You Say Potato

you say potato

In a misguided attempt to re-write the language of advertising, the Interactive Advertising Bureau (IAB) in a recent report changed the word “programmatic” to “automation.”  An AdAge article chronicled a litany of negative responses to the idea from several named industry insiders.  While they made the point collectively, each one only glanced the real reason the idea is off base.

Programmatic advertising automates a part of the process. Marketers grapple with a multitude of elements to build a targeted campaign in a world where market and demographic segments are more tightly defined than ever.  Programmatic advertising is an interaction between marketers and machines.  By contrast, automation is a general term that misses the point.  Someday, when the human half of the engagement is completely replaced by AI infused super machines we will need another word. For now, programmatic will do fine.  Source: Inspired by an article in AdAge

Seven Plus Plus Months

china business confidence

For twelve of the last thirteen months Business Confidence in China has been on the plus side.  The last seven months have been more like plus, plus regardless of the ups or downs.  All of the adjustments made by the government last year have had a settling affect on the business community and its view of the future.  Sources: Trading Economics; National Bureau of Statistics, China

Another Shoe Drops on Traditional Retail

digital bricks

 

 

 

 

 

 

Alibaba, China’s mammoth version of Amazon, and Amazon are both investing in bricks and mortar retail.  Seems contradictory, but its not.  It is contradictory only if you are a purest, if you see a divide between bricks (old) and digital (new) and fail to see their common goal; sales to consumers.

Retailers that are struggling to adapt to the new digital world are now going to be hit with another dropped shoe.  The digital players who re-wrote the consumer book on price and selection are coming at retail from their point of view.  Their stores will be a fully integrated retail/digital experiences, built to deliver the hits immediately, products like groceries that are difficult to sell online and offer an expanded product assortment online – all from your favorite supplier.  The stores will also be delivery points that will reduce or eliminate shipping costs for consumers.

There is no purity in business. Seemingly competitive forces eventually fuse into a third thing. That’s what is happening here. Source: Inspired by a stories in eMarketer, Fortune.com

Positivity Remains

consumer confidence

While Consumer Confidence for March has edged down compared to February, it is still well above both the positive line of 100 as well as the average for the last 13-month period of 106.  The important learning form these numbers is that Chinese consumers continue to be in a shopping mood – good news for advertisers.  Sources: Trading Economics; National Bureau of Statistics, China

Contradictory Survey Results

world federaton of advertisers

Data from this WFA survey are in conflict.  They show an industry in the middle of an inflection point. Based on intentions, the industry wants to move forward while based on satisfaction it’s not happy with the results gained from the foray into the future thus far. Two-thirds intend to increase their digital ad spend while vast majorities have serious concerns, which has led to a mere 21% satisfaction rate. This puts more pressure on suppliers and middleware providers to attack the major concerns expressed by advertisers.  Source: CampaignUS

China’s Mobile Subscription Growth Slows by 72%

china mobile carriers

We have been watching the growth of mobile in China for four years.  Until now, the story has be one of consistent growth.  It started as adaption and since 4G, it has been adaption with a high degree of replacement as the early feature phones were changed to more advanced products.  NEW: the trend of four years has changed, both adaption and replacement growth has slowed measurably.  For the eight months between May and December 2016 an average of 21.6 million new 3G/4G phones were added monthly.  For the four months of 2017 that average is down to 6 million, a 72% decline in growth.

China’s mobile device explosion seems to have settled at about 1.1 billion subscribers, a number that is more than the US and Europe combined.  Sources: China Mobile, China Telecom, China Unicom

Beyond the Waterfall

waterfall v. server side

An article by Bart Schouppe of Adhese in AdTech Daily makes the argument for more sophisticated ad delivery systems beyond the standard waterfall.  The key to success for the server-side implementation, as he refers to it, is higher initial fill rates and the resulting improvement in the user experience.  He claims that the waterfall implementation required second requests 85% of the time while the server-side implementation cut it in half.  Users were not waiting for ad loading as much with the more advanced systems in place, thus the improved user experience.  Source: AdTech Daily

Working Toward Honest

Seal of Approval

In his article in The Drum, Michael Greene suggests direction the entire digital advertising community should be working in its effort to remove fraud from the system.  Though there is no way to assure with certainty that fraud will not creep into any system, he suggests there are three things we can do immediately to improve the situation.

  1. Support the Trustworthy Accountability Group (TAG). “TAG’s Anti-Fraud team blocks domains and IP addresses” that are deemed to be hubs of non-human traffic after a report is received.
  1. Marketers should require “independent, 3rd party verification on all impressions.” This approach has its weaknesses too, particularly with regard to mobile.
  1. Transparency involving both financials and data are also required in an effort to reduce fraud.

These ideas are not the ultimate solution or the end of the issue, but in combination they are a good start toward reassuring the advertising community that their ad spend is doing what is intended. Source: TheDrum.com

Back on Trend

china retail sales growth

After a slight dip in January, retail sales growth is back to its normal range for the last two months with an 0.84% increase for March 2017.  For perspective, the average increase over the last 13-months has been 0.82%, which explains the steady growth represented in the graph.  The importance of these data is that they represent the clearest reflection of Chinese consumer buying sentiment.  For those of us in the business of profiting from sales to Chinese consumers, these numbers are encouraging.  Sources: Trading Economics; National Bureau of Statistics, China

Transparency Tipping Point

transparency tipping point

Through the almost 20-year history of digital advertising there has always existed an underlying tension between brands and publishers around click count accuracy, the measure for which brands were asked to pay. That tension has finally reached a tipping point that is causing many major brands to make adjustments in their media buying process.

According an article in the Wall Street Journal the result of this building pressure is reflected in comments by senior executives in agencies such as Omnicom, Accuen, WPP and Dentsu Aegis who are now offering more transparency. The new transparency reveals both itemized costs charged by the respective agencies and audience data to clients.

Result: A two tier pricing system with standard and premium audience data as the dividing line.  Source: Wall Street Journal