What’s behind P&G’s cutback on targeted Facebook ads?

ejinsight.com

With over 100 brands, P&G is the world's largest advertiser, using a mix of traditional as well as digital media. Image credit: gurufocus

Facebook has dominated the social network world with its 1.6 billion users. However, the world’s biggest advertiser, Procter & Gamble, said recently that it will scale back ads on Facebook that target specific consumers, and consider more spending on traditional platforms like TV. The news has shocked the advertising and internet world.
Marc Pritchard, P&G’s chief marketing officer, made the announcement in an interview with the Wall Street Journal last week. Pritchard said targeted ads placed with Facebook did not boost sales as much as expected.
“We targeted too much, and we went too narrow,” he said in the interview, “and now we’re looking at: What is the best way to get the most reach but also the right precision?”
The so-called targeted ads would pitch ads to a specific group of target customers. For example, if P&G intends to unveil a new perfume primarily for 25-35 year-old office ladies, it can place ads with Facebook asking for this specific group to be targeted at, bypassing females in other age groups and males.
Targeted ads based on attributes of users have always been viewed as the strength of social media platforms like Facebook. By contrast, traditional media like TV and newspapers are unable to zero in on a certain type of viewers or readers specifically.
Such targeted online advertising is supposed to minimize waste, which is typical when advertising on traditional media.
P&G spends nearly US$8 billion each year on advertising. After numerous reviews of its campaigns, it has now concluded that targeted ads are not as cost effective as expected.
In one example, the company tried ads for its Febreze air freshener, targeting pet owners and households with large families. Sales had been tepid until P&G carried out another campaign.
Using a similar budget, the company sprinkled the spending across a wide range of media, traditional plus online. Sales took off with the new approach.
Traditional mass-market advertising approach offers some synergy to a consumer giant like P&G which owns more than 100 brands.
For example, a sanitary towel ad in a subway station, though not intended for male customers, can raise the brand awareness. Next time when the customers are looking for, say shavers, there is a greater chance they may pick P&G products.
P&G has already ramped up ad spending on traditional media while scaling back from targeted ads, according to the Wall Street Journal.
The consumer products titan spent as much as 35 percent of its annual ad budget on digital media, and the percentage kept increasing in recent years.
But now the strategic shift means the trend could reverse in coming years.
Does P&G’s decision spell the victory of traditional media?
Not necessarily.
Audiences’ shift from traditional media to online platforms remains an irreversible trend. As such, digital advertising is set to keep expanding.
P&G’s high profile cut-back of targeted ads spending on Facebook could be just a bargaining tactic.
The company measures the efficiency of ads in dollar value, or how much business an ad brings.
The cost-per-view of targeting ads on Facebook is a lot higher than of traditional, undifferentiating media.
To reach 5,000 targeted viewers on Facebook, the spending needed can reach the equivalent of that required to reach a million TV viewers, according to Peter Daboll, chief executive of Ace Metrix, which tests ads for effectiveness.
That means targeted ads on Facebook are about 200 times more expensive than traditional ads.
But if P&G can get a better deal, Facebook advertising has the potential to become more alluring.

Research from The Drum and The Trade Desk finds programmatic video spend set to rise but hurdles still to be overcome

thedrum.com

Programmatic spend on video is set to rocket in the next year, with over 80% of respondents to a survey conducted by The Drum in association with The Trade Desk expecting to increase budget allocated to it.
The growth in programmatic advertising spend is likely to migrate from display advertising, followed by linear TV and print, according to the new report.
The Drum surveyed 200 agency professionals with responsibility for purchasing media to gain a more detailed understanding of what clients expect from programmatic video.
The findings of this survey were then debated by an expert panel of programmatic thought leaders. The survey data and the ensuing debate fed into the production of The Drum Market Insight Report: Programmatic Video Edition, in association with The Trade Desk. You can download a copy of the report here.
Despite the huge potential for growth, programmatic technology has yet to fulfil its potential as a mainstream way of purchasing video inventory with clients still too cautious about cost, viewability and wastage, according to the report.
Agency executives also believe that brand trust, fraud and ad blocking are other significant challenges holding back adoption of programmatic video, according to the report.
The research indicates that less than half of clients (46.2%) serve video programmatically, though over a third of the respondents’ combined overall video spend is served in this way.
Mobile to lead growth
Most, however, expect major growth – particularly on mobile – over the next few years.
The Trade Desk’s UK general manager James Patterson says that, while waiting for mobile inventory to grow and creative to mature, the technology is waiting. “Technology can track a user from the top of the funnel to the bottom. We can tell people a story across all different mediums, channels and devices.”
The overwhelming majority of those surveyed (88.5%) expect spend to increase over the next year – and nobody expects a decline in spend transacted this way.
That will be assisted by broadcasters and publishers, who are increasingly embracing the technology and investing in more premium formats and improved measurement and metrics.
Danny Hopwood, Vivaki vice president of solutions and platform operations (EMEA), notes: “Broadcasters are opening their doors to programmatic technology”. Not least, he says, because of a potential plateauing in linear TV viewing and an increased consumer appetite in video on demand.
Dan Hagen, Carat’s UK chief strategy officer, believes that video is the future – one “much more powered by data and what people want rather than what you want to shovel at people”.
When asked if clients understood programmatic distribution, education, knowledge and understanding remains a concern – although almost half of those surveyed believe that their clients either had a “reasonable” knowledge (43%) or “in-depth understanding” (2.4%).
Justin Taylor, Teads UK managing director, says that while 18 months ago clients were investing in data taxonomy they are now asking how they can use it – “and media is the first area they’re asking that in. That’s raised the bar of programmatic.”

Why Native Doesn't Have to Be Advertising

exchangewire.com

When I say ‘native’, you say ‘advertising’. This is how native is perceived in the digital industry, driven more so by the uptake in programmatic native, but is there more to it than just an ad format? In this piece, Alicia Navarro (pictured below), CEO and co-founder, Skimlinks writes for ExchangeWire that the marriage of sales and editorial allows the benefits of both to shine through and brings credibility back to the editorial experience for both publishers and readers.
Native advertising was such a good idea, in theory. Create beautiful, editorialised ads that would slide seamlessly into whatever the viewer was reading or watching. The more scrupulous advertisers would make it clear that this was still advertising of course, but somehow it wouldn’t distract, it would just simply add to the overall content experience.
In reality, according to Contently, only 19% of consumers trust native advertising while 62% think it diminishes the publisher’s credibility to run it. At a time when publishers, such as the FT, are having to make up for the drop in print readership and look to new revenue streams by building their own full-service agency, this isn’t a good sign. Publishers need to work smarter with brand advertisers to deliver editorial that is authentic, transparent, useful, and entertaining.

The advent of ‘Comtent’
This is where comtent comes in. Admittedly a portmanteau of our own making, comtent is commerce-related content: the marriage of commerce and content. Instead of having advertisers drive your content and producing advertorials, ‘comtent’ is about having editors create content your users will love, that just happens to be about products and retailers.
Just look at the success many social and editorial-led sites have had with creating pure-play
comtent such as Refinery29, WireCutter, Apartment Therapy, Gizmodo. These are great examples of publishers that produce high-quality, engaging and unique content around shopping-related themes while being independent and trustworthy. But is the publisher cutting off their nose to spite their face? With great product listicles or feature reviews, have they just handed the advertiser some free – and every reason in the world to save their ad dollars to spend elsewhere?
1: Affiliate your content
The best way to monetise comtent is through affiliate marketing. It simply means that publishers receive a commission if viewers click-through and buy the product linked to within the comtent. Historically this has been frowned upon as a corruption of editorial integrity.
However, the modern-day publisher has established policies and best practises that protect the independence and authenticity of its content while still being pragmatic about driving revenue. For example, did you know policies that ensure product reviews include a link to buy the product reviewed? This is because providing the link is a better user experience, like linking to a retailer’s site rather than a brand’s non-shoppable site, or like hiring commerce editors to add shopping links to content written independently by pure-play editors. There are many approaches that publishers have adopted to ensure they are creating content that their users trust and return to read. And, as a bonus, it can be non-intrusive revenue drivers.
How does this differ from native advertising? Native advertising is created and purchased by an advertiser, and eventually placed, thanks to a direct buy or a when done programmatically. Comtent differs in that it is first and foremost content, driven by editors – or, in the case of social sites, by the community – that can be monetised by affiliate marketing. Advertisers do not control the message, the placement, the frequency, or the promotion.
It has an added benefit of being utterly non-annoying. Unlike most other types of advertising that interject, pop-up, obscure, or slow down the content reading process, comtent is just content that a user has chosen to read, with nothing else clouding the experience. A greater reliance and focus on comtent monetisation through affiliate marketing may slow the inevitability of today’s ad-block debacle.
2: Understand your audience
The second major new revenue generator for publishers, resulting from the comtent phenomenon, are high-intent shopping data segments, also known as second-party data. Leveraged directly from the publishers’ first-party data and deciphered through machine learning.
Users engage with appealing comtent that users interact with, the publisher is then gaining insights into the shopping behaviours and preferences of their users: from what retailers are they shopping, what type of products and brands are they buying, what kind of content do they most engage with, etc. More comtent = more insights into your users, that can directly translate into ad revenues.
How? Publishers are able to approach new types of advertisers for which their comtent analytics show their users have an affinity. Publishers can also negotiate higher CPM rates, if they layer behavioural targeting onto an inventory sale. Publishers can also optimise the performance of their campaigns to achieve targets, thus, more likely securing a rebooking.
More savvy publishers are recognising that, in their efforts to secure ad budgets away from the all-consuming power of Facebook and Google, they need to create specialised bundles for advertisers that merge premium inventory with user behavioural traits. Users interact with comtent, especially if a publisher is part of a data co-operative, they can then glean predictions around shopping behaviours that can dramatically improve the appeal and performance of a publisher’s advertising propositions.
Good, but not enough
Native advertising is enormously popular because it gets around some of the intrusiveness and heaviness of display ads, but it isn’t enough. Publishers who recognise that weaving commerce authentically into their content, in the form of comtent, can gain a flurry of incremental benefits without any additional costs or effort. Comtent is being created anyway by your editors, and is naturally being read by your readers. All that is needed is a monetisation strategy (of which there are a number of partners that can help automate) and the means to feed the data collected from interactions with comtent into a data co-operative that can boost a publishers’ internal programmatic strategies.
It’s not going to be the sum-all solution for publishers to survive the post-print age, neither will it solve the ad-tech industry’s challenges with consumers distrust. But, when done well, it can be the source of incremental low-cost revenues and powerful insights.

The High Price of Low-Cost CPMs

hbr.org

Marketing is essential for companies. Throughout the customer journey, marketing both changes brand perception and awareness and drives sales. Simultaneously, companies need to justify marketing expenses — down to the last penny.
Reaching a balance isn’t easy. Too often CMOs succumb to the pressure to keep costs down at the expense of their brand’s health or product sales. This is especially true in the age of digital media, in which the temptation to pay low rates often leads to wasting money. Why? Because a CMO can argue that they paid low cost-per-thousand (CPM) rates on their ad buy. But trafficking in low CPMs has become dangerous. Too many times, those low rates are borne of fraud and bots (ad impressions created by automated scripts, not humans). Our research suggests that up to half of paid media impressions fail to reach a marketer’s target audience.

The Problem with Programmatic Channels

In a waste model we built to measure the quality of impressions in common programmatic channels, we found many contributors to waste, all of which drive up the real cost of what initially appears to be inexpensive. Some of these contributors are:

• Ads seen by bots, not humans
• Ads, including video ads, that are not viewable
• Ads that don’t fully load
• Ads that miss the target audience
• Ads that miss frequency windows

Facebook recently abandoned plans for its demand-side platform solution because of the many unviewable ads, fraud (like bots), and the lack of valuable inventory available in display networks. Marketers must consider the real, hidden costs of low-cost marketing. An increasing number of marketers are looking at them — hard.

Marketers are well aware of these quality issues. EConsultancy and Signal recently surveyed 350 senior North American marketers and media buyers with ad budgets ranging from $10,000 to well over $1,000,000 per month. The survey showed that because of the industry’s lack of transparency, just 12% of buyers feel comfortable with the current display-advertising model. An ANA survey released in March showed that two-thirds of marketers worry that they may end up buying fraudulent inventory or inventory that shows up at the bottom of the page and is never even seen, and they’re starting to demand more transparency from their media partners. The ANA is championing a standard whereby marketers enter publisher agreements only when impressions are “measurably viewable.”

Channels to Focus On

We see an overwhelming case for investing more in known, verified audiences with logged-in users, like Facebook, Instagram, Twitter, Pinterest, Snapchat, and YouTube. And the same goes for addressable television. Such networks nearly eliminate fraud and waste. You know you’re dealing with real humans — not bots or theoretical audiences built with unreliable cookies or audience panels.
Furthermore, when users log in to Facebook, Twitter, or Pinterest on their computer, tablet, or smartphone, the networks recognize that they are the same person on each device. By contrast, if you’re using cookies to reach prospects, you as a brand don’t necessarily know that the 36-year-old man you identify on a smartphone is the same person who logged on earlier that day on an iPad and MacBook Air. This matters. Real, addressable audiences result in greater measurability and performance attribution in branding and direct response campaigns.
Moreover, these audience-first platforms are setting the highest standards for user experience, ensuring highly engaged audiences in web and mobile app environments that are least vulnerable to ad blocking.
However, decisions about these channels must be driven by cost per performance.

Moving Forward

We have two recommendations. First, don’t work with partners who are not committed to being transparent about every shred of data and every penny of cost. Programmatic is great, but let’s have transparent programmatic, in which a partner gives you full access to the data that enables you to gauge the success of your campaigns.
Second, always ask for CPMs with performance right next to them. For example, use return on ad spend for direct-response ads and viewability (at a minimum) for brands ads. Your impressions are getting cheaper? Who cares? The real question is whether they are becoming more effective. It all comes down to return on investment, which is driven by outcome divided by cost. To truly manage your media investments to ROI, you must manage your cost based on real impressions and business outcomes, not poor quality disguised as low cost.

Does Facebook Advertising Truly Drive Business Results? Yes.

business2community.com
This week’s advertising update starts with a look at Facebook’s Q2 2016 earnings announcement which yet again surpassed expectations. In particular, we’ll talk about the huge boom in mobile advertising on Facebook and in addition, the growth in mobile purchasing in the United Kingdom. Finally, stick around for inspiration on what to do about those unopened emails you’ve been sending your customers and how to reach them in a whole new way.
Facebook has blown us all out of the water, once again, with their latest Q2 2016 earnings announcement. The platform has now reached a user base population of 1.7 billion, the entire population of the globe just 100 years ago. Revenue from advertising specifically was up 63%, from $3.8 billion to $6.2 billion, since Q2 2015. Mobile advertising revenue now represents 84% of all advertising revenue, up from 76% last year. This major rise in share of all ad revenue is big and just goes to show how important mobile is today, to consumers and advertisers alike. The U.S., Canada, and Asia Pacific were cited as having the fastest growing ad revenue. With 1.7 billion users each month, Facebook is clearly an essential place for advertisers to reach their customers.


Facebook’s mobile ad revenue has become 84% of its total ad revenue for a reason. Consumers are using mobile devices on-the-go all the time these days. This has become especially true for shoppers as they search for items in-stores, allowing them to simultaneously research the competition’s prices, check another store for an item in a different size/color, and read reviews from others who’ve made a similar purchase. However, no longer is mobile activity disconnected from the final purchase, according to a recent report by Signal. Today, a third of internet users in the UK buy gifts on mobile devices. To be more specific, 57% of 18-24 year olds in the UK are mobile purchasers, and 50% of UK consumers age 25-34 purchase via mobile (according to a report by Criteo). So as a retail advertiser, consider mobile as a top priority in your ad campaigns, as opposed to accessory. Consumers are constantly connected, so make sure that the next time they are interacting with your brand on their mobile device, you are there, prepared, and ready to engage.


We’ve all received email communications from a retailer in the past. This method of communication is still an essential next step in acquiring new customers for many brands. The best time to reach out to customers is within the first 24 hours of the first interaction, while your brand is fresh in their mind. Yet 40% of marketers are not engaging with customers within 24 hours of purchase. Even more astonishing is that 52% of retailers report that fewer than 20% of email recipients respond to their first communication. So what’s the solution? Try reaching out to them on another channel where they are engaging, often on a daily basis. By using what you already know about your current customers, like their email address, you can target them on channels like Facebook and Instagram, where they are constantly interacting with others, sharing content, and likely engaging with brands already. In short, use what you already have to acquire what you don’t!

How Programmatic Responsibilities Leave Many People Confused

bandt.com.au

Programmatic can throw up a number of problems; no more so than who owns and controls it. In this guest post, Andrew Birmingham, editor of business site Which-50.com, takes a look at its different components and attempts to offer a route to a more seamless approach…
Marketers who combine programmatic media targeting with dynamic creative optimisation (DCO) generally get the best performance, however there’s a problem.
Confusion abounds in the digital advertising ecosystem about who controls what when both strategies are combined.
“This is the result of the many components that make up programmatic advertising campaigns,” says Kelsey Meuse, global product strategist at ad management firm Sizmek.

“We are talking about two different areas, media and creative, and two separate practices, targeting and optimization.”
Instead she argues, it often helps to first clearly define the terms.
So let’s have a stab at it:
• Media targeting is the practice of controlling and limiting impressions to specific digital audiences.
• Media optimisation is optimising how many impressions to serve each segment, when to serve them, and what the advertiser should bid on them to minimise the average cost per acquisition.
• Creative targeting is controlling which ads are served to each audience; if there’s only one version targeted to each segment, the advertiser has no option for creative optimisation.
• Creative optimisation is for cases where advertisers have more than one creative going to a user segment or audience. Brands and agencies can change the creative through the life a campaign to improve performance.
According to Meuse, many people mistakenly blend these four distinct tactics of targeting and optimisation.
“The practice of serving every consumer within a highly targeted segment the same piece of creative sells short the potential of combining creative and media targeting.”
To tap into the full power of personalising creative advertising, she says marketers should consider the ways in which media and creative targeting work together.
Collaborate
“If a marketer targets a broader audience pool, and then targets the creative to more granular sub-segments of that audience, they can simplify the media buy and be more nimble about which creative is shown to a user within a given impression.”
Done right, this should ultimately reduce campaign trafficking complexity and increase performance, she says.
Take for example a retargeting effort by a luxury retailer. The audience pool is composed only of users who have visited the retailer’s site, but that doesn’t mean that every single one of those consumers should see the same piece of creative. Instead, the retailer can customize the creative on a granular basis, adjusting the message based on how much the consumer has interacted with the site.
Meuse explains that if the user has only been to the homepage, they may see generic deals and offers in the retargeted ad.
“If the consumer spent time within a certain retail category, such as shoes, then the creative targeting can optimise the creative to include shoes. If the consumer spent time looking at a particular shoe, the ad can serve that same shoe. A consumer who abandoned a cart can likewise see the products within that cart.”
In this example, the target audience is the single pool of users who have visited the site. The creative targeting is fluid, and optimises the ad unit each user receives based on behavior exhibited on the site, she says.
“This approach allows the marketer to implement a sophisticated strategy that takes into account the different types of users they are trying to reach. ”
There are also cases where the campaign operates on completely different media sets and strategies.
“Imagine an advertiser is running a campaign but they don’t want to buy impressions for consumers who have already bought their product, and also wants to avoid websites that they deem are unsafe environments for their brand messaging.”
In this case, she argues, the media targeting is focused on limiting the budget and waste, but the criteria don’t cross over to creative targeting in any obvious way – the media plan is only focused on what to avoid, but doesn’t say much about who will see the ads.
This leaves the marketer with a number of options for targeting the creative. They may choose to deliver different creative versions depending on geographic data, demographic profiles, or by ad engagement with previous messages.
“As both of these hypothetical campaigns reach consumers, they’ll return more performance data, which will provide the marketer with even more data points to optimize both the media and creative,” says Meuse.
“The retail campaign may find that shopping cart abandoners are more likely to purchase their full cart within 24 hours, while those who don’t return to the site within the first three days never buy anything from their previous cart.”
In theory all of this data fuels how the advertiser targets the media and creative, allowing them to save on media spend and drive more conversions.

Advertising: Convergence can make the impossible happen

reporternews.com

Advertising is the art of bringing the right combination of elements together for the purpose of selling.
The convergence of these elements can sometimes make the impossible happen.
In 1979 Perrier wanted to expand to North America, but how do you convince people to pay for something they could get free?
Enter Orson Welles with his 1979 television ad for the "Champagne of Waters" that ushered in bottled water for sale. The perfect convergence of personality, product, and media made the French product a staple in American stores.
How to sell something for which there is no demand will always be a major problem for advertisers; convergence can help. In the case of the vegetable Broccoli Raab, its seller Andy Boy brands relied on the concept to reach young food-conscious consumers.
Partnering with a celebrity chef, Candace Kumai to develop recipes and talk about it on social media and television, the brand used the convergence of personalities, product, and media with success. Appearing on the Wendy Williams Show to prepare recipes for the host, creating video ads for Hulu and YouTube, and hosting a dining event for 70 food and fashion writers was the right mix to jump-start the superfood on mainstream food blogs and websites.
Let's look at these three elements; media, product, and personality more closely in advertising.
First, the Media, which for Doritos had nothing to do with music video except to sponsor one for a hip hop duo, Rae Sremmurd. Billed as the music video you build, it relies on viewers accessing the video on overhere.tv to link their phone with other viewers to watch the performance. As more viewers join the video becomes longer and begins to unlock secret videos featuring real-time commentary by the musicians and other music. Here sponsored media is gaining an audience for the Doritos brand.
Next the Product, which here shares their space with a new publication, TheDrive.com and cars. Time magazine opened a 5,000-square-foot showroom in Brooklyn to house three custom Porsches, an Indy car, and a luxury Volvo hybrid. Located in the Time building, the showroom introduces their new venture that includes two auto themed YouTube channels and serves as a video set for hot car news. It's an example of using new media to support old media ad sales for the print edition of Time magazine.
Finally we have the Personality, in this case professional tennis players who seem to be endorsing everything these days. The current thinking about athletes to advertise is the idea of using them as brand influencers; not necessarily to sell directly but rather to create connections between the brand and consumers.
When Novak Djokovic lost at Wimbledon last summer he tried to tear off his shirt, made by sponsor Uniqlo, and failed. The fail was marketing magic for the shirt brand whose apparently indestructible quality got the attention of viewers in ways conventional advertising could never do.
If you doubt the ability of star athletes to make a connection, consider that Rafael Nadal, as brand ambassador for Tommy Hilfiger, doubled their year over year underwear sales in one month. Nadal, also sponsored by Richard Milles watches, wore their $775,000 RM 27-02 model for one match on the court and all 50 of that model available sold out instantly.
The wild card in these examples, unlike the Perrier example earlier, is the expanding technology options that make the media component accessible for almost every brand situation. Mercedes hired telco data firm Zeotap build clusters of people based on their mobile data billing and voice services each month.
With this information Mercedes targeted two distinct audiences with mobile advertising for their automobiles and the unnamed telco company was able to supplement shrinking profits from the dwindling number of new mobile subscribers.
With the mobile market saturated, the data telcos collect from their subscriber base is valuable for other brands now able to use the information for mobile ads.
Major league baseball teams are now implementing robots to greet visitors to their ballparks and using virtual reality to allow fans to tour teams spring training activities and other aspects of the game previously inaccessible for most ticket buyers. The goal is to enrich fan engagement at the ballpark and to reach kids with the new tech with offerings such as watching the game from the team dugout.
The possibilities for advertisers will be expanding as rapidly as the convergence. You can almost see, hear and taste the 7th inning stretch video sponsored by Doritos starring Candace Kumai singing the virtues of the Broccoli Raab smoothies in the team.