DIGITAL MEDIA DIGEST: JAN ‘20
A monthly look at the world of digital from NORTH’s point of view
Preparing for a Post-Cookie Media World
By Caroline Desmond, Director of Media Strategy
Earlier this month, the talk in the media industry was about Google’s announcement it would phase out third-party cookies from its Chrome browser in two years. This has led to an outcry from various advertising trade organizations that say Google is moving too fast and needs to have a plan B in place before it phases out third-party cookies. The main complaint seems to be that the advertising industry has not received sufficient notice.
The reality is, this latest move by Google is but one move in a series of steps taken by media behemoths like Apple and Google to limit the use of third-party cookie tracking. Back in 2013, it was thought that third-party cookies would be defunct by 2018 due to the advent of “Do Not Track” settings. Then in 2017, Apple was condemned by trade groups when it rolled out the Safari 11 privacy feature referred to as Intelligent Tracking Prevention (“ITP”). For those unfamiliar, this feature identifies tracking behavior on the Safari browser (like persistent cookies from third-party ad networks) and limits the lifespan of these cookies to 24 hours.
Media companies have seen the writing on the wall and have taken steps to find alternate ways of tracking online users. For example, companies like Facebook and Google have used unique identifiers like email addresses or logins to tie a user to online behavior. This so-called “deterministic” targeting is not dependent on cookies and is lauded for its ability to track users across devices. The challenge with this method is scale, so it is often supplemented with what is called “probabilistic targeting” — a form of targeting that involves collecting data points such as IP addresses, browsing patterns and even device proximity to determine which devices probably belong to the same person. Other media companies are returning to the simpler days of contextual targeting (e.g., targeting keywords or relevant content).
We will also likely see a greater reliance on first- and second-party data. First a quick terminology 101 for the uninitiated —
- First-party data = data you own (data collected from your website, your customer’s emails, your social followers, your survey results)
- Second-party data = someone else’s first-party data that you buy direct from the source
- Third-party data = data bought from data aggregators who were not the original source of the data
The changes we’ve seen in the last few years to protect consumer privacy are related to the restricted use of third-party data. There is less transparency when you have more parties in between the consumer and the ultimate end-user of the data (typically the advertiser).
As Digiday reports, “[p]ublishers like Vox Media and The Washington Post are increasingly flexing their own first-party data strategies to reduce the reliance on third-party cookies and other intermediaries.”
So it is not all doom and gloom despite the headlines in the wake of Google’s recent announcement. Likely, this continued move away from third-party cookies will improve both consumer transparency, which will foster better trust among consumers. Then on the flip side, as advertisers become less reliant on data company middlemen, we will see a return to stronger publisher-advertiser relationships that will yield better, more compelling ad content.
Amazon FireTV Attempts to Widen Footprint
By Izzy Kramer, Media Planner
As of this month, Amazon’s FireTV platform now reaches over 40 million monthly active users. Not only is this growth rapid (+6 million monthly users over the past 9 months alone) but it also puts Amazon in an incredibly lofty position. This might explain why they have begun talks with other Connected TV (CTV) app publishers and Over-The-Top (OTT) device companies to allow them to sell Amazon ad inventory on these streaming services and devices. Their call list includes companies like PlayStation, Xbox, Apple TV, and Android TV.
As The Wall Street Journal explains, “gaining access to streaming video ad inventory on other platforms would give Amazon a larger pool of consumers to offer marketers and a way to increase its advertising revenue.”
What is appealing about this deal to other CTV/OTT publishers and media companies is they consistently find it difficult to sell ad inventory. As Freddie Godfrey, founder of Origin Media Inc., puts it, “there is no publisher on planet Earth who has 100% fill all of the time, so they are always trying to add a new demand partner.” Amazon could act as that filler. We’ve seen this already with the high-quality list of partners Amazon works with, including CNN and Discovery.
Furthermore, what might end up sealing the deal is Amazon’s data. Amazon has access to a mountain of 1st party shopper behavior and purchase data they use to target audiences. Of course, Amazon has only made this data accessible to advertisers who work directly through Amazon’s ad tool. So for other Connected TV apps and OTT devices, it may become an “if you can’t beat them, join them” strategy.
This is especially true with Connected TV ad spend expected to rise to about $8.9 billion in 2020, up from $6.9 billion in 2019, according to eMarketer. As WSJ puts it “Amazon doesn’t break out ad revenue in its earnings, but advertising makes up a majority of its ‘other’ revenue category, which stood at $9.3 billion through the first nine months of 2019, compared with $6.7 billion in the same period a year earlier.” Given the rise of CTV investments, it is likely a good chunk of Amazon’s projected ad spend will go toward Amazon FireTV. What media company would want to miss out on at least a cut of that revenue? We’re keeping a close eye on Amazon’s next steps toward world domination.
Pinterest Incorporates Offline Sales Data
By Madelyn Engel, Performance Marketing Manager
Throughout 2019, Pinterest has been expanding its advertising options to be more focused on e-commerce, and to close the gap between product discovery and purchase. This month, Pinterest has announced that its long-awaited partnership with IRI, a global market research company, is finally being implemented. This partnership will help advertisers measure the success of their digital Pinterest campaigns through offline sales lift.
Pinterest is a valuable advertising platform because it attracts users as a place to plan and explore new products. Pinterest cites that “90 percent of users say they make purchasing decisions on the platform, and 70 percent use it to find new products.” This social platform is also unique in that it appeals to an older demographic, compared to Snapchat and Instagram, which appeals more to teens. Pinterest users are predominantly affluent women with HHI’s over $100,000, who are more likely to be moms and the main household purchasers. But there has been an increasing demand from users to connect the dots between discovery and purchase.
To meet these needs, Pinterest has released several new offerings such as Shop the Look ads, which allow retailers to feature multiple products in a single ad; Business Profile Pages, which feature a dedicated shopping tab; and Shoppable Pins, which allow businesses to connect their online catalogs to images. Additionally, Pinterest has increased their visual search features and has brought shoppable pins into visual search results.
While these new features have helped brands build awareness of their products, Pinterest has been lacking the ability to connect an advertiser’s digital campaign to offline actions, such as in-store visits, call tracking, or point of sale integration. According to Marketing Land, “Digital advertising is responsible for influencing trillions of dollars in offline transactions. But that impact isn’t captured by traditional digital analytics, which means businesses that sell products or services offline have only a fragmentary view of their customers and shopping behaviors.”
Finally, Pinterest has added a new offering that will help Advertisers close the gap between their digital advertising and offline sales. For the past two years, Pinterest has been working on a deal with IRI to measure offline sales lift, and this is finally coming to fruition. Using loyalty app purchase data to measure the impact of ad campaigns on in-store sales lift, advertisers will soon be able to determine which campaigns and creatives drove actual offline sales. IRI’s store-purchased data comes from roughly “500 million frequent shopper loyalty cards,” from which, IRI says “it reaches 93% of U.S. Households”. The company uses a control/exposed methodology to determine incremental in-store sales lift, matching ad exposures to loyalty cards that record in-store sales.
While IRI boasts the analytics can be made available in near-real-time, Pinterest promises to report on results “within weeks of a campaign’s conclusion.” The downside of this means no mid-flight optimizations. However, these learnings can be applied to future campaigns. Furthermore, this feature is currently limited to CPG advertisers–specifically food health and beauty categories, as that is IRI’s focus.