What I Saw Happen -- Q4 2020

What I Saw Happen -- Q4 2020

Again, I have been distracted this quarter with the election and COVID data absorbing my life. I still have my COVID/Healthcare website, where I post a new thought piece on a daily basis, of course based on data that I observe -- https://www.thismaysting.com/posts.

I hope you enjoy it.

Now back to my Q4 insights into the media world and, at the end, my positive outlook on 2021.

-msg

Overview

• Longest year ever

• Though, 2020, it could have been much worse

• Facebook, YouTube, and Twitter are now media companies, they are publishers in addition to tech platforms and the referees of journalism

• The pandemic has changed everything

• The big get bigger and the small get wiped out

• Post COVID, consumers have shifted from buying services and experiences to buying products

• Big breakthrough technology comes in two stages: stage one is doing things better and stage two is doing things we have never thought we could do before like self driving cars

• Amazon is the sun, it feeds us and nurses us but if you get too close it will incinerate you

• Some career advice: leave Ad Tech and get into Health Tech

• I am starting a SPAC

• Everyone is connected and no one is in charge

• Right now it’s not illegal to be a monopoly, but it’s illegal to abuse your monopolistic power

• A crisis is a horrible thing to waste

• Google Search was one of the most important new technologies for improving human life

• The federal government is a monopoly that can't go bankrupt and has horrible customer service

Big Tech

• Perhaps the tech companies have data on COVID and they know what’s going on but they’re afraid to share because then we will know how much data they really collect

• Instagram will test shopping functionality inside Reels, a new TikTok rival

• Facebook, Amazon, Alphabet, Apple all have monopoly power

• Google, Amazon, or Apple get ahead of the curve and spin off a major asset in 2021

• Facebook dominates the news media landscape and is largely unedited

• LinkedIn stories feels like a mismatch, who cares

• Is Google Chrome the second most valuable asset after Google Search?

• Facebook acquisition of Instagram in 2012 is one of the best acquisitions of all time

• Zero click search is an answer to a user's question right at the top of the search engine results page so the users does not need any further information that would be gained by clicking the link -- way too powerful

• Personalized advertising is under assault as Apple readies a change that would limit the ability of Facebook and other companies to target ads

• The Facebook algorithm is slowly ruining democracy

• Facebook is pure algorithmic amplification

• Now that Apple has launched their 5G phone what is next for the iPhone, folding multi- dimensional two screens?

• TikTok isn’t acting like a company that might be shut down in the US

• TikTok is reportedly experimenting with longer-form, three-minute videos

• Facebook said that just 6% of content US users see is political, though they didn’t say how the company defined political content or give a timeframe that the statistic applies to

• Parler downloads soared as conservatives flock to the Twitter clone after the Biden win

• Instagram cautiously considers paying publishers

• Amazon pharmacy today, next we will see Amazon minute clinics inside of Whole Foods

• Facebook employees say post-election changes to its algorithm should be made permanent

• Amazon, Google, and now Facebook are pushing into cloud gaming, which could finally give advertisers a way into this market

Streaming

• Disney is shifting its entertainment strategy to have streaming be its primary focus

• Com­cast is in talks with Wal­mart to de­velop and dis­tribute smart TVs, as the ca­ble gi­ant looks to be­come a dom­i­nant hub for stream­ing apps, not just TV chan­nels

• Nearly six months after the late-May launch of HBO Max, AT&T’S WarnerMedia and Amazon have finally come to a deal enabling the SVOD to be accessible on 40M Amazon Fire TVs

• The Queen's Gambit is the biggest limited series yet on Netflix

• Every movie should be cut into eight 30-minute segments and turned into a series

• Quibi died

• Discovery+ will be DOA

• Warner Brothers announced that all of its 2021 film slates will stream on HBO Max at the same time the films play in theaters

• AT&T’s WarnerMedia is considering two new streaming services, one revolving around CNN and the other based on TNT, TBS, and Warner Brothers movies

• Disney+ will be the same price as Netflix in a few years

• Disney+ has 86.8 million subscribers as of 12.11.20

• AMC, the world’s largest movie-theater company, said it may run out of cash by year’s end if it doesn’t raise more funds or get more people back to theaters

• What will happen to the movie theater experience?

Marketing/Agencies

• Snap’s First Commercial that allows users see when they open the app should be emulated by everyone, the IAB needs to make this a new ad product

• TV’s 2020 upfront market was horrendous, down 25% Y/Y

• Advance advertising commitments for the next year of TV could be down as much as 15% to 20%

• Samsung Ads launched Samsung DSP, a new self-service DSP platform

• WPP back on the hunt for deals -- WTF, they should focus on running the business

• P&G hikes marketing spending by at least $100M as sales soar

• Unilever reported revenue growth in the third quarter and said it would continue to boost marketing spending

• Amazon leapfrogged P&G, which has previously topped the list every single year since 1987, bar 2017 when it was outspent by Samsung.

• Amazon, whose advertising and promotion spending soared 34% to $11B in 2019 as net sales surged 20% to $281B

• Altogether, ad spending for the world’s 100 biggest advertisers edged up 0.9% to a record $300 billion in 2019 — before marketers slammed the brakes on spending in early 2020 amid the global pandemic

• Nielsen announced its plans to launch a single, cross-media solution to drive more comparable and comprehensive metrics across platforms -- will also be DOA

• Moderna is running its first consumer ad campaign

Publishers

• Google said it will pay publishers more than $1B over the next three years to license news content for a new product called Google News Showcase

• Facebook will pay mainstream UK news outlets millions of pounds a year to license their articles, as the social network faces the threat of a govt crackdown over its dominance of online advertising

• BuzzFeed is buying HuffPost -- actually Verizon paid BuzzFeed to take HuffPost and Verizon media group wanted to get out the news making business

• Group Nine, the publisher of The Dodo, PopSugar, NowThis, Thrillist and Seeker, is the latest media co to create its own online shopping marketplace

• Waiting for a publisher to use a SPAC to go public

• Average ratings for NFL games are down 9% versus last year, to 14.5M viewers

• Group Nine Media, owner of websites such as The Dodo and NowThis, is considering using a blank-check company to acquire some of its competitors as the digital-media sector continues to consolidate

• Facebook Instant Articles 5,700 new publishers added in 2020

• Can't believe Magnite has a market cap of $3.6B and Pubmatic $1.34B

• 2020 brought an identity crisis to the online advertising industry and I am sure it will continue in 2021

Commerce

• Shopping is mostly habit driven and COVID broke those habits

• Best Buy has enlisted Instacart to facilitate same-day delivery

• Macy's is working with DoorDash to offer online shoppers same-day and next-day delivery

• Can Walmart, CVS, and Instacart start to chip away at Amazon's advertising dominance?

• Walmart is aggressively expanding its advertising biz. The world’s largest retailer is making better use of its wealth of shopper data to link promotions on its website and app with ads

• Walgreens introduced a retail ad network called Walgreens Advertising Group, or Wag

• Amazon is the second biggest private sector employer behind Walmart

• Google tries to turn YouTube into a major shopping destination, including Shopify integration

• Walmart is officially entering the insurance brokerage industry with the launch of Walmart Insurance Services, which will start selling Medicare plans

• Is Amazon Prime Day really just the Amazon garage sale?

• Shopify is the second largest store in the world

• Holiday ad spending started early as brands and retailers face concerns over shipping capacity

• Apple is setting up kiosks called Express Storefront, in front of its stores to hand out pickups and cut down on crowds and lines

• The latest pandemic casualty is Black Friday

• A flood of orders for exercise bikes, fire pits, and other large items is set to complicate one of e-commerce’s biggest holiday-season headaches, RETURNS

• Retail Ecommerce Ventures acquired the RadioShack brand with plans for an online revival -- I always loved the RadioShack store

• Online grocery sales in the US will grow by nearly 53% in 2020, reaching $89B in sales, according to new estimates from eMarketer

• Cyber Monday brought in $10.8B in online spending in the US, according to analytics from Adobe. This was at the lower end of predicted range for online spend, which it set between $10.8B and $12.7B. Smartphones accounted for 37% of all sales

• Best Buy is testing new store formats at four locations in Minneapolis as a proof of concept for stores as fulfillment hubs

Work

• Microsoft is planning to let its employees work from home for up to half of the workweek even after the pandemic wanes and the company reopens its offices

• Google’s engineering directors are grappling with a worrisome trend: internal data that indicates productivity during the coronavirus shutdowns deteriorated among engineers, particularly newly hired ones

• As rent continues to plummet, companies are beginning to take advantage of their newfound leverage by luring employees back with larger private office spaces

• AT&T is putting WarnerMedia's huge NYC headquarters under review

• In a leaked memo, Google CEO Sundar Pichai cited the 'extraordinary circumstances' of 2020 in telling employees they'll get more time off to 'disconnect' and curb burnout

• Google opens the door to more remote working for employees. The tech giant may permanently adopt a “flexible work week” when workers return to the office, where employees can work from home two days a week

Other Stuff

• The house listing of the future -- 4 bedrooms, 3 bathrooms, 2 offices and 200+ Mbps

• LeBron is the basketball goat of our generation

• LASIK surgery increasing because of the foggy glass syndrome when wearing a mask

• Airlines could become the biggest facilitators of COVID testing in the United States at 2.5 million passengers a day

• China is accelerating through the pandemic

• $3.1T deficit in the United States in fiscal 2020 -- what the fuck, feel bad for my kids and future grandkids

• Heightened consumer cleaning, health and hygiene needs, these products are more important than ever, given the needs created by the current crisis

• The pandemic has increased consumers health consciousness

• Airlines are making the routes for leisure travel not business travel

• 1998 is when the government sued Microsoft, 22 years ago

• 60% of Americans work for a small business

• Podcasts are important but not mainstream, they punch over there weight with their elite audience

• Lincoln Project is becoming a media business -- next they might go after Zuckerberg or Dorsey

• The World Series was the latest big sports event to produce record-low ratings

• Americans have bought nearly 17M guns so far in 2020, more than in any other single year

• Gun sales across the United States first jumped in the spring, driven by fears about the coronavirus pandemic, and spiked even higher in the summer

• Amazon added 250,000 permanent full-time employees in the second quarter and another 100,000 in the first month of the fourth quarter

• Amazon is one of the largest employers in the world at this point, far ahead of the U.S. Postal Service's headcount of 633,000 or retail rival Target, which has 350,000 employees.

• Retail giant Walmart still outweighs Amazon with more than 2.2 million workers worldwide, but the list of bigger employers is growing short

• Media companies and marketers are scaling back or eliminating their usual plans for attending and entertaining at the Super Bowl

• The pandemic is sinking the fast-food industry’s bet on breakfast

• Georgia runoff could see $1B in spend, though probably closer to $500M

• The Weeknd will headline the Super Bowl halftime show

• We are spending more money on stuff not services

• Home prices are up 6% in 2020 mostly driven by very low interest rates

• In 2020, shelter animal adoption rates were consistently higher than in 2019

• Nearly 160M Americans voted in the 2020 presidential election, or about 67 percent of the voting-eligible population, up from 60% in 2016

• Restaurateurs and hoteliers are teaming up to create private dining experiences that allow guests to get out of the house, but limit their exposure to others

• Washington Post acquires CNN, love that prediction

2021, my thoughts

• 1M Americans are vaccinated a day in January and 2M a day in February, more as we hit March and April

• One dose is appropriate for the vast majority of the US population

• The news media, states, the feds, Johns Hopkins, start to report on daily vaccination counts

• The stimulus package has finally passed and it works

• Both the Pfizer and Moderna vaccines are ~90%+ effective with very limited side effects

• J&J rolls out their vaccine in Q2 with 70%+ effectiveness

• The warm weather in March/April make us all realize the end is near – the one year anniversary

• Indoor dining and bars start to open again in the Spring

• Hospitals become less full and care is much better across the board

• We hit herd immunity in some cities and states by Q2 and more in early Q3

• Movies open up, then concerts, then NYC theaters by the summer

• Pacific Rim tourists start to come back to the US followed by Western Europe travelers

• Summer Vacation plans that have been canceled start to remerge

• We will again start to see over 2M air travelers a day by the summer

• Basketball arenas and Basketball stadiums will once again fill

• Wimbledon and the US Open resume

• Dow hit 35K and NASDAQ reaches 17K by the summer

• Kids return to school in the fall and start a back to school shopping frenzy

• College students return to campus. and the jobs follow

• Unemployment drops to new lows as the hiring spree starts everywhere

• We will once again be in the era of the roaring 20’s -- just 100 years later

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, 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 2,750+ 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