DIGITAL MEDIA DIGEST: NOV‘18
A monthly look at the world of digital from NORTH’s point of view
A Recap Of Black Friday Through Cyber Monday
By Devon Brown, Performance Marketing Manager
In 2014, REI turned the American tradition of Black Friday on its head by closing all of its stores and encouraging customers to do something outside instead. Four years later, the campaign and its sentiment are still going strong. Meanwhile, physical stores are depressing dead zones while websites and logistics companies are being overwhelmed with traffic.
You could say it all started with #OptOutside, but that would be ignoring shifting consumer retail habits. Physical shopping is exhausting, and no one wants to spend their holiday putting the work into driving around from store to store and fighting crowds under fluorescent bulbs with screeching children everywhere. The mad dash used to mean that you were filled with holiday spirit; now it just feels gross. Consumers are finding they can spend a few minutes online buying gifts, enabling them to spend the rest of the day however they like. REI was a few years ahead of the curve and certainly the first to capitalize on that core truth, but to say they started the trend would be shortsighted. This year, the economic tides swung immensely in online retailers’ favor, with REI ironically absent from all mention.
Monday morning, The Daily, the most popular news podcast ever, which is nationally broadcast on NPR every day, released groundbreaking accounts revealing abhorrent working conditions for Amazon workers. Despite this, Amazon saw it’s biggest shopping day ever on Cyber Monday. Bigger than Prime Day, bigger than pre-recession Black Friday, bigger than anything. Over 18 million toys were sold, and the Echo Dot was the most sold item worldwide.
Later that day on the business side, Amazon quietly became one of the behemoth advertisers of 2018. With Facebook, Google, and the rest of Silicon Valley are shaking in their boots, and the rest of the world is busy shopping, Amazon came full circle in their Tortoise-and-the-Hare-style economic domination.
Additionally, other websites such as J. Crew and Lowe’s went down for periods of time over the weekend because it could not accommodate the massive surge of traffic on their own sites. Other retailers that had massive online sales with minimal foot traffic included Target, Wal-Mart, Best Buy, and Home Depot.
So where are we at?
Well, clearly the lucrative opportunity to invest in Amazon stock early has passed. But aside from that, the big takeaway is that consumers are demanding an expedited delivery economy. Slave labor working conditions will need to square with that fact, and brick-and-mortar retailers will need to continue to innovate to create a better in-store experience.
YouTube Expands Its Audience for “Originals” Programming
By Caroline Desmond, Director of Media Strategy
The media trade press is buzzing about YouTube’s recent announcement that it will be opening up all of its original programming to free, ad-supported viewing by 2020. According to TechCrunch, this will be a gradual shift that starts in 2019.
It appears the impetus for this decision is YouTube’s desire to grow audiences for its original shows by tapping into the platform’s nearly 2 billion users worldwide. Until now, original programming was only available to subscribers of YouTube Premium. For $11.99/month, YouTube Premium subscribers can watch YouTube Originals without ads.
The problem is, YouTube has been challenged to attract enough users to the YouTube Premium. In fact, Mediapost reports that some original content creators have shied away from developing content for YouTube Premium out of concern that their videos would be seen by more people through free, ad-supported content platforms.
So, not only could the ad-supported, free original programming model grow audiences; it could attract more creators who will have a better chance of reaching more viewers with their content. This, of course, is also good for YouTube from an ad revenue perspective. More viewers means more monetizable advertising impressions.
Variety reports that YouTube will continue to offer the YouTube Premium subscriptions to those who want it — the incentive being early access to original, exclusive content. YouTube also announced this week that it would offer a $6.99/month YouTube Premium service for students.
Fewer Better Programming Strategy
As part of their shift in programming strategy, YouTube appears to be investing in fewer, better original programs. This is not to say YouTube has not realized some success to date within their existing programming. According to MediaPost, “YouTube now has over 50 original shows, which have collected some eight Emmy nominations.” That said, Media Post goes on to qualify this success noting that “only one of those shows — “Cobra Kai” — has been a breakout hit, garnering critical acclaim and larger pop culture attention.”
Based on an exclusive report by the Hollywood Reporter, YouTube plans to cut back on the volume of scripted original programming it produces by 2020 to nurture originals with a proven track record and see how things go with the new ad-supported model. Part of the motivation for the fewer better approach seems to be a recognition by YouTube that it just cannot compete with investments by other video giants in original programming, at least not at the moment. According to the Hollywood Reporter, “The YouTube Originals budget, said to be in the hundreds of millions annually, has always been overshadowed by those of Netflix and Amazon, which shell out several billion each on programming.”
Why Brands Should Care
The shift to “freemium” — free & premium — ad-supported original programming also benefits brands in that there will be more quality programming available on YouTube for brands to align with. Given YouTube’s heritage as a user-generated-content (UGC) platform, it has not traditionally been known for professionally produced, premium content. Rather, the primary benefit YouTube has offered brands is the ability to target ads to highly relevant UGC contexts via keyword targeting.
If audiences grow for YouTube Originals, brands will have both the hyper-targeted capabilities they have always had on YouTube in addition to premium content alignments that help build brand equity.
There is another benefit to brands. If YouTube attracts a larger audience to view its original programming, it could eventually (in the long-term) compete with other ad-supported digital streaming video platforms like Hulu and Amazon Prime Video that also attract large audiences drawn by original programming. More competition in the ad-supported, digital streaming category will help ensure that the likes of Hulu and Amazon cannot corner the market. This will help keep rates competitive and affordable for small to midsize brands seeking to tap into digital streaming as an alternative to traditional TV media plans.
Google and Disney
By Izzy Kramer, Media Planner
As of this week, Disney and Google have struck a major digital deal that will have the two moguls working together. It’s like when two close friends of yours start dating. According to an article by The Drum: “Disney will migrate its digital video and display business over to Google Ad Manager as it becomes Disney’s core ad tech platform.” This includes all Disney properties, including Pixar, Star Wars, Marvel, and ESPN. Google will now power the advertising to promote Disney’s premium and powerful content.
While this is interesting just because it is fun to watch two titans collide, what is their long-term plan? There has to be a bigger end goal for these two companies to decided to work together, right? Well, yes. Google mentioned their plan in their blog post announcing this partnership: “together, we plan to build an advanced video experience for Disney that will transcend devices, platforms, and living rooms to bring the magic of premium video content into people’s hearts, minds, and screens — everywhere.”
This rings a bell of the video platform Disney has been struggling to get off the ground. It seems Disney has turned to Google to help get its streaming video platform in fighting shape to take on major competitors such as Hulu and Amazon Prime. For brands, this puts yet another video streaming platform into the ring of potential partners.
It also makes one speculate about YouTube’s expansion to an ad-friendly and free platform mentioned above. Is Google priming their top video platform for Disney? Or will Disney continue to develop a separate platform supported by Google but that will not directly compete with YouTube?
In North’s annual digital trends article, I wrote about how media moguls (i.e. Disney, Discovery, etc.) need to quickly figure out how to shift their focus from network-direct to consumer-direct relationships in order to compete with streaming platforms. When I wrote on this topic back in August we were seeing a trend that these media moguls were making changes internally by reorganizing their teams and developing new “direct-to-consumer” departments. In fact, I used Disney as an example: “Disney has created an entirely new division of direct to consumer products led by Kevin Mayer, Disney’s former chief strategy officer.”
However, it seems Disney has also developed a solution that seeks external resources by working with Google, a platform born and raised off of the consumer-direct relationship. Isn’t Google all about directly giving you the services you need? Just Google it. By seeking these external resources, Disney has phoned a friend much more experienced on the topic in order to answer the $1 million dollar question. (Makes you wonder when Regis is going to pop out.) Disney already understands they need to adapt or die, but now, it seems they are trailblazing an innovative means of adapting that other media moguls have not yet caught onto.
