Media Consumption

In the Facebook-faceprint tussle, score one for the little guys.

Phillip Nones Business, Content Creation and Content Management, Government, Media, Media Consumption, Publishing, Security, Social Commentary, Social Media , , , , , , , , , ,
Is that Maria Callas? Check with Facebook -- they'll know.
Is that Maria Callas? Check with Facebook — they’ll know.

I blogged last year about privacy concerns surrounding Facebook’s “face geometry” database activities, which have led to lawsuits in Illinois under the premise that those activities run afoul of that state’s laws regarding the use of biometric data.

The Illinois legislation, enacted in 2008, requires companies to obtain written authorization from subjects prior to collecting any sort of face geometry or related biometric data.

The lawsuit, which was filed in early 2015, centers on Facebook’s automatic photo-tagging feature which has been active since around 2010. The “faceprints” feature – Facebook’s term for face geometry – recognizes faces based on the social network’s vast archive of users and their content, and suggests their names when they appear in photos uploaded by their friends.

The lawsuit was filed by three plaintiffs in a potential class-action effort, and it’s been mired in legal wrangling ever since.

From the outset, many had predicted that Facebook would emerge victorious.  Eric Goldman, a law professor at Santa Clara University, noted in 2015 that the Illinois law is “a niche statute, enacted to solve a particular problem.  Seven years later, it’s being applied to a very different set of circumstances.”

But this past week, a federal judge sided not with Facebook, but with the plaintiffs by refusing to grant a request for dismissal.

In his ruling issued on May 5th, U.S. District Court Judge James Donato rejected Facebook’s contention that the Illinois Biometric Privacy Information Act does not apply to faceprints that are derived from photos, but only when it’s based on a source other than photos, such as in-person scans.

The Judge roundly rejected this contention as inconsistent with the purpose of the Illinois law. Donato wrote:

“The statute is an informed consent privacy law addressing the collection, retention and use of personal biometric identifiers and information at a time when biometric technology is just beginning to be broadly deployed. Trying to cabin this purpose within a specific in-person data collection technique has no support in the words and structure of the statute, and is antithetical to its broad purpose of protecting privacy in the face of emerging biometric technology.”

This isn’t the first time that the Illinois law has withstood a legal challenge. Another federal court judge, Charles Norgle, sided against Shutterfly recently on the same issues.

And Google is now in the crosshairs; it’s facing a class-action lawsuit filed early this year for its face geometry activities involving Google Photos.

Clearly, this fight has a long way to go before the issues are resolved.

If you have strong opinions pro or con about social networks’ use of face geometry, please share your views with other readers in the comment section below.

Bing Plays the Bouncer Role in a Big Way

Phillip Nones Advertising, Business, Creative and Production, Marketing, Marketing Communications, Marketing Research, Media, Media Consumption, Publishing, Sales , , , , , ,

untitledMicrosoft Bing has just released stats chronicling its efforts to do its part to keep the Internet a safe space. Its 2015 statistics are nothing short of breathtaking.

Bing did its part by rejecting a total of 250 million ad impressions … banning ~150,000 advertisements … and blocking around 50,000 websites outright.

It didn’t stop there. Bing also reports that it blocked more than 3 million pages and 30 million ads due to spam and misleading content.

What were some of the reasons behind the blocking? Here are a few clues as to where Bing’s efforts were strongest (although I don’t doubt that there are some others that Bing is keeping closer to its vest so as not to raise any alarms):

  • Healthcare/pharma phishing attacks: ~2,000 advertisers and ~800,000 ads blocked in 2015
  • Selling of counterfeit goods: 7,000 advertisers and 700,000+ ads blocked
  • Tech support scams: ~25,000 websites and ~15 million ads blocked
  • Trademark infringement factors: ~50 million ad placements rejected

Bing doesn’t say exactly how it identifies such a ginormous amount of fraudulent or otherwise nefarious advertising, except to report that the company has improved its handling of many aspects based on clues ranging from toll-free numbers analysis to dead links analysis.

According to Neha Garg, a program manager of ad quality at Bing:

“There have even been times our machine learning algorithms have flagged accounts that look innocent at first glance … but on close examination we find malicious intent. The back-end machinery runs 24/7 and used hundreds of attributes to look for patterns which help spot suspicious ads among billions of genuine ones.”

We’re thankful to Bing and Google for all that they do to control the incidence of advertising that carries malicious malware that could potentially cause many other problems above and beyond the mere “irritation factor.”

Of course, there’s always room for improvement, isn’t there?

Mobile shopping goes majorly mainstream.

Phillip Nones Business, Demographics, Marketing Research, Media Consumption, Sales, Social Commentary , , , ,

untitledFor years, the common perception has been that consumers tend to use their laptops, tablets or mobile devices to research purchases while ultimately visiting a store to make the actual purchase.

And up until now, most studies have shown that no matter what type of digital device consumers use to shop, large majorities prefer to complete the sale in a store or at the mall.

But now a new study is telling us something different. The research, conducted by questioning ~1,000 U.S. consumers by research firm Ipsos, shows that shopping frequency in physical stores hasn’t kept pace with the growth of smartphone shopping.

According to Ipsos, over the past year there has been a significant increase in the amount of smartphone shopping, with two-thirds of respondents reporting that they are doing more of this today:

  • Shopping more frequently via smartphone: ~64%
  • Shopping more frequently via tablet: ~60%
  • Shopping more frequently via desktop computer: ~57%
  • Shopping more frequently via laptop computer: ~57%

At first blush, these figures don’t seem startling at all, considering the rise in the consumer economy over the past year or so.  Moreover, ~41% of the survey’s respondents reported that they haven’t made a significant change in their frequency of shopping in physical stores.

But in considering the ways respondents reported how and where they’ve been shopping less frequently over the past year, the differences appear much more stark:

  • Shopping less frequently via physical store: ~30%
  • Less frequently via desktop computer: ~11%
  • Less frequently via laptop computer: ~11%
  • Less frequently via tablet: ~11%
  • Less frequently via smartphone: ~9%

It even goes further than that. The two groups which seemed most inclined to shop less frequently in physical stores were younger consumers (age 25 and under) as well as consumers who earn more than $100,000 per year.

Add to this the propensity for younger consumers to be using smartphones and tablets more often than their older counterparts, and it’s clear that some of the most prized demographic categories are migrating to smartphone shopping in a big way.

The implications for traditional retail could not be more clear:  adapt your business model or else.

Momentous milestone? U.S. advertising dips below 1% of GDP for the first time in living memory.

Phillip Nones Advertising, Business, Economics, Media, Media Consumption, Sales , , , , , , , ,

sdThe advertising industry has often been characterized as “boring.”  This 2014 analytical article from Bloomberg encapsulates the argument pretty succinctly.

Still, the “lay of the land” in the late 2000s and early 2010s represents a bit of a changeup from the previous decades of predictability.

During the period beginning the late 2000s when the “advertising recession” hit in an even bigger way than the overall U.S. economic recession, I’ve heard various industry insiders posit that there was more than merely a retrenchment happening due to overall economic conditions.

Beyond that, it was suggested that a migration was happening away from traditional advertising methods to more measurable ones.

Now we have more than just hunches to go on — and the results appear to be aligning with those suspicions.

The new evidence comes in the form of statistics released this week and reported on by MediaPost.

According to an analysis of ad spending trends published by Sanford Bernstein Research and Magna Global, for the first time in modern history U.S. advertising industry revenues have dropped below 1% of total U.S. Gross Domestic Product.

During the period 1999 to 2010, total advertising averaged 1.25% of GDP, but since then the percentage has stagnated or fallen. The 2014 total advertising estimate of $165 billion is 0.95% of GDP.  (The Bernstein/Magna research covers U.S. advertising revenues up through the year 2014.)

tbThe decline in advertising’s share of GDP is primarily due to the diminishing importance of two key traditional media categories: broadcast TV and cable TV.

Broadcast TV advertising’s annual revenue growth averaged around 3% per year between 1990 and 2010.  Since 2011, it’s been flat.

Cable TV has done somewhat better – but even there what had been around 12% growth per year has slowed to just a ~3% annual increase.

With such big baseline numbers for broadcast and cable TV, the behavior of these two broadcast categories have been key drivers of the advertising sector’s overall performance.

But we mustn’t forget another category that’s been performing pretty miserably of late: newspaper advertising.  It’s experienced a ~10% decline on a compound annual basis from 2010 to 2014.

That decline is even steeper than earlier projections had suggested.

Todd Juenger, a vice president and senior analyst at Sanford Bernstein, made a key takeaway observation about the newly published figures, noting:

“Our original piece theorized [that] advertising would recover to prior levels. Instead, it has remained deflated, suggesting the perhaps the Internet really has enabled marketers to eliminate waste.”

He’s right, of course.

Magazine Profitability Strategies: Prevention Magazine Goes for a Radical Solution

Phillip Nones Advertising, Business, Economics, Manufacturing, Media, Media Consumption, Publishing , , , , , ,

pmWhen a business model becomes problematic, sometimes the only solution is to step outside the circle with some seriously radical thinking.

That seems to be what magazine publisher Rodale has done with its flagship media property, Prevention magazine.

As reported by Jeffrey Trachtenberg this past week in The Wall Street Journal, beginning with the July issue, Prevention will no longer accept print advertising.

It’s a major step for a publication as venerable as Prevention, in print since 1950 and an important player in the magazine segment focusing on nutrition, fitness and weight loss.

According to the Trachtenberg piece, Prevention magazine has actually seen an increase in ad pages – up over 8% to 700+ ad pages in 2015 over the year before.  But here’s the rub:  ad revenues were actually down because of circulation losses.

The magazine hasn’t turned a profit in a number of years, either, although other related Rodale titles have (Runner’s World and Men’s Health).

The radical surgery planned for the publication means that the number of pages of a typical magazine issue will decline dramatically. So the cost of printing and shipping will go down.  In order to make up for the loss in ad revenue, the magazine’s subscription price is set to more than double to nearly $50 per year.

Price-conscious as consumers are, that action is expected to drive circulation figures down even further – from around 1.5 million to roughly 500,000 if the company’s projections are correct.

Is this an ingenious idea that will preserve and strengthen a highly regarded publication? Or a desperate action that will end up simply driving this magazine into oblivion in a novel way?

Maria Rodale

Maria Rodale, CEO of the family-owned publication company, thinks the former. As she stated to reporter Trachtenberg:

“We’re walking away from revenue but we’re also walking away from a lot of expense. Let’s serve our readers and charge them for it.”

Rodale anticipates that Prevention magazine’s operating expenses will be reduced by more than 50%.

What are the implications of that?  Maria Rodale again:

“If you have to run the numbers out with an advertising model, it’s hard to see it ever getting to profitability. With a non-advertising model, it quickly becomes profitable.”

… But I’m not so sure. This radical departure from the traditional ad-supported publication model may pay short-term dividends.  But will it turn out to be merely a momentary respite before the next downward slide – this time into irrelevance?

With so much information being so easily accessible online (and free of charge) – particularly in the areas of preventive health – I can easily envision fewer and fewer people wishing to shell out $50+ per year for the benefit of receiving a monthly publication that may or not contain highly relevant and valuable information each and every issue.

What do you think? Is this a silver-bullet solution?  Or a zinc zeppelin?

For many people, what’s “breaking news” isn’t breaking on traditional news media outlets.

Phillip Nones Content Creation and Content Management, Demographics, Economics, Media, Media Consumption, Publishing , , , , , , , , , , , ,

First it was Jon Stewart. Now it’s social media. 

(AP)
(AP)

If you suspect that Americans are increasingly getting their news from someplace other than the standard TV/cable, print and online news outlets, you’re right on the money.

In fact, research conducted by the Pew Center in association with the Knight Foundation during 2015 reveals that the share of people for whom Facebook and Twitter serve as a source of news is continuing to rise.

More specifically, nearly two thirds of the 2,000+ Americans age 18 and older surveyed by Pew (~63%) reported that they’re getting news reporting from Facebook.

A similar percentage reported receiving news from Twitter as well.

That compares with ~52% reporting that they received news from Twitter back in 2013 … and ~47% from Facebook.

Although both of these social networks now have the same portion of people getting news from these two sources, the Pew research discovered some nuanced differences as to their strengths.

smnA far bigger portion of people follow “breaking news” on Twitter compared to Facebook (~59% versus ~31%), which underscores Twitter’s strength in providing immediate “as-it-happens” coverage and commentary on live events.

Seeing such behaviors, it shouldn’t come as any surprise that both social networks have been implementing more initiatives that strengthen their positions as news sources even more:

  • Facebook has launched Instant Articles, a functionality that allows media companies to publish stories directly to the Facebook platform instead of linking to outside websites.
  • Facebook has also introduced a new Trending sidebar that allows users to filter news by major topic categories such as sports, entertainment, politics, technology and science.
  • Twitter has introduced live events to its roster, thanks to its purchase of the live video-streaming app Periscope.
  • A related Twitter initiative, dubbed Moments (aka: Project Lightning), allows anyone – even a person without a Twitter account – to view ongoing feeds of tweets, images and videos pertaining to live events.

According to Pew, news exposure is on social media roughly equal among all demographic factors including gender, ethnicity and income. The one exception, of course, is age.

All of these developments underscore the fact that the “traditional” TV, print and online outlets are no longer dominant when it comes to news consumption. And it’s highly unlikely that the trend will ever be reversed, either.

The Federal Trade Commission vs. Native Advertising: Score One for the FTC

Phillip Nones Advertising, Branding, Business, Content Creation and Content Management, Marketing, Marketing Communications, Media, Media Consumption, Publishing, Social Commentary, Social Media , , , , , , , , ,

ptpbIt’s pretty much a given these days that “native advertising” has it all over traditional advertising when it comes to prompting prospects to try a new product or service. Study after study shows that positive recommendations and ratings from family members, friends, key influencers and even simply fellow users are what prompt people to try it for themselves.

These dynamics mean that suppliers are looking for as many opportunities to publicize their offerings through these native channels as they can.

There’s a bit of a problem, however. Bloggers and other influencers have become wise to this reality — and many are taking it all the way to the bank.  The market is replete with conventions and other events such as the annual Haven Conference, at which these key influencers congregate and “hold court” with suppliers.

While there is no prescribed agenda regarding what’s discussed between suppliers and influencers, generally speaking there’s a whole lot of quid pro quo going on:  Things like receiving copious free samples in exchange for publishing product reviews, receiving monetary payments for mentioning products and brands in blog articles and on social media posts, and more.

One can’t really blame the influencers for peddling their influence to the highest bidder. After all, many successful bloggers and other influential people derive most or all of their livelihood from their online activities.  It’s only natural for someone whose influences ranges widely and deep to expect to be compensated for publicizing a product, a service or a brand — whether or not they themselves think it’s the best thing since sliced bread.

But there’s a growing problem regarding the “pay to play” aspects of native advertising. This past December, the Federal Trade Commission reiterated its opinion that such sweetheart deals are tantamount to advertising, and therefore must be prominently identified as such in online and other informational content.

Of course, including a prominent announcement that payment has been exchanged for an influencer’s commentary significantly lowers the positive impact of native advertising, in that the commentary being valued by consumers precisely because of its inherent objectivity and credibility is no longer much of a hook.

Until recently, it wasn’t clear how strict the FTC was going to be about enforcing its stated policy about disclosing financial remuneration for brand coverage by influencers.

L+TLWell, now we know.  It’s in the form of a settlement reach this month by the FTC with retailer Lord & Taylor over a particular online ad campaign that contained native advertising and social media components.  It’s the first time the FTC has brought an enforcement action since its native ad guidelines were published.

The settlement pertains to a promotional campaign for Lord & Taylor’s Design Lab private-label line of spring dresses. The initiative reached more than 11 million Instagram users, and the particular sundress at the center of the publicity campaign sold out quickly as a result.

The native advertising portion of the promo effort stemmed from an article about DesignLab that appeared in the online magazine Nylon.  That article was paid for by Lord & Taylor, which also reviewed and approved the article’s content prior to publication.

As could be expected, no notification that the piece was a paid ad placement was included when the article was published.

Skating close to the edge even more, the social portion of the promo campaign involved the retailer giving the sundress to approximately 50 top fashion bloggers, along with paying each blogger between $1,000 and $4,000 to model the dress in photos that were then posted to Instagram.

The bloggers were allowed to style the dress in their own way, but they were asked to reference the dress in their posts by using the campaign hashtag #DesignLab as well as @lordandtaylor.

Furthermore, the retailer reviewed and approved these social media posts before they went live, which enabled them to make stylistic edits before-the-fact as well.

Here’s an excerpt from the FTC’s statement about the Lord & Taylor action:

“None of the Instagram posts presented to respondents for pre-approval included a disclosure that the influencer had received the dress for free, that she had been compensated for the post, or that the post was a part of a Lord & Taylor advertising campaign.”

Clearly, the FTC is now putting muscle behind its 2009 opinion (and reiterated last year) that failing to disclose that an endorsement has been paid for is a deceptive practice.

In this particular “test case,” Lord & Taylor is getting off somewhat easy in that there have been no monetary penalties levied against the retailer. However, the company has signed a consent decree that is in place for the next two decades, which would mean “swift and stiff” penalties if the retailer were to transgress in the future.

Other terms of the settlement mandate that Lord & Taylor require its endorsers to sign and submit written statements outlining their obligation to “clearly and conspicuously” disclose any monetary or other material connections they have to the retailer.

Clearly, the Lord & Taylor settlement is a shot across the bow by the FTC, signifying that it means business when it comes to alerting consumers of the financial or other material connections that exist between influencers who are making value judgments on products and services.  In effect, the FTC is saying to the marketing world, “Be very careful …”

It’ll be interesting to see how marketers finesse the challenge of figuring out how to corral the obvious benefits of native advertising while mitigating the dampening effects of “full disclosure.”

Perhaps bloggers and other influencers will need to re-think their own business models as well, seeing as how the “golden goose” of supplier perks seems to have lost some of its luster now.

Stay tuned — this new “lay of the land” is still unfolding.

For authenticity in advertising … perhaps it’s time to stop making it “advertising.”

Phillip Nones Advertising, Branding, Business, Demographics, Marketing, Marketing Communications, Media, Media Consumption , , , , , ,

AT

Take a look at the interesting data in the chart above, courtesy of Nielsen.

Among the things it tells us is this: If there’s one thing that’s universally consistent across all age ranges – from Gen Z and Millennials to the Silent Generation – it’s that nothing has a more positive impact on buying decisions than the recommendation of a family member, a friend or a colleague.

Not only is it true across all age ranges, it’s equally true in business and consumer segments.

The chart also shows us that, broadly speaking, younger people tend to be more receptive to various advertising formats than older age segments.

this isn’t too surprising because with age comes experience – and that also means a higher degree of cynicism about advertising.

Techniques like the “testimonials” from so-called “real people” (who are nonetheless still actors) can’t get past the jaundiced eye of veteran consumers who’ve been around the track many more times than their younger counterparts.

Someone from the Boomer or Silent Generation can smell these things out for the fakery they are like nobody else.

But if friends and colleagues are what move the buy needle the best, how does advertising fit into that scenario? What’s the best way for it to be in the mix?

One way may be “influencer” advertising. This is when industry experts and other respected people are willing to go on record speaking positively about a particular product or service.

Of course, influencers have the best “influence” in the fields where they’re already active, as opposed to endorsements from famous people who don’t have a natural connection to the products they are touting. Such celebrity “testimonials” rarely pass the snicker test.

But if you think about other people like this:

  • An industry thought leader
  • A prominent blogger or social networker in a particular field or on a particular topic
  • A person with a genuine passion for interacting with a particular product or service

… Then you have a person who advocates for your brand in a proactive way.

That’s the most genuine form of persuasion aside from hearing recommendations from those trusted relatives, friends and colleagues.

Of course, none of that will happen without the products and services inspiring passion and advocacy at the outset. If those fundamental factors aren’t part of the mix, we’re back to square one with ineffective faux-testimonials that feel about as genuine as AstroTurf® … and the (lack of) results to match.

Antisocial behavior: Major retailers do much better broadcasting on social media than they do responding.

Phillip Nones Branding, Business, Content Creation and Content Management, Direct Marketing, Human Resources, Marketing Communications, Media, Media Consumption, Social Media , , , ,

untitledWhen it comes to social media, it turns out that the major U.S. retail brands are a lot better at dishing it out than consuming it.

On the “dishing out” side of the ledger, these retailers have been posting an ever-increasing number of social messages aimed at their target audiences.

A recent report from Sprout Social Index titled Snubbed on Social shows just how much:  In the 3rd Quarter of 2014, the average number of messages deployed by the typical major retailer was around 150, but in the 3rd Quarter of 2015, the number had grown to in excess of 350.

But what happens when these retailers are on the receiving end of social messages? Sprout Social has determined that the typical retailer receives around 1,500 inbound social messages over a busy quarter (such as during the holiday season).

Of these, approximately 40% of the messages are ones that warrant a response.

But only about 1 in 6 – fewer than 20% of them — actually get one.

And those consumers who are fortunate enough to receive a response are waiting approximately 12 hours to get it. That’s up from ~11 hours a year earlier.

One interesting factoid from the Sprout Social reporting is that customer messages on Twitter tend to get a better response from brands.

But it’s the difference between merely poor (~14% on Twitter) and downright embarrassing (~9% on Facebook).

untitledScott Brandt, chief marketing officer at Sprout Social, states it succinctly: “More often than not, brands are silent when their customers reach out.”

What are the implications of this (non-)behavior?

For one thing, interacting with customers helps drive more interesting and more purchases.  Sprout reports that consumers are seven times more likely to respond to social promotions and other social news if they have had meaningful interaction with the brand.

Obviously, ignoring the social messages that come through isn’t the way to build that engagement.

One dynamic that appears to be at work is that brands continue to use social media as a vehicle for broadcast messaging, whereas many consumers view social platforms as the place for a more conversational, two-way level of engagement.

You know – just like social media is supposed to work.

But there are some seemingly intractable reasons why it’s difficult to put the “theory” of social interaction into “practice.”

For starters, there are so many ways for people to communicate with companies and brands today (versus only by letter, phone or in person not that many years ago), that too many businesses are either stretched to thin or simply don’t feel the need to respond urgently if at all.

Another issue is similarly personnel-related. For brands to respond better would mean hiring and training people who possess the authorization to actually do something about a question or concern.  Low-level staff with low wages and benefits and with no authority to resolve issues is a clear ticket to nowhere.

At the very least, putting a process in place that provides a quick response to all inquiries – even if the initial response is auto-generated – is just plain common sense. The value to the consumer of a response that comes within just a few minutes – even if the message was posted in the dead of night – is what makes consumers bond with a brand.  (Just having their existence validated is huge for some people.)

Contrast that to the other, more common experience of brands ignoring their consumers to death … and where people never forget which companies aren’t good at responding to their questions or concerns. Does anyone think that reputation doesn’t have a dampening effect on sales?

More information about the Spout Social Index can be found here.

Facebook reigns supreme among smartphone apps — at least in the United States.

Phillip Nones Business, Media, Media Consumption, Social Media , , , , ,

faWhich was the most popular smartphone app in the United States during 2015? If you guessed Facebook, you’d be correct.

According to Nielsen estimates, the Facebook app notched more than 125 million average unique users per month during 2015. It was an ~8% increase in the app’s user volume over the previous year.

The second most popular smartphone app was YouTube, but at fewer than 100 million, its average unique user volume was substantially lower than Facebook’s.

The Nielsen estimates are calculated based on a monthly survey of 30,000+ mobile subscribers age 13 and older in the United States, as well as a panel of ~9,000 English-speaking adults (age 18+).

Here is Nielsen’s “Top Ten” chart for the most popular smartphone apps in 2015:

  • Facebook app: ~127 million average unique monthly users
  • YouTube: ~98 million
  • Facebook Messenger: ~96 million
  • Google Search: ~95 million
  • Google Play: ~90 million
  • Google Maps: ~88 million
  • Gmail: ~75 million
  • Instagram: ~56 million
  • Apple Music: ~55 million
  • Apple Maps: ~47 million

Within the top ten list, the two apps with the highest user growth in 2015 were Facebook Messenger, which charted an increase in average monthly users of ~31%, and Apple Music, with ~26% growth.

Also noted by Nielsen, the level of smartphone penetration ticked up yet again in 2015, so that today four out of five mobile subscribers are using a smartphone rather than a feature phone.

fa anAs for the ongoing competition between Apple and Android for smartphone hegemony, it remains a real donnybrook but with Android ahead.

As of Q3 2015, Android devices represented ~52.5% of the subscriber base whereas ~42.5% of Americans used Apple iOS devices to access their apps.  (The remainder is made up of Blackberry users and phones operating on Windows.)

Additional information about the Nielsen evaluation and analysis can be viewed here.  It will be interesting to see how these trends might change in 2016.  Would anyone care to make any predictions?