P&G Slashes Digital Ads by $140M Over Brand Safety. Sales Rise Anyway

Credit: Courtesy Procter & Gamble/Business Wire

Procter & Gamble‘s concerns about where its ads were showing up online contributed to a $140 million cutback in the company’s digital ad spending last quarter, the company said Thursday. That helped the world’s biggest advertiser beat earnings expectations. Perhaps even more noteworthy, however, organic sales outperformed both analyst forecasts and key rivals at 2% growth despite the drop in ad support.

P&G didn’t call out YouTube, the subject of many marketers’ ire earlier this year, in its fiscal fourth-quarter earnings release, but did say digital ad spending fell because of choices to “temporarily restrict spending in digital forums where our ads were not being placed according to our standards and specifications.”

Those cuts amounted to nearly a percentage point of profit margin for the quarter, with cuts to agency and production fees further boosting profits.

People familiar with the matter said P&G left YouTube in March over brand-safety issues, though P&G has also had problems with ads appearing on video content that didn’t match its goals. It’s unclear whether or to what extent the digital cuts came from other venues, though Chief Financial Officer Jon Moeller in a media call also noted Chief Brand Officer Marc Pritchard’s broader efforts to eliminate “a significant amount of waste” in the digital media supply chain.

YouTube parent Google reported strong revenue growth last quarter despite what appears to be a dwindling advertiser brand-safety revolt. But P&G isn’t in a hurry to resume spending either. Despite the cuts P&G had “very strong relative organic sales growth,” Moeller said. “So we stand in pretty good net as a result of all those choices.”

Asked whether P&G sees any need to put that…

Should You Trust Artificial Intelligence to Drive Your Content Marketing?

artificial-intelligence-drive-content-marketing

Before breakfast, I check my Facebook and LinkedIn newsfeeds for a quick synopsis of the day. As I jump in the shower, I hit “download” on a recommended movie on Netflix, knowing I have a long flight this evening. While wolfing down my cereal, I click once to buy a gift for a friend’s birthday next week. My iPhone pings to tell me that I need to leave now if I want to make that early meeting 54 miles away. And as I get in my car, I use voice activation to play my favorite Spotify playlist, and Apple Maps informs me it will take five minutes to drive to the train station this morning.

With real examples of demonstrable value in the market, we can no longer sarcastically joke that AI means “almost implemented.”

We are all being conditioned to rely on technology in our daily lives, not just for communication, but also for decision-making. This ever-deepening interface with technology is rewiring our brains to process information differently, as Nicholas Carr writes in The Shallows. It is the same with our customers.

Popular consumer apps have led to the unconscious mass adoption of advanced, predictive technology. And yet … while we are increasingly outsourcing our cognitive processes to myriad consumer apps and tools, the enterprise is only now waking up to this new level of customer expectation. This lopsided adoption is most clear when we consider that we now trust a car’s built-in collision-avoidance system to protect our lives, yet still question whether a machine can recommend what to write next in a marketing program or which customer should receive a new product offer.

We trust artificial intelligence to drive our cars safely but not to recommend marketing strategy.

Inconvenient truth

Over the past 10 years, marketing automation has grown into a billion-dollar industry by promising to bring personalization and efficiency to marketing programs. The siren call of automated lead nurturing, lead scoring, and triggered responses to critical prospect activities has proved irresistible to B2B organizations: There were nearly 11 times more companies with marketing automation in 2014 than there were in early 2011 (SiriusDecisions), and 60% of companies turning over at least $500 million adopted marketing automation by 2014 (Raab Associates).

However, the inconvenient truth about first-generation marketing automation is that it is not really automated. It is a fantastic central workflow tool that can achieve scale, but it requires resource to set up, integrate, manage, and optimize. Indeed, in many B2B organizations, the phrase “feed the beast” has been accepted into marketing parlance as a way of describing the resource demands of marketing automation. Most fundamentally, there is the issue of rule creep. As you set up campaigns, you define business rules: “If A happens, then do B” or “If the individual has this characteristic, then put them in segment 4.” These can be simple to start with, but are always an inadequate reduction of complex and varied buyer journeys. So, you add more rules to make the campaign more targeted. And every time you measure results, the outcome is that more rules need to be written. Some of our enterprise clients estimate that they spend $500,000 per year on these manual elements of marketing automation – and that is disregarding the vital and significant investment in ongoing content creation.

While marketing automation promises the world, what it actually does is automate the execution of content marketing, while decision-making remains an impractically manual effort. It offers marketers a strong workflow and even insights, but fails to provide an automated way to act on those insights at scale. Fundamentally, the content in those systems is dumb; the system doesn’t understand what the content is about and who should read it. To track those looking at how to address this, Forrester recently started a new research theme it calls “content intelligence,” which it defines as “the use of artificial intelligence technologies to understand and capture the qualities inherent in any content.” As the marketing technology analyst David Raab says, “Something has to give: Either marketers stop trying to make the best decisions or they stop relying on rules.”

Expectation gap

In the face of relentlessly rising customer expectations, leading marketers are investing in AI-based tools – a category that encompasses everything from personalization tools that “learn” from individuals’ online behavior to recommend content more effectively, to tools that can detect minute patterns across massive consumer data sets and predict future behavior. These are some of the most interesting on the increasing list of potential applications for AI in marketing:

  • Content strategy – recommending what content to create next
  • Campaign strategy – recommending what sequence of communications to deliver
  • Personalization – recommending the right content for each customer based on behavior
  • Segmentation – clustering customers based on behavior or intent
  • Copy automation – automatically generating subject lines and descriptions
  • Lead or account prioritization – ranking leads or accounts by their likelihood to close
  • Sales strategy – recommending the right product/service offering and content to use in sales
  • Sales intent – predicting the right product offering, deal size, and close date
  • Retargeting – recommending the right content within retargeted ad units

Since the major marketing suites have yet to fully deploy or productize their AI offerings, adopting AI usually requires a blend of point solutions and…

Cannes Lions Interview: Ben Barokas, Co-Founder And CEO, Sourcepoint

Advertisement
Ben Barokis, Founder and CEO, Sourcepoint
Ben Barokis, Founder and CEO, Sourcepoint

On the occasion of the 2017 Cannes Lions, I spoke with serial entrepreneur Ben Barokas about the state of digital publishing and his journey to founding Sourcepoint.

“The reason I started Sourcepoint, and why I’m so focused on the publisher, is that I believe that there needs to be additional transparency. If the user wants to pay for content by consuming advertising and providing data, or if the user wants to be able to pay directly for that content in a micro–transaction, the user should be able to do that. And we should make it as frictionless as possible in order to make that happen,” says Sourcepoint Co-Founder and CEO, Ben Barokas.

His company Sourcepoint provides the software, tools, and data to enable digital publishers to monetize their audiences through a variety of content compensation (payment or free) options. Founded in 2015, the New York City based company works with publishers such as AOL, Advanced Digital, Dennis, and Gruner and Jahr, to help them deal with what the firm refers to as “existential” threats from ad-blockers, ad fraud, and the struggle many, if not most, publishers face in adequately monetizing their content. The firm is backed by $26 million in venture funding from Accel, Foundry Group, Greycroft Partners, Northzone, and Spark Capital.

“This all started with AOL. I trafficked lots and lots of banners.” Says Barokas, who began a career in the digital advertising business as an ad trafficker for the pioneering online service 17 years ago. He eventually worked his way up to running the ad inventory management team and was responsible for ad product development up through to the merger and integration with Time Warner, and later what he termed the “disintegration” of the company.

“AOL Time Warner provided me with such incredible experience on what it takes to run a business like that at scale. While running advertising products, I had a number of interactions with Brian Adams, who later became my co–founder of my previous business, Admeld,” says Barokas.

He would leave AOL Time Warner to work for a start-up…

Why Motorola CMO Jan Huckfeldt is leaning heavily on TV

Fourteen months have passed since Jan Huckfeldt took the marketing reins of Motorola. Prior to his arrival, Ashton Kutcher was the cell phone company’s pitchman, and Droga5 was responsible for its creative. Today, Karina Kolokolchikova, a largely unknown actress, is the face of the brand, and Ogilvy, its creative AOR.

It’s a lot of change in not a lot of time, but when Apple and Samsung hold a combined 72.6 percent of U.S. market share and Motorola claims just 4.3 percent, every minute is precious. Thus, Huckfeldt has positioned Motorola as a challenger to its smartphone competitors.

In September, the marketer directly went after them by taking out a full-page ad in The New York Times, prompting consumers to “Skip the Sevens,” as in the iPhone and Samsung Galaxy 7s. In November, Motorola boldly took a swipe at Apple by pointing out that “rose gold isn’t an idea, it’s a color” in the brand’s “Hello Moto” spot—its first TV ad since 2011. Now, the brand launches its latest video titled “Hello Dinner,” which demonstrates that the Moto Z brings users together with Mods by connecting them in gaming, video projection and music speakers.

All three ads are part of Motorola’s “Different is Better” initiative, and Campaign U.S. caught up with the CMO to discover just how different Huckfeldt intends Motorola to be.

Motorola has undergone many changes—from being owned by Google to now Lenovo and from being an industry leader with the Razr in the early 2000s to now no. 4 in the U.S. How are you adapting the brand to fit this shifting landscape?
When I took on this role, I found myself with quite a number of brands. I made a pretty simple and straightforward, strategic decision to focus on Motorola only. If you look at the smartphone business, it is highly competitive. You cannot be in that market unless you are highly focused. We basically went from probably four or five different brands, which we entertained globally, to just one brand.

Secondly, we reduced our product lineup from over 45 products to 10 to 12 products.

The other thing that I did, I brought back some of those key brand aspects. Certainly the batwing [logo] was one of them. The batwing had almost disappeared in our marketing materials and from our product. The batwing is probably the sexiest icon in the IT industry besides the Apple logo.

The other thing was “Hello Moto,” which was a sound mnemonic used very successfully and was a beautiful brand asset because most brands are just appealing to the human eye. But here is one that appeals to the human ear. It’s a perfect additional brand device.

And how did these changes affect Motorola’s advertising?
I think if you look at our advertising, whether it’s the TV campaigns or our other materials to date, they very clearly speak of a highly distinctive brand. Most of our competition is following the less-is-more approach from the two big players, which influence each other. We are clearly speaking and standing out. We were influenced by some of the passion brands, like the Amazon Kindle. I think it helps us a lot.

The other thing that we adopted is the tone of voice that is very much that of a challenger. When we launched our highly differentiated product, Moto Z with those Mods, in the beginning, we actually focused our efforts in the U.S. in terms of advertising predominantly on reaching those Android users within Verizon. We decided that to target them, let’s rely on digital and social and hit those consumers at a very high frequency. Now, with those efforts, all our metrics were green. In fact, Facebook used our case, our approach, as a best-in-class case during their earnings announcements in the fall of last year. It didn’t really make an impact. All these efforts on digital and social, didn’t really make an impact for the brand and for the selling of our product.

We looked at this picture again and said, we have to be much bolder. We have to advance our change of visual identity, which we had planned for January. We did this. We then adopted this challenger-brand attitude. I also sent an open letter inviting consumers to skip the seventh…

Performance Based Leadership: Are People Born Leaders?

Best Seller TV, one of the top online business shows on C-Suite TV, is announcing its latest episode featuring an in-depth interview with leading business author Joshua Spodek, author of Leadership Step by Step: Becoming the Person Others Follow. This episode also kicks off the show’s fifth season.

Joshua Spodek, author of Leadership Step by Step: Becoming the Person Others Follow, talks about how people aren’t born leaders but instead develop leadership skills throughout life as a result of the obstacles life throws at them. He states that every great leader has learned leadership, but “no one’s born leading.”

Spodek also says he treats leadership as a performance-based field and that people have to practice being good, effective leaders — much like one has to practice playing the piano or sports in order to get better. As an adjunct professor at New York University, Spodek says that academia teaches people about leadership, but no one teaches you how to become a leader.

 

READ MORE

This Wild Apple Ad Shows That, Yes, The Rock Can Do Anything (With Some Help From Siri)

Dwayne “The Rock” Johnson has the kind of can-do spirit that makes it easy to believe he can do anything—fly a plane, take a selfie in space, design a fashion line—and still be on set in time to nail his scene on the first take.

At least, that’s the plot of Apple’s new longform spot, “The Rock x Siri Dominate the Day.”

With this nearly 4-minute spot, the irrepressible and seemingly…

It’s a pressure-packed holiday season for retail

The list of retailers plagued by store closures, bankruptcies, buyouts or very serious financial trouble is a who’s-who list of iconic brands that have fallen off their retail pedestals. This year has already proven to be a retail cull, and this holiday season will add more names to that list. It’s make-or-break for many, and the pressure, stress and urgency are palpable.

Retailers can anticipate more of the same when it comes to holiday discounting, as well as wild risks from some brands without much to lose. Here’s a closer look at what to expect:

It’s Amazon’s market share now

Not too long ago, retail was obsessively focused on how Amazon was eating into everyone else’s market share. Well, Amazon owns it now — the game is reversed. Every major retailer is going to be focused on how it can steal market share from Amazon this year.

And Amazon isn’t going to back down from that challenge.

Nike’s product rollout on Amazon portends even more major shakeups. Retail apparel is notably one of the few areas Amazon has struggled to gain traction, but that tide might be turning. If Nike’s relationship with Amazon expands, it could open the floodgates for other retailers that want to explore third-party operations with Amazon.

Amazon CEO Jeff Bezos always finds a way to surprise the industry. Many were surprised at the acquisition of Whole Foods Market, but it shouldn’t shock anyone if a holiday expansion of Amazon’s apparel line is in the works.

Walmart’s response

Walmart is one of the few brands that has held its own against Amazon. Walmart’s holiday response should directly compete with some of Amazon’s bigger initiatives, such as shipping — rivaling it in both speed and price.

Shopping options will also be highly marketed — reserve in store, buy online, pick up in store and ship from store will be consumer expectations for the major retailers.

Will it be enough to draw customers away from Amazon?

The promotional calendar is going haywire

If you’re a marketer, don’t expect to get much sleep. Promotional changes are coming…

CMO Momentum 2017: What takes to build better customer journeys

From left: Asim Brown, Clive Dickens, and CMO's Azadeh Williams
From left: Asim Brown, Clive Dickens, and CMO’s Azadeh Williams

Today’s digitally savvy customer is interacting with brands across so many different channels, from email to social to test – and brands are now faced with the challenge of creating a consistent and personalised customer journey across all these various touchpoints.

But looking at strategies across startups to big business, there is no one size fits all solution to a finding that path to 1:1 and a consistent, personalised journey that truly surprises and delights customers.

Speaking at CMO Momentum in Sydney, startup Bountye’s MD and founder, Asim Brown, agreed while the ‘customer journey’ has become a bit of a buzzword, for a startup the strategy starts with acquisition.

“Our company is about providing the right product at the right time, for the right person, and as we are a startup, we need to focus heavily on acquisition,” he told attendees. “So we look at how they interact with us, such as via Facebook or email, and what they tell us through those channels. So in terms of the journey, it’s about first educating them to get them on our platform, and then once they’re eon board, it’s about personalising that experience so they stay on that platform.”

For a more traditional and established business like Seven West, the focus shifts to both customer and stakeholder experience, Seven West Media’s chief digital officer, Clive Dickens, said.

“We need to just think differently around our consumers, and admit in the broadcast industry that consumer experience is key,” he said. “And as the voice of the broadcast industry on the stage today, I can openly admit and acknowledge that this hasn’t always been the case. So really, it starts with a change of mindset about what business we’re in – and then once you have that mindset, you can utilise the strength of the brand and content and leverage technology as the enabler to rapidly improve both consumer and stakeholder experience. And given our stakeholder and consumer focus, we need to put the whole brand experience first – and that’s important to build a sustainable model for a commercially funded business.”

A non-linear customer journey

According to Brown, startups like Bountye follow a non-linear customer journey path. The early stage community-based mobile platform for secondhand goods offer users the opportunity to donate some of their proceeds to charities or schools and receive a tax-deductible receipt. With a focus on digital-only channels, their user base has grown 20 per cent month over in the first 18 months, with…

IAG nabs News Corp innovation head as chief digital officer

Brennan IT expanded its team with a double executive appointment, designed to help spearhead growth across its mid-market and channel businesses. The internal revamp sees Wayne Simmonds appointed to the role of sales manager, business development, and Andrew Borthwick to the role of head of partners and channels.
Brennan IT expanded its team with a double executive appointment, designed to help spearhead growth across its mid-market and channel businesses. The internal revamp sees Wayne Simmonds appointed to the role of sales manager, business development, and Andrew Borthwick to the role of head of partners and channels.

IAG has poached New Corp Australia’s head of innovation and product chief, Mark Drasutis, as its new chief digital officer to over digital strategy and experience.

The newly created position sits within the insurance giant’s Customer Labs and covers a broad range of brands, including NRMA, CGU, SGIC and WFI. Drasutis will report directly to IAG’s chief customer officer, Julie Batch, and starts officially in October.

Drasutis has spent the past four-and-a-half years with News Corp, initially as its head of innovation, before being promoted to chief product officer of Digital in February last year. Prior to this, he led consumer products development for Yahoo!’s European, Middle East and Africa teams, based out of the UK….

The name is Bot, Chatbot: How to shake up conversions with stirring conversations

Think back to five short years ago: Facebook IPO’d; Oxford American Dictionary named “gif” its word of the year; and your only options to order pizza were by phone or on a website.

Five years! It seems like forever ago.

Now, Facebook stock has only gone up since its much-decried stock market debut, gifs are old hat (though the “jif” vs. “gif” pronunciation debate rages on), and you can order pizza by text, chatbot, Alexa, Google Assistant, Cortana and more.

It’s not just pizza. New technology is changing the way we behave as consumers and marketers. The landing page, once the internet’s gatekeeper and conversion hotspot, is becoming unessential. It’s a middleman that’s growing middle-aged and might not know what “the cool thing” is anymore.

The new conversion platform for brands and commerce?

Conversation.

From AI with love

Where the conversation happens matters.

According to a 2016 Ovum study, 53 percent of American and German respondents stated that they favor talking with businesses through chat apps versus the phone, mainly because of speed and convenience.

Meanwhile, 50.6 percent of consumers responding to a 2016 Ubisend survey said they believed that a business should be able to respond to their queries 24/7.

So, we have soaring usage of messaging apps, and a considerable number of our customers who believe we should be contactable 24/7. But staffing a customer service center 24/7 is costly and expends human capital by the bucketload.

Enter stage left: chatbots.

Take stage center for explanation purposes: XiaoIce, sometimes dubbed “Cortana’s little sister.”

Created by Microsoft (my employer) in 2014, XiaoIce is an AI chatbot that is based in part on Bing’s search technology. She’s designed to have a high IQ, as well as high EQ (Emotional Quotient, or emotional intelligence), to help her build strong bonds and connections with humans.

She’s able to remember and learn from previous conversations, and she is sensitive to emotions. For example, if you chat with her about a relationship ending, she’ll put you on a 33-day break-up recovery plan, checking in with you throughout.

To say she is popular would be an understatement. In just her first three days, XiaoIce was added to 1.5 million conversations on WeChat. On Weibo, she’s one of the most popular celebrity accounts. Can you imagine a bot having celebrity status? She has approximately 40 million users in China, with incredible engagement stats. The average conversation with her lasts 26 turns, and one out of four users has even said “I love you” to her!

What we learned from Xiaoice is that people want their tech to be approachable and to adjust to the way we communicate.

WeChat has proven just how profitable that can…