As we head into the Digiday Retail Summit today, here’s some retail news that’s been on our minds.
By the way, if you’re at DRS, look for us on Monday in the Grand Ballroom. We’ll be giving a bite-sized summary of our research whitepaper “A Network for Every Interest.” Read the entire whitepaper here.
Learn three new tactics retailers are trying in-store based on their own business data.
Sometimes it seems like people talk about “data” as if everyone knows what that means. Learn the basics of data, as advertisers use it.
If you’ve been hearing about programmatic lately, you’ve probably also been hearing a lot of jargon. Demystify the most common terms.
A new batch of successful, digital-only e-commerce companies like Nasty Gal, Birchbox, and Bonobos are opening their first stores this year.
Following new VP of Retail’s plan to triple Apple’s footprint in China, a new store opened in Chongqing yesterday.
Want to talk more about the interesting challenges facing retailers or about our research? Find Matt Rosenberg (@CanonFodder) at Digiday Retail Summit or tweet us at @140proof.
July 27, 2014 - 4 days ago
Over the past few weeks of The World Cup, we’ve witnessed spectacular goals, some fancy footwork with a soccer ball, and one “did that just happen?” shoulder biting incident. We’d say it’s been one of the best World Cups yet, and as we’ve whittled the brackets down to just four teams, lingering on the sidelines is another tournament taking place between social media giants: Facebook and Twitter. While The World Cup has stiff competition from other sporting events like the Super Bowl, which garnered an impressive 24.9 million tweets in 2014, the World Cup’s social engagement has dominated news feeds and Twitter feeds.
Both Twitter and Facebook caught on to the potential around the World Cup, before the whistles even blew by creating specific hubs for World Cup engagement. Facebook even crafted a special “Trending in the World Cup” section, as well as an interactive map for fans to check out where other users are viewing the game. Not to be outdone, Twitter boasted in a blogpost that “the only real-time #WorldCup global viewing party will be on Twitter, where you can track all 64 matches, experience every goal and love every second, both on and off the pitch.” Twitter’s real star of the show? Its rollout of “hashflags” that let every soccer fan show their patriotic pride when they included their country’s hashtag in a tweet. Let the games begin!
Facebook’s star lineup
In spite of a staggering 500 million soccer fans on the social network, Facebook is weak where Twitter has its strongest asset: real time engagement. Facebook’s trending topics, rolled out earlier this year, often lag behind events in games and are so targeted that they fail to capture the larger conversation.
Even if Facebook is the underdog there, they’ve certainly found other ways to drive their popularity with soccer fanatics. The players themselves seem particularly taken with the site as a means of connecting with their supporters. Case in point: remember that bite seen ‘round the world? Sure, there were plenty of witty Twitter reactions. But when it came time for Luis Suarez to apologize for his actions, he took to Facebook to write his condolences about his Italian snack:
With 7.9 million fans on Facebook, Suarez was certainly able to get a lot of people listening. Other players have followed suit (minus a remorseful biting incident, of course) and have utilized the platform as the best way to connect with their adoring fans. Is that enough to stand up to Twitter, though?
Twitter’s strategic gameplay
With engagement seemingly higher than ever on Twitter, there’s a lot to talk about how the social network has developed its World Cup strategy. But the World Cup’s biggest Twitter win was actually born out of team USA’s crushing loss to Belgium. Even though they lost, US goalie Tim Howard has become an internet
sensation ever since memes and #ThingsTimHowardCouldSave went viral on Twitter. Could Howard have just saved the social media game for Twitter, too?
This year’s champion?
Facebook put up a good fight, but we have to hand it to Twitter here. The site is simply unrivaled when it comes to mirroring the fast-paced nature of soccer itself, and fans, players, and the media alike have all taken notice. While the real winner of this year’s World Cup has yet to be decided, a hearty congratulations to Twitter for championing the World Cup of Social Media!
July 11, 2014 - 2 weeks ago
In the marketing and advertising world, business jargon is all in a day’s work. Just between nine and noon you might have had to “ping” your co-worker a dozen times, “push the needle forward” in a brainstorm session, or check in with colleagues on what’s “coming down the pipeline” for new business. In the ad tech world the buzzy nature of business speak has been taken to new heights. The jargon and complicated vocabulary associated with the industry has made an already complicated field seemingly impenetrable. Given that programmatic advertising is often heralded as the future of advertising (this year, eMarketer predicted that advertisers will spend $3.36 billion on RTB, up from $2 billion in 2012) we think it’s important that everyone have a better sense of what this new technology is really all about — minus the jargon.
What does programmatic have to do with me?
Remember the early days of internet advertising when surfing the internet meant you were subject to any number of annoying, flashing banner ads? That jarring experience is thankfully on its way out for all but the jankiest of websites. Programmatic advertising has modernized digital advertising by making the process of buying digital ad space more efficient, and as a result provides more relevant ads to people like you.
Here’s a vocabulary primer to get down before we dive in much deeper:
Media Buyers: This one’s straight-forward. The buyers in a programmatic ad buy are the people who are buying ad space on a website. A good example might be a retailer like Nordstrom.
Publishers: Here’s the other half of the equation. Think of them as being similar to publishers in the traditional sense. They’re the people who are publishing content on a platform —whether a social media site like Facebook or a magazine website like The New Yorker —and need to generate revenue for their site. In this case, they do so by selling off ad space, or ad inventory.
Data Management Platform (DMP): This is where users and publishers meet in the middle. A DMP is essentially a database for user data that then organizes that information in ways that advertisers, publishers, and other businesses can use. In short, by using the data stored in a DMP, ads are better targeted towards users.
Care to explain how that all happens?
In a nutshell, programmatic ad buying uses software and machine based programming to replace the typical mechanisms of buying digital advertising, like negotiations and business deals. By automating this interaction between buyers and publishers, programmatic advertising has made digital advertising more efficient and a more effective modernized process.
These digital transactions occur using a variety of technologies, the most common of which is called real-time bidding, or RTB. RTB is more than just another acronym in the marketing world. It’s the way that digital advertisements, sometimes personalized, are typically served to you. You can think of RTB as a real-time “auction.” In the milliseconds before a publisher’s web page loads, your ad impression (essentially information about you and the page you’re about to view the ad on) is loaded onto an ad exchange. Brands then ‘bid’ for their ad to be placed in front of you on that site, depending on the computer’s determined “worth” of your impression. RTB and personalized advertising is part of why big data has become so important to the ad industry as well— much of programmatic is reliant on big data stored in DMPs so that they can effectively target their ads to users.
All of this takes place in different places depending on who is spending the money. The buyers, specifically advertisers and agencies, use an ad exchange called a “demand side platform” or DSP to automate this RTB process. Alternatively, publishers use an ad exchanges called “supply side platforms” or SSPs to sell the ad space on their site.
So where does that leave Don Draper?
There’s no need to worry about your favorite ad man just yet. While it’s true that programmatic advertising is going to play an increasingly large role in the advertising world and computers may replace some ad buying jobs, advertising will always need human strategy and creativity to drive its success. That’s something that programmatic and machine driven advertising can’t replicate —at least not quite yet.
July 2, 2014 - 4 weeks ago
Ad creatives are a lucky bunch so far as careers go. They get to showcase their creative chops for 30 seconds during the Super Bowl, have entire TV shows written about them, and each year, they flock to the stunning French Riviera to celebrate the best of their industry at Cannes Lions. It’s a cumulative conference done in such spectacular style that few other industries’ annual gathering —maybe aside from The Oscars—can’t really measure up. And while the festival bills itself as honoring creativity, this year’s celebration, which ended just this past weekend, should have included another headline alongside it: discussing the potential of ad tech. Industry analysts noted that ad tech firms and players were just as present at this year’s awards. It wasn’t just the business deals that they brought to the table, either. The heightened ad tech presence this year became emblematic of advertising community’s shifting dynamic, and how it’s quickly bridging the divide between Madison Avenue and Silicon Valley.
A Glimpse Into The Future of Advertising?
Traditionally, Cannes has been a playground for advertising execs to showcase their best work. This past week though, Silicon Valley had just a big of a presence—and they weren’t there to just sip rosé on the French Coast. Instead, their presence was both strategic and symbolic. Big tech companies like Google, Facebook, and Yahoo! crowded in along the coast to boast about their ad offerings and reach. Ad tech companies like Rubicon Project attended to nail down business deals and showcase their digital platforms for advertising. And in Cannes’ “cyber” category, or its digital advertising field, there was a 39% increase in submissions this year from last year.
All of these trends suggest just how integral technology has become to advertising, and how it’s shaking up what once was an archaic process. One of this year’s biggest takeaways? There’s no need for the Don Drapers of the world to be timid when it comes to advertising technology— these new advancements in how ads are bought, sold, and placed will only help to boost business and solidify an agency’s offerings to a brand.
Cannes - The Next SXSW?
If this year’s increase in media attention around Cannes Lions is any indication, Cannes has not only shifted in its attendees, but within those paying attention as well. Once a niche industry event, it’s clear that Cannes Lions is rapidly developing into a more mainstream event. Cannes Lions was once limited to recapping the past year in advertising. Now it forecasts what we can expect from the next year as well. This shift parallels another mainstream tech conference, SXSW, and its own meteoric rise. And like SXSW, which began as a conference for the film and interactive industries, Cannes Lions may soon become a showcase not only for the ad world, but also for exciting, emerging technology. At this rate, who knows— with all these changes within the ad world and the conference itself, maybe we’ll see Cannes Lions 2015 decorated with a few indie band acts a la SXSW, too.
June 25, 2014 - 1 month ago
For consumers, data visualization often seems like a distant buzzword only applicable to marketers or merely another trend. A lot of us aren’t even sure what data visualization means outside of marketing jargon. In its simplest form, data visualization is code that sits on a huge database of numbers and transforms those numbers into images that allow you to interact with them. Data visualization can be implemented across disciplines and in a number of cool ways, too. Some of data visualization’s greatest hits have documented and visualized entire NBA game movements and even the history of the 20th century.
There’s no need for data visualization to be relegated to the pages of websites and marketing reports, though: it actually has a huge impact on consumers and brands alike, especially in retail. Data visualization has essentially become a new way of putting “big data” to good use for brands. Retailers are starting to use data visualization in very tangible ways as a means of competing with digital and e-commerce giants — and it’s affecting consumers in a very real way.
Many brick-and-mortar stores leverage data visualization as a means of competing with their e-commerce rivals. Nearly everyone is aware of the well-documented infringement of digital on the in-store shopping experience. A recent study from Deloitte only serves to emphasize this fact —it found that digital technologies, like mobile, social and more, influence 36 percent of $1.1 trillion of in-store sales. That number will likely increase to 50 percent by the end of 2014. So how does data visualization fit into retail’s struggling digital equation? Brands are beginning to implement it in a number of different ways as a means of keeping up with rapid shifts in technology and e-commerce. Check out a few of the ways below that consumers expect to see data visualization come into play in their brick-and-mortar experience:
Retailers are now putting the power of location analytics to work within the in-store retail experience, much in the same way that e-commerce has leveraged it. One of the best examples of this is popular jeweler, Alex and Ani. By using their stores’ existing security cameras, Alex and Ani has been able to monitor their customers’ shopping behaviors and patterns, and modify the layout of their store accordingly. For example, if they notice that an item is not picking up many sales because it’s in a lower-trafficked area, they may move it to a more frequently visited area instead. The next time you step into a store, consider that stock may not have been placed in each location merely for aesthetics. Instead, there’s a good chance that a savvy retailer has carefully laid out their inventory in a specific way due to data visualization.
Social data showcase
As it turns out, everything that you like and share on social media isn’t just for your friends to ogle at. It’s actually become useful data for retailers to determine a better, more personalized in-store retail experience for you. Take Pinterest and Nordstroms’ recent collaboration. Nordstroms pulled the data from their Pinterest community and highlighted specific merchandise in their store based on their most popular pins. It’s just one example of how brick-and-mortar stores have been able to incorporate social feedback into an in-store experience with the aid of data visualization. Consequently this combination has strengthen their ability to compete with e-commerce sites.
Price check in 5 minutes…
E-commerce sites are notorious for toying with their prices all day long depending on data on consumer shopping habits and variables like the time of day, weather, and more. Now brick-and-mortar stores are aiming to do the same as retailers embrace data that allows them to make speedy, digital price changes. Thanks to digital price displays within stores, customers may want to double check an item to see if the price shifted since the last time they went down the aisle. Clearly data visualization is becoming an integral part of brick-and-mortar strategy as it aims to stay relevant in an age of e-commerce, and it will only continue to affect our shopping habits as consumers.
June 25, 2014 - 1 month ago
Read any article on social media and millennials these days, and you’re likely to stumble on one consistent message: “Facebook is so 2010.” While the media’s understanding of millennials’ social media preferences and Facebook’s waning influence may be overstated, it does accurately convey the inherently fickle nature of millennials’ social media inclinations, often leading to the confusion (and frustration) of marketers.
Millennials, or those between the ages of 18 and 34, are a crucial demographic for marketers. As one of the fastest growing populations in the country, these 72 million Americans play a huge role in swaying trends across the industries. With an impressive combined purchasing power of $245 trillion, they also play a powerful role in market performance. But above all, millennials may be best known for their addiction to all things digital, and in particular, their attachment to social media. Having grown up on digital technology, they are the first generation to become true “digital natives” and often define what’s cool in social media. However, their preferences can be equally indicative of what’s on its way out, which has a tendency to leave marketers anxious that they’ll be left out of the next big thing in social media (remember MySpace Tom from the early 2000s?).
Facebook is so 2010
As millennials have fast-tracked big changes in social, the social media ecosystem has become increasingly fragmented. Up until a few years ago, social media was pretty easy to understand, even for those “out of the loop.” There were just a few key platforms: Facebook, Twitter, and Instagram. What’s more, monetizing those platforms and advertising to the crucial millennial niche was relatively straightforward. In recent years though, millennial engagement with these platforms have been on the decline. A recent study found that 25 percent fewer U.S. teens use Facebook now than they did in 2011, and only 23% of teenagers cite Facebook as the most important social network.
Advertisers don’t need to run for the exits yet — the big platforms still maintain a stronghold on the landscape. According to a Pew Research study, a whopping 81 percent of millennials have a Facebook account, and a study from ComScore found that 46 percent of millennials used Instagram. Even so, their influence is clearly waning. So if not Facebook, where are these millennials headed, and how can marketers continue to reach them?
Popular with millennials, a headache for marketers
In stark contrast to the exhaustive over sharing characteristic of Facebook and Twitter, there has been a new rise in the social media world: private messaging apps. Apps like SnapChat, which has popularized the disappearing picture message, is now used by one in five millennials. Whisper allows its fast-growing user base to post messages to followers and the public anonymously.
While the perks of these new apps have proved wildly popular with millennials, marketers are a little less keen on the idea as advertising capabilities are slow to catch up to what’s hot on social. Advertising plays a huge role in social networks long-term viability due to the revenue ads produce. Young, wildly popular social apps generally don’t have the resources to offer advertising options as their focus is on scaling fast. Pinterest, for example, only just launched paid advertising. Pinterest launched in late 2010 and has since become a hugely popular social platform with an estimated 40 million active users, but its introduction of ads just last week signifies just the lapse of time that happens as companies grow and can invest in ad capabilities. By the time advertising launches on these new platforms, millennials have oftentimes moved on to the next cool app, and brands are fearful that will happen with these new social media networks as well.
These new forms of social media have also proved logistically problematic for marketing. With pictures that disappear in a flash and sometimes limited consumer data, advertisers have found themselves in a bind. With no intuitive place for ads and monetization, how can advertisers connect with millennials on these popular new platforms? It’s a question that leaves marketers squirming.
Making Room For Marketing
Traditional social media may well be feeling some competitive heat, but that doesn’t have to spell doomsday for marketers. Instead, marketers should take some fresh perspective on these new social mediums. Private messaging apps and anonymous logins offer an opportunity for marketers to move into consumers’ everyday mobile activity. Moreover, while marketers may initially be intimidated by the prospect of working advertising into these new formats, they can push marketers to think more creatively on how to best reach some of their most valued customers.
Some of the most creative (and relevant) brands today have already pushed into these domains. For instance, Taco Bell recently launched a creative campaign that leveraged Snapchat stories (a visual, video equivalent of a Facebook status) to zero in on its Gen Y customers. Hulu similarly unleashed a clever campaign on anonymous secret sharing app Whisper by targeting specific keywords that users search for, and providing images of its new show alongside it. Even WeChat, a popular Chinese texting app similar to WhatsApp, is proving that simple texting apps are a new opportunity for marketers by integrating e-commerce into their platforms.
While millennials may jump around on their social networks, it’s no reason for marketers to sweat. Consider it an opportunity to get more creative in advertising and you won’t be left feeling left out like MySpace Tom.
June 18, 2014 - 1 month ago
The term ‘big data’ may seem like Silicon Valley jargon, but don’t write it off quite yet: it’s more than just a buzzword. Big data is a real, applicable tool that helps businesses to better reach their audience, and consumers to better relate to and interact with the brands they love most. The big data explosion is only just getting started, too: analysts project that there will be a 4300% increase in data generation by 2020. If big data is too big to wrap your head around, here’s one easy way to think of it: big data is your data. In other words, it’s all the information that’s been stored about people’s various habits online that is then analyzed and processed to provide them more relevant content online, and businesses a more effective way of reaching them.
And just as its name implies, big data has a big array of uses as well. All types of businesses, from massive corporations to tiny startups can put big data to good use. It’s often just a matter of understanding how, why, and what type of data a business should leverage. We decided we make things easy and break down a few of the ways advertisers are harnessing the power of big data to better engage consumers.
We’ve established that big data is instrumental in providing more relevant advertising to people while they’re surfing the web. But what kinds of specific data do advertisers leverage from this targeted advertising? One form is found in location-based data. By detecting their device’s location when they’re online, advertisers can serve people ads, targeted emails, or other marketing messages based on what’s relevant to that location. In fact, location data is so powerful that it is expected to net as much as $600 billion in consumer surplus.
Leading retailer Macy’s puts location-based data to good use through its app and personalized promotions. The app uses data by detecting when a shopper and her smartphone is in the store and will then send relevant promotions and personalized notifications for items she’s passing in the store. The retailer can then take this location-based data to the next level by analyzing where customers have been lingering in aisles or passing through quickly to redesign their store layout. This is a core example of how location-based data can benefit the consumer in the moment and in the future.
Advances in tracking and analytics online have made the e-commerce experience a whole lot more convenient for shoppers, as well as more useful for advertisers. Data is collected and studied on what people do prior to purchasing and what they end up buying. Then, it’s used to identify trends.
You’re probably familiar with one of the best examples of purchase data in action from e-commerce giant Amazon. Amazon uses a hybrid technique of analyzing a member’s purchase history, what they’ve placed in your shopping cart, and what they’ve recently been searching and browsing to create a highly personalized online shopping experience. This technique pays off for Amazon too — it’s cited that its conversion to sales of on-site recommendations could be as high as 60 percent.
So how does social media fit into the big data equation? Contrary to popular belief, the typical person’s Facebook feed isn’t all Farmville updates and Upworthy videos. And it’s fairly informative for advertisers. All of the content that people produce by posting status updates and liking posts generates data — a huge amount of it. It’s estimated that Facebook, for instance, takes in 500 times more data than the New York Stock Exchange (NYSE). It’s no surprise, then, that social media is one of the biggest sources of data for advertisers out there. If you think about it, when you Like movies on Facebook or Favorite tweets on Twitter, you’re declaring your likes and dislikes in a few data points. That data subsequently becomes an opportunity for businesses to understand your preferences, and accordingly deliver ads that would be interesting to you (and effective for them).
Here’s one instance in which social data is useful for businesses and you, too: ever been stuck searching for a perfect gift for a friend? One startup is leveraging social data to help you overcome that exact barrier. With your permission, Spanish company Giftri, taps into Facebook’s data mine to offer you personalized gift recommendations on Amazon. By using algorithms to study what pages your friends have liked, how they describe themselves on their profile, and who their friends are, their software is designed to take out all the guesswork for you and deliver perfect gift recommendations. It’s just one more way that big data works for you and advertisers.
So tell us, how do you incorporate big data into your strategy for connecting with consumers?
June 6, 2014 - 1 month ago
We live, work and play in an API-driven economy. Apple has more than one million apps in its store, many of which wouldn’t exist without the ability to build off of other existing platforms like Twitter, Square and Google Maps. When a company decides to create an open API, it can connect to the ecosystem of existing apps and in turn bolster a company’s ability to drive revenue and innovate.
An API is, put simply, a way to share data between programs, services, or companies. Often this means an app talking to a database, or a script talking to a website. For example, Amazon connects its own services together with a federation of internal APIs, while Twitter makes its data available to the outside world with its API.
Open APIs’ Greatest Hits
Sharing data on open APIs with the Web community may initially seem counterintuitive to some companies. But if you’re serious about growing your platform, then you should consider allowing other hackers to tap into your API. And by “hackers” we mean people who make stuff, as opposed to “crackers” who break stuff. Hackers are always looking for interesting raw material for building interesting apps in innovative ways that can inspire your business thinking. After all, some of tech’s greatest hits (and likely future successes) have been born out of open API innovation.
Let’s look at Netflix for starters. A few of the streaming service’s most revered applications, including the algorithm that suggests which flicks you should watch next, are the result of developers experimenting with an open Netflix API. What’s even more exciting is that new innovations (and improvements!) are constantly created via open API competitions. Case in point: a recent submission at a Netflix hackathon produced a feature that uses data from FitBit to determine if you’ve dozed off while streaming a movie and pauses the film accordingly. While you won’t see this feature on your Instant Queue anytime soon, it’s clear that an open ecosystem fosters creativity.
Twitter is another example of a company that’s experienced success with an open API. By bringing other developers into the fold, they’ve acknowledged that they can build something bigger than themselves. Popular apps and platforms like TweetDeck and Hootsuite are the direct descendants of this way of thinking — both have not only augmented their user’s experience of Twitter, but have helped to foster a whole new segment of Twitter users. It’s part of how (and why) we founded 140 Proof, too. Because we could use Twitter’s API and access its infrastructure, we have been able to tap into that data and create real, actionable insights for our clients.
One place you might not expect for an Open API to crop up? The news industry. Of course that hasn’t stopped The New York Times from employing one, though: they’ve added it to their arsenal as a means of staying ahead of a rapidly shifting industry. This move enables other news sites to enrich their sites with content from The New York Times and consequently allows everyone greater access to high quality news content. As The New York Times has become fond of saying, “why just read the news when you can hack it too?”
Under Lock and Key
Of course not all tech companies have chosen to go the open API route. Facebook’s API, for instance, is more of a closed system, often to the frustration of many developers. They’ve claimed that this closed system has thwarted their ability to effectively create good apps for the platform and its users. Similarly, LinkedIn claims to have an open API ecosystem in place, but it’s contingent on a third party app’s ability to recruit new users to the site, or provide LinkedIn some other kind of direct benefit. A ‘one-way’ or closed API ecosystem like these sites’ threatens to stifle the innovation and creativity that developers can lend a company.
Another company that’s not keen on sharing its code with developers is music streaming service, Pandora. It’s actually one of the few music streaming companies that maintains a “less is more” policy when it comes to open APIs. They reason that open access to their API would mean that people could access their music without having to see advertisements — which are the crux of their business model. However, closing their API also puts their listener base at serious risk as they drift toward other services that allow them access on multiple platforms.
The Bottom Line
Facilitating an open API system is a good idea for a company that wants to push their product into becoming something more. But what does an open API really mean for a company’s bottom line and revenue stream? Opening a site’s architecture to the developing masses is just good economics. This collaborative ecosystem and creativity creates something of a software domino effect — smaller apps continue to build off of pre-established ones and help expand the company’s network. It’s an equation that clearly benefits both sides. Companies are able to add apps — they wouldn’t have had the resources to build — that complement existing products as well as grow their audience. The smaller apps benefit by having the opportunity to work with a pre-existing platform and its users.
In short, an open API not only enhances your product, it stands to grow your reach and revenue, too. Creating an open API ecosystem is a low-risk move (with a low cost, too) that essentially allows companies to outsource research and design projects. With just this minimal investment, companies clearly stand to gain a lot from an open API system. By limiting a product to a closed API, a company risks the potential of their product, and can stifle innovation.
Like the headline? You can get a “You Can’t Spell Capitalism Without API” T-shirt in the 140 Proof store.
June 3, 2014 - 1 month ago