CMO Today: Google and Facebook Drive 2017 Digital Ad Surge
March 14 2017 - 8:14AM
Dow Jones News
By Mike Shields
DUOPOLY MONEY: Times are good in the digital ad business -- at
least for the top 85%. The U.S. digital advertising market will
surge by 16% this year to $83 billion, largely driven by the
continued dominance of Facebook and Google , eMarketer reports. By
some estimates, the two companies take in upward of 85 cents on
every new dollar spent in the industry, with the rest of the
business fighting over the remaining 15-cent scraps. Part of the
reason for Facebook's ever-expanding clout is that it has seen
video consumption, and video advertising on its platform, and its
subsidiary Instagram explode of late, CMO Today reports. Outside of
the Google/Facebook family, Snapchat ad revenue is predicted to
surge by 158% to $770 million, a terrific number, but still
relatively tiny as a percentage of overall spending. It will take a
while before Snapchat makes the big two nervous. Meanwhile,
Twitter's fortunes are going in the opposite direction, as
eMarketer says ad revenue there is actually set to decline 4.7%
this year. If a global platform like Twitter is losing to the
duopoly, what hope does the average web publisher have?
POST MEDIA: Can a media company, let alone a newspaper company,
really morph into an enterprise tech provider? Maybe if its owner
is Amazon founder Jeff Bezos. Ever since Mr. Bezos acquired the
venerable Washington Post in 2013, besides helping revive the
company's journalistic fortunes by pushing more innovative business
and publishing practices, he has the company talking up its
ambitions in ad tech. Specifically, the Post wants to build digital
ad products and tools it can sell to other publishers. It's been
easy to roll one's eyes at this prospect, as companies from
Microsoft to AOL to Yahoo -- companies with bigger digital scale
and tech bona fides -- have struggled on this front. But Monday, in
an Amazon-esque move, the Post said it was licensing Arc
Publishing, its digital content management suite of tools, to Tronc
-- publisher of the Los Angeles Times and Orlando Sentinel, CMO
Today reports. Sure, perhaps landing the beleaguered Tronc as a
partner isn't as large a victory as inking a deal with the New York
Times or BuzzFeed. Still, it's impressive considering Mr. Bezos's
history of disruption and relentlessness.
JWT LIMBO: It's been a year since Erin Johnson, J. Walter
Thompson's chief communications officer, filed the now-infamous
lawsuit accusing the ad agency's chief executive, Gustavo Martinez,
of racist and sexist behavior. Mr. Martinez resigned, and a
prolonged period of soul searching and self-flagellation for the ad
industry followed regarding its record on diversity and female
leadership. Campaign U.S. takes a deep look at the fallout, how
it's cast a pall over the agency's operations. WPP, which owns JWT,
has refused to settle the case. Meanwhile, Ms. Thompson is working
at the agency in a limited capacity, while Mr. Martinez has been a
consultant for WPP in Spain and Latin America. All the while, JWT
has had to try to operate as usual and win new accounts, with mixed
results, Campaign reports. The ad industry has tried to move on,
hiring more women in leadership roles and making improved diversity
a cause at seemingly every conference and gathering. But until the
JWT case has resolution, it will be tough to move on.
OLDIES RADIO: Can Pandora -- once the most innovative form of
digital-radio consumption, with its blend of algorithm-driven
playlist and elements of consumer choice -- compete in a radio
world increasingly driven by Spotify and its on-demand model? This
week marks the debut of Pandora Premium, the company's $10-a-month
subscription product that is essentially an answer to Spotify's
beloved listen-to-whatever-you-want-whenever offering. Pandora is
betting that even with more than 100 million people paying for
music subscriptions, there is a ton of head space in the streaming
music market, the Verge reports. Many people don't want to just
search for any one of 30 million songs at a given moment, CEO Tim
Westergren argues. "For most people that's just overwhelming."
Pandora is betting on its personalization and programming chops as
appealing to a new breed of music subscriber. The challenge for
Pandora seems to be in a media sector so driven by currency, the
company's model already feels like an "older" way of consuming
content -- and there aren't many revival tours in digital
media.
Elsewhere
Once Verizon completes its acquisition of Yahoo, Yahoo Chief
Executive Marissa Mayer is set to receive a $23 million golden
parachute. [ WSJ]
Fox Business Network has been on a recent winning ratings streak
over rival CNBC. [ BuzzFeed]
Ketchup brand Heinz is planning to run a series of print and
billboard ads using the exact "Pass the Heinz" creative message
pitched by the fictional executive Don Draper a few years ago on
the series "Mad Men." [ Adweek]
Amazon's Twitch service, where millions of people stream footage
of other people playing videogames, plans to stream 831 episodes of
the show "Power Rangers" over the next 17 days. [ Business
Insider].
As the fledgling Drone Racing League gears up for a second
season, which will broadcast in 75 countries including via ESPN in
the Americas and Sky Sports in the U.K., some competitors are
landing six-figure contracts. [ CNBC]
Whoever replaces recently fired U.S. attorney Preet Bharara will
inherit a continuing investigation of Fox News, as a federal grand
jury is expected to convene in Mr. Bharara's former district soon
to hear testimony from at least two witnesses in that case. One
candidate who has emerged as a possible successor is Marc L.
Mukasey, who previously represented former Fox News chairman Roger
Ailes. Fox didn't have any comment Monday, according to NYT, but
said last month that it plans to fully cooperate with all
inquiries. [ New York Times]
EBay is looking to ramp up its ad business and keep more
shoppers on its own site rather than sending them elsewhere on the
web. [ Recode]
YouTube has rolled out Uptime, an experimental app that lets
people stream content at the same time from different locations. [
VideoInk]
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(END) Dow Jones Newswires
March 14, 2017 07:59 ET (11:59 GMT)
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