in-person events was the primary marketing medium was also quite extensive as they had to pivot quickly to try and attract customers via digital strategies. This included increasing presence on social media (Instagram, Tik Tok etc) and upping the spend on influencer marketing.

Overall, all signs point towards the pandemic fundamentally changing the game when it comes to marketing strategy. While the pivot to digital marketing might have happened eventually across the board, Covid-19 accelerated the shift much quicker than expected.

Sources: https://www.retailwire.com/discussion/did-the-pandemic-change-digital-marketing-for-good/

Mobile UA strategy

Last time I have learned a bit more about ad-monetization channels - how can we maximize $ / Imp (CPI) by balancing fill rate and the CPI threshold through ad mediation platforms. The goal is to earn the most revenue by providing ad space to other advertisers.

This week I have interviewed one of my former colleague in the user acquisition team to learn more about the strategy on advertising our own game in other platforms. Basically the other side of the story.

What I have learned is that the strategy is mainly about how much risk you are willing to take to grow your game. It all starts with a foundation curve of LTV. The most fundamental aspect of calculating LTV is the cumulative ARPU - measuring the amount of money you can get over the life time of an average user. 

The growth of the LTV curve highly depends on the by-day retention of a game. Say a Hyper-causal game that only has $5 LTV until the curve flattens out, it doesn't make any sense to spend more than $5 CPI on a channel to acquire a user since it will not make any money.

If my game's LTV is still growing after 3 years, the usual strategy is to think about how much to spend vs. how much risk and growth I am willing to take. For example, if I do a 60 days payback strategy (60 day value = $10) on the 3 years $30 LTV game I've mentioned, I can only acquire users with $10 CPI with low risk and high profit per user over time. However, growth would be suffering since I can't acquire that much user with $10 CPI. On the other hand, if I do a 2 years payback period, I can spend $20 CPI, which allows me to buy a lot more users but I am also taking more risk at the same time and earning less per user. 

In the end of the day, LTV is king. It controls how much you can grow a game and also how much and how fast you can regain those ad dollars spent. 

Which one is better for digital marketing through social media? Instragram vs. Tiktok

 Here is the list of 8 Best social media platforms to market small business in 2021:

• Facebook
• Instagram
• TikTok
• Pinterest
• Reddit
• Twitter
• LinkedIn
• Snapchat            

TikTok is a new platform comparing with Instagram. While TikTok grows fast, Instagram behaves better than TikTok for social media marketing. At the end of 2020, 96% of brand campaigns included Instagram influencers. From my own perspective, Influencers on Instagram attract me more and lead me to shop same products they promote. While I may spend time using TikTok to have fun, I don't like to shop through TikTok. 

Kyle Hjelmeseth, founder of G&B Digital Management, explained that influencers have been sticking with Instagram because it is so well-established.

“Influencer talent is so ingrained in Instagram and brands are spending money there. So there’s not a lot of incentive for Instagrammers to move to TikTok,” he said. “They’re already making a lot of money. And Instagram now has Reels [videos], so we can arguably do the same thing, while keeping to your core audience.”

On the brand side, Instagram remains a safe investment: Companies already have established relationships and an understanding of how it works.

In China, people are not allowed to access overseas social media Apps. And Tiktok becomes the most popular social media for digital marketing. Influencers in various social media platforms following Tiktok to start live streaming video to promote and sell products. The live streaming will increase interaction between consumers and influencers. The most famous influencers can lead more than a hundred million selling amount in the special day like November 11. I didn't see this method as popular as other methods through social media for digital marketing in the United States at present. But will it be more popular and become a mainstream in the future? 

Instagram also has live streaming function. TikTok announced an expanded partnership with e-commerce platform Shopify, as well as a pilot test of TikTok Shopping among select Shopify merchants across the U.S., U.K. and Canada. Which platform will show better in the future for digital marketing? I am looking forward to observaing the changes in the next few years.

Reference:

https://footwearnews.com/2021/business/marketing/instagram-vs-tiktok-social-media-marketing-1203126936/ 

https://www.socialmediatoday.com/news/the-8-best-social-media-platforms-to-market-your-business-in-2021-infograp/595834/ 

Email Marketing is Dead, Long Live Email Marketing!

As an e-commerce professional, I’ve often heard or read that email as a marketing channel was dying.  Many of the retailers I’ve worked for believed that SMS and chat bots were going to be the primary method of communication with our customers in a matter of years. However, email not only continues to be a strong email channel for companies but is also customers’ preferred method of communication with businesses according to this article.  It’s understandable for businesses to prefer email since also according to this article, for every $1 dollar spent on email companies see a return of $42 dollars. 

Email is effective because it meets customers where they are and email clients allow you to get work, personal, and school email all in one place. However, it is not fool-proof, and this article gives some good advice on how to make email a more effective channel like growing your list, controlling how often you email your list, and having clear measures of success.   In addition to this it’s also important to make sure the content is as optimized as possible.  And the best way to optimize email content is by making it as relevant as possible for the recipient through personalization.  

One of the initiatives that is probably on every retailer’s roadmap is personalization and this is especially important for email. As stated in the article referenced above, the best emails are “personal, targeted, and crafted with the customers’ objectives and objections in mind.” At my current company we are planning small optimizations like using recipients first names in the subject line.  We’re also building a “newsletter preferences” feature where recipients of email can choose the type of content or products they would like to hear about.  Collecting this first party information from users will get us closer to personalization and is a lower lift effort on the team than coding sophisticated algorithms. Along with personalization initiatives, we, like other retailers, still find email to be our best performing channel. And while SMS and other methods should be explored, we have a long way to go before we declare email a dead channel. 

Make a Run for the (Gen Z) Border

 

Fast food legend Taco Bell has recently launched two new marketing initiatives that aim to further their grip on the Gen Z demographic. Notoriously successful with this much sought after demographic group, the taco gurus have once again thought outside the bun to spread their message of taco and burritos for everyone, but especially the younger folk. 

Using an innovative "Taco IRL" campaign, Taco Bell has set their eyes on spreading brand awareness globally by partnering with influencers and leveraging paid and organic social messaging. With this strategy, customers can scan a QR code that will then populate a taco emoji in a users messaging app. In turn, a free taco is their reward after they hit 'send'. It all rolls up to a very ambitious effort to 'own' the taco emoji on people's phones. So when you tell your bff it's Taco Tuesday and do so using one of these: 🌮, you'll immediately think of Taco Bell. Mind = Blown. 

The second major initiative leverages their Discord and spreading awareness of National Taco Day, which they claim to be the biggest holiday for the company. The biggest point with this strategy is that Taco Bell is truly trying to create a community of taco lovers in hopes that connecting over 'a shared love of Taco Bell' will help facilitate organic growth for the company. The Discord server held contests to award members and aims to become a long lasting stop to share thoughts why T Bell is the go-to spot for gorditas. 

Source: https://www.thedrum.com/news/2021/10/04/taco-bell-takes-ownership-taco-emoji-global-taco-day-stunt

Lies, Damn Lies and Ads

 Lies, Damn Lies and Ads

Google bringing ethics to ads - by banning advertisements that deny climate change, Google is taking a big step towards bringing an expanded sense of right and wrong to advertising. However, it is also effectively proclaiming itself as an arbiter of "Truth". While most scientists agree on the realities of climate change, it is obviously still a contested issue politically.

This move raises additional questions about what other "Truths" Google shall seek to arbitrate.  Health claims of supplements and other health & wellness products is one possibility, the money-making potential of certain investments or investment platforms is another. While this certainly has the potential to have a positive impact in fighting misinformation and fake news, it feels like a slippery slope both from a social / public good perspective and from a business perspective for Google - does it create the precedent / expectation that Google polices all ads for truthiness?  If I make a purchase based on a Ad supported by Google and the claims turn out to be false, can I now sue Google?

As a digital marketer, we know the expectations are high for the ethical validity and truth in the content we put forth. Now the gauntlet has been thrown to the less ethical among us and challenged us to do better, to be better.

Now we wait and see. Will history judge Google as sage or folly?

Oracle uses AI to automate parts of digital marketing

 https://www.reuters.com/technology/oracle-uses-ai-automate-parts-digital-marketing-2021-09-20/

Read this interesting article on Reuters. Apparently, Oracle has a new system that uses artificial intelligence to automate key parts of digital marketing campaigns. The system is called 'Fusion'. The software uses artificial intelligence to automatically assemble marketing campaigns and determine whether the people who interact with emails or advertisements might eventually buy a product, sending their contact information to sales teams.

'To do it, the system sucks in data from a variety of sources. Some of the data, like email contact lists, will come from the Oracle customers who use the system. And some of the data will come from massive marketplaces of third-party data that Oracle has acquired in recent years to grow its digital advertising business.'

Mark Zuckerberg Has Had a Terrible Week

First on Sunday, whistleblower Frances Haugen went on national tv and accused that Facebook prioritizes profit over user safety, and then on Monday, a networking problem brought down services used by more than 2.75 billion people.  These issues highlight the risks faced by countries that rely on the services for communication.

These issues most certainly will force political leaders to try and impose new laws that will curb the ability of powerful social media platforms, such as Facebook.  The new laws will address browser privacy settings, which will directly impact the digital marketing ecosystem.  Companies will face financial and resource strains to support marketers as they continue to track and target customers.  Security is necessary to maintain privacy, and for many companies, it is about keeping customer data, intellectual property, employee information and many other data sets secure.  Is Mark’s bad week going to turn into months and years?

 Facebook Outage, Whistle-Blower News: Inside Mark Zuckerberg's Bad Week - Bloomberg

Apple's privacy changes drive up ad prices for e-commerce marketers

 https://www.marketingdive.com/news/apples-privacy-changes-drive-up-ad-prices-for-e-commerce-marketers/606976/

I have been seeing the pop up window showing if I consent to be tracked by apps. I always answers no but didn’t notice it would be such an influential threat to e-commerce. Those marketers used to rely a lot on app tracking to find the right customers they want, now it becomes harder and even more expensive. I think the solution for now is to diversify channels they use, find the effective ones and further do more target marketing on different customer segmentation. 

As the article mentioned, company like Facebook which revenue comes a lot from ad would have to develop ways without relying on personal data. As a customer, I don’t think it’s necessarily a bad thing since people have been annoyed by the boring ads on it. It’s can be a time to consider what digital marketing can really attract people but not just showing the results they get from the apps.

Digital Marketing Used to Persuade COVID Vaccine Holdouts

https://www.bloomberg.com/news/articles/2021-09-25/to-reach-vaccine-holdouts-scientists-take-a-page-from-digital-marketing

This article was very enlightening to me given the CPA is really a cost per action (versus the definition of cost per acquisition and not necessarily based on completing a sale / transaction). More broadly, the article discusses digital marketing from a public health standpoint (versus revenue generation). The article notes how companies use online ads to best promote their products with the ultimate goal of getting to a sale using varying techniques such as color schematics, typefaces, etc. and how the United Nations, Yale Institute for Global Health and Vaccination Demand Observatory have recently partnered with Facebook to lead the charge in applying the same concepts companies use in their online ad campaigns to determine how best to promote COVID vaccinations. The article also points out different cultural and regional perspectives on digital marketing campaigns and the need to tweak digital ads to the respective target audiences to deliver the highest CPA (while obvious certainly very interesting).

Facebook "faulty configuration" leads to outage ... and outrage!

 https://on.ft.com/3Bcwc9M

A couple of hours in a working day without access to Facebook, Instagram, Whatsapp, or Facebook Messenger... The end of the world? Arguably - no. But ask anyone how frustrated they felt when these services became inexplicably inaccessible on Monday of this week. To people like me, who had an urge to connect with family and friends about some great news that I had to share, the disruption was every bit annoying. The world lost its ability to connect and we all had to reckon with the weird reality of not being reliant on Facebook for a couple of hours in the day. But to Facebook, this was not just a glitch that could be explained away. It was a disaster that affected the bottom line; Facebook's share price was negatively affected, closing at a 4.9% decline on Monday evening. And that is the most shocking fact of all; this failure revealed the ugly underbelly of how Facebook makes money by exploiting the human need for connection. Look only to Twitter, where Edward Snowdon took advantage of the outage to urge people onto the free + privacy-focused Signal app. A good point - but did any of us actually switch? What is the customer captivity of Facebook and its brands? Why is it that we can be so frankly outraged at its manipulation of our data, but when the opportunity arises, we find it hard to leave? ... 

Augmented Reality in Digital Marketing

 

Thinking about what the topic of this blog should be, I thought it would be a good idea to write about the impact of Augmented Reality as an effective tool in the world of digital marketing. Augmented reality offers the potential for businesses to add a digital component on top of their physical locations and products. Customers can scan a product or object to pull up an AR experience tailored either toward giving additional information about the product or some form of supplemental brand-related experience. The application of AR in this regard stretches into numerous industries and markets. For example, the ticket sales company StubHub created an augmented reality app, which allowed users to view a 3D display of the stadium where the Super Bowl was played. Fans were able to visualize the look of the field from various seats to choose the right seat for them. Starbucks has turned to augmented reality to digitize the experience of touring one of their coffee shops. Users can scan objects within the shop to access a virtual tour, conveying additional information to supplement the physical site. Within the auto industry, Hyundai and Mercedes have both been adopting AR applications. Hyundai was the first to create an augmented manual for drivers and Mercedes has taken this concept a step further. Mercedes owners can access a feature called 'Ask Mercedes', which pairs an AI assistant with an augmented reality interface to answer a host of potential questions.

Creating a novel, unexpected or fun augmented reality experience can result in a significant buzz for a brand if executed properly. AR is a relatively new phenomenon for most people, meaning that a well-designed AR experience will get people talking and generate lasting memories. As people prefer a brand that keeps them happy and satisfied, that kind of exposure and customer goodwill can pay lasting dividends. A perfect example of using augmented reality to create buzz would be a Pepsi campaign situated at a bus station. Pepsi allowed users to access an AR virtual window alongside the bus station’s wall. Users were treated to the sight of a marauding tiger, UFOs, and robots running loose within the AR vista. By leavening the tedium of waiting for a bus with an augmented reality experience, Pepsi managed to generate discussion and strengthen its brand. Uber has since followed suit with a similar campaign in Zurich, creating AR experiences for their riders and generating more than one million YouTube views.

By employing strategies like this, companies can generate millions of dollars in earned media. In a competitive market, an augmented reality campaign can be that differentiator that allows a brand to stand out from its peers and create sustained discussion and name recognition.

Here are the links, enjoy !!

AR use in Business Cards

https://youtu.be/u8njnXc7ziY

Hyundai AR user Manual

https://www.hyundainews.com/en-us/releases/2080

Pepsi Max Bus Stand Campaign

https://youtu.be/GB_qT6rAPyY

Uber AR Campaign

https://youtu.be/bCcvEVyAXQ0

Email open rates will be affected by iOS 15

 

Watch for inflated email open rates now that iOS 15 is out

https://martech.org/watch-for-inflated-email-open-rates-now-that-ios-15-is-out/

Email open rate is the percentage of email recipients who open an email out of the total number of successful email deliveries. It has been one of the important indicators to monitor/measure email campaign success. Email open rate allows marketer to receive quick feedback by performing A/B testing to optimize subject line, the timing of delivery, etc.

With Apple’s iOS 15 becomes available, the email open rate might not be as useful as it used to be. Apple’s iOS 15 offers a Mail Privacy Protection feature that protects users’ privacy by blocking email senders from acquiring user’s IP address and preventing marketers from knowing whether the email has been opened or not. The open rate could drop or rise, depending on the use’s Mail setting. This will have a big impact on the email marketing industry, as around 30%-40% of email subscribers use Apple to handle their emails and the marketer will lose insights on their email open rate.  However, other email metrics can still be leveraged, including click through rate, unsubscribe rate, and conversion rate. I believe the impact on email marketing is limited by this new privacy feature on iOS 15 and would expect email marketing will continually serve as one of the most important digital marketing channels.

Facebook outage costs Facebook, Inc $60m in ad revenue

Earlier this week, Facebook, WhatsApp and Instagram went down for a combined six hours, costing the platform over $60 million dollars in advertising revenue. The sites went down on Monday Oct 4th at noon Eastern time, and were largely restored at 7pm on the same day.

Fortune and Snopes were able to calculate the $60m loss by looking at annual revenues and calculating hour by hour and minute by minute rates.  Facebooks earns about $220k in ad revenue per minute.

What isn't clear yet is whether this advertising spend was diverted in any way during the outage. Did demand for Google Ads spike during the outage, resulting in higher clearing prices for keyword searches, or was this revenue loss simply unspent and returned to advertising budgets to be spent later? It would be interesting to review keyword prices during the outage, to see whether there was any impact.

The drop in revenue was however very small in comparison to the drop in Facebook's share price. A day later, Facebook's share price is 3% lower, representing an almost $7b drop in valuation - showing the company's sensitivity to anything that might risk it's access to advertising revenue.

The outage comes at a terrible time for Facebook, given a whistleblower is currently testifying to Congress that Facebook is aware of the effects of its algorithms on young people and that misinformation is spreading across its platform, but is not acting on it because of the negative effects it may have on its income streams.

To Reach Vaccine Holdouts, Scientists Take a Page From Digital Marketing

Given the mixed sentiment and some hesitancy about COVID-19 vaccination globally, several organizations have come together to develop the Vaccination Demand Observatory. The Observatory leverages digital marketing analytical approaches to design ways to effectively promote vaccination. 

This is done through conducting experiments that assess and monitor the type of responses to various pieces of vaccine information. One finding is that the way information is conveyed, can be received very differently depending on the country or even in different regions within the same country.

The goal is to ultimately develop a way to gain public trust in the vaccinations by understanding people and the way they react to information.

Article:  https://www.bloomberg.com/news/articles/2021-09-25/to-reach-vaccine-holdouts-scientists-take-a-page-from-digital-marketing

Growth of Digital Advertising in Connected TV

     Digital Marketing has largely been seen to drive focus away from TV advertising.. but that might be changing now with the rise of Connected Television (CTV). CTV's, or Smart TVs, from brands such as Roku, Apple and Samsung, make today's TV much more like a computer, with internet integration and the ability to access applications that have a variety of purposes. CTV has become even more popular through the pandemic, with streaming services like Netflix and Hulu being stay-at-home essentials.  

    Another reason that CTV advertising is gaining ground is that the shift away from third-party cookies is making advertisers look for opportunities in other spaces. Consumers are no longer standing for cookies. Apple has banned third-party cookies from Safari already, and Google has announced that they will phase third-party cookies out of Chrome.

    It will be interesting to see how the CTV advertising space takes shape. When I thinking of streaming services, I generally think of no ads, or at least ads I can skip. But sometimes even a skipped ad is enough for a company to get its message across. Also, a user skipping an ad is proof of engagement. There is also opportunity to use CTV as part of the bigger puzzle if advertisers are able to track users through multiple platforms.

Articles read:
https://www.10thdegree.com/connected-tv-is-the-future-of-video-advertising/