The Full Monty: Weathering the Storm – April 30, 2018
The duopoly has us right where they want us; the cost savings of AI; hooking kids early on voice technology; bitcoin is the greatest scam in history; the future of content marketing and where customer experience is headed; why influencer marketing fails; what's behind flagging corporate reputations; Amazon's Prime directive; earnings for the tech giants are all rosy; Netflix wants to get into the theater business; MoviePass may not survive; streaming music companies like the revenue streams; don't get too personal with personalization efforts; what you need to know about GDPR; books, books and more books; the podcast of the week and more in Weathering the Storm edition of The Full Monty from Brain+Trust Partners for the week of April 30, 2018.
Please consider supporting the considerable effort made for you here each week.
How about it?
The Full Monty, a Brain+Trust Partners publication, exposes you to virtually everything you need in business intelligence at the top of every week. Links are below with commentary in italics. Please sign up for our email updates to make sure you don't miss a thing.
Announcements
Last week we experimented with a partial feed, requiring you to click through from the email to the web page. We had mixed results and we're returning to a full feed. Please let us know if you have any additional feedback about it, or feel strongly one way or the other.
Top Stories
Amid all of the recent uproar of data privacy issues among a number of companies, the outrage did nothing to stop the forward motion of Big Tech. Timing, incentives, and lack of competition all play a part in explaining this unstoppable force.Why is that?
Timing may be a factor. With Facebook getting called out more than halfway through the quarter, and Mark Zuckerberg making his appearance before Congress in the final weeks of the quarter, there was little time for advertisers to make any drastic changes to their advertising spend. We should keep an eye on how they perform in the next quarter, as we'll be able to see if there's truly been an impact. We anticipate a very small blip in Q2 as things begin to normalize, but it won't stop these juggernauts.
One of the other reasons is that financial markets have given Facebook no incentive to care about users’ privacy. As we saw this quarter and have witnessed in many previous quarters, investors continue to reward Big Tech companies whose business models rely on targeted advertising. To investors, these companies are seen as innovators in what is becoming known as surveillance capitalism. In the ad tech business model, it's business first, users second.
Not to mention that there really aren't any alternatives to advertising on Facebook and Google (although Amazon is making a go of it). The duopoly accounts for 63 percent of US digital advertising revenue, and given than they control so much traffic and attention, it's difficult for advertisers to go elsewhere. Combine that with the coming GDPR regulations in Europe that will require brands to ask for permission for users' data, and Facebook and Google may even strengthen their positions.
The 2018 Corporate Accountability Index evaluated the 22 most powerful tech companies on their disclosed commitments and policies affecting freedom of expression and privacy. Many are falling short, having made meager progress over last year. That may change with GDPR, but there doesn't seem to be a solid push for this across the industry.
So it's clear that brands need to step up and own and control their own data, which of course means that they'll have a more direct relationship with customers. There's only one issue with that: brands have spent the last decade or more outsourcing their digital and social efforts to platforms and agencies to do the work on their behalf. The results? Brands simply aren't ready for modern-day marketing.
And so here we are...
Artificial Intelligence / Autonomous
The latest in AI, machine learning, bots, and blockchain, mobility, and autonomous everything.Aʀᴛɪꜰɪᴄɪᴀʟ Iɴᴛᴇʟʟɪɢᴇɴᴄᴇ / Mᴀᴄʜɪɴᴇ Lᴇᴀʀɴɪɴɢ
- The economics of AI are fascinating. Five imperatives for harnessing the power of low-cost prediction.
- Google's co-founder Sergei Brin has thoughts about the threat of AI in today's technology renaissance and is even giving thought to the future of job destruction/creation.
- Amazon launched a $79 Echo Dot Kids Edition with kid-friendly Alexa and one year of FreeTime Unlimited, a bundle of curated content with a Parent Dashboard. This is how you hook them early.
- Also? It rewards kids who say please and thank you.
- Amazon is creating a home robot. Don't look now, but we're about to become The Jetsons.
Bʟᴏᴄᴋᴄʜᴀɪɴ
- The advent of GDPR may drive blockchain usage for content. Experts think it can help build trust and transparency in the digital economy, in keeping with the spirit of GDPR.
- Trying to keep up on the latest bitcoin craze? Don't bother. Bitcoin is the greatest scam in history – a colossal pump-and-dump scheme.
Aᴜᴛᴏɴᴏᴍᴏᴜs / Mᴏʙɪʟɪᴛʏ
- Ford Motor Company shocked the industry last week, saying that it is discontinuing every passenger car except the Mustang and Focus Active, instead putting its energy into trucks and utilities, backed by flexible platforms and electrified drivetrains. A bold and perhaps even controversial move, but one that will give the company more profits to put toward autonomous and electric vehicles.
- The Chinese ride-hailing giant Didi is preparing for an IPO. Quicker than Uber.
- Now there's a real-life Transformer that you can ride in. More than meets the eye.
Communications / Marketing / Business Strategy
Sᴛʀᴀᴛᴇɢʏ / Mᴀʀᴋᴇᴛɪɴɢ / Cᴏɴᴛᴇɴᴛ
- A discussion about what the future of content marketing looks like.
- As Facebook falters, news aggregators like Flipboard make a comeback. You can follow links throughout the week as we flip them into The Full Monty.
- Aristotle knew what marketers don't: why influencer marketing fails.
- A look at the state of customer experience and where it's headed.
Jᴏᴜʀɴᴀʟɪsᴍ / Cᴏᴍᴍᴜɴɪᴄᴀᴛɪᴏɴs / Rᴇᴘᴜᴛᴀᴛɪᴏɴ
- US corporate reputations are in decline. The Reputation Institute attributes these declines to a growing belief that companies focus on profits over people. In other words, lack of authenticity. Or perhaps they're simply being transparent about their priorities.
- We're in an age of information overload. That doesn't mean that we can't be more well-informed about our messaging. One way to forge ahead is to simply look at human behavior as a guide.
- Having a creative brand personality can boost your PR efforts.
Retail Apocalypse
Humans are a transactional species, and the practice — if not the very notion of what retail is — is undergoing a historical metamorphosis.- Walmart is merging its British unit Asda with competitor Sainsbury in a $70 billion deal. Walmart will retain a 42 percent stake in the new entity as it moves toward more joint ventures in competitive markets to more effectively compete with other online retailers.
- Amazon is raising the price of Prime from $99 to $119. Given their recent announcement that there are 100 million Prime members, that's an additional $2 billion to Amazon. And let's face it: it's not going to stop you from paying the additional cost, is it?
- PetSmart was the most expensive takeover in retail. And now it's drowning it debt. Once again, watch for a major retailer to suffer because of an LBO (ref. Toys 'R Us, Payless, Gymboree, etc.).
- Don't want your packages stolen off of your porch? No problem. Amazon will deliver packages to your trunk. Now you can risk theft of your car instead.
- And Walmart is partnering with DoorDash for delivery, in addition to previous relationships with Uber, Lyft, Postmates, and Deliv for the last mile.
- But don't count on Walmart and Instacart working together. The sticking point: Walmart wants to use Instacart for delivery, while Instacart wants people to fulfill orders through its app.
SPONSOR
Want to know what 500 marketers (budgets up to $10 million) believe and how those beliefs influence their behaviors when it comes to hiring and firing agencies just like yours?
Don't miss this FREE 16 page report, full of information, insight and guidance on how to best approach prospects based on the findings.
Some of the results are going to really surprise you.
Platforms
News to know about relevant social, virtual, and augmented reality platforms that may affect your business.Tᴡɪᴛᴛᴇʀ
- Twitter reported earnings and performance last week, and Wall Street was thrilled. The company reported profits of 16 cents per share on revenue of $665 million for the quarter, including a profit of $61 million. And they added six million new users.
- Twitter is making good on its pledge to fight the persistent problems of spam, bots, harassment and misinformation that have plagued the social platform for years, revoking access for 142,000 apps covering 130 million tweets in one week.
Fᴀᴄᴇʙᴏᴏᴋ / Iɴsᴛᴀɢʀᴀᴍ / WʜᴀᴛsAᴘᴘ
- As reported above, Facebook beat Wall Street estimates of $11.41 billion by reporting $11.97 billion in revenue, and $1.69 earnings-per-share, compared to the $1.35 estimate. User growth was up 3.42 percent compared with only 2.15 percent last quarter.
- Perhaps most impressive of all: 91 percent of the advertising revenue was from mobile ads.
- Facebook published the internal guidelines it uses to make tough decisions on sensitive topics on its platform, including hate speech, child safety and terrorism.
- Instagram Stories now allows users to upload multiple photos and videos at once.
Aʟᴘʜᴀʙᴇᴛ / Gᴏᴏɢʟᴇ / YᴏᴜTᴜʙᴇ
- Alphabet outperformed Wall Street with revenue of $31.15 billion in Q1 versus the expected $30.29 billion, and an EPS of $13.33, compared to the estimate of $9.28.
- The new Gmail redesign is here, with lots of increased functionality.
Sɴᴀᴘ / Sɴᴀᴘᴄʜᴀᴛ
- Snap announced Snappables, AR lenses that use touch, motion, and facial expressions for single and multiplayer games, rolling out globally with new games weekly.
- Snapchat redesigned its redesign. The stock reacted accordingly.
Oᴛʜᴇʀ
- Digg was bought by a company called BuySellAds. Goodbye, Digg. It was nice knowing you.
- Flipboard launched a new Technology section. It should appeal to you if you read this newsletter regularly.
Media
The latest in the world of streaming video, audio, and the advertising, pricing and bundling models related to them.Vɪᴅᴇᴏ
- Netflix wants to get into the movie theater business. Given their success with original content, it's not a stretch. But it may erode their profitability and core focus as they become more like a typical studio. Then again, they have a secret sauce, and this move is akin to Amazon getting into brick and mortar stores.
- Neflix-loving kids are killing cable.
- As it prepares for an entry into streaming video, Disney could be a worthy foe to Netflix and Amazon.
- E-sports viewership is now larger than NFL viewership. That's right: more people are watching people play video games than are watching people play football.
- MoviePass has changed its terms from $9.95 for one movie per day to four movies per month. Some question whether MoviePass will even survive.
Aᴜᴅɪᴏ
- Spotify announced a new version of its free app, reflecting the company’s belief that creating a better user experience for unpaid subscribers will result in more paid subscribers.
- Google Play Music will be replaced by YouTube's upcoming music streaming service, with Play Music users forced to use the new service by the end of 2018.
- Apple Podcasts topped 50 billion all-time downloads and streams. What's more impressive is that in 2017, it notched 13.7 billion episode downloads and streams. That's quite a jump.
- Revenues are surging for streaming music providers.
- Program of the Week: Our pick this week is The Moment with Brian Koppelman. Interviews about the pivotal moments that fueled fascinating creative careers. I've every interview to be fascinating, and I think you will too. Thanks to Collin Kromke for the suggestion. Do you have a program to recommend? Add yours to our Google Sheet: smonty.co/yourpodcasts.
Don't forget to subscribe to The Difference from Brain+Trust Partners!
Privacy / Security / Regulatory
Business disruptions in the legal, regulatory, and computer security fields, from hacking to the on-demand economy and more.Pʀɪᴠᴀᴄʏ / Sᴇᴄᴜʀɪᴛʏ / Hᴀᴄᴋɪɴɢ
- Consumers want personalization, but they don't want it to get too personal.
- Hackers are finding ways to break into hotel rooms that don't involve your key or carelessness. As hotel companies move customers to mobile phone-based keys, even if one guest uses a keycard and discards it – and even cards as five years old – may result in potential hacking.
- Why we should worry about Google and Facebook owning our data.
Rᴇɢᴜʟᴀᴛᴏʀʏ / Oɴ-Dᴇᴍᴀɴᴅ Eᴄᴏɴᴏᴍʏ
- As the deadline in Europe looms, here's what you need to know about GDPR.
Measurement / Analytics / Data
The future is not in plastics, but in data. Those who know how to measure and analyze it will rule the world.- Scott Brinker is @chiefmartec and he produces an annual graphic that contains all of the marketing technology companies. Last year, it was 5,000. This year? Nearly 7,000 companies make up the Marketing Technology Landscape. At this rate, it feels like consolidation is coming.
- If you want to get better at deep learning, then you need to practice. The good news is that Analytics Vidhya has put together 25 open datasets for deep learning that every data scientist must work with.
Mental Nourishment
Other links to help you reflect, improve, or simply learn something new.- What one job skill is most lacking in the US? LinkedIn CEO Jeff Weiner has the answer. And it's part of our of our sections above.
- Art in the Instagram era involves much less real-time admiration, as you might guess.
- Westworld is back for a second season on HBO. And if you like Westworld, you'll like these 10 books.
- And if that's not enough, The Great American Read from PBS brings you America's 100 most-loved books.
- If you want to succeed in writing, use a masculine name. In a groundbreaking study of more than two million books published in North America between 2002 and 2012, scholars found that books by women authors are priced 45% less than those of their male counterparts.
Do you like what you see here? Please subscribe to have trends on digital communications, marketing, technology and business delivered to your inbox each week.
Upcoming Brain+Trust Speaking Engagements
Upcoming events:- Digimarcom in New York City on May 10 and in Houston on June 7.
- The Customer Experience Summit in Dallas on May 22.
Can we speak for your organization or event? Drop us a line.
Brain+Trust Partners companies evolve at the speed of customers. From social and content strategy development to technology and data vendor selection, to improved operations, our focus is on improving the customer experience and saving money. And our decades of experience working for major brands means that we deeply understand the challenges you're facing. Let us know if we can help you.
--
