NetworkNewsWire
Editorial Coverage: From Main Street to Wall Street, the
COVID-19 pandemic shook up the world, and the reverberations are
still echoing. High-flying growth stocks related to software and
cloud communications have cooled down since late in 2020 as people
return to offices and unlock houses to go outside again. Sure,
there is still talk about delta and other variants of SARS-CoV-2
wreaking havoc, but market participants are now also talking about
what a post-coronavirus world is going to look like. Certain
markets — the hospitality sector for instance — will steadily
return to normal after more than a year of lockdowns. Others, such
as media spending, will never be the same. Trends away from
television and radio toward digital channels have accelerated and
quite likely will experience a boon in the coming months and years
as ad budgets increase will full economic reopenings. As
advertisers look for solutions, they will continue to turn to
social media influencers and content creators as sophisticated
strategies to sway consumers toward their products and services.
That’s right in the wheelhouse of Clubhouse Media
Group Inc. (OTC: CMGR) (Profile), a company aggregating an impressive
portfolio of influencers and content creators from sports stars and
entertainers to niche experts that have the ear of millions of
followers and the platform technology to effectively target any
demographic. Coming out the other side of the pandemic, top
companies like the
Trade Desk Inc. (NASDAQ: TTD), Magnite Inc. (NASDAQ:
MGNI), ViacomCBS Inc. (NASDAQ:
VIAC) and Roku
Inc. (NASDAQ: ROKU) are knee deep in the
advertising evolution, making adaptations that will continue to see
the companies thrive going forward.
- eMarketer forecasts $455.3 billion in global digital ad
spending in 2021, up 20% from 2020 with a bias towards display
spending over search.
- Clubhouse Media Group has 200-plus content creators across four
professionally run content houses and a network that reaches more
than 400 million followers.
- CMGR also offers proprietary Magiclytics software, a robust
platform for analyzing social media campaign effectiveness.
- Clubhouse just inked a joint services agreement with Rick Ware
Racing, an American motorsports team that competes in the
NASCAR.
Click here to view the custom infographic of
the Clubhouse Media Group editorial.
$455 Billion in Digital Ad Spending
During the pandemic, people were forced into digital channels to
shop, work, communicate and entertain. Advertisers know this and
believe that many will maintain the digital lifestyle now that it’s
part of their life as evidence by eMarketer forecasting total
digital ad spending of $455.30
billion in 2021. That’s up about 20% from 2020, but a look
under the hood shows that analysts are calling for 55.2% of the
total spend to go to display advertising compared to 40.2% for
search, widening the gap between the two by 5 percentage points, or
$68.12 billion in dollars, from 2020.
Hungry for meaningful return on investment, advertisers are
increasingly looking to the emerging market of social media
influencers and content creators in combination with
next-generations machine learning and artificial-intelligence
technologies for the results they desire. Armed with these types of
marketing tools, a juggernaut such as Nike can reach its global
target audience as easily and precisely as a homemade, gluten-free
cookie maker in southeastern Ohio can hit its target in Athens.
Results that both are willing to pay for, as noted by a Business
Insider market report estimating companies will spend up to
$15 billion on influencer marketing in 2022, pushing it
passed parity with local TV ad revenue.
Clubhouse Media Group Inc. (OTC:
CMGR) is in front of the trend, already building
a global network of four professionally run content houses, with
each hosting in excess of 50 content creators. All four content
houses have their own brand, group of influencers and production
capacities to keep cranking out content to entertain and inform
followers. Clubhouses’ portfolio of services available to those
handpicked influencers include management, production and
deal-making. The business model is designed for Clubhouse to reach
out in all directions, not only offering services to corporate
customers but also via management services to individual influencer
clients, as well as operating an investment business specializing
in M&A or investments directly related to social media
markets.
CMGR’s flagship content house is emblematic of the brand.
Clubhouse Beverly Hills operates from a massive 12,000-square-foot,
seven-bedroom, nine-bathroom, $23-plus million gated house in the
glamorous 90210 zip code. A complete production team and chosen
group of content creators live in the house, constantly
collaborating and producing content that is pushed out through all
the group’s social media channels. Other Clubhouse content houses
include Clubhouse Europe, located on the island of Malta in the
Mediterranean; DanceDome LA, which includes a custom dance studio;
Society Las Vegas, located just 10 minutes from the world-famous
Las Vegas Strip; and Dobre House, the newest clubhouse, also
located in Beverly Hills.
With content houses of this caliber and content creators such
as Indy car
superstar Lindsay Brewer as part of the team, the reach is
expansive. The network has more than 400 million followers in total
and has delivered more than 1.5 billion monthly social impressions.
The company defines its total followers as a sum of all followers
across all social platforms, inclusive of Clubhouse influencers and
corporate-owned social media accounts. TikTok’s video platform is
the single biggest driver of followers for the group at roughly 290
million, followed by 51.7 million on Instagram, 56 million on
YouTube, 2.6 million on Snapchat and 2 million on Twitter.
The Magic Behind Clubhouse Analytics
Clubhouse’s revenue model is circular. The company generates
cash flow by claiming a piece of any deal related to content of its
affiliated creators (contracted content or sale of proprietary
content) and through providing data analytics from its package of
tools branded Magiclytics. Through acquisition and in-house
development, Clubhouse has created Magiclytics as a software
platform enabling brands to monetize influencer marketing more
efficiently by analyzing campaigns, optimizing budgets and
succinctly selecting social media influencers best for any given
job.
Coupling machine learning and artificial intelligence with other
types of data (i.e., historical, campaigns, etc.), Magiclytics
accurately provides insights about how brands should spend
marketing dollars. Again, the model is circular in that a brand can
come to Clubhouse looking for campaign management, influencers and
analytics, or a Clubhouse-affiliated influencer can take the data
to a brand to demonstrate why they are a perfect fit to advertise
for their brand. Either way, Clubhouse makes money.
Product Launch on Tap
Clubhouse has an advisory board that is an anomaly for an
OTC-listed company. With members that include a partner from
venture capital fund A16Z (Andreessen Horowitz) and a leading media
executive who previously held the positions of GM at PBS, managing
director at BBC Worldwide America, president of Viacom Productions,
and executive vice president of Primetime at NBC Entertainment, the
company is not sitting still. CMGR intends to launch products under
its own brand and use its stars and network power for viral
advertising. With an army 400 million strong, influencers such as
Lindsay Brewer, professional wrestler Taynara Conti, the Dobre
Brothers, and more, the Clubhouse stable can get the word out
quickly.
This is tearing a page right from the game plan of similar key
influencer networks such as Kylie Jenner and Kim Kardashian, both
of whom grew their brand’s valuations to unicorn status ($1
billion+). In 2019, Jenner sold a majority stake of Kylie Cosmetics
to beauty firm Coty for $600
million. Kardashian followed that by selling 20% of her KKW
Beauty to Coty for $200 million in January.
Racing Sweet Spot
Brewer, who has been coined the Future of IndyCar, was just
joined by another household racing name in Clubhouse’s garage.
Earlier this month, Clubhouse inked a joint
services agreement with Rick Ware Racing (RWR), an
American motorsports team that competes in the NASCAR Cup Series,
NASCAR Xfinity Series, WeatherTech SportsCar Championship, NTT
IndyCar Series, and IMSA Sports Car Championship Series. The pact
with RWR also includes a new relationship with Fintekk, a
motorsports racing and marketing company already working with
RWR.
The new agreement is beneficial to all from the top-down. Each
company will bring its social media and marketing teams to the
table for collaboration to promote each other’s brands throughout
the term of the contract. For providing its comprehensive network
to RWR, Clubhouse will get prominent logo placement on RWR vehicles
during all 11 events its team races in both IndyCar and NASCAR
circuits through September 26, 2021. This includes those of Formula
One/IndyCar legend Romain Grosjean and IMSA Asia Le Mans champion
Cody Ware and others in the RWR lineup.
Adapting and Thriving
Today’s consumer is savvier than ever. The days of blasting
consumers with digital pop-up ads are over; technology can filter
it out or the user will simply close the tab annoyed. Banner ads
are glossed over as if nonexistent. Television ads are skidding
because of cord cutting, and DVRs make it possible to fast-forward
through commercials. Indeed, the market is dynamic, and if brands
and providers want to be at the top of their game, they must adopt
next-generation technologies or potentially sacrifice share in the
lucrative $150-billion global advertising industry.
The
Trade Desk Inc. (NASDAQ: TTD), a global adtech leader,
has recently launched Solimar, its new trading platform designed to
help marketers optimize their digital advertising campaigns across
the open internet. More than two years in the making, Trade Desk’s
bespoke platform was a response to the rapidly evolving
digital-marketing environment wherein clients can capitalize on
their first-party data for greater precision while advancing
consumer-conscious privacy in a cross-channel digital media
environment including CTV (connected TV).
Magnite Inc. (NASDAQ:
MGNI) operates the world’s biggest independent
sell-side advertising platform. The company’s platform
enables publishers to monetize various screens and formats,
including CTV, desktop display, video, audio, and mobile, as well
as allows agencies and brands to access brand-safe ad inventory and
execute advertising transactions. Adding to its
offerings, Magnite just acquired SpringServe, a leading
ad-serving platform for CTV that manages multiple aspects of video
advertising for CTV publishers, includin such as inventory routing,
customized ad experiences, and advanced podding logic, for $31
million.
ViacomCBS Inc. (NASDAQ: VIAC) is
an iconic global media and entertainment company that creates
premium content within its portfolio of consumer brands such CBS,
Showtime Networks, Paramount Pictures, Nickelodeon, MTV, Comedy
Central, BET, Paramount+, Pluto TV and Simon & Schuster, among
others. In addition to offering innovative streaming services and
digital video products, ViacomCBS provides powerful capabilities in
production, distribution and advertising solutions, meaning it
stays on top of trends.
Roku
Inc. (NASDAQ: ROKU), a vendor of streaming hardware,
software and services, saw a boon during the pandemic lockdowns, as
measured by gains in both user base and engagement. Revenue
from Roku’s
platform unit, which includes its ad busines and media sales,
during the first quarter of 2021 spiked 101% to $466.5 million, as
streaming hours increased by 1.4 billion hours over last quarter to
18.3 billion.
The advertising space has always been extremely competitive,
with content serving as king to attract viewers. In days gone by,
the content may have been a newspaper article, a radio show or
television program, but things have changed. Those pieces of
content still have their places in monetizing from ads, but they
are gradually seeing their importance being shared with the power
of social media content and influencers to best target potential
consumers. All that COVID did was put pressure on the gas pedal to
accelerate an already inevitable trend.
For more information about Clubhouse Media Group, please
visit Clubhouse Media Group Inc.
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