Mobile Fix April 13
This edition is coming from New York where I MCd the 11th Media Kitchen VC conference. The topic was newTV and, with the pull of TMK in the US, we were able to muster an incredible set of speakers including Terry Kawaja, some of the top East Coast VCs, the leaders of the firms driving OTT advertising and more.
Huge amount of learning, which we will get into next week, and I will be doing a workshop based on all this content for UK clients over the next couple of months. If you are interested in learning about this dynamic space let me know.
With flights, jetlag and the conference, Fix is a little more topline this week.
Everyone in New York seems to be watching Zuckerberg being questioned by Congress. With a generally poor standard of questioning, few punches landed, but the constant noise over privacy is going to have an effect. Wired point out that Mark is quite well practised at apologising — he has been doing so since 2003. Apple, Amazon and Google have read the tea leaves and they expect things to change
The FT contrasts Tim Cook criticising the Facebook for its approach to privacy with the $3billion deal with Google that keeps them the default search engine for iOS users. We have long argued that this deal is fragile and wonder whether — finally — the climate has changed enough for this to become an issue?
Along with the the Safari changes, Apple have taken a strong position on privacy and it’s looking like a smart move, especially as doing what they see as right has little effect on their revenues
Google are suspending third party adserving on YouTube in Europe apparently in response to GDPR, with the obvious side effect that brands will now have to use Doubleclick. It’s an ill wind…
Whilst #deletefacebook seems to have lost impetus, the privacy debate will drive a change in behaviour. We called peak facebook a while ago, as we think people will decide bored scrolling isn’t a good way to spend your time. A Guardian article looks at how flicking through social apps is the way teenagers pass the time.
A good Ben Evans piece makes a similar point; the death of the newsfeed;
The Spotify IPO proves Europe can create Unicorns. And they are pushing out new initiatives — including the expansion of their self serve ad studio — which should open up audio for the long tail of advertisers. But there is still an opportunity for a cross platform tool that would let smaller brands access more audio content — particularly podcasts. Talking with Global we hear that programmatic audio is going from strength to strength.
Spotify has also announced a partnership with Hulu so they can offer TV and film as well as music.. Given how expensive it is to acquire new customers we should expect more smart partnerships like this. But the corroraly of this is how a smart bundle from Apple and Amazon might cause Spotify to unravel. Amazon claim they have doubled their music subscriptions in the last 6 months, citing prime membership and the burgeoning use of Alexa and other smart speakers. In our newTV conference yesterday we kept talking about how distribution tends to outweigh content. Could it be that Apple and Amazon owning the means of distribution gives them a real advantage? Of course the different services may have a quite different audiences — for example, Amazon claim they stream much more country music than the rest of the industry.
This good NYTimes piece on Amazon Go looks at how retailers are using tech instore with some good Chinese examples, where unmanned stores are starting to scale. I still think the best approach is empowering staff with technology, rather than expecting customers to engage with tech. Amazon Go works because the tech is largely invisible. And letting people use their own devices to interact makes perfect sense too.
Nike are quietly transforming their business to be more digital and plan new apps that make personalised offers as you enter a store. Their SNKRs app from a couple of years ago worked a little like this with exclusive drops of new sought after shoes, but the new apps seem to take things a stage further. And they have bought an analytics firm to help them better understand the lifetime value of their customers. Nike were very early with apps like NikePlus and seem intent on building on their past success.
Twitter founder Ev Williams is now focused on Medium and thinks it can solve the problems of publishing — arguing that now the ad-only experiment has decidedly failed, quality information providers will be able to build strong businesses, and consumers will be better served than ever.
How? Through bundles that give you access to a range of publications for a monthly fee. It’s an interesting idea but — again — we explored the balance between subscriptions and ad revenue in TV during our event this morning and the consensus is a balance will win. Not least because many people don’t have the disposable income to add yet another bundle.
Building on the article by EV, a smart VC thinks Medium could use Blockchain to solve the two key issues; ownership of content and frictionless payments.
As Facebook declines as a source of traffic for publishers, a new driver is emerging — the articles Chrome recommends on mobile.
As a teaser for some of the thinking we shared at our newTV conference, this is a good summary of the moves US broadcasters are making with data driven TV ads. Many agencies — including TMK — expect the live OTT services like Hulu and YouTube to start selling ads.
And I think that Amazon could introduce a Prime Video lite with ads, as a way to amortise their content budget over a bigger audience whilst trying to have viewers upgrade to Prime and ad free video. We shared this bullish piece on Amazon and ads a few weeks ago but it misses the key point; Amazon double dip on advertising. They pocket the ad revenue and they profit from the resulting sale.
As P&G push the industry forward with their stance on cleaning up the ad supply chain and their move into data driven precision advertising, they are also reengineering the agency business. Horizontality within holding companies gets lots of focus — and is usually hard to pull off. Now P&G have managed to get talent from different holding companies to work together.
Consultancies are seen as the existential threat to the Agency world, but they have their own challenges.
At the 4As conference in the US this week Google announced a new way to buy YouTube which avoids brands safety issues and talked of their efforts to build a better ecosystem
Google have been pushing webapps for years but now you can run Progressive Web Apps on Apple too, with iOS 11.3 now supporting them. This feels like a big deal, as we continue to argue that native apps only really work for loyal customers. For new customer acquisition mobile web is key and the new opportunities for enhance functionality with PWAs should be really useful.
Good write up of the recent Chain Connect conference in Paris. Always lots to learn from China. For example did you know ecommerce giant Alibaba make half their revenue from ads?
Finally… a fascinating look at how the 20% outside the duopoly can survive and thrive.
What’s cooking at The Media Kitchen?
My colleague Barry Lowenthal wrote an article on Why Brands Struggle When Marketing to an Envious Consumer
Our friends at KBS Albion have been nominated for a Webby for their great work on Ada health app. It would be great if you could support us with a vote
Fix is my thinking rather than that of MediaKitchen. We now have over 5600 subscribers across Google, Facebook, Snap, Yahoo etc as well as many VCs, Brands and Agencies.