Monday, 24 April 2017

60% of US internet homes have at least one connected TV device

"Year over year, the number of homes with an installed connected TV device increased by six million, now totalling 60 per cent of US Internet homes, according to the NPD Connected Intelligence Connected Home Entertainment report. As the number of connected TV homes continues to grow, the devices used to make those connections have shifted. In January 2017, streaming media players were the most commonly installed internet-connected TV device. Thirty-five per cent of US Internet homes now have a streaming media player, up from 29 per cent in 2016.
“The average connected home has three devices installed and able to deliver apps to their TVs, but the mix of those devices continues to change,” advised John Buffone, executive director, industry analyst, NPD Connected Intelligence. “Shifts are also occurring in the industry as TV manufacturers migrate to operating systems from Roku, Amazon and Google. This benefits content owners, as they can reach a larger audience through distribution on fewer platforms, and viewers, as they’ll be able to find more of the programming they want in a single location.”"

80% of Snapchat users use the app in restaurants

"Snapchat, the disappearing messaging turned mobile storytelling app, released a new ad product Wednesday that is a quick swipe at Facebook's big offer to advertisers and retailers: online to offline conversions.
That's jargon for Snapchat's pitch to help retailers get more products off their shelves and prove to them that ads on Snap helped create the magic behind those sales.
The feature, released out of beta, is called "Snap to Store." Snap also reported new data, compiled by Greenberg Strategy (commissioned by Snapchat), on what percentages of Snapchatters use the app at particular venues:
80% at a restaurant
66% at a shopping mall
50% at a gym
49% at an airport
Wendy's was one of Snapchat's early beta testers, along with 7-Eleven and Paramount Pictures.
Wendy's created sponsored geofilters in its U.S. stores that promoted the JalapeƱo Fresco Chicken Sandwich. According to Snapchat's internal data (that is verified by third-party platforms), the geofilter drove 42,000 visitors to a Wendy’s within seven days of viewing it."

Facebook Messenger has 1.2bn active users

"We now have over 1.2 billion people actively using Messenger every month. And I keep on hearing powerful stories about how our product is becoming a more important part of your daily lives. So from all of us here at Messenger, a heartfelt thank you to all of you for giving us a chance to build something good and more meaningful for you."
Source:  Post from David Marcus on Facebook, 12th April 2017

PetSmart bought Chewy.com for $3.35bn

"PetSmart has agreed to make the biggest e-commerce acquisition in history, putting a deal in place to snatch up fast-growing pet food and product site Chewy.com for $3.35 billion, according to multiple sources familiar with the deal.
The deal is a huge one by any standard — bigger than Walmart’s $3.3 billion deal for Jet.com last year — and especially for a retail company like PetSmart, which was itself valued at only $8.7 billion when private equity investors took it over in 2015.
But Chewy.com has been one of the fastest-growing e-commerce sites on the planet, registering nearly $900 million in revenue last year, in what was only its fifth year in operation. The company had been a potential IPO candidate for this year or next, but was taken out by its brick-and-mortar competitor before that. It was not profitable last year."

Tuesday, 18 April 2017

More than half of US broadband homes watch at least one OTT TV service like Netflix

"For many, this transition to watching over-the-top (OTT) content began with a subscription to Netflix. While Netflix can claim much credit for spurring this transition to OTT, there are emerging signs that the medium is now growing well beyond its largest player, as other services are now capturing the attention of viewers and staking out their respective positions in the market.
In December 2016, according to comScore data, more than 49 million homes – 53 percent of U.S. Wi-Fi connected homes – accessed at least one OTT service. Moreover, these households were active in viewing OTT content, doing so an average of 19 separate days during the month, and for 2.2 hours per usage day. OTT viewing mirrors linear TV with the highest concentration of activity happening during traditional Primetime hours.
While Netflix remains the clear leader in the OTT market, it’s also clear that other services are now establishing their own presence. Netflix reached an impressive 75 percent of OTT homes as of  December 2016, but YouTube had a large OTT footprint being viewed in 53 percent of those homes. Amazon Video was third with 33 percent reach, and Hulu was fourth at 17 percent. In fact, there are now 11 OTT services that reach one million or more homes in a given month.
While some may find it difficult to think of Netflix as second in anything, in terms of engagement, it’s number two with 28 hours of average viewing time per home. Sling TV, which makes a “skinny bundle” option that  features content from multiple networks, leads on a “per household” basis with 47 viewing hours per month.
Although three out of every four OTT homes do watch Netflix, it’s important to recognize that the remaining 25 percent of these homes watch only competing services. More than 30 percent of YouTube’s and Twitch’s TV audiences, for example, do not watch Netflix on the TV. For Hulu, it’s 14 percent.
Netflix’s dominance is also being challenged by Amazon Video, which appears to be growing the OTT pie through its tie-in to Amazon Prime and the Fire TV platform. At the time of this writing, Netflix is the top OTT service on every viewing platform from Roku to game consoles to Blu-ray Disc players, with one big exception: Fire TV. On the Fire TV stick/box, Amazon is first, followed by YouTube. Netflix is third.
OTT is a growing an increasingly important segment of the video viewing landscape, and the popularity of multiple services beyond Netflix suggests the market is poised for more growth. With 50 percent of households still yet to engage with OTT as of December 2016, there is a major opportunity for a number of services to help fill this vacuum. The question is whether – or to what extent -- Netflix can retain its leadership position in this space as that happens."
Note - I'm assuming that YouTube is just standard YouTube videos being watched on TV, rather than YouTube Red, the paid service.  

Facebook has over 5m active advertisers

"Facebook Inc plans to announce on Monday that more than 5 million businesses are advertising on the social network each month and that it is updating its suite of ad services to try to draw more small businesses onto its mobile platform.
Chief Operating Officer Sheryl Sandberg said in an interview with Reuters that the number of ad buyers was an important milepost, showing that Facebook has room to grow despite its massive scale.
The company said in September that it had 4 million advertisers, and in March 2016 that it had 3 million. The world's largest social network, which is free to users, has 1.9 billion people on it.
[...]
Among the 5 million advertisers, the biggest industries are e-commerce, entertainment/media and retail, the company said. Some 75 percent of them are outside the United States, and its fastest-growing markets are India, Thailand, Brazil, Mexico and Argentina, the company said.
Nearly 50 percent of the advertisers create ads on mobile devices, reflecting the increasing importance of smartphone-based usage to Facebook's future.
More than 90 percent of Facebook's users access the network through mobile devices, and mobile advertising accounts for 84 percent of ad revenue, the company said in February."

$20bn of rides were booked through Uber in 2016

"The ride-hailing giant more than doubled gross bookings in 2016 to $20 billion, according to financial information Uber shared with Bloomberg. Net revenue was $6.5 billion, while adjusted net losses were $2.8 billion, excluding the China business, which it sold last summer.
[...]
Uber’s business is massive and getting bigger. In the last three months of 2016, gross bookings increased 28 percent from the previous quarter to $6.9 billion. The company generated $2.9 billion in revenue, a 74 percent increase from the third quarter. Losses rose 6.1 percent over the same period to $991 million.
While the rate of sales growth compared with losses is encouraging, Uber is still losing a significant sum, said Evan Rawley, a business professor at Columbia University. “That’s a lot of cash to burn in a quarter,” he said. Jeff Jones, the company’s president of ridesharing who resigned last month, previously joked to staff that he joined Uber expecting P&L, meaning a profit and loss statement, but only found an L."

Instagram Stories has over 200m daily active users

"Today, we’re introducing new sticker tools that help you be even more creative, whether you’re sharing to your story or having conversations with your friends in Direct.
Over 200 million people now use Instagram Stories every day to keep up with friends and accounts they love. And with recent updates to Direct, it’s never been easier to have playful, visual conversations with close friends.
Now, with these new sticker tools, you have even more ways to turn your most casual, everyday moments into something fun to share."

Wednesday, 12 April 2017

UK Digital Ad Spend exceeded £10bn in 2016; Mobile up 51%

"17.3pc rise is highest annual growth rate for 9 years
• Mobile driving almost entire growth, up 51pc
• Mobile video the fastest growing ad format, up 103pc
Driven by advertisers’ need to tap into people’s rising use of mobile to watch content, digital advertising grew at its fastest rate for nine years – by 17.3pc to £10.3 billion in 2016 – according to the Internet Advertising Bureau UK / PwC Digital Adspend report. The last time annual growth was higher was 2007 (38pc).
As almost half (48pc) of UK internet time is now spent on smartphones, mobile ad spend rose 50.8pc to £3.87bn. Mobile now accounts for 38% of all digital ad spend, up from 4% just five years ago. However, it accounts for 63pc of video spend, 76pc of Content & Native (including social media news feeds) and 79pc of social media spend.
Mobile video is fastest-growing ad format
Spend on mobile video ads more than doubled (up 103pc) to £693 million – making it the fastest growing ad format. It accounts for 29pc of the total growth in digital ad spend.
The rise in mobile video ad budgets reflects online YouGov data showing that in the last six months, 54pc of British smartphone users watched video clips on their phone, with two-in-five of these saying they do more of this than a year ago. A significant number have also watched TV programmes (17pc) and films (11pc) on their smartphones. This behaviour is much more prevalent among 18-24 year olds, with 75pc watching short clips, 44pc watching TV and 33pc watching films on mobiles. Six-in-10 people who watched short clips, TV or Film on their phone did so whilst ‘out and about.’
The rise in people consuming mobile and video content has accelerated digital’s growth rate to its highest level for nearly a decade,” said the IAB UK’s Chief Marketing Officer, James Chandler. “Reaching the £10 billion threshold has been made possible by brands breaking the mould, trying innovative formats and making the most of video to reach and amaze people. It’s impossible to ignore the issues the industry is facing at the moment, but digital never stands still and these figures are testament to the long term strength and power of digital.”
Video – across mobile and PCs – is growing at 56pc, driven by outstream/social in-feed’s huge 234pc rise to £465 million. Outstream accounts for 43pc of all video spend but 56pc of mobile video. Pre- and post-roll video ad spend grew 12pc to £603 million (55pc share of all video).
Sebastien Bardin, Sony Mobile’s European senior digital marketing manager, added: "Online video is becoming a bigger priority, providing an impactful and cost-effective incremental reach. In particular, outstream video is great for engaging with our target audience in premium, trusted and viewable environments without disrupting their media consumption or being too intrusive."
Nearly three-quarters of display is traded programmatically
Display ad spend rose 26pc year-on-year to £3.77bn in 2016 – 72pc of which was traded programmatically (£2.71bn) – with significant growth coming from direct deals and private marketplaces.
“The biggest change in how display ads are sold is the rise of programmatic direct, which now accounts for nearly half of sales,” says Dan Bunyan, Senior Manager at PwC. "Right now, considerations such as brand safety mean the advertiser is rightly demanding more certainty in the placement of their ads and the industry is evolving quickly to find new solutions to address brands' needs in this dynamic environment"
Ad spend on social media sites grew 38pc to £1.73bn, accounting for nearly half (46pc) of display. Social media spend on mobile alone grew 54pc. Content & Native ad spend – which includes ‘advertorials’ and ads in social media news feeds – increased 28pc to £1.17bn (31pc of display).
Search and classifieds
Driven by mobile, which grew 48pc, paid-for search overall grew 15pc to £4.99bn – a 48pc share of digital ad spend. Classifieds, including recruitment, property and automotive listings, grew 8pc to £1.48bn (14pc share)."

Tuesday, 11 April 2017

dunnhumby's advice for FMCG advertisers on Facebook

"dunnhumby’s analysis shows that advertisers who planned campaigns with a relevant but broad reach, running for more than 6 weeks, at a frequency above 1 per person per week saw the greatest benefit from including Facebook on their media plans.
Combining these findings with those of the papers published last year, and applying the adjustment factors referenced, we are starting to see that for a campaign to achieve optimal sales lift, it should ideally be planned with a frequency ≥1 per person per week (not to be confused with f=1), across a duration of more than 6 weeks.
If an advertiser knows that people outside a core audience will not buy their products – perhaps due to them only being relevant to one life stage or one gender – then narrow targeting could be optimal, but more generally the rule is that a far greater return on ad spend will be achieved by aiming for as broad a relevant audience as possible."
Source:  Blog post by Facebook Business, 31st March 2017

Tesla 'spends less than $6 on advertising per car sold'

"Car makers spend hundreds of millions of dollars every year to promote their products. Anyone who has ever watched the TV series Mad Men got to see how aggressively ad agencies court the automakers to gain their business. One account can have an outsize effect on a firm’s bottom line.
A new report from Global Equities Research analyzes just how much each car company actually spends on selling its cars. Not surprisingly, makers of premium brands spend the most. For every Jaguar that finds a buyer,  parent company Tata Motors spends $3,325. Lincoln shells out $2,550 on advertising for every car it sells.
At the other end of the spectrum, Toyota and Honda spend the least, at approximately $250 per car. Keep in mind that those two companies sell a lot of cars. Any ad agency would be delighted to have their business. Also, those numbers are separate from their premium brands, Lexus and Acura.
A new study by Global Equities analysts Trip Chowdhry approximates that Tesla spends even less at $6 per vehicle. In an e-mail to investors this week, Chowdhry said “Tesla power and leverage is unprecedented. $6 of Ad Spent per Vehicle for the product generating more than $8 Billion in revenues and more than $14 Billion in bookings is unheard of in the Industry.”"
Note - I'm not sure of the full validity of this figure, but it's pretty clear that if you have a very famous and outspoken CEO, plus a product that people love you can rely a lot more on social media and PR.
(See also Brewdog, valued at £1bn, built on PR, social media, and events)