Monthly brandtech blend – May – Covid-19 special

Home Blends & Trends 4 May 2020

At fifty-five, a great part of our work is about educating our clients and explaining the latest changes and trends that are shaping the digital marketing industry.

As such, we would like to help you take advantage of this unusual hiatus to reflect on the stakes and goals of our jobs, deepen your digital knowledge, and continue to develop your tech expertise.

After more than a month of lockdown, what are the impacts on our data privacy, brands’ marketing strategies, in-housing, the revenue of tech giants, audio and SVOD platforms, and advertising in China?

Data helps to fight coronavirus, but at what cost?

How can we use data to help combat the pandemic, while ensuring privacy? Bluetooth, mobile, GPS, and medical data… There are many types available for different uses, from identifying infected people to preventing the virus’ spread, not to mention leveraging data to help medical research and predict the pandemic’s evolution. Governments and big tech companies are joining forces to find the answer, but each country seems to approach the issue in its own way. While Europe is facing internal discrepancies around data use due to its privacy protection policies, the overall approach leans towards using anonymised and aggregated Bluetooth data for contact tracing. China is using population location tracking on an individual level via smartphone data (initiated by the government, helped by local tech giants) as part of its long-existing mass surveillance policy. The United States is seeing many private initiatives from companies like Google and Apple, who have joined forces to co-create an anonymous contact-tracing network via Android and iOS to monitor the spread of the infection and build population movement patterns. 

Many topics are relevant when it comes to leveraging data to safeguard public health around the world, including transparency, security, personal freedom, and how to avoid mass surveillance. 

Read more on TechCrunch, or on CEPS.

In-housing faces its stress test

The primary goal of in-house marketing is to help brands regain control of their marketing activities and save money. During the pandemic, however, the efficiency of in-house agencies is at stake. Indeed, brands are asking their media agencies to invest decreased budgets across a range of media channels – something that in-house teams are more capable of doing. Moreover, these teams are fixed costs for companies whereas agencies’ fees change. Because some parts of agencies’ contracts cannot be completed during the crisis, brands are increasingly relying on in-house marketing. In-house teams are thus producing more cost-effective and less risky advertising content, in order to gain quick-win profit.

Read more on Digiday

Tech giants are taking advantage of shifting ad budgets

It’s actually a virtuous circle: publishers are seeing a bump in their subscription numbers during the coronavirus, and most of these subscriptions come from Facebook spending. Indeed, thanks to lower CPM and higher clickthrough rates, driving subscription through Facebook has become cheaper for publishers and they are making the most of it – for those who can afford advertising at all. 

On the other hand, retail media is also part of the winning team during the crisis, with Amazon leading the pack. Indeed, advertisers in clothing, electronics, personal care and consumer packaged goods are moving ad spending towards retail and grocery media channels like Amazon, or even Walmart or Target. As consumer behavior is drastically shifting towards e-commerce across all categories – even for people who had never shopped online before – and with the foretold death of third-party cookies, retail media channels are emerging as a very attractive source of first-party data.

Read more on Digiday.

Brands change marketing strategies, and consumers respond

Although a lot of brands have lost confidence and aren’t sure how to address their consumers anymore, some brands have decided to show up and encourage consumers to stay at home, while sending a call to action to their communities. Whereas big brands such as Coca-Cola or Airbnb are cutting their advertising investments, Converse has decided to maintain them and launch a #CreatatHome campaign, involving company employees such as creatives, stylists, photographers, and models. The goal is to showcase creative work and leverage digital media platforms, especially TikTok, Instagram, and Twitter. The Telegraph is actually running a study on consumer sentiment towards advertising in the current context in order to help brands adapt their message accurately.

Read more on Digiday.

For podcasts and SVOD platforms, the show must go on

No commuting, no problem: the podcast industry doesn’t seem to be suffering from the crisis. Indeed, platforms such as Vox Media or Entercom showed increased listenership. Podcasts are simple – both to listen to and to produce – and are available on demand,which encourages advertisers to continue investing in the medium, even during the pandemic. Moreover, if a brand wants to change its message, assets can be redone in a matter of days when it’s for a podcast. Brands that continue to invest in podcasts are mostly larger, whereas DTC venture-funded brands and direct-response advertising are cutting their budgets. 

Read more on Digiday.

SVOD platforms are also profiting from the pandemic. Netflix announced outstanding results for the first quarter of 2020: a total of 167 million subscribers worldwide (+15 million for Q1) which led the company to beat its own stock record. The company is now worth more than $190bn. Netflix, however, is not immune to the current challenges, such as filming new content or facing new competition. Indeed, Disney+ has already reached 50 million subscribers in only six months of activity and despite only being available in 14 countries. Other competitors are also emerging such as NBC Universal’s Peacock which recorded 15 million subscribers in one week, and HBO Max’s upcoming launch. But Netflix has a unique string in its bow: a very broad catalogue, which none of its rivals can compete with… yet.

Read more on The Drum, and The Verge.

Ad activity picks up in China – a light at the end of the tunnel? 

Media and news companies say that they are seeing a comeback in advertising activity in China, with pending contracts finally being signed and campaigns which had been paused being restarted. The virus has devastated ad revenue in the industry and 88% of publishers expect to fall short of their forecasted results this year. As news publishers have been seeing record traffic over the past few months, advertisers are starting to invest again, and some brands are launching new products, such as a new handset from Huawei skincare and repair products for skin issues caused by protective masks from beauty brands.

Read more on Digiday.

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