Google / YouTube Brand Safety (ENG)

Greg Brooks

Background

There have been multiple reported brand safety issues relating to advertising adjacencies on Google / YouTube and other sites. In short, brands have found their advertisements connected with hate speech and offensive content that they would wish to avoid being associated with their brands. Worse, due to model operated by YouTube and other sites, these ads are financially supporting the organisations creating the offensive content. These issues are currently reported as related to advertising through Google’s UK operations.

Details and Implications

YouTube is un-curated. It deploys brand safety technology but it is not infallible. While brand adjacencies to bad content are minimal, however horrible, an additional immediate issue in respect of brand reputation is the featuring of these instances in media with far wider reach than the concerning adjacency itself. The recent issues have been covered widely by The Times, The Guardian, BBC, Sky, The Financial Times, The Independent, The Sun, Wall Street Journal and many more national, international and trade publications in the UK and beyond.

In response to this issue, many advertisers have chosen to withdraw or pause their investments in Google and YouTube until there is more clarity over the situation. GroupM is not currently advising the withdrawal of advertising from Google / YouTube, but has been vocal, along with WPP, in pushing for more responsibility over the issue from the major digital platforms.

Sir Martin Sorrell has spoken widely about the need for more responsibility to be taken by the major digital platforms: "I think the most constructive way of doing it is getting Google and Facebook to understand the problem, which I think they do, and to get them to step up to control it just like any other media right now would in a traditional sense,” he told CNBC.

Matt Brittin, Google’s head of Europe, the Middle East and Africa, apologised to the assembled audience (and those watching online) at Advertising Week Europe in London. Watch the Ad Week Europe session here.

Today (March 21^st 2017), Google’s Chief Business Officer Philip Schindler announced in a blog post (https://blog.google/topics/ads/expanded-safeguards-for-advertisers/) Google’s intention to tighten controls and improve systems. We will update our guidance to clients as soon as details are known.

Summary

Digital advertising on platforms where content is user-generated and not curated has inherent brand safety risks. GroupM vigorously pursues every brand safety precaution and technology available to mitigate these risks, and we encourage all clients to make use of these tools.

At the highest levels, we have communicated with Google, Facebook, Snapchat and other partners to encourage their development of solutions. However, a 100% foolproof system may not be possible. It’s important that brands know this and proceed with caution – as well as with available safety tools. 

SXSWi 2017 (ENG)

Rachel Lowenstein

Manager, Strategic Innovation

Life+ North America

Background

Austin’s SXSWi festival just wrapped: There were panels, interactive activations and galleries dedicated to the ever changing world of digital. From marketers to developers, publishers to neuroscientists, the festival had a diverse group of attendees. Below is our highlights.

Details and Implications:

Humanization of autonomous living was a huge theme, through VR, AR, AI and new tech. The view of a cognitive future where technology can better anticipate human needs was everywhere. Instead of technology interrupting the status-quo, SXSWi proved to be about technology enhancing lives, propelling rather than interjecting. This notion was not specific to one industry or technology. Rather, it was prevalent across emerging technology discussions.

One session outlined nine principles for developing AR (augmented reality) systems. Gamification and entertainment aside, the message was that brands should take mixed reality experiences through the lens of utility and value building first and make them shared. More, ‘grab an augmented remote to rent a movie from Amazon then watch with your family on TV’ vs. ‘wearing a headset, rent a movie in a VR app store, and watch the movie alone. The commentary was that VR isolates us from human interaction while AR can deepen connections.

AI was promoted as the connective tissue of autonomous living that will predict what we want and need. From chatbots providing new forms of customer service, ecommerce and messaging, AI will drive a cognitive future across interfaces. The real question being asked here is what human interaction is this replacing and how does that drive value? Through efficiency, service or exclusivity? The interfaces we can build for bots are endless but brands need to make sure that bots have human touches to ensure they are well received and used.

New interactive surfaces were presented as another way that the digital world is enhancing the human one. Sony and dozens of start-ups in the trade show showed off projections with sensors that users could engage without having additional screens in front of them. Health-tech start-ups are doing away with wearables, instead offering tattoos to monitor robust health metrics. In the long run, we’ll see hardware getting smaller or disappearing entirely as we infuse interfaces with anatomy and real objects, meaning brands will need to adjust social media, digital, and connected device strategies as screens shift to actual physical environments.

Summary:

SXSWi remains a huge melting pot of inspiration, innovation, parties and BBQ. It is quite unlike any conference you will attend elsewhere (and that is without attending the film, music and comedy versions of the event, some of which run concurrently). In previous years VR, AR and AI have all taken centre stage, whereas this year we saw them coming together to create a vision of what our future lives could look like. For more insights and in depth coverage from SXSWi, please go to MindshareInTheLoop.com for the team’s daily recaps. 

Quarterly Earnings Q4 2016

Norm Johnston, Chief Strategy and Digital Officer

Background
The first major earnings reports of the year are out, covering the major players and their Q4 results.

Apple: Desperately seeking diversification

Apple needed a big quarter after several previous earnings reports left analysts disappointed. It delivered in Q4. Quarterly revenues were $78.4bn, up from $77.4bn a year ago, helped by strong sales of the iPhone 7. Remember the term “phablet”? The new iPhone7 Plus, with its much larger screen, appears to have given people the nudge they needed to finally upgrade. Interestingly iPad sales were down by 19%. Apple had strong growth across the board with sales increasing with everything from desktops to the Apple Watch. Apple Pay users tripled and transaction volumes rose by 500%. Investors are also keeping a close eye on Apple’s Services (Music, Apps, etc.) given Cook’s very public prioritization of that side of the business, particularly with a growing challenge from Amazon. All eyes are now on Apple’s highly anticipated next wave of product and services, particularly the next iPhone, which will fall on the products 10^th anniversary.

Alphabet: It’s all about the CPC

Alphabet’s quarterly fortunes seem to increasingly rest on one key variable: how much it makes per click (cost-per-click, or CPC). So despite an increase in revenue from both YouTube and its core search product, Alphabet’s stock price took a tumble primarily based on that one single variable. CPC decreased by 16% year-over-year, surpassing analyst expectations of an 11% drop. It has been the great migration to mobile that has been the underlying cause of the decline. Frustratingly for Google the last quarter results indicated that the volume in mobile searches and the corresponding revenue was making up for the CPC drop. Now it appears, at least in the short term, Google is still exposed to fluctuations in that volume/value equation as well as nuances between brand and generic search CPC and trends. That explains the flurry of new ad monetization products, particularly for YouTube, where there is still plenty of room for growth through better ID-based targeting using historical behavioral data, such as your search activities. Alphabet’s “Other Bets” showed growth ($262m in Q4 vs $150m a year ago), but from a small base in contrast to the overall business ($26bn). 

Facebook: Teflon

Facebook delivered another strong quarter despite industry-wide criticism on some embarrassing miscalculations on key metrics such as video view durations. The lingering impact of that flawed data may yet come back to bite Facebook even as it races to correct historical data and introduce greater third-party verification. In the meantime it’s mainly positive news. Revenue was up by 53% to $8.8bn, spurred on by more monthly users (+17% yoy) and more monetization and advertising opportunities, particularly on Instagram. So far there has been little sign of last quarters’ expectation setting over future growth in light of potential ad loading issues. On the negative side Facebook took a financial hit on the Oculus lawsuit to the tune of $500m. On the one-to-watch side is Zuckerberg’s comment that Facebook may be exploring original and licensed short-form content (with ads), perhaps to challenge the about-to-be-very-enrichened-via-IPO SNAP.

SNAP: Here we go again

SNAP officially and finally filed for its long-mooted IPO. SNAP is now reporting 158m daily users (as opposed to the usual monthly metric), healthy but slow growth compared to rivals like Facebook that experienced a much stronger “hockey stick” addition of users in the early days. This comparatively anemic growth has raised concerns that perhaps Snapchat has peaked, or is losing momentum to Facebook which has layered comparable and competitive features into apps like Instagram. A platform built on youth is always at risk when they grow up and move on, and the next generation decides there is something cooler out there. Nevertheless, SNAP has done much to build a strong advertising and content platform with plenty of opportunities for brands to play. Revenue reached $400m in 2016, a healthy start to monetization, even if the company still lost $500m due to investments and costs. It’s doubtful any of this will make a difference to the IPO, which seems certain to whip the markets into another Facebook-like frenzy of buying. Whether SNAP faces a similar marketing beating and correction to its share price in the early days is probably somewhat dependent on whether analysts view it as the next Facebook or Twitter. 

Search Targeting on Pinterest

Amy Perkins

Background:

Pinterest announced last week that it will be introducing a search advertising product. Although keyword based targeting has been available through third party providers such as 4C since 2016, the new product will include new targeting features and a shopping feed similar to Google’s product listing ads.

Details and Implications:

Pinterest prides itself on being the ‘world’s catalogue of ideas’, with over 150 million people a month using the social media platform to plan everything from tomorrow’s lunch to next year’s round the world adventure. The key to this statement is ‘to plan’, as users tend to be at the top of the funnel browsing for ideas that they plan to purchase later - sometimes up to three months before a key event or holiday. According to a Pinterest study, 76% of Pinners save items to purchase later, taking advantage of this unique way to preserve ideas that resonate. With 2bn searches a month taking place on Pinterest and the majority being generic non-branded terms (97%), this is a great opportunity for advertisers to capture this intent whilst the consumer is still in the research phase.

Generic keywords are notoriously expensive on other search engines such as Google and Bing, therefore Pinterest could be the new favourite search platform for generating awareness, especially as 72% of Pinners say that the platform has introduced them to a new brand or service. Keyword targeting is not new on Pinterest, advertisers have previously been able to target using keywords through third party platforms such as 4C. The update is regarding new targeting capabilities, bringing the options in line with search engines ability to use match types. At present, all keywords are broadly matched, resulting in less accuracy. The update means advertisers will now be able to ensure that keywords match exactly the search query of the user (exact match), or at least the specific keyword will be included (phrase match). Keywords will be purchased through an auction, with CPC determined by bid and relevance of the creative.

To help Pinterest get ahead in the search space, it has also partnered with Kenshoo, which has been a leader in integrating paid search and social campaigns, to enable advertisers to share their shopping feeds to create ads. This means that instead of having to develop ad creative (or ‘Pins’ in this case), the shopping campaign ads are pulled directly from the advertiser’s feed, with the possibility to dynamically update ads based on inventory levels. Considering the majority of ecommerce retailers will already have a shopping feed in place for use on other search engines, this will give advertisers another route to would be consumers.

Summary:

Pinterest offering more advanced keyword targeting options and new ad creative formats will help make it a better offering for advertisers looking for a platform to gain awareness with greater potential reward. Pinterest is a unique platform in terms of how consumers interact with brands, as unlike other social media platforms, they are actually researching and actively searching for new ideas and potential purchases. This offers a real opportunity to create engaging and relevant awareness campaigns, as long as marketers can be patient and wait for the conversions to occur a few months down the line. 

Facebook Measurement Update

Andy Roberts

Background:

In the face of recent criticism over inaccurate data reporting, Facebook has announced a series of initiatives designed to provide deeper understanding of the performance of its products and increased levels of third party measurement.

Details and Implications:

For its first initiative Facebook has expanded its partnership with Nielsen to enable its Digital Ad Ratings (DAR) product to measure reach and in-target performance on desktop and mobile across 8 new markets, bringing the total to 25 global markets. New markets are: New Zealand, Hong Kong, South Africa, Puerto Rico, Turkey, Taiwan, Poland and Ireland. It has also extended its partnership with comScore going beyond viewability to include in-target performance for Facebook properties in the United States. This will start with tests using comScore to evaluate in-target reach for audiences on desktop and mobile through its validated Campaign Essentials (vCE) product.

The initiative is welcomed as it provides demographic support of traditional Facebook data targeting across more markets and products. This enhancement also brings Facebook closer to what we regard as a standard facility across most other digital vendors. We continue to push all publishers and platforms, including Facebook, to introduce third party audience verification across all markets as soon as possible.

The second initiative sees the extension of third party viewability measurement beyond Facebook and Instagram video to more placements, apps and services including Audience Network in-stream video via comScore and Integral Ad Science (IAS). The issues surrounding display viewability are now being addressed on Facebook through comScore, Integral Ad Science and Moat. These partners will be able to provide metrics on when a display ad enters the Facebook screen and when the entire ad appears on the screen. Facebook is also adding a new viewability verification partner, DoubleVerify.

For some time GroupM have been pressurising Facebook to firstly allow and then to extend the use of third party verification to bring it in line with the majority of the market. So it is good to see progress although the speed of integration and the interpretation of output data has been slow.   We welcome the inclusion of more verification partners to provide more robust comparisons. However, we are keen to see measurement extended across more markets and to see faster acceptance of output data to allow us to make better informed investment decisions.

The final initiatives involve two ways of improving the sharing of insights. The first of these involves the expansion of the Metrics FYI blog to cover all aspects of measurement. It will be renamed Measurement FYI. The second sees the introduction of a portal where measurement partners can gather data directly from Facebook, Instagram and Audience Network to provide better quality inputs for market mix modelling (MMM). The MMM portal is designed to provide more accurate and actionable insights for advertisers that engage in cross-channel measurement and planning.

Finally advertisers and agencies are being allowed through the garden walls to have exportable access to Facebook data that was previously restricted solely to its domain.   Whilst we are still to learn the full extent of data access and whether this is available to all clients, it is certainly a positive step in the right direction and will allow access and use of source data. However, given recent measurement issues, we will continue to have worries about the true accuracy of FB sourced data unless it is third-party verified.