Tuesday, April 19, 2016
One of the competitive advantages of the ad tech community is that they are positioned as the low cost medium with CPMs as low as $1.00 for ad impressions. To achieve this low price, these companies have automated the content publishing (via user generated) and the ad buying process as part of their business model. This is a huge competitive advantage for the ad tech sector versus traditional media organizational structures, who have editorial and sales teams and ad rates in the $10-50 CPMs range. At these rates, it sounds like they are dumping ad inventory in an oversaturated market to get market share.

 

This huge price advantage suggests further pain for publishers in the competition for on-line ad sales. As one president of a mid-size ad agency told me “ Business sucks, it’s tough to survive in the digital age”. This  observation offers the media industry little comfort in today’s environment. So what are we to do as an industry? We are told that we have to go digital to prosper, but it is tough to compete against the ad tech community as they eat up more share of the ad market each year. So let's take a page out of their playbook, instead of them taking one from ours like the packaging of content marketing and native ads that follows the rules of magazine publishing. Let's see where we can automate tasks.

One of the great benefits of technology is that it can automate repetitive tasks that can save on labour costs and increase staff productivity. I still remember the first wave of automation technologies in the publishing industry during the late 1980’s where typesetters, mechanical layout artists, stats cameras, digital retouching and film were are part of the production process and replaced with an Apple Macintosh computer with desktop publishing software and eventually direct to print technology.  Art Directors in this period of transition needed to update their skills as the coloured marker and pieces of paper was becoming obsolete in the creative process and replaced with a keyboard and mouse.

Technologies used to automate today are robot calls and email broadcasts for mass communication. On websites content is published through a CMS and the use of e-commerce check-outs for online sales. For operations there are CRMs, accounting, design, digital edition/app solutions, database and pre-press digital systems. As publishing operations we always strive to get leaner and there is an automation technology that can help with web content at no cost to publishers.

CNW has a content automation tool/widget that publishers can use as content on their site for free. ‘’The CNW News widgets helps provide current content at no cost for a blog or news site,’’ says Nadine Tousignant, Manager, Media and Audience Relations for CNW. The source content is from press releases and it appears as content on your website based on editorial and geographical criteria. The publisher provides a blank web page link on the site and CNW provides the code for the content automation that fills the page. The news feed will appear on the site as a special section with a five story teaser feed that can appear on the home page.

We tested this technology on the Masthead and the COPA sites and it works well as the widget enables the publisher to automate the process of reviewing press releases that may be relevant for your audience. In our case Masthead will have media news and on the COPA site we used digital news filters. For transparency with the reader  the content  is clearly identified as a news feed from CNW.  To read the content, they are not directed to the CNW website, but it appears on the host’s website with the graphic branding intact. All traffic on the web site generated by the content is tracked by the host web sites reporting system so content integration with current processes is seamless. All content that is distributed on the site is reported back to the issuer and helps raise the profile of the media brand as a secondary benefit.

 

 

 

This solution can help small publishers compete against the ad tech community’s competitive advantage of free content and will only take a few of hours for your web person to set it up. The time saving through this content automation concept surely has some benefits to consider. This type of content automation can only complement the information provided on the website as original and insightful—thought cannot be generated by an algorithm and that costs money. This looks like a win-win situation for publishers; they can get free content for their website and CNW’s clients get better press coverage in this two way relationship.

There will be a growing wave of marketing automation technologies that you will be pitched from companies promising the benefits of data management and integrating the data with your marketing efforts. They will claim that this will handle your leads and sales better versus what you are doing now. The system will monitor all reader entry points like social media, email and web site plus customer data that is processed by an analytics algorithm. The algorithm creates a personalized customer profile that will help improve customer service and lead nurturing at each stage of the sales cycle. Geez this sound like a modern circulation plan, maybe they took this idea from our playbook too.
Tuesday, March 15, 2016
The smartphone has change the way society interacts with each other. Who would have predicted that the personal communication device unveiled in the Star Trek series from the 1960’s would become a reality in 2016, but it has.

 

The increase in functionally and use of smartphones has created a side effect not anticipated by the inventors, just like prescription drugs. It started out in the business community as the "Crackberry" addiction and now has spread to “Smartphone Zombie” status and governments are taking action to ensure the safety of their citizens as it spreads.

How are people addicted to their smartphones? This chart from Catalyst Canada and GroupM Next on the Canadian Mobile Market 2015 shows 22 different ways people are distracted using their smartphone with games, banking/bills, twitter/Facebook , weather and directions as the top five uses. Texting and phone stats was not reported in the study.

 

A Smartphone Zombie is a person that goes in a trance and does not notice any of their surroundings and their dependency on the smartphone shuts off other senses and rational behaviour. To have some fun on the topic, below is a top 10 list of in-effective habits for smartphone zombies. See if you are one.

 

 
The Top 10 In-Effective Habits of Smartphone Zombies 

If you have suffered from three or more of these habits or symptoms, please go to a smartphone addiction counsellor as you are at risk of becoming a zombie—which is a terminal condition as you will be part the living dead.

1. In a crowded room you hear a beep and grab your smartphone in a nervous twitch. This is an early symptom of being a smartphone zombie, diagnosed as the Crackberry addiction.

2. You are constantly checking your smartphone for email wherever you go, even in meetings with real people. Another early warning sign, you will need to go to a life fear management session or get a medical marijuana prescription so you can calm down.

3. When your battery is dead you suffer from anxiety attacks, as people cannot reach you. This is another symptom of the Crackberry addiction; it is best that you not use the smartphone for 48 hours until the anxiety subsides.

4. You hide in a room and text with your friends. You forget how to communicate verbally with friends and family. This “zombie like trance” of non-verbal communication is a  clear sign that you lack any people skills and will lead to a dysfunctional state of mind.

5. When you misplace your smartphone you have a panic attack when you search your house or work looking for the smartphone. If you suffer from these panic attacks you better go see your doctor, as this is unhealthy as this may lead to other medical conditions.

6. Looking at your smartphone while walking and bumping into a person, mailbox or pole. In the UK due to the high number of zombie accidents on pedestrian walkways they plan to have padded poles on all sidewalks and in China they have smartphone lanes where people cannot stand still in.

7. Crossing the street while texting and not noticing it is a red light. This is one of the more dangerous habits as you may only do this once, except in NY where drivers are accustomed to people walking through red lights. Apparently, in Georgia texting and walking or driving is still OK.  Must be the right to free speech thing they like to talk about a lot in the USA.

 8. You sleep with your smartphone in bed as it makes you feel secure. If you tend to have this phobia, you better go to the country or cottage and get some rehab and disconnect for a while. You better get a teddy bear to help with the withdrawal symptoms during your 60 day rehab.

9. Slowing down traffic at a traffic light while checking for a text or email message. You ever notice why a car is standing still at a stop light while its green. Now you know. This can be a cause of driver fury on the roads from these in-attentive drivers.

10. Texting while driving and causing a traffic accident by hitting the car in front of you. It has been estimated that 23% of all car accidents are caused by texting and driving. My guess repeat offenders in the future will have to disconnect their phone before the car can start, just like they do for drinking and driving.

Through a little humour and bad jokes, I want to rekindle the “ technology vs. people“ debate with the use of a smartphones zombie metaphor, as it seems that society is becoming a slave to technology and that is not right. This can happen with publishers if you let technology drive your business process and not the other way around. Publishers should be in control, as technology is not always right, but in fact has a high failure rate.

In the January 2016 issue of Direct Marketing News on CRM technology, Leigh-Ann Clarke states that the failure rate of CRM technologies is estimated at 30-70%, as the design focus is on software rather than the customer. So perhaps, the marketing and advertising opportunities in the mobile world for publishers is overrated, if we assume the same failure rates as a benchmark. But at the same time, 40-50% of web traffic and email newsletter is now mobile so there is an opportunity for publishers, just not as big as was thought. Just a thought to ponder.
Thursday, February 18, 2016
The engines that drive the great world wide web are data centres. These are nodes on the Internet that connected to everybody and I want to take you on a  behind the scenes tour of a data centre that host all the applications and data. I reached out to Cover-All, a company based in Toronto to get a tour of their 10,000 sq. ft. datacentre. Cover-All offers, data centre management, cloud computing and outsourced IT services for their clients.

When I arrived at their facility, before I entered where all the hardware is located, I had to go through three doors that required a security pass to enter and was also equipped with video surveillance.  The Cover-All data centre is comprised of a control room, mainframe computers, storage devices that includes a robotic vending machine storage tape system, six 20-ton air conditioners, two 120 batteries back-up power units and two back-up diesel generators.

To ensure that the data has the most uptime there are systems in place to retrieve any lost data on back-up storage tapes or a mirror image of the data on another computer in a different location for disaster recovery scenarios. In case of a power outage the batteries engage for up to 17 seconds and then the twin diesel engine kicks in with enough fuel for 72 hours. There is always built into a data centre set-up, back up and double back up plans to ensure 24/7 uptimes for data and power.

 

 

 

 

 

The facility is protected from physical on-site attacks, network intrusions (logic attacks/ password security) and cyber attacks (hackers). Datacentres need to be certified (CSAE3416 compliance) in Canada and must have an annual security audit to be an accredited facility. There is a cloud of secrecy of the location of data in the industry as data theft is a prominent concern in all security protocols and being secretive is the norm.  You can imagine the security protocols for a VISA transaction datacentre that is as large as a football field; it is a virtual Fort Knox.

According to industry estimates there were 8 million data centres (source: IDC), in the world in 2014 with 3 million in the USA up from half a million in 2011 (Source: Emerson). I expect these estimates are below actual figures due to the secrecy in the industry. The growth of the number of data centres mirrors the growth of the use of smartphones and video consumption online. It has been estimated that there are 4.9 billion devices connected to the Internet in 2015 in a world where the population is 7.4 billion. The world’s largest data centre is located in Lanfang, China with a facility that measures 6.3 million sq. ft. This is equivalent to 43 Costco Warehouses that average 144,000 sq. ft. or 154 Canadian Tire Stores at 40,000 sq. ft.

These facilities need lots of power and some consume enough power of a small town. To cut down on power costs large-scale data centres favor cold climates, as cooling costs are 50% of power costs and is lower in cold climates. Barrie has become a Canadian hub and is home to BMO, TD Bank, Cogeco and IBM as these firms have built facilities in Barrie in the past few years.  A major USA hub is in Loudoun, Virginia, which is home to 60 data centres and boasts that 70% of world Internet traffic flows through their data centres. Some data centres have adopted green power strategies and some use solar and hydro to help power their Internet factories.

When choosing a data centre or web hosting facility, publishers must keep in mind of the privacy laws of that country where the data centre is located as data is not treated equally in each country. For example in the USA all data is subject to the Patriot Act (ie: terrorist security protocols) and other locations might not have the same security protocols and audit systems in place that have been established in Canada and the USA.

These power hungry internet factories are part and parcel of the digital industrial revolution and sometimes it is hard for me to fathom that you can reach over 1 billion websites in the world with the click of a mouse. On top of that there is a cloud of secrecy in the operations of the data centre so we should adopt the honour code from the movie “Fight Club”, please don’t talk about what you learned in this month’s posting or you may get a visit from the Sons of Anarchy Motorcycle Club.

Thursday, January 21, 2016
The growth of the adtech segment in the advertising world has gone through various lifecycle stages as seen in other industries. An adtech company is Google, Facebook, MSN, Yahoo, YouTube, Taboola, ad networks etc. The phases of any industry are early adoption, great growth, mass adoption and finally maturation where sales peak. For the ad tech industry I would guess estimate it is in early maturation phase as sales are starting to level out. The best indicator of this is the recent 28% decline in Apple stock in the past year.

 

As this community grew up they have learned a few lessons about what makes a good advertising media model. This learning curve includes criticisms on privacy, security, spam, malware, automated web traffic, ad fraud and now ad blocking.

There is a growing community of web users that have been irritated by all the ad tricks being used that include click bait, deceptive articles and flash ads. You can read my May 2011 blog posting on my Top 10 ways you can irritate and repel you reader, as they are still relevant today.
   
This band of users have established guidelines on what is acceptable advertising online and we need to listen, as they are telling us what ads works with them and would be a great creative guideline to adhere to as I agree with their concerns. Below is what they define as acceptable ads that the publishing industry should take notice of.

What is an acceptable Online Ad?
1) Acceptable Ads are not annoying:
People don't need to be tricked into clicking. Advertising can rise above the noise by being useful – and even tasteful. The blinking and jiggling just annoys the real buyers, means the people who do click did it either out of curiosity or because they are an unsupervised 6-year-old. Either way, an intrusive ad is not going to generate a sale – and it might just get you some negative press and ill will.

2) Acceptable Ads do not disrupt or distort page content:
Users can very well become interested in an ad, but advertising is not the reason one visits a website. You visit a site for its content, and therefore the page should not be sullied by ads that disrupt or obscure that content without permission – pop-ups and pop-unders, pre-roll video ads and the like. When ad placement and structure are done well, they may actually inspire you to explore more without resorting to nasty tricks.

3) Acceptable Ads are transparent with us about being an ad :
If it's an advertisement, just say so! There's a place for ads, and there's a place for editorial. And there's even a place for advertorials or native ads if they're not camouflaged as editorial content. Good stuff is always welcome, but it needs to be genuine.

4) Acceptable Ads are effective without shouting at us:
We could be in the library, or on an airplane, or in a meeting … you never know when we're going to click on an ad. So please don't embarrass us with blaring sounds by default. If we want to listen, we'll click.

5) Acceptable Ads are appropriate to the site we are on:
Website publishers need to manage the user experience with the user's benefit in mind: don't let inadvertently selected advertisers harm your brand. Accepting just any kind of ad to be shown on your website might be profitable in the short term, but allowing advertisers to compromise the user experience with obnoxious ads – or even scams – will not pay off in the long run. In short, Acceptable Ads aim to be appropriate to the audience of the site they are displayed on.

This movement is part of the growing use of ad blocking software worldwide and according to a Page Fair/Abobe 2015 Report on Ad Blocking. The report states that it has grown to 198 million users worldwide in June 2015 from 21 million in 2010, 900% growth in five years with Europe leading the way with 77 million users, followed by the USA at 45 million.

These early adopters of ad blocking software are millennials (18-34), technically savvy and male. The reasons they starting using it was because of the misuse of private data via surveillance marketing (50%) and the increase in the volume of ads (41%). It seems that Gamers (26.5%), social network (19.1%() and Tech/Internet sites (17.1%) are the hardest hit by this ad blocking movement. (Page Fair is a firm that supplies a solution for ad blocking software)
 
 

How does an ad blocker work? Well, it is simple, all you need to do you is add an extension in your settings feature in your Chrome browser and you are ready to go. AdBlock is offered by getadblock.com for free/honourware and is one of three apps listed in the Google Chrome Extension app store and boasts it has 40 million users.

I have tested it on my computers and it works great as it filters all ads even the pre-roll video on tv shows and sports highlights. The software, however, does not block ads that part of a digital edition as they are embedded and are not delivered by an ad server. In addition websites load faster and is a secondary protection against ad malware.

Here is a funny video ad from the company:



 
 

One of the other ad blocking app firms is AdBlockPlus and they have a whitelist approach that allows websites to have their ads bypass the ad filter if they meet the “Acceptable Ads” criteria stated above. This is a free service for websites with 10 millions impressions or less, but it has been rumoured in the Financial Times that AdBlockPlus is charging a 30% cut of ad revenue for websites over this 10 million threshold. The irony of this is that people signed up to be ad free and then they are letting firms through by paying a fee, sort of the troll over the bridge business model or what I call “Extortionware.” These tactics are just part of the dog eat dog culture of the ad tech community and growing frustration and dissatisfaction with the ad tech industry.

This market force is part of the looming digital shakedown of the adtech community that I see growing in momentum in 2016 that media publishers can capitalize on. Based on what I am seeing and experienced the digital revolution is over in publishing as we are seeing a lot of recycled ideas in the marketplace, a growing digital burn-out by consumers and a cut-the-chord trend for cable tv influencing this opinion. As publishers we will need to listen to this growing voice for decisions you make on your digital strategy on whether it will be effective.  The time for us to stand together united and say we are the best media choice is now upon us, as an industry like creating Canada’s Publishing Industry Ad  Creative Guide based on the Acceptable ads criteria.
Wednesday, December 23, 2015
If I had a Christmas wish for the publishing industry it would be a recipe for the right mix for a modern media brand and a market opportunity to hitch a ride on. I think in 2016 both of these wishes may come true.

The first market opportunity I see is a web creditability problem, with the growing concern in the media buying community of automated traffic created by bots and spiders on the internet being estimated as high as 40-50% of global traffic. Current web stats cannot accurately tell the difference between a robot and real person. The only clues are single page visits and traffic from certain countries. This is a window of opportunity for media publishers to gain a competitive advantage in the market as publishers can deliver “real people” through a digital subscription model to compete against other digital ad offerings. The industry is also well positioned as the trusted content leaders to defend the content turf from the native advertising threat. Maybe the industry can use fear to their advantage instead of being subject to digital fear tactics.

 
The second opportunity is the resurgence in print in book publishing as sales for digital has peaked at an estimated 20-30% of industry sales in the USA, with a growing trend of digital to print readers. Digital did not kill the book industry as it did the music and video rental industry in spite of all hype from the tech industry.  I have also seen digital subscriptions for controlled free publications level off around 50%, which supports this trend in reader behaviour with digital adoption plateauing. So print is still very important part of the mix after the digital shakedown from the tech industry as they have moved on to the banks and cars as their next targets.

For a recipe for the best digital mix we can look to La Presse (French Daily newspaper based in Montreal) for inspiration. In 2011, it boasted a circulation of 263,000 for their Saturday print edition and now it sits at 136,000 in 2015, a 48% decline in print readership. In 2013 La Presse launched a tablet app that has a reach of over 500, 000 (This app won silver on the COPA 2014 awards) users. In September 2105, La Presse announced that in 2016 they would only publish a print version 1x week instead of 6x and concentrate on digital.   

LA PRESSE AUDIENCE PROFILE

 

 

 

 

La Presse is a shining example of what is working in the 24/7 news media space with a website, tablet app, mobile version and print edition, what I called the hybrid model. The weekend print edition enables La Presse to stay in the game for the lucrative retail flyer market. What was really smart in the app they created was that it was designed for the screen, took advantage of the benefits of technology and adapted to the scrolling habits of  readers. La Presse’s success has not gone unnoticed, as it is the technology behind the new Toronto Star app that was launched this year.

While the app model is a good distribution channel, my concern is that there is no subscriber database to build a business around long term as all the downloads are through a third party vendor and they will also own your subscribers. The app model also closes the door to other ways readers engage with your brands, as computers still have 50% share of the digital use. That is why I still like browser based digital edition technology for magazines as the publisher has complete control of the brand and owns the subscriber database.

Taking a typical magazine (8" x 10") size and transferring it to the web with this technology has had limited success as it is hard to read. It also requires a zoom to read as the text may be too small. That is not an optimal solution, as it has to be just like print – look and read; not look, zoom and read. The digital magazine is a useful digital subscription (free or paid) tool that delivers real people online and provides space for larger ads vs smaller ads (Leaderboard and Big Box) on websites that are not as effective.

Here is an example of the digital edition of Harrowsmith Country Life (client of mine) that is optimized for the screen (ie: it is just as convenient as print as you do not need to zoom when reading). Harrowsmith is a digest size magazine, which happens to be the optimal dimensions for a digital edition magazine with engagement similar to print readers ie: 50% spend more than 1/2 hour reading.

Harrowsmith is now published 4x a year and its print/digital hybrid model is printed 2x a year.  The demand for print is still strong with paid newsstand sales of over 55,000 copies for the Fall Almanac edition and 30,000 copies for the Spring Garden issue. As we all know, paid is the ultimate proof of readership.

 

 

So there you go, my Christmas wish list for the publishing industry that includes a recipe for digital success and a market opportunity to hitch a ride on. The publishing industry needs to forge their own path in 2016 as a united group to compete in the digital landscape, not just copy what everybody else is doing in a me-too strategy. 

The ability to create a qualified audience that delivers real eyeballs has always been an industry strength and is even more important now in the digital age. My personal Christmas wish is that technology be used to create world peace and harmony. Have a nice holiday!

PS: Masthead is a sponsor of FFWD Advertisng and Marketing week that is being held in Toronto, Jan 25-29. You can enter in a draw for a pair of tickets at this link. Winner will be announced on Jan 11.


About Me
Martin Seto

 
Martin Seto is the principal of Reflex Media, a media consultancy practice offering media owners digital publishing, event management and ad sales help. His media expertise also include working with ad agencies as a media buyer/planner for tv, radio, print, outdoor, magazine and online. He has been in the advertising and media industry for 25+ years and he has been an instructor/speaker with Centennial College and at magazine conferences across Canada. He can be reached at marty(dot)seto(at)
reflexmediasales.com or 416-907-6562, and on LinkedIn.

Most Recent Blog Comment
Steven Threndyle says:
Look, as Mad Men proved, well designed ads are sexy and people for the most part love 'em. As creato...
Blog Archive
2016 (4)
2015 (12)
2014 (12)
2013 (12)
2012 (12)
2011 (12)
2010 (8)