SPO: Navigating the Cannibalistic Chaos of Ad Tech

2023-10-30

Where jargon flows freely and acronyms rule the day, there exists a creature so elusive and enigmatic that it sends shivers down the spines of even the most seasoned ad tech experts. This creature, my friends, is known as Supply Path Optimization (SPO), and it’s a beast that’s been lurking in the shadows, ready to sink its teeth into the industry.

So, what the heck is SPO, you might ask? Well, grab your decoder rings and hold on tight, because we’re about to dive into the murky waters of this cannibalistic practice.

Imagine you’re a demand-side platform (DSP), navigating the treacherous jungle of supply-side platforms (SSPs). Each SSP has its own bag of tricks, its own secret handshake, and its own version of auction mechanics. It’s like a chaotic bazaar where everyone’s haggling for the best deal, but nobody’s speaking the same language.

Enter SPO, the algorithmic savior of the DSPs. It’s the GPS guiding them through this jungle, helping them pick the ripest fruits (or bids, in this case) while avoiding the rotten ones. Some DSPs use SPO to cherry-pick the most promising bids, while others use it to cut ties with SSPs that don’t play by the rules. It’s survival of the fittest in the ad tech wilderness.

Why SPO Matters

Now, you might wonder why DSPs are so obsessed with SPO. Well, there are two big reasons. First, there’s the issue of bid duplication. In this wild, wild west of digital advertising, bids are flying around like mosquitoes on a summer night. SPO helps DSPs avoid duplicating their bids, saving them from overcommitting their resources.

Second, it’s all about the auction mechanisms used by SSPs. You see, not all SSPs play by the same rules. Some use second-price auctions, where the highest bidder pays the second-highest bid price. But others have their own secret sauce, and the result is an unholy mishmash of auction methods.

In the grand game of thrones that is the ad tech industry, SPO has become a weapon of choice. Media buyers are demanding precision targeting, even as the old ways of doing things crumble like a castle under siege. It’s a battle for dominance, a scramble for the Iron Throne of ad tech supremacy.

Havas Media Group, in its quest for ad tech partners, has slashed its roster of SSP partners from a staggering 42 down to a mere handful. It’s a sign of the times, a signal that the industry is undergoing a seismic shift.

Who’s Eating Whose Lunch?

There’s a feeling in the air that DSPs are out to devour the lunches of SSPs. It’s a game of cat and mouse, where both sides are trying to outsmart each other. But who will come out on top in this high-stakes showdown?

At the heart of this intrigue lies “data activation,” the ability for HMG’s clients to target audiences on PubMatic’s inventory without relying on those pesky third-party cookies. It’s a dance of data and identifiers, a tango of targeting in the digital age.

But SPO is just one battlefield in the war for dominance in programmatic advertising. The industry is witnessing the rise of disintermediation, the act of cutting out the middlemen. Three musketeers have emerged in this grand scheme: GroupM, The Trade Desk (TTD), and Magnite.

GroupM has thrown its hat into the ring with the GroupM Premium Marketplace. It’s a bid to bring order to the chaos, to centralize control in a fragmented landscape. By partnering with Magnite and Pubmatic, GroupM aims to streamline media buying, negotiate better rates, and optimize the supply chain. It’s a bid to remain relevant in an era where advertisers are exploring in-house programmatic options.

The Trade Desk, on the other hand, has unleashed OpenPath, a direct bidding solution that bypasses SSPs. It’s a bold move that threatens to disrupt the SSP business model by eliminating intermediaries and reducing costs for advertisers.

Meanwhile, Magnite has its sights set on premium video with ClearLine. With acquisitions like SpotX and SpringServe under its belt, Magnite is positioning itself as a player in programmatic guaranteed (PG) deals. It’s all about maximizing spend on working media and simplifying the relationship between sellers and agencies.

The Disintermediation Dilemma

The rise of these products raises a critical question: Is disintermediation intentional, or is it merely a consequence of logical business decisions? The answer is likely somewhere in between. While these products aim to streamline processes and reduce intermediaries, they also offer value to both buyers and sellers.

These developments in programmatic advertising may not lead to an immediate industry collapse, but they signify a significant shift in how advertising transactions are conducted. Publishers and advertisers should seize these trends to negotiate favorable terms and ensure efficient supply paths.

In this ever-evolving landscape, adaptability is the name of the game. Those who embrace change and find opportunities within it will thrive in the dynamic and competitive world of programmatic advertising.

The Dance of DSPs and SSPs

In the complex tango between DSPs and SSPs, it’s not about going around each other; it’s about creating an ecosystem that ensures success in the future. Automation, transparency, and efficiency are the key moves on this dance floor.

As the industry wrestles with supply chain complexities, transparency, and value, the role of intermediaries is under scrutiny. The programmatic advertising landscape is evolving rapidly, and the players who adapt to these changes will be the ones who emerge victorious.

In the end, it’s a game of survival, and only the fittest in the ad tech jungle will thrive. As SPO and disintermediation reshape the industry, one thing is certain:

The ad tech ecosystem is in for a wild ride, and no one knows where it will lead.

Is Streaming Truly the Future of Profit? An Insight into Hollywood’s Modern Dilemma

Pesach Lattin

2023-10-25

The Hollywood sign, for so long a symbol of the land where dreams come true, now seems to cast a long, doubtful shadow over Tinseltown’s most recent venture: streaming. With protest signs, cries for fair compensation, and an industry in tumult, one can’t help but wonder: Is the promise of streaming sustainable?

A Historical Deep Dive

In 2007, Netflix leaped from its DVD-rental model to introduce the world to streaming, radically reshaping our consumption habits. This was a seismic shift comparable to the transition from radio to television. A subscription-based model offering an almost infinite library? The proposition was delectable. But it took a mere six years for Netflix to pivot once more, this time producing original content. A strategy that sent shockwaves throughout traditional media houses.

Discovery, NBCUniversal, and Paramount, alarmed by Netflix’s progressive moves, were pressured to build their direct-to-consumer platforms. However, the catch was in the economics of it all. Traditional TV had a straightforward model: commercials fund content. With streaming, monthly subscriptions became the primary revenue stream.

Growing Pains in the Industry

The initial growth numbers for streamers were staggering. Each quarter brought with it an astronomical rise in subscribers. But herein lay a deceptive underbelly: growing subscribers doesn’t necessarily equate to growing profits. The cost of producing original content and licensing others skyrocketed. And while these platforms had amassed subscribers, the average revenue per user was significantly lower than traditional TV models.

Then came the shocker in 2022: Netflix reported its first subscriber loss. An occurrence that many believed was the inevitable canary in the coal mine for streaming. Disney soon echoed this sentiment, further causing ripples of uncertainty in the streaming world.

According to a report by IndieWire, starting in 2023 only Netflix and Hulu seemed to be in the green. Other major players, including Disney+ and HBO Max (Now Just Max), were hemorrhaging money. They all faced the same conundrum: while revenue flowed in, profitability remained a distant dream.

To bridge the chasm between expenditure and earnings, streamers adopted multiple strategies:

Ad-Incorporation: Taking a page out of traditional TV’s playbook, platforms like Disney+ introduced ad-supported tiers. Once Netflix jumped on this bandwagon, it found that these subscribers generated more monthly revenue than their ad-free counterparts.

Tax Write-downs: Some streamers found profitability, ironically, in their losses. For instance, WBD’s cancellation of Batgirl was suspected to be a move to avail tax write-down benefits.

Migrating to AVOD and FAST: AVOD (Advertising Video on Demand) and FAST (Free Ad-supported Streaming Television) emerged as solutions to the profitability conundrum. Brands like Roku and Tubi started offering ad-supported viewing, enticing users with free content. Mainstream streamers saw an opportunity to offload lesser-watched content onto these platforms, earning through ads while also trimming their libraries.

The Way Forward

Today’s streaming landscape is reminiscent of the early days of cable TV, where a plethora of channels eventually led to bundled packages. As more streamers vie for the same audience, will we see a similar bundling of streaming services?

Furthermore, as streamers scramble to appease investors, the industry’s true stakeholders – the writers, actors, and creators – are often left in the lurch, bearing the brunt of the financial tumult.

It’s evident that streaming, in its current form, is not the promised land many hoped it would be. While it offers unprecedented accessibility and a platform for diverse content, its long-term profitability remains shrouded in doubt.

As technological disruptions continue to redefine Hollywood, it’s a wait-and-watch game. For now, both streamers and traditional media must adapt, innovate, and perhaps even collaborate to navigate the tumultuous waters of the modern entertainment industry.

The Comedy of Errors: Why Your Ads are 33% Irrelevant and Incredibly Hilarious

Pesach Lattin

2023-10-25

It seems our modern age’s three certainties are death, taxes, and—judging by a recent report from Advertiser Perceptions and Claravine—getting the wrong ad 33% of the time.

With the advancements in ad tech, you’d think the robots knew us.

But as it turns out, the algorithms have their own brand of humor.

Alright, roll up those sleeves and ready your magnifying glasses as we delve into the Sherlock Holmes of ad mysteries. Picture this: A chap clicks on a link to a renowned knitting site, and voila! The system pegs him as a 60-year-old granny with a penchant for wool.

But maybe, just maybe, he’s a rugged biker looking to knit a cozy muffler for those cold rides? Shocking, right?

Now, let’s pivot to our next enigma. Consider a surfer who checks out VeganRecipes.com but also haunts the local BBQ grill site and sneaks into adventure travel blogs.

Who might they be? An adrenaline junkie with a kale obsession who’s planning a vegan BBQ in the Himalayas? Or perhaps, just someone with, dare we say, diverse tastes?

Data inference is a lot like blind dating. We might get a few tidbits – this one likes cats, that one enjoys hiking – but the rest is often educated guesswork sprinkled with optimism. And as the research indicates, often this “educated guesswork” translates to: “Here’s an ad about butt-flap onesies because you once bought diapers… for your neighbor’s baby shower.”

Bravo, ad tech, bravo.

It’s baffling that in an era of real-time dynamic advertising, 50% of advertisers are as oblivious as a cat to a laser pointer when it comes to realizing their ads just cuddled up next to unsuitable content.

And let’s not even begin to discuss the trauma of being chased around the internet by that pair of shoes you Googled once. We get it; they’re nice shoes.

Maybe I bought them in store, maybe I didn’t like them after all. But for the love of cookies (pun intended), stop the relentless pursuit!

I’m not the only one amused and bemused by the uncanny, sometimes haunting, other times laugh-out-loud hilarious ad choices. If the banter on Twitter is a yardstick of public sentiment, we’ve all been served ads that make us question whether Skynet’s younger sibling has a sense of humor or is just truly clueless.

In the comedic goldmine of ad mismatch, Twitter stands out with its offerings that make it feel like a garage sale, manned by Ron Popeil, selling everything from the Veg-O-Matic to… a T-shirt with a horse’s head on a heartbeat line?

Yet, amidst all the hilarity and occasional eyebrow-raising moments, the genuine concern for brands is the risk to brand safety and the substantial ROI they’re potentially missing out on.

A system that serves irrelevant ads is a system that’s not serving its purpose. If 29% believe the main culprits are organizational inefficiencies, there’s a call to action right there. Moreover, the absence of standardization makes the conundrum even harder to decipher than a cross between hieroglyphics and Morse code.

The industry is crying out for consistency, clarity, and, dare I say, a little common sense. Chris Comstock from Claravine hits the nail on the head with the “go, go, go” mentality. It’s like we’re all on a treadmill set at maximum speed, trying to change our shoes while it’s still moving.

We find ourselves at a crossroads. On one side is the promise of technology – the dream of perfectly targeted, efficient, and effective advertising. On the other, the reality of “butt-flap onesies” and “horse heartbeat shirts.” It’s time for a bit of introspection, education, and course correction.

So, dear ad tech, while we appreciate the chuckles, how about upping your game? After all, in the immortal words of Shakespeare (or was it an old advertising guru?): “To be relevant, or not to be relevant, that is the question.”

The Unstoppable Momentum of Stephanie Parry: The New EVP at Jellyfish

Pesach Lattin

2023-10-24

London’s shimmering skyline was a touch brighter this morning. Not from an odd gleam of the sun, but from a notable shift in the sphere of global digital marketing. Jellyfish, one of the pioneering captains of this vast sea, has reeled in a prized catch. Stephanie Parry, with a commendable voyage of 17+ years across the stormy seas of global marketing, is now the Executive Vice President (EVP) of Client Management at Jellyfish.

Parry’s name has been synonymous with change, passion, and growth. She’s a seasoned sailor, whose compass always points to innovation, and her dedication to her craft is evident in her impressive tenure at large multi-market behemoths as well as nimble high-growth SMEs.

The corridors of Jellyfish will soon resonate with her ethos of creating “honest, human relationships”. There’s an art to balancing the commercial vigour with the human touch, and Stephanie seems to have mastered this tapestry.

Her collaboration with SheUnit promises to be a powerful one, a partnership forged to champion Diversity, Equity, and Inclusion (DEI). For Jellyfish, it’s not just about changing the narrative; it’s about setting the tone for the industry. Gender equality isn’t a box to tick; it’s a mission to embrace. And with Parry’s history at Shine for Women – where she sculpted strategies to amplify gender equity – one can say, Jellyfish’s commitment towards DEI is in capable hands.

While at Mindshare, Stephanie showcased an uncanny knack for guiding global behemoths like BlackRock through labyrinthine marketing transformations. But what sets her apart? It’s her fervent belief in being “clientcentric” and fostering “collaborative partnerships”.

The world of marketing is a vast mosaic of B2B and B2C sectors. Stephanie’s canvas is diverse – spanning from the cultural nuances of the UK to the bustling streets of France and the innovative hubs of the USA. It’s not just about understanding different markets; it’s about immersing oneself in them, something Stephanie has done repeatedly, breathing life into marketing visions for Fortune 500 titans.

However, in the heart of this commercial maven, beats an ethos that’s rare. She’s a believer in (kindly) speaking the truth, even when the winds are rough. In an industry often painted with hues of grey, her commitment to truth is a refreshing shade of bold.

“I am so excited to join brilliant Jellyfish,” Stephanie shares, her voice filled with palpable passion. “A company with incredible talent, tech, and a genuine passion for client excellence.”

For Jellyfish, the journey ahead is clear, with Stephanie Parry at the helm. And as Nick, a colleague and admirer of her prowess quips, “It’s going to be fun.” Indeed, the horizon looks promising, and the waters, inviting. For Jellyfish, and for Stephanie, the voyage has just begun, and it promises to be one for the annals.

Email Marketing Law Update: Google Announces New Requirements for Bulk Email Senders to Gmail

Richard B. Newman

2023-10-23

On October 3, 2023, Google released an announcement entitled “New Gmail protections for a safer, less spammy inbox.” By February 2024, Google will require bulk senders to authenticate their emails, allow for easy unsubscription and stay under a reported spam threshold.

“…[T]oday, we’re introducing new requirements for bulk senders — those who send more than 5,000 messages to Gmail addresses in one day — to keep your inbox even safer and more spam-free,” according to the announcement.

Focus on Email Authentication

According to the announcement, “bulk senders don’t appropriately secure and configure their systems, allowing attackers to easily hide in their midst.” Validation that a sender is who they say they claim to be and email security is a particular focus of the new Gmail protections.
“[I]t’s still sometimes impossible to verify who an email is from given the web of antiquated and inconsistent systems on the internet,” the announcement reads.

‘You shouldn’t need to worry about the intricacies of email security standards, but you should be able to confidently rely on an email’s source. So we’re requiring those who send significant volumes to strongly authenticate their emails following well-established best practices. Ultimately, this will close loopholes exploited by attackers that threaten everyone who uses email.’

Last year Google started requiring that emails sent to a Gmail address must have some form of authentication. According to the announcement, it has seen the number of unauthenticated messages Gmail users receive plummet by 75%.

Allow for Easy Unsubscription

“You shouldn’t have to jump through hoops to stop receiving unwanted messages from a particular email sender. It should take one click.”

Google is requiring that large senders provide Gmail recipients the ability to unsubscribe from commercial email in one click, and that they process unsubscription requests within two (2) days.

Enforcement of a Spam Rate Threshold

A “clear spam rate threshold” has also been announced, one that senders must stay under to ensure Gmail recipients are not “bombarded with unwanted messages.”

“These practices should be considered basic email hygiene, and many senders already meet most of these requirements. For those who need help to improve their systems, we’re sharing clear guidance before enforcement begins in February 2024,” according to the announcement.

Takeaway: By February 2024, Gmail will start to require that bulk commercial email senders: (i) authenticate their email via Google best practices; (ii) enable easy unsubscription in one click with a two (2) processing deadline; and (iii) remain under the spam rate threshold. Google recommends that those covered (for example and without limitation, digital advertisers) to follow the guidelines in this article as soon as possible. The failure to comply may result in emails not being delivered as anticipated or being flagged as spam.

Richard B. Newman is a digital marketing practices attorney at Hinch Newman LLP. Follow FTC defense lawyer on X.

Informational purposes only. Not legal advice. May be considered attorney advertising.

TAG Points the Finger: Juniper’s Allegedly “Flawed” Research

Pesach Lattin

2023-10-23

We’ve seen many things: rogue ads, accidental viral campaigns, and the occasional hard-rock hamster video (don’t ask). But every now and then, something comes along that truly makes us sit up – and not always for the right reasons. Enter Juniper Research and their recent ad fraud report.

Research 101: Always share your methodology. It’s the bedrock that assures us that you didn’t just pluck numbers from thin air during a daydream. Given that ad fraud is sneakier than a cat burglar in socks, a robust methodology isn’t just good to have—it’s vital.

Yet, Juniper’s report, according to Michael S. Zaneis, the CEO of Trustworthy Accountability Group (TAG) with its bold numbers and grand claims, has all the clarity of mud. While they might as well have said, “Trust us, we’re Juniper,” the industry would love a bit more to go on than a name drop.

Ad standards are to digital advertising what grammar is to language. Without them, we’re left with incoherent babble. The Media Rating Council tried to save us from such chaos with their well-established definitions of ad fraud. But it seems Juniper, in their maverick spirit, decided to play linguistic gymnastics, bending definitions to their whim.

They created a mix-and-match collage of terms, making one wonder: Did they use a dartboard to choose definitions?

Plus, invoking Google’s Video Partners program as the poster child of ad fraud is like accusing a fish of forgetting to ride a bicycle – it doesn’t match up with any known definitions, including Juniper’s own!

Now, to the soap opera-worthy twist in our tale: Juniper’s eyebrow-raising promotion of Fraud Blocker. It’s akin to writing a critique about soft drinks and then singing the praises of an obscure soda brand out of the blue.

Was there a secret handshake we missed? Juniper’s silent treatment on its ties with Fraud Blocker makes the gossip mills churn. Rumors are they were paid for this advertisement, or have some sort of investment in Fraud Blocker. What’s up?

The Peanut Gallery Weighs In Against TAG

Dr. Augustine Fou, ever the provocateur, wears a smirk as he points out the irony of the situation. “It’s amusing,” he begins, “to see TAG, with their own quirky methodologies, going after Juniper with such gusto.” He implies that TAG’s own certification might be less of a badge of honor and more of an “everyone gets a trophy” kind of award. “It’s like watching a pot call a kettle black, but in this case, both might just have a few smudges,” he adds, barely concealing his glee.

Shailin Dhar, CEO and co-founder of Method Media Intelligence, doesn’t hold back either. He leans forward, eyes sharp, “TAG’s intentions might’ve been golden, but the road to ad chaos is paved with self-declarations and unchecked badges.” He points out the gaping hole in TAG’s approach, questioning the efficacy of a system that, in his words, “lets anyone slap on a ‘Good Guy’ badge after a pinky promise.” For Dhar, the problem isn’t just Juniper’s report, but an industry that sometimes mistakes self-certification for rigorous vetting.

As the digital ad world spins on, the Juniper saga reminds us that while we all love a good plot twist, when it comes to research, we’d rather stick to the straight and narrow.

So here’s hoping for clearer methodologies, consistent definitions, and fewer surprise endorsements in our reports. And maybe, just maybe, more hamster videos.

Silver Surfers, Siri, and Strategy: Marketing’s Wondrous, Witty AI World

Pesach Lattin

2023-10-18

In a world where your toaster might soon ask about your emotional state, it’s worth pondering if AI marketing is the future’s brave new frontier or just another tech mirage. Let’s cut the tech jargon: AI is changing the game for marketers.

Today, we’ll embark on a journey into the labyrinth of AI marketing, brushing up against its fascinating corners, its shinier opportunities, and the gritty challenges we face as we make friends with our digital comrades.

Goldman Sachs, not your average soothsayer, but a titan of finance, rolls its eyes at the “AI bubble” whispers. Remember the dot-com drama of the 90s? Some see AI’s rising star and think, “Here we go again.” But Goldman Sachs? They’re ready to place their chips on the AI table.

Our guy Peter Oppenheimer, top dog at Goldman Sachs’ equity strategy team, is rather convinced we’re just toddlers in this tech playground. With AI investments predicted to hit a cool $200 billion by 2025 and generative AI tipped to toss a casual $4.4 trillion into the world’s money jar, it seems we’re onto something big.

With AI’s grand entrance, guess who gatecrashes the party? Ad fraud! The shadier corners of programmatic marketing are buzzing with bots and scam artists, draining advertisers’ pockets faster than you can say “clickbait.” For context, programmatic ad fraud stole the limelight (and cash) with a whopping $65 billion heist in 2021. That’s bigger than the entire credit card fraud scene! It’s like a Hollywood sequel nobody asked for, reminding us to keep our digital wits about us and give fake news and spam the cold shoulder.

AI’s given the fraudsters some new tools, leading to us throwing cash at phantom audiences. Almost a quarter of the money poured into programmatic advertising might just be vanishing into thin digital air. The antidote? Tight partnerships and eagle-eyed vetting.

Voice-activated AIs are the new BFFs. Siri and Alexa aren’t just tech toys; they’re shaping how consumers search. If you own a smartphone (and who doesn’t?), there’s a 97% chance you’ve chatted with an AI. If that’s not a hint for marketers to get voice-savvy, I don’t know what is.

Beyond the voice game, AI is a mastermind in deciphering the hieroglyphics of consumer behavior, predicting the next big thing, and fine-tuning engagement blueprints. Armed with AI, marketers now have the digital sixth sense they never knew they needed.

Think of AI as the ultimate matchmaker, setting up marketers and consumers for meaningful connections, thanks to predictive analytics.

With AI’s uncanny ability to predict trends and desires, the age of hyper-personalization isn’t coming—it’s here. Modern CMOs, like Lisa Cole of Cellebrite, aren’t just leading marketing troops; they’re teaming up with AI, turning it from a tool into a strategic confidant.

Embracing AI isn’t just tech-savvy; it’s downright revolutionary. While the kids these days are often seen as digital natives, it’s the silver surfers who might just have the adaptive edge when it comes to AI. Breaking news: age isn’t a barrier to befriending algorithms!

As AI dives deep into marketing, it stirs up a cocktail of dilemmas:

Are consumers chatting with a bot or Bob from accounting?

Ever heard a chatbot spew nonsense? That’s a “hallucination,” and not the fun kind.

As AI evolves, will it leave human marketers in the dust?

AI’s penchant for “borrowing” content and faces? A tricky legal minefield.

In the swirling dance of AI and marketing, one thing’s clear: AI isn’t some digital diva set to exit the stage. It’s here, reshaping the very core of the marketing cosmos.

Companies harnessing AI are poised to elevate customer joy by a quarter.

So, if you’re placing bets on the future, put your money on a world where AI and marketing groove together, crafting a digital symphony that’s more captivating than ever. AI in marketing isn’t just a trend; it’s the headliner.

How Giants Like Netflix Are Circling Back to Cable’s Shadow

Pesach Lattin

2023-10-18

The age of streaming dawned with a promise, a vision of a horizon where content was king, and viewers were no longer shackled by the constraints of traditional cable.

But as the years have rolled on, those early promises seem to have evaporated, much like morning mist under the blazing sun.

Today, we stand at a curious juncture where the once-revolutionary pioneers, like Netflix, echo the missteps of the very institutions they vowed to replace.

Netflix, the harbinger of the streaming renaissance, transformed our living rooms into theaters and broke the weekly episode mold, giving birth to the binge-watching era. But when Ted Sarandos, its co-CEO, revealed the underwhelming performance of their advertising tier, it wasn’t just a company hiccup. It was an industry-wide siren, a warning that the titans of streaming might be treading on thin ice.

This shift can be, in part, attributed to the creeping specter of “enshittification.” An amalgamation of corporate greed, complacency, and a relentless drive for quarterly profits has started to eclipse the initial focus on user experience.

The signs are all too familiar: tightening policies (akin to Netflix’s battle against password sharing), ceaseless price hikes, and nebulous fees, all designed to satiate Wall Street’s ever-growing hunger.

Amazon’s recent moves serve as a glaring example. Once celebrated for its disruption, Amazon now charges its loyal Prime subscribers $15 monthly (or an annual $139) for a gamut of services, including streaming. However, the recent introduction of ads to this premium experience, followed by the audacious offer to remove them for an additional fee, smacks of the very tactics traditional cable was lambasted for. The move, while potentially boosting short-term revenues, seems like a dance on the precipice of consumer tolerance.

It underscores a disturbing trend where market vibrancy, competition, and customer contentment are sacrificed at the altar of immediate fiscal gains.

In an idealized world, the explosion of streaming platforms should’ve ignited a fierce battle for supremacy, spurring innovations and competitive pricing. But the present landscape paints a different picture. Blinded by Wall Street’s relentless demand for quarterly returns, many streaming giants seem hell-bent on extracting every ounce of value, often at the expense of product quality and consumer goodwill.

The consequences of this approach are manifold: a proliferation of pointless mergers, dilution of once-esteemed content (HBO’s recent quality dip stands out), and an overarching disregard for user experience.

This bleak scenario is further exacerbated by industry-wide layoffs and a glaring reluctance to remunerate creatives fairly for their contributions.

The irony? Those at the helm of these corporate behemoths, exemplified by figures like Warner Brothers Discovery CEO David Zaslav, often appear to be navigators lost at sea. Despite their lofty titles and salaries, many give no indication of genuinely understanding, or even caring for, the intricate tapestry of their industry, employees, or consumers. The culmination of these missteps? Spiraling costs, subpar product quality, stagnant wages, widespread industry turmoil, and the damning shadow of “enshittification.”

But perhaps the gravest danger lies in the industry’s inability, or unwillingness, to recognize its trajectory. The blunders and myopia that plagued traditional cable and left it vulnerable to disruption are eerily mirrored in today’s streaming landscape. One can’t help but wonder:

Are these giants, with their complacency and hubris, setting the stage for history to repeat itself?

As we navigate this evolving landscape, the hope remains that the streaming world will course-correct, returning to the user-focused vision that once made it revolutionary.

But for now, as the lines blur between the old and new guards, consumers and industry stakeholders watch with bated breath, waiting to see how this story unfolds.

The Murky Waters of Podcasting Ad Fraud

Pesach Lattin

2023-10-12

The digital soundscape of podcasts has experienced exponential growth. Millions worldwide tune in every day, taking solace in the intimate embrace of a podcast’s comforting audio.

Like any influential medium, podcasts have piqued the interest of advertisers and with that, an influx of capital.

But this golden age for podcasts, with its rapid expansion and significant revenue milestones, is facing the timeless ailment of the advertising world: fraud.

Recent revelations highlight the depth of this deception. DoubleVerify, a prominent brand-safety firm, illuminated an alleged fraud operation they’ve dubbed ‘BeatSting’. With losses estimated to be around $1 million per month, the implications are deeply unsettling.

This is a tale as old as advertising itself. It recalls stories of the dot-com era, where new online websites would garner impressive impressions only for brands to later realize they were essentially advertising to bots. The concept is the same: as long as there are metrics to manipulate, there will be entities determined to manipulate them.

The digital terrain of podcasting is especially susceptible. Services like iBoostReach promise instant growth in downloads, placing them at the top of the charts. On paper, it’s a tempting offer; but in essence, it betrays the authenticity that podcasts and their advertisers rely upon.

Investigations by reputable sources, like Bloomberg, paint an even grimmer picture. Tactics include the acquisition of in-game ads. When a user interacts with such ads, podcast episodes are instantly downloaded, misleadingly increasing their download count. This duplicity goes even deeper, with eminent names like The New York Post and iHeartRadio identified as beneficiaries of these in-game ads.

Given the mounting evidence, doubts are rightly raised about the true impact and reach of podcast ads. When platforms such as Spotify view podcasting as a “$20 billion opportunity”, the significance of these issues becomes even more apparent.

Digital advertising has long grappled with the specter of ‘ad bots’. They mimic genuine user interactions, from clicks to browsing patterns. Their goal is singular: to deceive advertisers into believing they are reaching real people. This insidious practice has ramifications for podcasting. Client-side ad insertion, or programmatic advertising, allows for precise targeting. But when these systems get infiltrated by bots, the results can be disastrous for advertisers.

This tale is not limited to just podcasting. The industry of connected TVs faced similar scrutiny when reports unveiled ads playing on devices that were turned off, leading to billions in fraudulent impressions. The blowback was swift and severe, with budgets slashed and trust eroded. Podcasting stands at this precipice.

The murky waters of podcast advertising fraud are not navigated alone. Services like iBoostReach highlight the hidden side of the podcasting boom. Yet, it’s the silent acknowledgement of its existence by industry insiders that’s most alarming.

Major publications have been caught up in this scandal. Tactics like purchasing in-game ads that auto-play podcast episodes represent the lengths some will go to inflate numbers. This begs the question: in a world where genuine engagement is the currency, why are we still falling for such deceptions?

The answer lies in the dynamics of the advertising industry. The pressure to showcase impressive metrics, coupled with the urgency to maintain growth trajectories, pushes entities to the brink.

We also witness the complex web of minimum guarantees, contracts ensuring podcasters a set revenue regardless of their show’s performance. When commitments are based on projections and potential, they become vulnerable to manipulation. Recently, high-profile legal battles have erupted over these contracts, shining a light on the fragility of trust in this industry.

Efforts to rectify this are evident. At the Podcast Movement conference, discussions centered on spotting fraudulent numbers. But the consensus was clear: while they can guide, the onus falls upon the industry to self-regulate.

In the end, the podcasting world stands at a crossroads. While the future holds immense promise, there is a growing need for genuine introspection and reform. Only then can this incredible medium truly realize its potential, devoid of shadows and mistrust.

The Ascendancy of Connected TV: A Dive into the Future of Advertising

Pesach Lattin

2023-10-12

In the dim light of modern living rooms, a battle is being waged: the evolution of television consumption. From black-and-white family gatherers to colorized rectangles of entertainment, TVs have long been the center of home recreation. Today, the rise of Connected TV (CTV) marks a significant shift in how we view and interact with content. As Millennials, Gen X, Y, and even Gen Z make their mark, they’re tuning into CTV like never before.

How We Got Here: The Rapid Rise of CTV

CTV has established itself as a major force in the 21st century. Its sudden rise in popularity isn’t merely because of its novelty or the allure of modernity. It lies in its unparalleled user engagement and lucrative accessibility for advertisers.

Traditional linear TV, once the unchallenged behemoth of the ad world, now seems like an old, fading star next to CTV’s dazzling 82% attention rate. This riveting new platform is absorbing users’ attention for three seconds longer on average, pulling them deeper into its embrace.

The Catalyst: AVOD’s Magnetic Pull

The swelling tide of CTV owes a significant debt to Ad-Supported Video On Demand (AVOD). Media companies and broadcasters, while still committed to crafting riveting content, have found a golden goose in interspersing brand advertisements. This ad infusion allows these platforms to cut down subscription costs, making viewers all the more amenable to a few commercials if it means free content.

By 2026, a staggering 174 million AVOD enthusiasts will emerge, with 68.6% basking in the offerings of OTT services. With audiences scattering and splintering across numerous platforms, advertisers have a challenge and an opportunity: to cast a wide net, pulling in diverse, niche audience segments apt for tailored campaigns.

Navigating a Cookieless Landscape

The impending demise of third-party cookies looms large on the digital horizon, setting the stage for OTT and CTV platforms to evolve robustly. As this cookieless future becomes our reality, marketers are amplifying their focus, keenly watching every dollar in their arsenal, ensuring they weaponize their campaigns for optimal results.

Amidst these seismic shifts, the evolution of CTV and OTT heralds a lush vista for marketers. Flexibility is the name of the game, with the ability to scale budgets up or down, taking inspiration from audience purchasing behaviors.

Traditional TV: The Diminishing Giant

Traditional, linear TV, which for decades enjoyed an unbroken reign, now confronts an existential dilemma. With only 56 million U.S households tuning in daily in 2022’s latter half, its influence is waning. The world is changing, and if brands hope to survive, they must change with it.

In light of this, the compelling question for advertisers is stark: If the vast majority of linear ads can’t access half of U.S households, how do they bridge this expansive gap? CTV beckons as the answer, urging retailers to integrate it into their holistic video strategies.

The Impending Recession and Its Implications

The winds of economic unpredictability blow cold, and as per Ned Davis Research, a global recession isn’t a distant possibility but an impending reality. Yet, history has shown that even in these turbulent waters, brands that navigate with courage, amplifying ad spend during economic downturns, often reap long-term rewards. Analytics Partners highlights that 60% of brands that bolstered their media investments during the last recession witnessed an ROI uptick.

Deciphering the CTV Conundrum: A Marketer’s Perspective

2023 presents a nuanced tapestry for marketers. Balancing the growing allure of CTV advertising against the backdrop of economic uncertainty is no mean feat. The very fabric of viewership is morphing, presenting challenges aplenty but also opportunities.

CTV offers an arsenal of benefits — it’s precise in targeting, measurable in its impact, and can be fine-tuned for specific metrics. With 23% of CTV viewers making purchases post-ad exposure, it’s evident: CTV is not just a platform; it’s a sales catalyst.

Moreover, its cost-effectiveness offers brands an escape from the often exorbitant world of traditional TV advertising. The return on investment, both in terms of brand awareness and engagement, seems to tip heavily in favor of CTV.

The Future Beckons

The dynamism of CTV advertising mandates advertisers to be agile, constantly adapting to the latest trends. The data supports the momentum: CTV ad spend is projected to skyrocket to $26 billion in 2023, with OTT video ad expenditure not far behind, expected to touch nearly $10 billion.

Traditional TV, long an unchallenged monarch of the advertising realm, now faces a formidable challenger in CTV. The metrics support the narrative, with CTV providing performance-based metrics spanning from initial awareness to ultimate conversions.

Programmatic capabilities, with their automated real-time bidding processes, promise to play a pivotal role in strategic media plans. These capabilities promise omnichannel marketing strategies, cross-device targeting, and much more.

When Big Data Plays Hide and Seek: The Unraveling Mystery of Ad Accuracy

Pesach Lattin

2023-10-10

In the gleaming corridors of the digital age, precision was promised to be the holy grail. An Eden where every ad, every piece of content, would be a hand-tailored suit, molded impeccably to the contours of its intended recipient. But nestled within this utopia, lurking beneath the surface, is an unsettling shadow: the specter of unreliable data.

Imagine, for a moment, the world of a brand manager. Envision the aspirations to connect with a very particular subset of society – say, the middle-aged suburbanite with a predilection for organic delights. This vision necessitates a digital scaffold, a blueprint of data to make the connection tangible. But what if, instead of a reliable scaffold, what’s provided is a house of cards?

Enter the comprehensive study spearheaded by Truthset, under the aegis of the Coalition for Innovative Media Measurement (CIMM). Their audacious goal? To dissect and discern the veracity of the very data that’s often taken for granted, particularly within the mercurial realm of TV ad targeting.

To say the study was ambitious would be an understatement. Delving into a staggering 3.9 billion hashed emails and postal linkages, spanning the length and breadth of the United States, the project bore the weight of its grand aspirations. Data from 15 leading firms was scrupulously examined, then cross-referenced against venerable institutions like the U.S. Census Bureau and the Pew Research Center. Two decades of records, encapsulating the period from 2005 to 2023, were sifted, sorted, and analyzed.

The revelations? Jarring, to say the least. Amidst the tangled web of 1.2 billion unique HEM and postal pairs, an unsettling pattern emerged. A single email address, for instance, linked curiously to an average of 1.6 postal addresses. Flip the script, and the anomalies persisted: a single postal address found itself tethered to an overwhelming 9.1 emails on average. For those in the trenches of advertising, such disparities threaten the precision they desperately seek.

Targeted advertising, it appears, is wading through murky waters. With accuracy levels swaying unpredictably between a dismal 32% and a more respectable 69%, the fulcrum of modern marketing is being tested.

But the study isn’t a harbinger of doom; it’s also a beacon of hope. Within its pages lies the key to rectifying these systemic imbalances. By merely excising the dross—the inaccurate data points—the trajectory of campaigns can be drastically altered. The difference? An ROI metamorphosis from a middling $1.08 to an eye-catching $1.54.

Truthset’s vanguard, Scott McKinley, elucidates this pressing issue with clarity. While the advertising cosmos is enamored with the vastness of big data, McKinley stresses the need for precision. “It’s not just about amassing data,” he states, “but refining it. We now possess the tools to sift through this digital morass, forging paths to sharper targeting, robust ROIs, and immersive consumer experiences.”

As the tendrils of AI weave an ever more intricate tapestry, the veracity of the data that feeds it takes center stage. The clarion call from Truthset isn’t about the Sisyphean quest for 100% accuracy. Instead, it’s a plea for iterative refinement. For understanding that in the quest for perfection, it’s the journey, with its trials, learnings, and evolutions, that truly matters.

This is the crossroads where the world of marketing stands today. In a rapidly fragmenting digital arena, where audiences are dispersed across a plethora of platforms, capturing the zeitgeist of consumer behavior becomes a herculean task. But with initiatives like Truthset’s study, there’s a glimmer on the horizon, a promise that with the right tools and mindset, marketers can once again find their true north, ensuring that their messages not only reach but resonate with the audiences they seek.

The Great AI Masquerade: How Adtech’s Buzzword is Less Sci-Fi and More Sci-Why

Pesach Lattin

2023-10-06

In a world awash with tech jargon and gadgets that promise to revolutionize our mundane lives, nothing quite captures the imagination as much as “Artificial Intelligence.” Adtech, ever the flashy showman of the digital realm, seems to have adopted the term with an eagerness that would make a magpie jealous. However, like that overeager magpie, Adtech might just be collecting shiny trinkets rather than genuine gold.

Welcome to the Great AI Masquerade! Let’s pull back the curtain.

Remember the excitement of your first magic show? Everything seemed so real, until you realized the magician’s greatest skill was sleight of hand. Much of what Adtech labels as “AI” is precisely this – a masterful act of redirection. The algorithms of yesterday, basic and linear, are now wearing the glitzy robes of today’s AI. It’s the tech equivalent of your pet cat wearing a lion’s mane wig.

The first AI systems did indeed have the allure of the artificial – much like a soda-pop rendition of a vintage wine. But now, with platforms like ChatGPT (and many Adtech tools) coming into play, there’s a twist. They’re using real human creativity, wit, and labor, then packaging it under the AI banner. Imagine crediting the car for a journey’s tales instead of the driver.

Now, Adtech’s interpretation of AI turns this spectacle into a veritable circus. Those trusty old optimization tools? They’ve just been given a fresh coat of “AI” paint. It’s like renaming your grandfather’s old bicycle as an “eco-friendly, manual propulsion vehicle” and then trying to patent it.

This wouldn’t be as amusing (or alarming) if it weren’t for the corporate honchos joyfully jumping on the bandwagon. CEOs, CTOs, and a parade of other acronym-loving professionals proudly attach the AI moniker to their brands. It’s become the tech equivalent of claiming royal ancestry because your great-aunt twice removed had a corgi.

Companies are now marketing “AI-powered” everything. From mortgage recommendations to investment advice, there’s an “intelligent” algorithm for that. If taken at face value, you’d think these programs were holding existential debates in binary, pondering the very nature of their digital existence, before advising you on a home loan.

The crown jewels in this comedy of errors are our dear marketers. In their eagerness to stand out in a crowded marketplace, they’ve slapped the AI label onto everything with abandon. “AI-driven” this and “AI-powered” that; the claims have become as ubiquitous as the air we breathe and about as substantial as a puff of smoke.

Of course, let’s not throw the baby out with the bathwater. Machine learning is genuinely shaping our future. Like that diligent student always overshadowed by their flamboyant classmate, machine learning sits quietly in the background, making actual strides, while “AI” hogs the limelight with jazz hands.

So, where does this leave us? As technology continues to evolve at breakneck speed, it’s essential to differentiate between genuine innovation and mere theatrics. Real AI has the potential to be the game-changer we all envision. Still, until that day, let’s celebrate genuine tech achievements and approach the Adtech AI carnival with a discerning eye and a bucket of salt.

In the end, it might be prudent to remember that just because something glitters in the world of Adtech doesn’t mean it’s AI gold. Sometimes, it’s just good old tech in a fancy new hat. And while hats can be stylish, it’s always good to know what’s underneath.

Direct Seller Defeats FTC Pyramid Scheme and Earnings Claims Allegations

Richard B. Newman

2023-10-04

In November 2019, the Federal Trade Commission filed a lawsuit against direct selling wellness company Neora, LLC (f/k/a Nerium International, LLC) and its Chief Executive Officer alleging that the company operates as an illegal pyramid scheme and falsely promises recruits they will achieve financial independence if they join the scheme.

The lawsuit also alleges that defendants deceptively promote “EHT” supplements as an antidote to concussions and chronic traumatic encephalopathy caused by repetitive brain trauma, as well as Alzheimer’s disease and Parkinson’s disease. The FTC sought to permanently stop the defendants’ alleged deceptive practices and return money to consumers.

According to the FTC, Nerium is a multi-level marketing company that sells supplements, skin creams, and other products through a network of “brand partners.” Further, according to the FTC, Nerium operates an illegal pyramid scheme that pushes distributors or brand partners to focus on recruiting new distributors, rather than retail sales to customers.

Nerium allegedly incentivizes recruits to make a substantial upfront investment in Nerium products and then commit to additional product purchases each month. Brand partners also receive greater compensation from recruiting new brand partners than they earn from retail sales, the FTC alleges.

According to the FTC’s complaint, one of Nerium’s top earners advised in a 2015 promotional video that there are three things brand partners should do to “explode” their business: “Number one: Recruit. Number two: Recruit. Number three: Recruit.”

According to the FTC, Nerium and its CEO also misrepresented that brand partners can earn substantial income and achieve financial independence. The complaint alleges that Nerium promises “lifestyle-changing income” to its recruits, and that social media posts by Nerium and its brand partners feature brand partners who were supposedly able to retire from their jobs or earn a six-figure income. The FTC alleges Nerium’s compensation plan is structured so that, at any particular time, the majority of brand partners will not make substantial income and will instead lose money.

The FTC also alleges that Nerium, its CEO and others deceived consumers in their marketing campaign promoting the supplement Nerium EHT. They allegedly claimed without substantiation that EHT can enhance brain health and prevent, reduce the risk of, or treat concussions or chronic traumatic encephalopathy, as well as Alzheimer’s disease and Parkinson’s disease.

The complaint also alleges that in an effort to capitalize on growing awareness of concussion-related CTE among football players, Nerium recruited former professional football players to pitch the products to parents and coaches concerned about children’s health.

On September 28, 2023, a federal district court rejected the agency’s “overemphasis on recruiting” test and denied FTC lawyers’ request for relief on all claims, including, but not limited to, unlawful pyramid scheme, unsubstantiated product claims and unsubstantiated earnings claims.

The court opined that while sales data is a significant component in any pyramid analysis, it is not enough to look at the compensation plan in isolation – without also assessing actual operational data and the internal business structure. Notably, the court then tackled the issue of third-party liability (e.g., knew or should have known, facilitation or substantial assistance, etc.) and held that the FTC did not present sufficient evidence that consumers believed that distributors were agents of Neora. The court also noted Neora’s compliance program – a lesson for digital marketers vis-à-vis onboarding, training, auditing, monitoring, remedial action and adherence to applicable legal regulations.

As to the earnings claim allegations, the court found that Neora did not guarantee any level of income for distributors and disclosed typical earnings in a disclosure statement. Lastly, the court found that Neora is not currently making claims that their products cure, treat or prevent human disease. As such, the court concluded that an injunction against Neora and its distributors is not warranted because it would be no more effective than the aforementioned compliance program.

The case is Fed. Trade Comm’n v. Neora LLC, Civil Action 3:20-cv-01979-M (N.D. Tex. Sep. 28, 2023).

Richard B. Newman is a digital marketing compliance and regulatory defense attorney at Hinch Newman LLP.

Informational purposes only. Not legal advice. May be considered attorney advertising.

The Creator and The Decline of Original Sci-fi: A Misconception or a Movie-Goer Reality?

Pesach Lattin

2023-10-04

So, we’re at it again, aren’t we? Lamenting the potential death of original science fiction in the midst of box office hits and multimillion-dollar franchises. As Gareth Edwards insightfully quipped, “No one is really creating original sci-fi blockbusters anymore, it’s an endangered species.” But as the buzz around The Creator builds, there’s an undeniable tension in the air: Is original sci-fi truly on the brink of extinction, or are we just witnessing a rebirth in another form?

To understand this, let’s first address the so-called “crisis” of originality. On the surface, we’re in a landscape where sequels, spin-offs, and cinematic universes reign supreme. Saw X, Paw Patrol 2, and My Big Fat Greek Wedding 3 are testament to this phenomenon. However, The Creator defies this trend, reminding us that ambitious, big-budget, original sci-fi isn’t entirely a relic of the past.

The Creator also exemplifies the daring spirit of New Regency. This studio has consistently bet on ambitious projects, often with a mixed bag of results. But this isn’t simply about profit margins; it’s about the preservation and rejuvenation of cinematic artistry. It’s evident in the meticulous detail of Edwards’ film, from the intricately designed lookbook to the on-location shooting across Southeast Asia.

However, the real battle for The Creator isn’t in production but in reception. Up against pop culture behemoths and sequels, the film faces the challenge of carving its niche and proving Edwards’ gloomy proclamation wrong.

One cannot deny the allure of familiarity. This is where movies like Paw Patrol 2 hold an advantage. Yet, The Creator beckons with a promise of novelty – a fresh vision in a landscape that can often feel saturated with the tried and true.

Disney’s marketing machinery has amplified this promise. By introducing AI robot models at sporting events, to the revamped trailers that dive deeper into character relationships and emotional arcs, they’ve played up the human element juxtaposed against the cold, mechanistic backdrop of the film’s futuristic setting.

Then there’s the tantalizing promise of a Hans Zimmer score and Edwards’ credibility (garnered from his past endeavors like Godzilla and Rogue One). As RelishMix noted, there’s a “rally behind director Gareth Edwards.” This sentiment is echoed across social media platforms, with eager fans heralding the movie as a breath of fresh air.

Perhaps the debate isn’t just about the lack of original sci-fi films but rather our willingness to embrace them when they do emerge. This is where The Creator becomes a litmus test. Will audiences flock to theaters and prove there’s still a thriving appetite for novel, thought-provoking sci-fi?

In conclusion, original sci-fi may not be as endangered as some claim. There’s certainly room for both original stories and beloved sequels in our cinematic universe. However, the survival and thriving of original sci-fi hinges on more than just creators and studios. It requires an audience willing to embark on new journeys, to embrace the unfamiliar, and to celebrate innovation just as much as nostalgia.

So, while the SAG-AFTRA strike may cast a shadow on Hollywood, the real story will be written by movie-goers. Will they vote for originality with their ticket purchases? Only time will tell. But for now, let’s hope The Creator isn’t just a film title, but a prophecy of what’s to come in the realm of sci-fi cinema.

UrbanObserver

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The Great AI Masquerade: How Adtech’s Buzzword is Less Sci-Fi and More Sci-Why

Direct Seller Defeats FTC Pyramid Scheme and Earnings Claims Allegations

The Creator and The Decline of Original Sci-fi: A Misconception or a Movie-Goer Reality?

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