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What I Saw Happen -- Q2 2018

Overall -- the move to DTC is happening

  • Direct to Consumer (DTC) is still the place to be in this new brave world, though will it last and is there consumer fatigue

  • GDPR was a non-issue for most US based companies, for now

  • Most companies spend so much time living quarter-to-quarter/month-to-month and very little time thinking about next year, and more importantly, the next 3 to 5 years

  • Most people don’t care about privacy

  • Platforms continue to win, though issues occurring

  • American consumers are moving to a small number of relationships were they pay a monthly fee in all categories -- entertainment, food, clothing

  • Self-driving cars will change the world, though it is a generation plus away

  • Year over year Direct Sales for Q2 down 5-10% for the UDS based display publishers (msg aGaDdo estimate)

  • Global economy will not be stronger in 2019 vs 2018; have we hit a peak?


Platforms/Aggregators -- the Facebook, Google and Amazon Triopoly continues to thrive

  • Facebook will still grow, it has the BEST data

  • Facebook does not sell data they just hoard it, massage it and lend it to advertisers for amazing targeting

  • Google, Facebook and Amazon will eventually only supply marketers viewable ad impressions though each will have a slightly different definition of viewability

  • Google seems to be on the sidelines as Facebook continues runs into walls at least once a week during the quarter

  • If Congress can't ask Zuckerberg intelligent questions about Facebook, then how they can Congress regulate Facebook?

  • Mark Zuckerberg should hire either Obama (Barack or Michelle) to be the Chairman of Facebook

  • One of the big tech companies will buy Roku, Pandora, Spotify and/or Sonos

  • Many acquisitions are Active now: T-Mobile/Sprint; AT&T/Time Warner; Disney/Fox; CBS/Viacom; Discovery/Scripps; Comcast/Sky -- All because of the power of Google/Amazon/Facebook/Apple/Netflix

  • Twitter wants to be acquired by Disney

  • Snap will not make it long-term will need to be acquired to thrive

  • Amazon, Google and Facebook will all fight one another it is inevitable as an example Amazon is trying to figure out search

  • Amazon passes $1 trillion market cap first

  • Everywhere that Amazon bumps up against another company, Amazon wins

  • YouTube has about $10 billion in advertising revenue and because of brand safety issues did not go up in 2017

  • If Facebook divests Instagram and Google divests of YouTube then we have real advertising competitors to the triopoly giving us five companies not three

  • The EU has not been able to produce a top tech or media company like Google, Facebook, Amazon or Netflix; partly because of too much regulation -- though Spotify should soon be on this list.

  • Pinterest year end revenue was around $470 million, which was below internal projections

  • What happened with eBay?

  • I like the AT&T media acquisition strategy much more than that of Verizon

  • Voice-controlled products like the Amazon Echo are taking off -- the Echo’s installed base in the U.S. grew from 20 million in the third quarter of 2017 to more than 30 million in the fourth quarter


Marketing -- complicated out there for Marketers

Still need to push for MTA/DDA, in today's world last click attribution is just silly

Intel recently bought programmatic buying in the house just in the United States primarily to get access to all the raw data

Marketers spend more on Amazon as Amazon increases share

CRM files are the key to best ad spend ROI, CRM files uploaded to walled garden is best marketing ever

The CPM value in programmatic is linked to identity

A marketers job is to help drive growth for the company

Direct to Advertisers (DTC) always need new marketing channels to test -- they start with Facebook and Google for DR then go offline for Brand building like TV and outdoor; though are we seeing brand fatigue in this new category

Advertising world continuously moving from Brand to Measurable Direct Response (DR)

Seems like CMO’s across the board are starting to step up and drive more of the business

If you’re a CMO, you need to be better friends with your CIO


Agencies & Consulting Houses -- still powerful, though shifting power away from agencies

  • Prediction -- Accenture buys WPP and the consultants come in and fix the WPP agency

  • Agencies have just lost their way -- they need to reinvent themselves

  • Cannes will be slow this year vs. previous years, only real companies will attend with attendance down probably 25% or so and return to reality

  • WPP will not be broken up and will stay and be very centralized

  • Agencies are starting to focus on the power of creativity in the advertising ecosystem

  • Martin Sorrell’s new agency entity will not make it -- too much competition and will never be 100% analytically focused like agencies need to be today to be successful

  • Publishers should spend more time with consulting houses -- seeing how they operate and how they are helping marketers

  • The biggest threat of agencies looms from consulting firms, which used Cannes to flex their muscles.

  • Marketers shift in priorities to first-party data means clients will inevitably have more direct control of their marketing as it becomes more programmatic-led and in-house

Publishers -- pushing programmatic harder than ever

  • Q2 Direct revenue down again looks like Q3 will be down as well -- each Quarter is down 5 to 10% Year over Year

  • Publisher still in the Direct and Branded Content business need to figure out how to better use Salesforce

  • Podcasts are amazing, though need better monetization engine than what we have today

  • Content that informs and inspires and gets people to share is Good

  • Love what Vox is doing, going deep with key verticals -- like Food, Real Estate, Tech, etc.

  • Advertisers put $314 million into podcast ads in the U.S. last year. Very small compared to things advertisers care about. Like TV — $68.5 billion — or internet search ads — $22.8 billion — or internet video ads — $11.9 billion. Facebook alone did $39.9 billion last year. And even radio generated $17.6 billion in ad spend last year

  • A publisher's long term revenue mix should be 1/3 revenue subscription 1/3 revenue advertising 1/3 other -- e-commerce and events aspirational

  • if you are going to work my publisher in today's world -- make sure the publisher has a strong subscription product

  • Too much CHURN in the Branded Content world

  • Every publisher needs a VP of User Experience in 2019+

  • Direct TV is using ATT type data to garner 3 to 5 times CPM than that of a traditional Turner show

  • Will contextually targeted advertising come back in vogue

  • Publishers are still struggling with how to set up the sales and sales operations roles and responsibilities

  • Too many publishers rented or borrowed traffic from Facebook as opposed to building an audience through the front door

  • So many publishers rushed into the agency business over the years and quickly realized it wasn’t that great, especially the low margins

Ad Tech -- slowing down as it consolidates

Blockchain is just really transparency, not sure there is an ad tech usage of the technology

We need an old school ad network light of GDPR delivering banner ads with no cookies, bedrock media

Identity is the future and tech needs to figure this out to survive and prosper

Consolidation will happen soon, though i have been saying this for over a year

CTV is and will be huge; it is a race for those not names Google, Facebook or Amazon to compete and grow

Ad tech layoffs are happening

Do we need a DSP for the small business?

AT&T buys Appnexus and turns the Appnexus DSP to a self serve model for buying CTV -- Turner ads on Direct TV to start

Unfortunately, the layoffs are starting in ad tech, will hit a peak soon, then more consolidation

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Bonus 1 -- 15 industries of the future that are closely related to Ad Tech -- if you are trying to get out of Ad Tech, move to one of these

Direct to Consumer -- Any Direct to Consumer (DTC) business, razors, mattresses, video like Netflix or Hulu, food, etc. and the lifetime value of the customers for these companies

Voice and Podcasts -- Siri, Alexa and Google – though how do advertisers use this new voice enabled channel. ad insertion in particular, love the Pandora acquisition of AdsWizz. Voice search optimization

Data warehousing/Data visualization – Domo, Looker, Tableau, GoodData, Qlik, Business Objects, Datorama, etc.

SEO -- Search Engine Optimization is never going away it is still very relevant, with voice SEO next

Multi-touch attribution – Neustar and GA360 , this critical for marketers, as last click overstates many marketing channels

Outsourced engineering resources – we all need more programmers, not touching the core product by tangential pieces of the business

Benchmarking -- Across ad sales and other aspects of the business – how do I know if I am doing well?

Triopoly -- Work for Facebook, Google or Amazon. They are all in great long term positions, with Spotify and Roku in the background

Consulting Houses/Agencies -- Work for a top consulting house specializing in Tech, Advertising, Marketing, Systems, etc. or work for an agency and help them survive, they need smart people more than ever, though try to find a new breed analytical one vs a holding company

Salesforce – Become an expert in CRM, never going every company will always need a sales teams

TV/Connected TV – Data-enabled and addressable is coming. Not going away for the big guys – CBS, NBC, Disney, Turner, Scripps, etc. I also love Roku in this space.

eSports/Gambling -- Advertising in esports. Lots of room for growth. Maybe add in sports gambling her as well. Maybe eSports analytics or measurement

Drones -- all related to Drones maybe even Drone law?

Driverless Cars -- Will be a huge industry though definitely a generation away

Retail -- as an example, every retailer needs a CDP (customer data platform), a CDP is like a DMP with better, 1st party data

Bonus 2 -- An interview with Rob Daniels who left Ad Tech for better paths and is now running sales for a SAS company selling Ed Tech

Robert has been in Ad Tech since 2000 (he was at Advertising.com for 6 ½ years and then ran sales for ContextWeb) but was concerned about the job prospects in AdTech now and in the future

He was previously the EVP of Sales for OwnerIQ from 2009 - 2017

He looked at interviewing as a full-time job

Interviewed with 40+ companies over a 90 day period from November 2017 - January 2018

Spoke with 60+ recruiters

He was intrigued to get into more of a SaaS/software sale in a new industry outside of media

Many companies rejected him saying he did not have enough SaaS experience

Others were intrigued about the high growth he had achieved at OwnerIQ and ContextWeb leading their sales teams

He now runs sales for DataCamp a leading online learning platform in the data science field

DataCamp is a leading education technology player and sells annual subscriptions to businesses

He misses the people in media and the friends he made but truly enjoys being in a new field

Bonus 3 -- Appnexus becomes the first self-serve FREE DSP for CTV

AT&T uses the Appnexus DSP to go full serv-serve

This new DSP will be FREE

All Appnexus engineers then focus on the new and improved DSP

The Appnexus DSP then allows access to all the Direct TV Local spots via the new Appnexus DSP

The Appnexus DSP then then adds in all Turner spots via Direct TV via the new Appnexus DSP

Appnexus becomes the first self-serve FREE DSP for CTV

Not a bad move, IMHO, though would The Trade Desk be a better yet more expensive DSP acquisition

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What I saw happen archives

Links to all previous versions

2018

V14 -- Q3 2018 -- https://docs.google.com/document/d/1faNYxQmiAyI0Y9Zz8olNl5VQGueJSg2-KHN5yRUT6bw/edit

V13 -- Q2 2018 -- https://docs.google.com/document/d/1YU7cmaYRJZT8EYyxk_1mL3pVcb2X5eo9LB8qxtLXCVE/edit

V12 -- Q1 2018 -- https://docs.google.com/document/d/1lfj5WyzCqRVLCob_xAHztSzmDuzMtASQ1XVYL7c7Ld8/edit

2017

V11 -- Q4 2017 -- https://docs.google.com/document/d/1MjMQ-WYlpk4-B9FQm6ZoXJgGMrbCn67w3UcOrXC3SMM/edit

V10 -- Q3 2017 -- https://docs.google.com/document/d/1ukIMeykiUxuP69rAHblQBjwZi-nZRVwNwRMs0Zi55iY/edit

V9 -- Q2 2017 -- https://docs.google.com/document/d/1YlbYDGAot6QJ4q-AH3q0eaM_LRviDMirm4PyX9SuDHc/edit

V8 -- Q1 2017 -- https://docs.google.com/document/d/1ASKiIy8Aef2sA1OhIYkFFNbgKEh8TxUSgOTz-2ao7DA/edit

2016

V7 -- Q4 2016 -- https://docs.google.com/document/d/1MyvWKNG8CyvT_8tw7QQwf3is93F5t9AJuJEZm2Jcl4A/edit

V6 -- Q3 2016 -- https://docs.google.com/document/d/1D5WvVQD9chNbd3jRe40BV_8QKsOuNAH39HDs5W72gC8/edit

V5 -- Q2 2016 -- https://docs.google.com/document/d/1wdvjZsvYXeI5cQHTacC1y--cfcfHtC157g5SkRTXtBo/edit

V4 -- Q1 2016 -- https://docs.google.com/document/d/1k95jh3E6NQ5CZiZ5Ommtvbgvrofnpox702fYl94QF5E/edit

2015

V3 -- Q4 2015 -- https://docs.google.com/document/d/1C6Z0RRzMSzXq3qhkxo-FxlrAeoan1G6SK23QIsIjRYw/edit

V2 -- Q3 2015 -- https://docs.google.com/document/d/1gfAdBSx-IReHHKqenjA4SxHaLULjv60NGUEVpWbQGC0/edit

V1 -- Q2 2015 -- https://docs.google.com/document/d/1Bzj681ehRXH0FDuDoBQVuBCfzVwIpv-3Tgp-0znLlAU/edit

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If you made it this far, feel free to send me some feedback -- matthew.scott.goldstein@gmail.com

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