business

How media companies engage a distracted audience

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Aka how far into this article will you switch to puppy videos?

A long, long time ago, in a galaxy called 1992, Robin Williams starred in a movie about a toy factory. They called this movie “Toys”, which was not a clever name for a movie, but it was descriptive. The movie had a lot of toys, and in that year, Matt was all about it.  And so it was, that on a recent rainy Saturday (ok fine it was a perfectly nice day out), I fired up Netflix and searched “Toys.”

And thus, my adventure down the rabbit hole began…

First there was a documentary about the toys we grew up with in the 80’s.  Then an international film about a toymaker coping with his own mortality. Oh look, a Kevin Smith documentary about those little vinyl figures. Hey, a Netflix short-form series about eSports (I guess this is a toy.).  And the cartoons. So many cartoons. It was overwhelming, and I hadn’t even checked HBO. So I did what most people do, I put on an episode of Queer Eye that I’d already seen twice.

Choices are good, I’m not here to convince you otherwise. There are 500 original scripted TV shows and 750 reality TV shows in production right now. A fifth of those scripted shows were created by Netflix which, didn’t even have original programming until a few short years ago. That’s wild.

It almost makes me wistful for what the early days of television must have been like. Programming was simple. Morning cartoons, daytime soap operas, and prime time entertainment ran like clockwork, based on an average demographic of age and gender.

Not to mention if you missed it, you missed it. There was no ghostly haunting of a new show moaning through through the rafters of your queue every time you sat down to ponder what to watch next before someone spoiled it. (Too dramatic?)

I don’t know how they measure the attention span of a goldfish - Ani DiFranco once described it as “the little plastic castle is a surprise every time!” - but they say ours is even shorter. We’ve got mountains of everlasting new content every day, and if you’re one of those people looking to tell a new story you’re definitely struggling with how to find your audience.

I talked to a few publishers who are tackling this problem in a few different ways. Because audiences vary across mobile, TV, desktop, and voice-enabled platforms, they’ve been repurposing their content to adapt.  But, they haven’t lost sight of that balance of emotionally driven, human content that can learn from the data and technical capabilities we have in 2018.

So what is this? A better channel? A new approach? What does it all mean, Basil?

Screens? Where we’re going, we don’t need screens…

Yes, much of our consumption is on a screen somewhere between 3” and 70” (should you be so lucky). But think of the new platforms we’re seeing become viable in just in the last few years with chatbot APIs and new voice UI devices already crowding the market. It’s hard enough to perfect an existing channel, let alone figure out a new one.

“Today consumers have more choice than ever before when it comes to how, when and where they consume content. They’re either getting a daily app news debrief while commuting on the subway or streaming a football game via tablet while waiting in line at the airport,” said Sean Galligan, Vice President & Industry Lead, Tech & Telecom, Verizon’s Oath, referring to a Pew Research Center report that found the median U.S. household contained five devices: smartphones, desktops, laptops, tablets or streaming media devices.

“In order to stay relevant and top of mind when today’s consumer has all of these choices, brands have to build the best premium experiences. That means creating killer mobile content, trusted mobile data that performs, and mobile-first ad tech.”

Of course, what works in one place might not in another, and that’s important to remind yourself, said Chris Papaleo, Executive Director of Emerging Technology at Hearst.  

“We’re very focused on imagining what platform a person is engaging the content. What day that user is likely to encounter this content and what content format works for the device they’re using,” said Papaleo. “You can’t create one piece of content and put that everywhere. It’s very much about content that’s native to the platform. Even Facebook and Snapchat have their own unique characteristics that make our thinking about content on those platforms very different from how we might work elsewhere.”

The smart publisher views this state of affairs, not merely as a challenge, but as an opportunity. Every new platform presents an awesome new creative outlet. (Like a 4D movie with smell-o-vision!)

“The choice and variety of available devices today isn’t all doom and gloom for content creators. It’s an opportunity to connect with audiences at multiple touchpoints, like never before,” said Oath’s Galligan.

Papaleo echoed the sentiment.

“On the more established, mainstream platforms, like Snap and Facebook, it’s about reaching our existing user base where they are,” he said. “Since voice-enabled platforms are still emerging, we can potentially reach a wider audience as we position ourselves to be a quality experience that gets surfaced in response to an organic user question.”

For example, Hearst has a product called “My Beauty Chat” on Amazon’s Alexa, which Papaleo refers to as a “beauty focused content experience on voice.” It draws on the expertise of Hearst’s beauty editors across multiple magazine titles such as Cosmo and Marie Claire. If someone asks Alexa to give them a beauty tip, Alexa might surface up that content. “We believe if it is going to be more convenient for users to search with their voice, rather than type it into their smartphone keyboard or on some other screen, we need to figure out the best pathway to get our information to the user.”

I am a human and I have emotions

So to recap: we’re no longer tracking viewership in Nielsen watching journals (Which is good, I don’t need a paper trail on my Drag Race watching habits #TeamMonet). Detailed statistics on viewership are now the norm, and it means you’ve seen a lot of content driven by knowing just what gets viewed.

Demand Media has created tons of “How to” stories based on the questions most asked online, for example, “How to tie a bow tie.” (Spoiler alert: I still don’t know!) At one point, Demand Media dominated the top of Google searches for most “How to” questions.

Topix leverages a similar methodology, but takes it even further. Their stories aren’t driven by a news cycle, but by emotion.  How do they put their finger on the emotional pulse of their audience? They distill it from their 50 top-grossing stories.

“We identified four emotions that were driving the most engagement: nostalgia, schadenfreude, pride of knowledge and humor,” said Chris Tolles, CEO of Topix. “As opposed to using data to build a relationship with an individual, or deliver more personalized stories, we’re using data that can resonate with a broader population. Since then we’ve produced stories on a small budget that alone have generated three quarters of a million dollars due to the fact that, in this case, the content made people feel nostalgic.”  

As an example, stories that have a historical angle can make the reader feel nostalgic. And nostalgia is a super powerful emotion (we’re not biased at all…). Moreover, stories made to be timeless can evoke these same feelings repeatedly.

“We’re not going to create anything that’s ephemeral,” said Tolles. “If it can’t be interesting a year or a decade from now we’re not going to write about it. Cinderella doesn’t go obsolete; we’re looking at creating things like that and then use data to fine-tune the content for the audiences that are interested.”

Tolles pointed out that this approach to content production is more like following a recipe. It’s a utilitarian form of creativity, not solely artistic, he suggested.  

“I came from a background of selling packaged software. If you have a media publication background, you don’t look at stories as stand-alone products, but rather ongoing articles that lose relevance over time,” said Tolles. “For us, we’re trying to make sure people stick with our stories because they have the best emotional connection possible and for as long as possible, which then turns out to be very, very profitable.”

We must go deeper

To every yin, there is a yang. Such is the balance of life. And so it is that for every Topix, there is an Oath. In contrast to Topix’s utilitarian approach, Oath strives to create deeper reader relationships with it's trusted brands. Take for example Tumblr, a platform that creates and cultivates communities of people around specific shared interests. Fun fact: Tumblr’s audience - of which 75 percent are under 34 years old - creates one billion posts a month.

“As a user-led platform where voicing one’s opinion and creativity is encouraged, Tumblr’s community especially rallies around a spectrum of topics from entertainment to activism, allowing its audiences to not only go deeper with content but to connect with others [who are like-minded],” said Oath’s Galligan.

“Not only do users want to go deeper with digital content, brand, character and community but brands must build and reflect that affinity. What audiences are looking for is simple: brand love.” said Galligan.

In a recent study aptly named the Brand Love Index, they called out six key drivers of brand loyalty.  Among those drivers is the ability to set trends and take a strong stance on values. According to the study, “people want to be seen using brands that share their values (representing 12% of brand love globally). In the U.S. however, this drives 14% of brand love, more than almost anywhere in the world.”

In other words, if a brand reflects the values of its community, the audience is more inclined to like them. Not exactly a hot take, but it’s important to remember as we witness the polarization of news sites and the increasing number of publications willing to partake in conversations previously deemed… icky.

Pulling It All Together

Now, pair all of that brand-talk with all that new-platform-talk we made earlier. Brands are now willing to have more meaningful conversations, on platforms that feel even more personal. With robot mouth voices!

“The personalized experience is something that’s exciting to be able to do on voice platforms that I don’t believe you have the ability to do when you’re just publishing content on the Internet. That’s one powerful way that we see more personalized experiences evolving though we’re at the early stages of that,” said Hearst’s Papaleo.

“The difference between voice platforms, like Alexa or Google Assistant, vs simply listening to podcasts is the interactive nature of the voice platforms,” Papaleo added, suggesting a person can reveal a lot more about themselves through a conversation. “A small thing we’re starting to build now is tailoring our messages based on someone’s prior engagement with our products though we need a lot more people on those platforms using the products before we have a really great sense of how that pushes the product vision forward.”

And In Conclusion...

Content is tough.

Engaging, emotional, raw content is even tougher.

And there’s no easy answer, but there are a ton of new tools and platforms that sometimes seem to take over so quickly that we forget to take a step back and really think creatively about how we can use them to better connect with people.

The moments when people are engaged with your content are happening more often and in entirely new ways. But even more so, they are happening more and more at the same time.

These goldfish are easily distracted, and these goldfish are your audience. You have to know them really, really well - even down to their goldfish values. If years ago, the lack of options made consumers beholden to the whims of creators, that script has completely flipped.

And that means putting a whole lot of effort into those little plastic castles.


Timehop’s journey toward conquering mobile ads

Being ahead of the curve with “in-app header bidding” led to a 1200% jump in daily revenue

For years, we’ve known that mobile usage has been greater than desktop, having surpassed the web since 2014 to be exact. Yet mobile advertising options have been less than ideal, on mobile web or in app. This has left my company Timehop with no choice but to go on an unexpected and unconventional journey to build our own solution. In the end, it wasn’t only worthwhile, it was a fortuitous decision -- one of the best we’ve made so far in our young history.

To appreciate our story, you have to understand the two ways to make money via mobile advertising: through a browser or through an app. Mobile web is a relatively robust ecosystem, thanks to being similar in technology to desktop web. Yet there are several drawbacks to this approach in mobile. Ad blockers limit your audience. Customers may prefer to consume your content in an app. And you lose all of the user experience benefits of building an app.

On top of all of this, advertisers prefer the safety, accountability and efficacy of in-app advertising. In-app mobile ad spend comprises about 80 percent of all US media dollars spent on mobile, according to eMarketer. They’re estimated to have hit $45.3 billion last year, up from $11 billion in 2016.  At Timehop, in our early years, we spent considerable effort migrating our first few million users from an email-based service to one that the user consumes in an app. These larger advertising trends were part of our motivation.

The problems and promise of in-app advertising

While consumers spend more than two hours on apps each day vs 26 minutes viewing the web on mobile, those in-app audiences are confined to the top five players, such as Instagram and Snap. These large companies with hundreds or thousands of employees and large demand from advertisers are in a position to build their own ad-serving technology in-house, and dictate to the market - who is yearning for their inventory - how to buy their ads.

For everyone else - from the smallest app to large, top publishers - the solution is more complex. The default solution is to replicate what they’ve done on the web: have an in-house staff directly selling their inventory, then turning to third-party providers for technological solutions to sell the remaining inventory.

Yet because of the challenges of in-app advertising, and its differences from web, third-party solutions leave much to be desired. The technical solutions offered by third parties are more limited than web, and those that exist often make a middling attempt at replicating desktop web technologies, often at the expense of the improved user experience of an app.

In-app advertising solutions also often lag behind their mobile web counterparts. For example, header bidding. It’s all the rage on desktop web and in-browser mobile. Header bidding is a technique where ads are auctioned in the HTML header on the web, rather than as the page loads. All the bidding is done to multiple ad exchanges before the page is rendered. This is opposite of waterfall, where each partner is contacted individually. This new, popular approach to web advertising results in improved revenue for the publisher.

Header bidding obviously makes the selling of ad space faster and more efficient. Yet in-app “header bidding” is a nightmare (never mind that there are no HTML headers in mobile, the name has stuck for simultaneous auctions.) Says Digiday, in its rundown of the situation, “Like much of ad tech, header bidding was built to solve a desktop challenge. But mobile is eating media.”

Third-party technical solutions exist, but they are less than ideal. Many of them rely on software development kits, or SDKs. This means incorporating a big chunk of code into the app. Yet one doesn’t just have to implement the SDK of the company handling the auction. Imagine working with a number of ad partners and integrating each SDK for each one. On Timehop, we have more than 10 different ad partners; if we uploaded each SDK, it would make us a 600 megabyte app. We’d be overloaded and slow, and it would hurt the user experience.

There are other reasons app developers hate SDKs. There’s lack of control, and they’re extremely rigid. If I wanted to change something to make it look right for my users, I’d have to request this change from the ad partner.   

The paradox for us and for many publishers is clear: in-app provides greater advertising revenue theoretically, yet the technical solutions aren’t as effective yet. For many publishers, the paradox is immaterial since most of their readers rely on mobile web. Think about it, how many news publication apps have you downloaded? But for Timehop, where millions of users are interacting with our app every day, the problem is acute.

Which led us to start this journey.  

Enter Nimbus and a 12x revenue jump

This all explains why we created Nimbus, our header-bidding solution, that rids us of those app-bloating SDKs and enables us to be flexible. Our company consists of 15 people, and it was a sizable commitment of resources to go down this path. But having tried several of the “best-in-class” in-app advertising solutions, we felt we had no choice.

Nimbus is our ad server, which brings the “header bidding” process to in-app mobile. Nimbus holds a simultaneous auction for 10 (and counting) major ad networks at the beginning of every user session, delivering the highest-paid ad to the user. All without resorting to implementing innumerable SDKs. Prior to Nimbus, we managed clunky waterfalls - passing our user from one ad provider to the next, waiting for someone to bid. This resulted in lower income, and a degraded user experience. On top of that, we had a bloated app. At one point, we had four ad partner SDKs in our app. Horrendous.

No more. We started Nimbus in mid-November 2017, and had a beta launch by the end of that month, just in time for the holidays. We started with video, which generates higher CPMs. And, if I may be so bold: We killed it. Daily revenue grew by 12x during November and December.

After the new year, we started implementing static images, as well as viewability scores and anti-fraud features. Even though video inventory dropped, which put some pressure on revenue, sales are still a healthy 400 percent above where we started. Moreover, it’s only been three months since launch and already the product has paid for itself, meaning we’ve already made more revenue than the cost of development. Post holidays, we’re now at around 7x our pre-Nimbus revenue, with significant room to grow.

Building your own in-house solution isn’t easy. We had our own challenges, which include having a small team. Yet fortunately, we had the right mix of expertise in mobile development and programmatic advertising on desktop. The combined knowledge enabled us to build Nimbus. This kind of talent isn’t easy to find. There are probably only a handful of people who can do this in New York. And for any person with expertise in mobile programmatic, they’re likely going to work for Facebook or Google. We were lucky to hire a programmatic partnerships exec and two engineers from the same programmatic company that was going out of business. All this to say that it’s hard to replicate what we built.  

As for the audience size, there’s little value in spending the money to build a solution if you don’t have viewers to see the ads in the first place.

Publishers backs’ are against the wall

Of course, none of this would have been possible had we not had a sizable mobile audience to begin with. We think of ourselves as “too big to be small and too small to be big.” Millions of daily actives is a sizable number, so long as you’re not comparing yourselves to Facebook or Snap.

For large publishers, this is a conundrum. One study conducted by Nielson and The Knight Foundation showed a significant imbalance that news organizations have with regards to readership on their websites and on their dedicated apps. What’s clear: consumers don’t like downloading news apps.

According to the report, “mobile users who access news through apps spend more time reading the content, but the overall audience for apps is small.”  

 

For large publishers, their backs are against the wall. Audiences are moving to mobile. But on mobile, their audiences are looking at a browser, when the real ad money takes place in apps. And apps are dominated by Facebook, Twitter, Snap and their ilk. Says Digiday, “Apps theoretically present a huge opportunity for publishers since eMarketer estimates that 86 percent of the time users spend on mobile is spent in apps. But publishers have struggled to monetize their content in apps, and many of the most popular apps simply do not belong to publishers. A spokesperson for App Annie said that only two (ESPN and CNN) of the top 200 most-downloaded apps last month belonged to publishers.”

Therein lies the problem for these publishers. Let’s say I’m Coca-Cola and I call a news organization with a small-in app audience and say, “I’ve got a new ad campaign for Diet Coke with Lime, and the digital side of it is $20 million. I’m going to send it out in $2 million chunks spread over in-app advertising, branded content, maybe an event, or maybe a big show. Please send me a proposal.” The news organization would make their proposal to the brand, but without a large in-app audience, they’d essentially be missing one segment the brand wants to target.

This is what sets us apart from many other apps out there. We have an in-app audience and we have beautiful ads that are full screen and highly, highly viewable (we have excellent MOAT scores!)   

Looking forward

At Timehop, now both pieces are in place in-app: audience and monetization. It’s taken years since we first migrated over from an email list, but we’re there. We have a sizable audience of daily active users - several million. And we can now effectively monetize them. We can do it quickly. We can do it with a polished user experience fully integrated into our product. We’re even ready to accept full screen vertical video ads - some brands have re-purposed their Snap ads for Timehop. We would love to see more of that.

We’ve also begun setting up Private Marketplaces [PMPs] with brands and trade desks, giving them priority access to advertise with our users, helping us maintain quality advertising for premium brands, and sparing us from the more shady corners of the programmatic world.

Not only that, having both pieces in place has allowed us to control our own destiny. Staying a small team has helped, to be sure. And now with both pieces in place we can look forward to building the many, many other product innovations we have in the pipeline.

We’re excited for what comes next.