Mobile Fix — November 15
newTV
The Streaming wars have started. Disney+ is live — getting good reviews (despite some tech hiccups) and they claim 10m subscribers — although how many are paying the full $6.99 isn’t clear. And they settled their squabble with Amazon in time for the launch so are available through FireTV etc. Does that mean Amazon will be selling some Hulu inventory?
Netflix boss Reed Hastings isn’t showing any concern — suggesting the right metric will be how people spend their evenings.This interview has some interesting thoughts on ads — making the point Disney have great insight into ads through Hulu yet chose to go with no ads. The Wall Street Journal are the latest to round up all the players and their prospects — with their research (above) suggesting 30% of Netflix customers will churn. This PDF from a talent agency also looks at consumers views noting most think cost is an issue and that almost half see ads as acceptable.
A long piece by Matthew Ball gets into the fact all these competing firms are actually in different businesses and consequently not really in competition. Apple want viewers so they can sell more iPhones and Amazon want viewers so they sell more Prime memberships. Disney want to better monetise the content they create and Netflix wants to monetise the content it asks others to create. A good read.
One significant change will be how seriously the sharing of passwords is taken — lots of talk about getting stricter but does anyone really want to have their audience drop in this hyper competitive market?
Apple are adding to their bench strength in TV with a deal with the former HBO CEO
Closer to home ITV have announced their targeted TV service (their take on Sky Adsmart powered by the Videology tech stack that Amobee acquired last year) but it doesn’t launch until next February. Their new CEO is talking more digital than the previous regime;
In an odd bit of timing,just days after the Britbox launch — where Sky isn’t involved — the BBC and Sky announced a partnership (where the iPlayer will be integrated with the SkyQ box). Seems smart for both parties but seems to undermine the BBC element in Britbox when shows are going to stay on the iPlayer for up to a year.
And Champions League rights are coming up for grabs, with DAZN likely to compete with Sky and BT — and maybe ITV. In the US CBS now have the rights for the Champions League.
DTC
The noise around DTC is luring lots of new entrants. The new strategy of a US retailer in launching a DTC brand UpWest is covered in some depth here. Another new brand Havley have got lots of attention with their content marketing on how to launch a new brand
As Shopify grows — with over 1 million customers — bugs are apparently appearing and some are complaining — but these pressures come with any simple tech. The early website building tools like Wordpress and Squarespace can miss the expectations of more sophisticated users and this opens the door to custom builds — which almost always turn into a problem. Being tied to one developers custom code at best costs too much and at worst falls over when the developer stops supporting it.
The app based ecosystem of Shopify is the best place for a new business to start and as you progress, look for advice from the community — chances our your issue has been solved by someone else already.
The trend towards DTC holding companies I highlighted in Bonsai Brands is building . Bow and Drape is now part of Win Brands — benefiting from back end consolidation and expertise in marketing and product. Former AOL chief TimArmstrong has been talking up his plans for building audiences for DTC and his DTC alternative to Black Friday is almost here
New Marin data shows e-commerce is growing fast eCommerce ad spend was up 115% in Q3 2019 compared to Q3 2018, and eCommerce ad spend was up 51% versus Q2 2019. Due to increased market saturation, the cost per eCommerce click was up 10.5% in Q3 2019 compared to Q2 2019
Ex eBay exec joins Nike as CEO and they stop selling direct to Amazon. The antipathy between eBay and Amazon is deep rooted — we know an adtech firm who mentioned they used AWS and were told eBay would not work with them unless they changed that. But this underlines the problem Amazon have; many see them as a competitor rather than a platform or even a retailer. Nike doing the Amazon deal was seen as highly significant by many — and their withdrawal will too.
And the key issue for most brands is having Amazon better police fakes and grey stock
H&M are testing live stream shopping — the idea of a DTC equivalent to QVC keeps coming up in China — see below — and I feel sure someone is going to crack it in the West. We think of this as a digital drop ala Supreme etc.
China
It’s that time of year when Singles Day in China sets new records for e-commerce spend. More interesting this year is how new formats like live streaming have played a part
The Q3 figures for Tencent were poor and missed the low estimates — the gap between them and Alibabi is really opening up. It’s worth reading the Tencent investor release (PDF) to see some of the new services that have done well. Other Asian tech firms are doing better — Kakao in South Korea saw profits double
Some more detail on the opening up of China payments we mentioned last week
And this WPP report On Social Commerce In China is a must read (pdf)
Social
Having taken inspiration from Snap for the last few years now the Facebook NPD team is finding inspiration in TikTok with their new Instagram Reels app just launched in Brazil.
And before they were inspired they tried to invest — with Zuck negotiating to buy Musically, which was eventually bought by Bytedance and reinvented as TokTok. Axion dug into the Influencer report that we shared last week and show that TikTok outperforms Facebook amongst 13–16 group. Even more impressive is how well Snap does.
WhatsApp have looked to Google Shopping with their new catalogue feature as they push for ecommerce.
AR
Lots of talk on smart glasses as Apple are seen to be busy on this — although later than thought, with confirmation of what we heard — version 4 of Snap glasses are the big deal
This review of version 3 Snap glasses hints at the possibility
This round up of the key players in Glasses is a useful summary but misses North and Bose, all of which prepare the market.
Ads & Privacy
It’s easy to knock online advertising — I did it yesterday on my talk at Ezoic Pubtelligence, taking pot shots at banners — the cockroaches of digital media — and the irrelevance of click through rates. So this well shared article on online ads as the new dotcom bubble hits all the easy targets — dim strategies, poor formats and inadequate metrics.
But we know that smart brands are making digital ads work incredibly well.
Just we refute the general criticism, we see that most health apps are sharing user data with advertisers. Well actually, they are not sharing the fact that Fred Bloggs of Hackney has a cold; they are saying If you have an ad for a cold treatment we can show it to 43 people with colds, including one in Hackney. It’s a little different but maybe we have lost the argument to have the right language used.
In an interesting coincidence the WSJ reports on a project called Nightingale where health data on millions of Americans is being shared with Google — something like DeepMInd did with Moorfields in London
Amazon
New data from eMarketer forecasts that Amazon will take almost 10% of US digital spend by 2021 — up from 6.8% this year. I think this it probably too low given their insistence on selling some inventory on all the TV services where they sell subscriptions/ apps.
Yet another new format Grocery store is announced by Amazon. What happened to all the rest they have announced?
Adtech
A visual guide to How Google Edged Out Rivals and Built the World’s Dominant Ad Machine
The key rival to Google domination is TradeDesk who reported great figures for Q3 and talked up the contribution of connected TV
It’s clear that Google and Facebook are the key beneficiaries of #AdtechPerfectStorm but we also think good publishers will prosper. There is lots of innovation taking place with key publishers and the market in general seems to be moving towards more simplicity. I think that as the poor programmatic practices like retargeting wither in the absence of 3rd party tracking, people will look to simplify tech stacks and question what is really adding value
Johnny Ryan of Brave continues to lobby regulators on privacy and this is his latest evidence submission. A new move from Google looks to be in response to his arguments and seems to limit the opportunity for context — this seems an unfortunate consequence of privacy and it will be interesting to see how this evolves.
As the real implications for GDPR emerge the IAB is warning that the US equivalent- California Privacy — has some unintended consequences
Voice & Audio
A good podcast with Spotify founder Daniel Ek. And this is a good read on how Spotify and streaming turned the music industry fortunes around.
A fascinating look at how Amazon see the roadmap for Alexa — moving from passive to proactive interactions. When we talk about a SuperApp we think of a visual interface and how Uber or Google Maps could evolve to meet this need. But audio — with smart earPods — could be a better way to get there. A must read.
VC Loup Ventures are big on audio and this piece on AudioAR is a great read.
Quick Reads
Good thinking on how to build marketplaces
Ecommerce in France is booming — good look at Amazon versus the local players
Facebook is secretly using your iPhone’s camera as you scroll your feed. Doh! Bug or super surveillance?
Moving towards a faster web — how Chrome is speeding things up and also how they may label slow sites as being slow.
Personalisation is a smart strategy — why wouldn’t you use data to inform the service you offer. This is a great report on which companies do this well
Barry Diller is one of our favorite Billionaires. Major player in TV then in Movies. Then he discovered ( and took over) QVC and moved into commerce. His firm IAC is now building out Mobile Apps and on track to make $200m revenue annually.
We mentioned that Essence were doing some intriguing ads for Google using context and Machine Learning. I was invited in to hear more about the approach and it is really interesting. Read more about the activity here
You Tube gets more like Twitch with Super Stickers
A16Z on Growth, Sales, and a New Era of B2B
Google’s global brand lead says ad industry needs to get better at pre-testing digital creative
ABC Entertainment’s Chief Wants to Change How TV Success Is Measured
Finally… Google are launching bank accounts. I think the only surprise is what took them so long?
In some work for a bank nearly 10 years ago we shared research showing young people were very open to a GAFA bank. From the work we did on Halifax we found you can get people to switch banks and Monzo and Starling demonstrate this is still the case. The problem for the main competitors is the way Google can gain real value from the data that flows from banking.
A couple of weeks ago we got into a great discussion on Banks with my latest podcast guest Tom Goodwin. It’s another quite long one but i think it’s a great conversation — let me know what you think. Thanks to our pals at Vida for helping put this together.
Enjoy my talk with Tom. And please share
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