The merging of MarTech and AdTech

Previously MarTech (marketing technology) and AdTech (advertising technology) were very separate entities. MarTech refers to technology seeking to understand and ultimately predict consumers and their behavior. AdTech is the actual copy and strategies used to get clicks and conversions. These two technologies are quickly becoming one and the same according to this article.

I think this really refers to the futility of devising advertisements without know exactly how they should be used. I liken this to the end of Mad Men. A Don Draper, who has such insight into peoples' minds pales in comparison to what the aggregated data can tell us about those same minds.

The bottom line is great creative is good. Great creative with reasoned goals behind it is the future. It is one of those, "everybody is doing it" things now. Everyone else is going to get left behind.

MarTech + AdTech = ?

Mobile is the remote control for our lives

This presentation repeated the idea that our mobile phones are becoming the remote controls for our lives. It is a really interesting concept. The justification is that we not only use it to communicate but to eat, sleep, meet other people, work, and do virtually any other task we need or want to do.

The application to digital marketing is how the value in integrating with mobile platforms and actually acquiring a customer is just rising. This presentation posited that the lifetime value of one customer on mobile is worth approximately 4$. As a result, companies and their marketers are going to great lengths to acquire those customers.

Ultimately, I think the best way to attract mobile users is to create a great mobile experience. This is easier said than done, but a few things would a long way. For one, there just shouldn't be any options to participate in anything (links, pictures etc) that are incompatible with the mobile platform. Furthermore, there shouldn't be any core functions of a particular business that its mobile app can't do. Those seem like basic requests, but I am baffled at how frequently they are violated.

Ultimately, we have a lot of options with how we want to spend our time on our phones. We are going to slowly congregate towards the best applications regardless of the marketing that encouraged us to do so.

Increasing value of mobile user

"Mass Personalization" is recurring current theme in the industry

The concept Mass Personalization refers to personalizing and customizing marketing to each individual consumer on a large scale. Personalization has many benefits, but broadly speaking allows marketers to cater marketing to individuals in ways that will most likely result in actual commercial behavior. This concept has been around for a while. What is new is the scale with which it can be carried out. We are getting closer to the point that all consumers can be targeted in a personalized fashion, rather than just those that have had a long enough relationship with a given business that their behavior is well known. This scale is a current aspiration, at least.

The concept of personalization is about content, timing, pricing and medium. Our profiles all tend towards certain behavior. We buy at certain times. We buy certain things. We like to research or view or actually purchase in certain places. We seek deals and discounts, or not, in certain ways. When marketers know enough about us, they can predict all of these behaviors. That type of information is now being collected at an unprecedented rate. Through places like Facebook and Google, all of our personal information can be collated with our online behavior. Our online behavior is increasingly becoming just our behavior, so knowing what this consists of tells a pretty holistic story.

I actually don't have strong reservations about this development. The idea that I would only be shown ads when I want them and for what I want is pretty attractive. In practice though, it still seems like I am still being delivered ads on a huge scale and basically just for things that I happen to have interacted with recently. For example, when I am on a site just researching a product that I am casually interested in, the ad for that product follows me everywhere, until it tapers off. I am pretty adept at ignoring these ads and rarely are reminded or encouraged to actually buy things.

My observation is that as quickly as marketers are learning how to reach us, we are learning how to distance ourselves from them. This dance will likely continue.

State of digital marketing

Isreal-based Perion acquired NYC-based Ad Tech Company Undertone

Undertone was acquired by Perion in a $180M all cash deal. The deal is meant to give Perion a bigger presence in the American market. It suggests a trend towards more consolidation and a shifting of the type of ads being delivered.

Undertone specializes in high-quality, or "high-impact" ads. They make interactive video and media-rich ads meant to earn higher click-through rates than average display ads. The acquisition represents a bet on this type of service. Despite their higher price tag, these types of ads will play a large role in the future of digital advertising.

The acquisition also represents another data in the trend of consolidation. The big players like Facebook and Google have been snapping up a lot of ad tech companies over the last few years and seem to be increasing this behavior. Consolidation generally marks a maturing industry and price pressure. High-margin items like media-rich ads are likely one of the better solutions to this downward pressure. However, the larger trend will continue its march towards commoditization of these products.

Fidelity writes down investment in Snapchat by 25%

Fidelity wrote down the value of its large investment in Snapchat two weeks ago. This represents, among other things, a lack of trust in Snapchat's ability to advertise successfully on its app.

Snapchat has recently begun displaying ads on its app. They largely consist of short videos not unlike the ones that people send to each other. There are short clips from television shows, news headlines from online and television shows and other non-media ads. They are displayed in an array that allows consumers to select which ads they want to view. They tend to have some entertainment value themselves, which offers at least some encouragement for people to watch them.

Fidelity's write down can be viewed as a strong indication that this model of displaying ads is not as strong as was once thought. As we have learned, ads are valued at their ability to actually convert to consumer behavior. One question that comes to mind is that if people are selecting ads on the basis of their personal preferences, are the ads actually incentivizing any new behavior. Instead, maybe consumers are just watching clips of shows they already are watching anyway.

The Snapchat business model is under serious doubt at the moment. Their ads need to prove their value to sustain the value that is the source of their continued funding.

Facebook's targeted display market is growing much faster than Google's

Facebook's display ad sales strategy is growing revenue much faster than Google's. This reflects a superior ability to harness the trove of data both companies have on their users by Facebook. It also gives us insight into the future of customized advertising, and the implications of scale when it comes to online marketing.

Facebook and Google use two different strategies, respectively named cloning and customer match. Cloning is the process by which the demographics of people that have already bought an advertiser's product are "cloned" or used to identify a very similar person to target ads towards. Customer match which has been largely pushed as a result of cloning's success does something similar, but inferior. Advertisers upload email lists of their customers. Google finds logged in users with similar demographics, which it then targets ads towards across all of its platforms (Google, YouTube, etc.).

The growth rates are not equivalent. Facebook's cloning is driving much more revenue growth than Google currently. This elucidates a longstanding question of what type of data will be more helpful in actually selling products or services. The two companies collect slightly different types of data, and it seems the personal nature of Facebook's is currently more valuable. Given Google's own attempt at creating a social network through Google+, this is not a surprise. However, considering that people use google as their primary search tool for commercial transactions and Facebook does not directly collect specific purchasing intent, this might be slightly counter-intuitive.

More broadly, these are the two players in this market because they are better equipped to harvest the data troves they have. It is unlikely that without this scale of information collection that another competitor can play a large role any time soon.

Pusher's rapid growth hints at future of mobile advertising

A small, London based, startup called Pusher is reportedly sending 110 billion messages per month. This indicates they are growing rapidly, and could suggest the future need for real-time capabilities in apps, including advertising.

The technology Pusher creates is designed for developers. It provides the capabilities to offer real-time features such as chat and push notifications. They already offer the ability to integrate push-to-call as well.

It seems to me this reflects a trend towards mobile capability for these types of features that are considered easier to integrate with laptop and desktop interfaces. Furthermore, this reflects one possible way to integrate mobile compatible types of advertising onto devices that often can't integrate traditional forms of advertising like banner ads.

For example, push notifications can be used to bring a user's attention to an opportunity to purchase or otherwise consume something. The fact that developers are gobbling up this type of capability could indicate this is a feature that is in high demand.

Whether this trend influences the future of digital advertising is yet to be seen. It could be the smoke from a soon-to-be fire.

Pusher article on Business Insider

New app blocks ads in all iOS apps

A company called Been Choice has recently released its app of the same name in iTunes store. The app blocks ads in native applications in iOS including Apple's own News app. It also has a feature that allows a user to allow their information to be shared to an even greater degree than if ads were just allowed and tracked based on views and clicks. When this setting is on, users can accrue points, which can then be cashed in for actual money.

It is an interesting question whether the future of digital marketing will consist of only those consumers who have opted in or not. There is certainly value in advertising to a consenting population willing to share all information needed to craft an effective strategy. However, the question of whether this population will be big enough or lucrative enough to cover the costs of content that advertising revenue alone supports.

It seems to me that if this trend persists, content providers will need to have the power to offer different levels of content according to the degree of opt-in an individual consumer has committed to. For example, for those consumers that have opted out of all advertisements and data collection, they would have to enjoy less content that is paid for by those things to avoid a free-rider problem. Furthermore, there needs to be sufficient incentive for consumer to share their info and see ads.

Been Choice is just one of many avenues consumers have to avoid ads. Time will tell whether content providers and blockers continue to outwit each other or work together.

http://techcrunch.com/2015/10/06/apple-approves-an-app-that-blocks-ads-in-native-apps-including-apple-news/#.hwskl7:TkRM

Virtual reality presents new opportunity for digital marketing

Making Predictions about digital marketing is difficult partly because the landscape will likely change so much, digital marketing will have to stretch its definition to include the new variations it will encompass. One such change is the continued development of virtual reality technology. Facebook acquired one of the largest players in virtual reality, Oculus Rift. Facebook just announced last week that the virtual reality technology they have been developing will be compatible with sites like Hulu, Netflix and other personal streaming services. As the article discusses, this means that virtual reality audiences will be available for ads through those services creating a new platform brands can reach their consumers.

This will surely come as a relief for all of the advertisers that have had to adapt to streaming sites themselves, and shift away from television. The development of virtual reality though adds a new opportunity for brands to create an experience akin to in-stores, but actually from the comforts of our homes. We could hold a pair of shoes, try on a sweater or handle a new phone virtually.

This shift will change marketing strategies once again, but may be a shift that works in the favor of the advertiser. 

http://www.businessinsider.com/one-step-closer-to-bringing-e-commerce-ads-to-virtual-reality-users-2015-9

Google tries to change their image in Europe through charm offensive

Google is attempting to change how they are perceived in Europe from a pushy monopoly to an engine for growth. They are touting a report done by Deloitte that claims Google is responsible for billions in growth in the UK. They are also emailing prominent politicians and holding events where they highlight all of the small businesses, charities and other organizations they have helped through their different products and services.

The conflict centers on whether Google is exercising its influence in the region in a harmful, unfair way. Specifically, the EU alleges that they are displaying products from sellers that advertise with them preferentially over those that do not. A fine of up to $6 Billion could be levied, which sets the stakes very high.

I think it is easy to highlight the economic activity Google is responsible for because it plays such a huge role in how people interact with the internet. As we have seen already, while Google is the site for 60% of all searches in the US, 98% of European searches are done through them. As more and more business and interaction happens on the internet, its role will only increase. However, economic activity does not justify unfair competition. At the very least, if they are prioritizing certain sellers over others regardless of price or any other metrics, consumers deserve to know, so alternatives can be sought out.

The outcome of similar disputes has led either to Google softening its policy or pulling the business entirely. The latter is unlikely given how important it is to them, so this will likely yield some change. Policies that effect consumers negatively should be pushed against by consumers first and foremost if sustained, universal change is ever to happen at Google.

http://www.businessinsider.com/google-released-a-report-detailing-how-it-helps-businesses-in-europe-2015-9