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What I Saw Happen -- Q3 2020 

Authors note

I have been a bit distracted this quarter with the election and COVID data absorbing my life. In fact, I started a COVID/Healthcare website, where I post a new thought piece on a daily basis, of course based on data that I observe -- I hope you enjoy it and would love any feedback. Now back to the media world…..


  • If you’re not paying for the product, then you are the product

  • Strong evidence that the media landscape has changed forever

  • Apple’s anti tracking moves hurts publishers and advertisers, iOS14 update is looming and lack of Safari monetization for publishers is still occurring

  • Growing regulatory concern emerging in the US -- DOJ and Google, FTC and Facebook, Amazon and/or Apple could be next

  • Auto, Movies, Travel and Luxury advertisers still not spending though Auto should return in Q4

  • Political spend is very big for some publishers and expect to be significant through the election

  • Endless monetization of our data is the new normal

  • The phone is your constant companion as people continually watch dumb stuff

  • People prefer videos to photos and photos over text

  • Maybe Amazon’s idea of turning your biggest expenses into profit centers is the single greatest move in the history of great moves (e.g., AWS)

  • Google and Facebook are the most disruptive and profitable middleman in history

  • Health is the next luxury category led by Nike, Apple, Google/Fitbit, Peloton and maybe Lululemon/Mirror. Walmart and Amazon will also figure out this category with Amazon as my bet to be the leader in the long term

  • The US is really 50 individual states and thousands of individual counties: horrible for analyzing data

  • Small businesses make up about half of the US economy, without them the economy stays stagnant

  • We are in a self-service media economy: get it when you want it

  • Uneven bumpy recovery. Ups and downs. Undulations. Peaks and valleys

  • iOS14 is a big update -- more time for Apple engineers to focus on software in the pandemic

  • Credit-card providers are updating their rewards programs for an era when air miles aren’t the perk they once were -- Chase now has Apple products at 10% off

  • Tim Cook may take a hard stand against FB and threaten to kick them off the Apple ecosystem

Working From Home

  • The pandemic is helping us all break old, bad habits

  • Working from home can be ok, but is based on all the shared connections you have built pre- COVID

  • The next phase of building new products and innovation is hard remote.

  • The future will be a more flexible workspace, we know we can work remotely, so bring people together for brainstorming and group meetings: a hybrid approach.

  • Working from home has turned into living at work

  • Behaviors are quickly changing with the at home economy, new habits are now staying, 200+ days since the March 15 shutdown

  • Are home office pods the future???


  • Flexibility for advertisers is paramount, especially the ability to swap out creative and pause campaigns in hours not days, especially TV

  • Looking for flexibility now more than ever

  • Performance marketing continues to grow, with attribution more important than ever

  • Agencies have been in a recession for decades

  • Marketers basically pay for the Internet with advertising, glad they’re finally doing something on the Facebook front

  • While big name brands like Coke and Patagonia are jumping on the Facebook boycott, one group of companies that's mostly absent from the movement -- DTC companies like Glossier, Casper, and Daily Harvest

  • Forecasting a 13% drop in US ad expenditures for 2020 (excluding political) to about $208B, followed by a rebound of a 4% drop in 2021 to $217B

  • The pandemic gave brands literally a once in a lifetime ability to gain market share as users potentially change behavior forever

  • Marketers are looking for media plans post COVID that don’t have a lot of risk

  • CMO’s are being pushed by CFO’s more than ever, marketers need to make the CFO happy

  • Marketers are demanding better cancellation options

  • AVOD/OTT is a tremendous opportunity for advertisers today and tomorrow

  • Procter & Gamble is taking in-housing to a new level, by negotiating upfront deals directly with TV networks

  • Agencies will start to sell off the good assets if there are any left

Total US Ad Spending in 2019

  • Amazon: $6.8B

  • Comcast : $6.1B

  • AT&T: $5.5B

  • Procter & Gamble: $4.3B

  • Walt Disney: $3.2B

  • Alphabet (Google): $3.1B

  • Verizon: $3.1B

  • Charter Communications: $3.0B

  • American Express: 3.0B

  • General Motors.: $2.9B

Digital advertising Quad-opoly (Google/Facebook/Amazon/TikTok?)

  • Apple will eventually have a daily ad on the iPhone with no targeting

  • The Justice Department has narrowed its coming lawsuit against Google to focus on the company’s dominance in search

  • The top 100 brands accounted for less than 6% of Facebook's total global revenue -- amazing that FB, like Google, has managed to monetize the long tail so well

  • Google will license news content from publishers, the product will launch later this year with news companies from Germany, Brazil, and Australia

  • Don’t forget there are 15 months left before Google Chrome drops cookies; what is up with the Google privacy sandbox and Turtle Dove?

  • Snap has over 350 partners in Discover, a curated environment

  • Google, Facebook, Amazon, Apple and Microsoft have so much cash in the bank, that’s bad because it’s not circulating through the economy

  • Revenue for Google's Waze fell by 60% in Q2

  • The government should force Facebook, Google, and Amazon to go dark for a week then we could all develop new habits and find alternatives

  • With the decline in search revenue, Google is pushing for YouTube and YouTube TV to be more profitable in Q3

  • Is it a coincidence that Trump went after TikTok after its users purchased tickets for the Tulsa Oklahoma rally

  • TikTok opened its self-serve advertising platform to all advertisers just as the Facebook ad boycott was in full swing

  • TikTok officially opened up a self-serve ad platform that lets companies buy and manage ad campaigns directly.

  • Siting security concerns, Amazon has notified all employees that they must delete TikTok off their company phones

  • While Apple does collect a 30% commission from in-app purchases from many apps, Amazon and Walmart’s shopping apps are exempt

  • Facebook is UGC, amazing how it turned UGC into the best marketing machine ever invented

  • TikTok is just an algorithm on top of UGC

  • Reels may be the first new FB product that actually works

  • TikTok has over 100 million US active users, and skews extremely young

  • Facebook‘s biggest competitor is the government

  • Facebook is warning advertisers that they can expect weaker ad performance from iPhone users once iOS 14 comes out

  • Retailers like Walmart, CVS, and Instacart are starting to chip away at Amazon's advertising stronghold in the pandemic

  • Instagram is beautiful where TikTok is goofy and fun

  • TikTok is just an algorithm on top of user generated content

  • Facebook is designed to reward shock

  • Amazon ads was created in 2012 and now has $14 billion in revenue -- wow!!!

  • Does Apple eventually launch an ad free search engine?

If FB, Google, Amazon and Apple were up broken these are the 27 companies that would emerge

  1. Facebook

  2. Instagram

  3. WhatsApp

  4. Google Search US

  5. Google Search Non US

  6. Google App Store

  7. Google Cloud

  8. Google Maps/Waze

  9. Google Hardware

  10. YouTube

  11. Doubleclick

  12. Amazon Stores -- ecommerce

  13. Amazon Stores -- physical

  14. Amazon Private Label Goods

  15. AWS

  16. Amazon Video

  17. Whole Foods

  18. Amazon Prime Video

  19. Amazon Health

  20. Apple Phone

  21. Apple Mac

  22. Apple iPad

  23. Apple Watch/Health

  24. Apple App Store

  25. Apple Physical Stores

  26. Apple Chips and Processors

  27. Apple One bundle

Apple misses over the years

  • IMessage should have been Instagram

  • Facetime should have been Zoom

  • Apple Music should have been Spotify

  • Apple Watch should have health features like Whoop, Oura, or Amazon Halo

  • Apple News and Apple TV are horrendous

  • Only breakthrough product post Jobs has been the air pods and they are incredible, and maybe the Apple Watch


  • Apple News will never be a significant monetization platform for publishers

  • Is the publisher CMS the most important tool they have?

  • I can’t believe media sales used to be done with spa days, mani-pedis, Hampton summer shares and Vermont skiing trips -- wow that’s a set of skills that is not relevant today

  • Programmatic should be called pause-o-matic, unbelievable flexibility at the hands of the advertiser

  • We see relevant ads for free content, the internet quid pr quo

  • Think of a work without cookies, where every pub needs to ask for email to achieve a CPM that make viable

  • Will zoom one day have ads?

  • Congratulations to David Cohen who is running the IAB, we finally have some competent leadership in a industry that needs it desperately

  • Programmatic CPM’s increase as the quarter progressed, though not back to where they were last year, but very close

  • Programmatic CPM'S are now increasing in August and September and almost back to 2019 levels, should increase the rest of the year – most likely due to a share shift for marketers away from TV

  • NBCUniversal’s cable channels were once a crown jewel, Now they are an albatross

  • Verizon scrambling to unload HuffPost as losses mount

Programmatic insights from STAQ

  • Revenue finally surpassed 2019 at the end of July

  • CPMs increasing weekly since the start of Q3, hitting the $2.00 mark at the beginning of September

  • All screens now cost the same. In Q3 for the first time device CPMs converged and Mobile surpassed Desktop by 2%

  • Google up 200% Q/Q while Facebook just stopped spending in Q2.

  • Walmart up 200% Q/Q and without any real marketing around their “Prime” service

  • After significantly slowing spending in Q2, Auto is making a comeback with all 9 auto advertisers in the Top 50 up in Q3

  • Computers/Electronics saw big increases both HP and Dell both up 60+% Q/Q

  • P&G stopped spending in the beginning of Q3 while Unilever is up 225% Q/Q and Kimberly Clark is up 400% Q/Q

  • Apple and Samsung in September are up 100+% Q/Q. Both are releasing new phones in October which should see them continue to increase spend into Q4

  • Streaming wars heat up as Time Warner up 90% Q/Q promoting HBO Max. Disney up 112% Q/Q as they promoted the releases of Hamilton and Mulan on Disney+

  • LendingTree who found their sweet spot of low priced inventory in early COVID significantly dropped spending the last 6 weeks of Q3


  • I love YouTube TV -- such an elegant user interface with very low ad load and easy to share access with my family, though pissed about the July 1 price increase for additional channels I don't care about

  • Remember when watch parties were big?

  • Programmed linear television sucks, OTT is so much better, looking back we will be amazed we ever watched programmed TV, besides live sports

  • I still find it unbelievable that a third-party has not emerged to measure all streaming services

  • Does Roku, pull a YouTube, and have all inventory only available self-serve through the DataXu ad platform?

  • Amazon and/or Netflix need to get into live sports, news, and business coverage

  • Jason Kilar, boss of HBO Max said we need to prioritize the consumer experience and not have too many ads -- maybe HBO has a chance

  • Netflix, Amazon and YouTube are fundamentally tech companies, all the other streaming companies are media companies

  • YouTube’s reduced the time from 10 to 8 minutes for a video to be eligible for mid-roll ads

  • The only thing Qubi reinvented was how to go through $1.5 billion faster than any other media company in the world

  • Quibi is for sale, fire sale I am sure

  • Does anyone really need NBC/Peacock?

  • NBC Affiliates opt Out of '30 Rock' Upfront Special as a host of station groups are choosing not to air the special, which doubles as NBCUniversal's pitch to advertisers

  • Peacock late to the game and really missed not having the Olympics, like Disney+ had Hamilton

  • Buyers still don't want to lock in their upfront pricing only to see the market collapse due to more lockdowns

  • Hamilton delivered for Disney+ with the musical life spurring a spike in app downloads over its July 4th weekend debut

  • Twitch, time to take it very seriously gaming is the sleeping fiat especially for targeted ads

  • Netflix will never take ads

  • Hulu introduced a self-service tool to make it easier for small and medium-sized businesses to buy its ads. Hulu long enjoyed collaborating with many of the top 200 brands in the US, this will give viewers more creative diversity and relevance to their ad experience

  • Hulu is the second major company to launch a self-serve ads platform this quarter

  • Still amazed we all are still paying exorbitant cable bills for non-existent live sports, we should have received credits

  • 80% of Spotify subscribers are ad supported

  • More CTV deals will be done on an outcome based basis -- If I spend $100M I get $150M in incremental sales

  • CTV ad spend in 2020 will be $8B, a 25% increase year-over-year. 6% of total digital spend in the US

  • When was the last time anyone watched a show on Apple TV+?

  • Disney+ subscribers generate significantly less revenue per paying subscriber than their rival Netflix

  • During the June quarter, Disney+ average revenue per paying subscriber was $4.62 while Netflix averaged $10.80

  • AT&T will launch its ad-supported HBO Max service next spring

  • Netflix's spending on movies and programming will rise by $3B to $13.6B in 2020, outstripping its nearest rivals ViacomCBS, Disney and NBCUniversal when purchases of sports activities rights are excluded


  • Walmart has 2.3M employees and Amazon about 900K, when does Amazon surpass Walmart???

  • Sports gambling will be massive post COVID

  • Inventory overload, COVID caught stores by surprise and left them stuck with too many goods that are now tough to sell

  • Department stores like JCPenney, Nordstrom, and Macy's have been pummeled with low foot traffic and stores closures amid the pandemic and will start to focus on experience and convenience as the evolve

  • Death of malls will reshape the suburbs, with abandoned malls turning into local markets, office space, affordable housing, etc.

  • Buying a car is hard as inventory dried up

  • Walmart launched its Amazon Prime competitor

  • Some 2020 retail bankruptcies -- GNC, Brooks Brothers, Neiman Marcus, J. Crew, Pier 1, Modell’s, Lucky Brand, JCPenney, Sur La Table, John Varvatos, Lane Bryant Ann Taylor bankrupt etc.

  • Bed Bath & Beyond plans to close about 200 stores during the next two years as it looks to return to profitability

  • US online grocery sales hit a record $7.2B in June up 9% over May, as 45M households used the service, up from $5.3B in April and $6.6B in May

  • Instagram rolled out its new Shop section, where users can browse make purchases

  • E-commerce as a percent of total retail has gone from 15% to 25% during COVID

  • Businesses are transformed forever from an e-commerce perspective

  • Walmart will close stores on Thanksgiving Day this year; retailers in general dialed back last year on Thanksgiving hours

  • Amazon Prime Day moved to mid October

Non-US Stuff

  • Digital ad spending in China will still grow 5% in 2020. But there will be a power swap among the major platforms, as Tencent displaces Baidu and becomes the #2 publisher. Alibaba will remain #1, but with lowered expectations.

  • Facebook could be forced to allow users to switch off personalized advertising, and Google required to hand valuable data about search engine usage to competitors, under UK proposals to introduce competition into the digital advertising market.

  • India has many recent acquisitions/investments by US firms. India has ~1.2B mobile subscribers

  • TikTok is having trouble in India due to its Chinese ownership

  • India had more than 300M users of TikTok

  • Instagram has expanded its TikTok rival service, known as Reels, in India, in the wake of the country's decision to ban TikTok and dozens of other Chinese apps over privacy concerns.

  • Everyone is investing in India, right now especially Tech

  • UK, like the US, bans Huawei

  • India is the next big opportunity for tech.

  • Great time to be an entrepreneur in India.

  • Venture capitalists will probably spend more time in India as well

Other Stuff

  • Interactive video games, is the underdog in the whole tech/media future

  • Engineers, Data Scientists and Analysts should go work for the CDC and get our medical data in order

  • Crazy that Amazon, Microsoft and Apple are each over a $1.5T (yes TRILLION) market cap

  • Washington Redskins and Cleveland Indians -- can't believe this has taken so long

  • DMexco will be online-only this fall

  • Apple is finally coming out with an update to its podcast app, long overdue

  • Omnicom plans $20 Million in podcast ads on Spotify in Q3/Q4

  • 41 out of the top 50 telecasts in 2019 were NFL related

  • Twitter might be building a paid subscription-based service, an alternative revenue stream

  • Airlines will start to use the hub system to offset demand and also decrease customer satisfaction

  • Gun sales in America have surged since the pandemic began, with 7.8 million background checks run for firearms purchases between March and June. With 40 percentage first time buyers. Up from a typical 25%.

  • The global fertility rate, the number of babies being born is approaching 2.1 per woman, the level at which experts say the size of the population starts declining. These trends predate the pandemic and reflect more women around the world having access to contraception

  • 30-Year mortgage rate reaches the lowest level ever, 2.98%

  • DraftKings announced the launch of its standalone Casino app in Pennsylvania. This marks the second state where the app will be made available, following last month’s successful launch in New Jersey.

  • Sports gambling will grow as states need the revenue

  • Will Studios release films state by state depending on how significant the coronavirus is?

  • CES 2021 moves to an all-digital experience -- as expected

  • New York City’s obituary has now been written three times in the past 20 years, it will come back stronger and greater than ever and will end up younger and more interesting

  • COVID reshapes the economy, much as war and depression reordered life for previous generations

  • College towns in the Northeast are a great place to go in the next pandemic

  • Business trips are rare as we discover that we don’t need to travel as much as we did before

  • Cruise ships, movie theater and theme parks are in jeopardy

  • Traditional department stores and malls are dead

  • I miss the energy in the room

Acquisitions, etc.

  • Peloton will be acquired by Apple, Nike, Under Armor, or The Gap/Athleta

  • Google divest of GAM/DV360 for a $50B+ price tag

  • Google spins off YouTube as a separate company

  • AT&T divests of DirectTV

  • Neeva, a search engine that doesn’t collect user data or sell ads, is acquired by Apple or Viacom

  • Apple buys Sonos

  • Walmart buys into healthcare, maybe an insurance company?

  • Roku acquires Viacom/CBS, AMC and/or Discovery

  • TikTok goes public at $50B valuation, then acquires Snapchat and/or Pinterest

  • Where is the Fox News conservative competitor?

  • TikTok goes public in the United States and

  • Anyone with over 1 million followers on Twitter or any tweet they do should be reviewed by Twitter security and be on a five-minute delay


What I Saw Happen -- Q3 2020

  • 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, AdExchanger, Ad Age, The Information, eMarketer, Digiday, Math & Magic, Arete Research, Axios, Business Insider, AdWeek, Variety, LionTreee, Twitter, MediaPost, New Yorker, NY Times, Seeking Alpha, CNBC, CES, etc.

  • I send this out to 2,600+ of my colleagues in the industry -- if this gets passed along to you click here to be added to the distribution

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

Of course, let me know if you have any questions. :-)

-msg (Independent Analyst/Advisor/Consultant) // //

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