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What I Saw Happen -- Q1 2021

What I Saw Happen -- Q1 2021


To Level insights Insights

  • Facebook knows who you are, Google knows your intentions, Amazon knows what you buy, Netflix knows what you watch and Apple knows how you operate

  • The best ad tech job may be working for retailers like Walmart, Amazon, Instacart, Kroger, Best Buy, CVS, Walgreens, etc.

  • Consumer time spent with media surged during 2020, but the share of time spent with media supported primarily by advertising dollars fell to its all-time low

  • Tim Cook is the biggest threat threat to Facebook not the US Congress or the White House

  • Robinhood, Google, Facebook, SNAP, Pinterest, Twitter, etc. services that are used by hundreds of millions/billions of people that are free and really just mine and sell your data

  • iOS versus Android is the biggest company war since Coke vs. Pepsi

  • In the next few years will see Amazon and Walmart introduce a cryptocurrency

  • Everyone is always trying to catch up to Netflix

  • Google search just takes the user to publishers website where Google can monetize the traffic

  • Breaking up monopolies would be very good for Tech in the long run and for the shareholders

  • Forget SPAC’s now NFTs are all the rage -- NFTs, or non-fungible tokens, are unique files that live on a blockchain, are easily exchangeable and are able to verify ownership, authenticity and scarcity of an asset

  • We are social creatures -- I really really miss being with people, in person

  • The Internet is scaled anonymity

  • If you want to get in front of someone, take the time and write them a hand written letter

  • Nearly 80% of all digital minutes are spent on mobile and roughly 88% of those mobile minutes are spent within apps

  • Whether its Amazon delivery or vaccination deployment, the last mile is always the most important

  • Updating Section 230 is looming will take over the entire internet ecosystem for a cycle

  • Improve your zoom experience by hiding SELF VIEW

  • The top 15 apps in the US in January, 2021

  • 1–5: YouTube, Facebook, Gmail, Google Maps, Google Search

  • 6–10: Facebook Messenger, Amazon, Weather Channel, Google Play, Instagram

  • 11–15: Apple News, Google Drive, Google Photos, Pandora, Spotify


Big Tech

  • Apple plans to launch a subscription service for podcasts

  • Apple is working on an iPhone with a foldable screen

  • Social media algorithms rule how we see the world — that is NOT good

  • Facebook has close to 2B users, posting over 100B things each day

  • The global SMS system, at its peak, had 20-25B messages a day

  • Google handles 3.8 million searches per minute on average across the globe. That comes out to 228 million searches per hour, 5.6B searches per day, or 2 trillion searches per year — WOW!!

  • Twitter, is the worst performing stock in big tech over the past seven years

  • Facebook says it will permanently stop recommending political groups to users in an extension of a temporary ban brought in before the election

  • YouTube is a powerhouse for Google, with Q4 revenue up 46% to almost $7B

  • In fact, if YouTube was a public company, the market cap would probably be $600B+

  • In 2020 YouTube ad revenue is now larger than Netflix subscription revenue

  • Instagram is developing a “Vertical Stories” feed that resembles the TikTok experience

  • TikTok is planning a big push into e-commerce and affiliate advertising

  • The U.S. plan to force the sale of TikTok’s American operations to a group including Oracle and Walmart has been shelved indefinitely

  • TikTok is testing a new third-party selling product called TikTok Shop

  • Facebook unveiled a strategy aimed at encouraging iPhone and iPad users to allow online tracking. Before seeing Apple’s upcoming privacy screen, which will enable users to opt out of tracking, Facebook will show a screen explaining that tracking will result in ads that are more personalized

  • TikTok's US advertising business is estimated to be small still compared with larger social platforms, but the co said it tracked a 500% increase in advertisers running campaigns in the US over the course of 2020

  • News Corp struck a three-year deal with Google that it said includes the development of a subscription platform, shared ad revenue via Google’s ad technology services, the cultivation of audio journalism and “meaningful investments in innovative video journalism by YouTube.”

  • Twitter announced it will become the latest site to offer direct payment tools for users, creating a "Super Follows" feature that will allow creators to charge followers and give them access to additional content. The social media network has also announced a new feature called "Communities," where people can create and join groups around specific interests

  • Google says it will stop selling ads based on people's browsing histories and tracking users across the internet, though the new policy doesn't include mobile apps

  • Amazon is a search engine just like Google, though Amazon is pushing products in its own ecosystem that are the most profitable

  • Spotify has spent almost $900 million in their push into the podcast space, in an effort to offset the heavy costs of music licensing

Streaming

  • Subscriptions to on-demand video services will hit 1.9B globally by the end of 2025, up 65% from year-end 2020.

  • Hybrid services that include ad-supported tiers are expected to account for $1.4B in ad spend

  • Netflix announces beefed up 2021 film slate, it will be releasing a new movie a week

  • The average US streaming household now subscribes to 3.1 services

  • 27 percent of cable subscribers plan to cut the cord in 2021, almost twice as many as in 2020

  • For the first time ever, advertisers can reach more households through Connected TV than traditional linear TV

  • Netflix is not seeing a negative impact from recent price increases -- I bet it will be $24.99 a month in the next few years

  • Modern Family will be available on both Disney’s Hulu and NBCUniversal’s Peacock services

  • AT&T has booked a $15.5B charge on its declining DirecTV satellite business; AT&T paid $49B for DirecTV in 2015, but since then the business has continued to lose customers -- the worst tech acquisition in the past decade

  • Peacock had lost nearly $700M on $100M of revenue in 2020. By the end of this year, Peacock will have lost $2B, it said, implying a loss of $1.3B in 2021, its first full year of operation

  • Disney’s streaming services lost $3.3B in its fiscal 2020, up from $1.8B in fiscal 2019

  • Netflix has burned through Billions since launching its streaming service more than a decade ago: In 2019 alone it burned through $3.3B. The company recently said it is nearing a sustainable cash-generating level.

  • NBCUniversal, currently owned by Comcast, should combine with WarnerMedia

  • Roku plans to produce original shows and feature films

  • Netflix, Disney+ and HBO Max have all done away with free trials recently and the moves call into question how much longer the sneak peek will remain a standard user acquisition tool

  • Disney+ currently has a little below 40 million subscribers in the U.S., or nearly 40% of the total. As Disney has said about 30% of its subscribers come from India

  • More than half of Disney+’s 95 million subscriber households globally do not have children

  • Viacom/CBS promises a lot of everything with Paramount+. The streamer will feature a content catalog of more than 30,000 episodes, 2,500 movie titles and over 1,000 live sporting events, plus around-the-clock news coverage

  • Roku has entered into an agreement to acquire Nielsen’s Advanced Video Advertising business, which includes Nielsen’s video automatic content recognition and dynamic ad insertion technologies.

  • Most of the new streaming services launched lately by mainstream entertainment companies, including NBCUniversal, Discovery and Viacom/CBS, have a cheap or free ad-supported tier

  • Netflix is testing a crackdown on password sharing as competition in streaming services intensifies

  • WarnerMedia will return to releasing movies first in theaters

Marketing/Agencies

  • Martin Sorrell’s S4 Capital continues to announce more acquisitions

  • One of the biggest casualties of the pandemic was television advertising, as big marketers shifted money from TV commercials to social media apps like Snap and Facebook

  • Holding companies stock only goes up if they talk about M&A

  • The organizers of the Cannes Lions plan to bring back their in-person festival this summer

  • Netflix slashes annual global ad spend by 23% despite record year

  • Ad pauses by marketers are the new normal, flexibility is critical

  • Dentsu’s restructuring effort includes cutting more than a quarter of its top 1,000 executives

  • Will the pandemic fix the broken RFP process, the RFP is like competing in hunger games, the RFP process went from 57 day cycle to just 30 days post COVID

  • Direct-to-consumer marketers are increasing their ad spending on Amazon

  • Building look-alikes is really hard to do

  • Marketers will have extremely flexible budgets in 2021

  • The traditional linear TV $70B a year spend will never come close to that figure again

  • Marketers are currently spending a significant amount of their marketing budget on identity solutions

  • Having a first party relationship and the data it goes with it is really good — captain obvious here

  • 2/3 of all digital ad dollars go to Facebook, Google and Amazon

  • Over 99% of America’s 28 million companies are under 500 employees, this is a significant portion of the $20 Trillion US economy

  • Brands are giving QR codes another look during the pandemic

  • The ad spend numbers for 2020 are mixed. Traditional media of course took a hit, but $9 billion in political spending kept things from getting even worse

  • WPP plans to invest more than $200 million over the next few years to build a new data operation; WPP plans to shift many of the data resources currently scattered across its sprawling portfolio into its GroupM division, which plans to build a new technology system and consulting operation that will help marketer clients manage and use data to reach consumers

Publishers

  • Affiliate revenue can be an attractive revenue stream to complement programmatic revenue - but takes focus, content expertise, investment, and....patience

  • Several traditional publishers are buying their way into the space -- NYT has Wirecutter, Nextstar has Best Reviews and Vox/NY Mag has The Strategist.

  • Bustle hires a bank, exploring SPAC deal to go public

  • News publishers expect advertisers to return to news after Trump's departure

  • Privacy has become a key differentiator for browsers trying to challenge Google Chrome's market dominance, such as Apple's Safari, Mozilla's Firefox and Brave

  • Group Nine Media Inc., the digital publisher whose brands include Thrillist, NowThis and PopSugar, effectively went public as trading began on a blank-check company it formed

  • Google struck a deal to pay French publishers for the snippets of its articles it displays in search results on services including Google New

  • Fox News has dominated ratings but over the first two weeks of 2021, it has averaged fewer viewers throughout the day than both CNN and MSNBC, and the numbers have been especially stark since the insurrection at the US Capitol and the subsequent impeachment of President Trump

  • ESPN looks to sell X Games as it deals with streaming pressure

  • Digital ad firm Magnite has acquired RTL's SpotX in a $1B deal as it takes on Google for video ad dollars

  • Reddit seizes its moment by raising $250M; the company was valued at $6B in its latest funding round, after it gained prominence as the home of internet traders who powered the meme-stock frenzy

  • The National Football League has just announced a major series of long-term TV deals, including a contract giving Amazon exclusive streaming rights to Thursday football broadcasts; the agreements begin with the 2023 season and run through the 2033 season, and are valued at more than $105B

  • Vice and BuzzFeed are likely to go public by merging with SPAC’s in the next few months, the deals are likely to be done at valuations below what the media firms have fetched in the past

Commerce

  • Shopify is the retail operating system

  • Snap acquires a company that helps online shoppers pick clothes that fit properly

  • Costco reported better than expected sales results, driven by online shopping and demand for frozen food, sundries and liquor and hidden treasures

  • Walgreens will launch a credit card and a prepaid debit card as part of a broader push into financial services

  • Google is trialling a new way to shop from YouTube videos, as it looks to ramp up how video commerce can be made easier

  • Walmart is ramping up its pitch to advertisers as it seeks to be one of the top 10 ad sellers

  • As many as 10,000 stores could be closed in the United States this year, which would set a new record, as the COVID-19 pandemic continues to take a toll on the industry and companies evaluate their real estate footprints, 10,000 closures would represent a 14% uptick from 2020 levels

  • Half of retailers plan a digital makeover as e-commerce sales boom amid COVID-19 pandemic

  • Walmart acquires Thunder ad tech as it preps self-serve display portal

  • Walmart has more store traffic that anyone in the world

  • Andy Jassy is raising advertisers' hopes that he'll help solve some of their longstanding gripes about the company. Advertisers have long wanted more data to see if their ads grow awareness and lead to sales, and they're speculating that he'll bring together disparate parts of the company and bring more measurement to ads. They point to his leadership of another growth business, AWS, and its cloud products that could help improve the accuracy of ads.

  • Consumers spent $120bn on Shopify in 2020 - double the figure for 2019 and over 40% of Amazon’s competing business

  • Visa and Mastercard are planning to raise credit-card swipe fees for many online transactions

  • A Goldman Sachs executive who helped build its consumer-banking business from scratch is leaving to take on a similar task at Walmart

  • Chains such as CVS, Walmart and Walgreens are collecting data from millions of customers as they sign up for Covid-19 vaccines and come get their shots, using the information to promote their stores and services, tailor marketing and keep in touch with consumers,

  • Instacart raised $265 million in new funding from existing investors at a $39B valuation

  • Pretty much everyone I know shops more at Amazon now than they did last year

  • 15 largest retailers in the US in 2018 ($B)

  1. Walmart $387

  2. Amazon.com $120

  3. The Kroger Co. $119

  4. Costco $101

  5. Walgreens Boots Alliance $98

  6. The Home Depot $97

  7. CVS Health Corporation $83

  8. Target $74

  9. Lowe's Companies $64

  10. Albertsons Companies $59

  11. Apple Stores / iTunes $47

  12. Royal Ahold Delhaize USA $43

  13. Best Buy $39

  14. McDonald's $38

  15. Publix Super Markets $36


Health

  • Amazon is reportedly developing a new Alexa-powered device that can track sleep and monitor for signs of sleep apnea using radar

  • Haven, created two years ago by Amazon, JPMorgan Chase and Berkshire Hathaway to address soaring health-care costs and improve patient outcomes will close

  • Google has completed its acquisition of wearables pioneer Fitbit

  • Peloton is so popular that its used bikes typically sell in less than a day for nearly full price, according to reporting from the New York Times' Sapna Maheshwari and Erin Griffith. The huge demand for used Peloton bikes caused the company to put plans for a used bike marketplace on hold because of lack of inventory

  • More than a dozen top U.S healthcare providers created a new startup called Truveta that will analyze anonymous patient health data to help improve drug development and other therapies

  • Health care will be dominated by Amazon, Apple and Google with Walmart, J&J and P&G lurking

Work

  • Hundreds of Google employees unionize, culminating years of activism

  • Comcast moved all of their care reps to work remotely from home, which has gone so well that they are leaning towards embracing this model permanently

  • Employers have begun mapping out their remote work policies post-pandemic, but these policies may not extend to many millennial and Gen Z workers. A new study has shown that younger workers may actually prefer to work in person, as they have a greater need for hands-on coaching and mentorship opportunities that are not necessarily available to them when working from home

  • Executives are wary of how remote working might affect company culture in the long run. Alphabet noted in its risk factors that “hybrid work models” adopted post-pandemic may have “effects on our ability to compete effectively and maintain our corporate culture.”

  • Tiffany will join a small list of large New York companies that have required employees to return to the office, including JPMorgan Chase & Co.

  • HSBC plans to slash its office space where the Goldman Sachs CEO says WFH is an aberration

  • With remote work, I bet some people will start to take two full time jobs

  • Mike Bloomberg said he expects employees to return to the office once they get vaccinated — but some want work-from-home life to continue

  • Over at Viacom/CBS, the goal is to give US employees the option of returning to the office right after July 4th weekend

  • Small businesses should not have been responsible for lease payments during the pandemic, there should’ve been some more equity between a small business and the landlord

  • Google said it planned to invest $7B in offices and data centers in 19 U.S. states, making it the latest tech giant to expand its footprint while other companies retrench in a commercial real estate market roiled by the pandemic

  • Citigroup employees can spend up to two days per week working remotely when the bank’s offices reopen also banned internal video meetings on Fridays and announced a holiday called Citi Reset Day

  • 10 ways office work will never be the same

  1. Working from home is here to stay

  2. Flexibility is a double-edged sword

  3. Some populations will benefit from working from home while others struggle

  4. The office will still exist, but you’ll use it differently

  5. Expect more AI, automation, and freelancers

  6. Our communication will be more asynchronous

  7. How our productivity is measured will change

  8. Culture will be harder to create

  9. We’re more human at work

  10. More of your colleagues will live somewhere else


Other Stuff

  • GameStop may have changed how individuals invest

  • The red-hot housing market has achieved a number of milestones this past year. Perhaps the most telling is this: There are more real-estate agents than homes for sale in the US

  • Travel advertising fell 60% in 2020, but a rebound may well be in the cards. “Industry executives and analysts expect leisure travel to rebound first, with a slower recovery in business travel

  • Less business travel and significantly more leisure travel will occur in 2021 and 2022

  • COVID dims job prospects, so young people sign up for the military

  • You may have to download an app to attend a sports event, the pandemic will most likely encourage this

  • Chick-fil-A is once again America's favorite brand as consumers turn to fast food for comfort during the pandemic

  • Subway added protein bowls to its menu—footlongs in bowl form, minus the bread.

  • KFC is going national with the upgraded chicken sandwich

  • McDonald's is releasing its new chicken sandwich like a hot sneaker drop, with a limited edition hoodie and vinyl

  • Prediction that tesla buys GM and pushes GM to go 100% electric

  • GM revealed a new tech-themed corporate logo, its first major change in decades

  • Airbnb said it would cancel or block all reservations made during Inauguration week in the DC

  • CES was largely irrelevant this year

  • Diageo reported a rise in sales as it shifts marketing dollars to encourage sales in U.S. liquor stores and online

  • Robinhood is increasingly in Washington’s sights, may have to consider new rules for online brokerages and their market makers

  • New Walgreens chief Roz Brewer broke barriers to become the only Black female Fortune 500 CEO

  • Exxon Mobil reports a historic loss of $22B

  • Airlines are updating loyalty programs to appeal to younger consumers, both despite and because of the pandemic’s effects on travel

  • More than 100,000 restaurants across the country have gone out of business since last March. And while many states have reopened indoor dining to some degree, reservation numbers are still down

  • Outdoor concerts could return this summer, with possible indoor shows later in the fall

  • Danny Meyer prefers a restaurant payment experience that's similar to how people pay for ridesharing: When you're done with your meal, you pay with your phone, instead of needing to wait for a server to initiate the process

  • Fox renewed The Simpsons for the show’s 33rd and 34th seasons, extending its reign as the longest-running primetime scripted TV series

  • Starbucks and Chick-fil-A both rely heavily on drive-thrus, and use video technology and handheld tablets to take orders.

  • Bitcoin is continuing to climb — its price is now above $54,000, giving it a market cap of more than $1 trillion — and draw more fans in corporate America. But skeptics are increasingly asking whether it’s worth the huge environmental cost

  • After drawing huge audiences on Netflix and sparking new interest in chess, “The Queen’s Gambit” could become a Broadway musical

  • Square has bought control of Tidal, a streaming music service founded by Jay-Z, for $300m, because Jack just likes hanging out with pop stars?

  • The Golden Globes Ratings for Sunday night’s awards show on NBC dropped more than 62% to 6.9 million from last year’s roughly 18.3 million

  • Uber agreed to buy alcohol-delivery service Drizly for $1.1B in stock and cash, signaling its ambition to provide a wider range of items to consumers’ doorsteps.

7 big numbers that defined the 1st quarter

  • 143M: Covid vaccine doses administered in the US to help stem a pandemic that has taken ~2.8M lives worldwide.

  • $1.9T: The size of the stimulus package that passed in March — more than twice as big as the 2009 financial crisis package.

  • 6.2%: The national unemployment rate in February, down from nearly 15% in April 2020 — but almost double pre-pandemic levels.

  • $162B: The record amount raised by companies that went public this year. Only $37B was raised in the first three months of 2020.

  • 225: The number of SPACs that have gone public this year (nearly four/weekday). They’ve already raised more than they did in all of 2020.

  • 1.685%: The 10-year Treasury yield (the interest rate the US government pays to borrow money), which has tripled in a year.

  • $69.3M: How much an NFT of a digital collage sold for at a Christie's auction, setting a crypto art record (by far).

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What I Saw Happen

  • A pithy, curated recap of what I saw happen in the quarter

  • All the insight below are from conversations I have had, podcasts I have listened to and, sometimes, an article I read. It only makes the list if I believe it and I have heard it several times

  • Some examples of sources are Vox/Pivot, NPR, WSJ, AdExchanger, Ad Age, The Information, eMarketer, Digiday, Math & Magic, Arete Research, Axios, Insider, AdWeek, Variety, LionTreee, Twitter, Bloomberg, MediaPost, New Yorker, NY Times, Seeking Alpha, CNBC, CES, etc.

  • I send this out to ~3,000 of my colleagues in the industry -- if this gets passed along to you click here to be added to the distribution https://www.WhatISawHappen.com

  • I love getting feedback, feel free to reply and send me a message

-msg (Independent Analyst/Advisor/Consultant) matthew.scott.goldstein@gmail.com // https://www.linkedin.com/in/msgmsg/ // https://www.WhatISawHappen.com

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