Facebook attempts to clean up its act.

Is it enough?

Watching Facebook these days as it pivots from diffusing one “rude development” to another seems a little like watching someone perform a combination plate-spinning and whack-a-mole act.

We’ll call it the Facebook Follies.  The question is … is it working?

Last month, Facebook issued its newest Community Enforcement Report – a document that updates the world about improvements the social media giant is making to its platform to enable it to live up to its stated community standards.

Among the improvements touted by the latest report:

  • Facebook reports now that ~5% of monthly active accounts are fake. (Still, 5% represents nearly 120 million users.)
  • Facebook reports now that its ability to automatically detect “hate speech” in social posts has jumped from a ~24% incidence in 2018 to ~65% today. (But this means that one-third of hate speech posts are still going undetected.)

Moreover, Facebook now reports that for every 10,000 times Facebook content is viewed by users:

  • ~25 views contain content that violates Facebook’s violence policy
  • ~14 views contain content violating Facebook’s adult nudity and sexual activity policy
  • Fewer than 3 views contain content violating Facebook’s policies for each of these categories: global terrorism; child nudity, and sexual exploitation

The community enforcement information is being reported as “wins” for Facebook … but people can’t be faulted for thinking that Facebook could (and should) be doing much better.

zm
Facebook CEO Mark Zuckerberg

On a different type of matter, this past week it was reported that Facebook has agreed to settle a class-action complaint that accused the social platform of inflating viewing metrics on Facebook videos by up to 900%.

Although details of the settlement haven’t been revealed, this development appears to close the book on criticisms that were lodged as far back as 2016, in which advertisers charged that Facebook hadn’t investigated and corrected errors in its metrics — nor allowed for third-party verification of the metrics.

It’s yet another agenda item that’s now been ticked off the list – at least in Facebook’s eyes. But now another controversy has now erupted as reported over the past few days in The Wall Street Journal.

Described in a front-page article bylined by veteran WSJ reporters John McKinnon, Emily Glazer, Deepa Seetharaman and Jeff Horwitz, Facebook CEO Mark Zuckerberg appears linked to “potentially problematic privacy practices” that date all the way back to 2012, when Facebook signed a consent decree with the Federal Trade Commission but that it may have violated subsequently.

Contemporaneous e-mail communications retrieved from the time period suggest that Zuckerberg was more than merely passively involved in deliberations about a particular app that claimed to have built a database stocked with information about millions of Facebook users. Purportedly, the app developer had the ability to display the Facebook user information to others — regardless of those users’ privacy settings on Facebook.  The e-mails in question detail speculation about how many other apps were stockpiling such kinds of user data, but the evidence shows little or no subsequent action being taken to shut down the data mining activities.

Another view.

These latest developments raise questions about the veracity of Facebook’s stated intentions to redouble its efforts to uphold community standards and focus more on user privacy, including moving toward encrypted and “ephemeral” messaging products that are better aligned with the European Union’s existing privacy laws that the United States may also be poised to adopt in the future.

Apparently Facebook recognizes the problem: It’s ramping up its global advertising spending to “rebuild trust” — to the tune of doubling its previous ad expenditures.  Here’s what Facebook’s marketing head Antonio Lucio is saying:

“There’s no question we made mistakes, and we’re in the process of addressing them one after the other.  But we have to tell that story to the world on the trust side as well as the value site.”

Ad-tracking company Kantar notes a big increase already in Facebook’s U.S. ad spending — up to nearly $385 million in 2018 compared to only around $50 million the year before.  As for the campaigns themselves, Facebook is relying on a number of big-name ad agencies like Wieden+Kennedy, Leo Burnett and Ogilvy for developing its various campaigns.

Another view.

There’s more than a little irony in that.

Considering the latest news items, what are your thoughts about Facebook? Are they on the right track … or is it “too little, too late”?  Are their intentions honorable … or are they simply engaged in “window dressing” to get people off their case?  Let us know your thoughts.

Drivers are more worried about distracted drivers than drunk drivers.

But then again, we’re just as guilty.

A recent survey of ~1,800 adult American drivers conducted by Wakefield Research has found that the top safety concern they have is distracted drivers on the road – a factor cited by ~70% of the respondents.

This far outstrips concerns about people driving under the influence of alcohol or other stimulants – a concern that was cited by just ~45% of the respondents.

But in a classic example of “do as I say, not as I do,” a clear majority of the survey respondents (~58%) reported that they check their own mobile devices when driving.  Perhaps we believe that our own skills are far above those of the average driver …

This squares with the findings another survey conducted recently by analytics firm Zendrive. That research found that 85% of drivers feel that distracted driving is a problem.  Despite those concerns, nearly half of the Zendrive survey respondents (~47%) admit that they themselves use their phones 10% of more of their time while driving.

Phone usage while driving seems pretty high overall, with nearly 6 in 10 reporting that they talk on the phone, half use maps or other navigation tools, and nearly 4 in 10 text while driving. Let’s take these results at face value … but I wonder if the actual behaviors are even more slanted towards mobile phone usage than the stats suggest.

We can at least give credit to the respondents for acknowledging that what they’re doing isn’t particularly kosher, since ~83% of them admitted that they put down their phones when they see law enforcement on the road.

And here’s one other finding that I found particularly interesting: nearly 40% of the survey respondents reported that their own children have asked them to stop using their phone while driving.

Talk about parent-shaming – and the parents admit it!

More findings from the Wakefield research can be viewed here.

Do you find these findings surprising, or about as you expected? Please share your thoughts and observations with other readers here.

Twitter, in Four Sentences

Terry Teachout

Back in 2015, Wall Street Journal columnist, author and arts critic Terry Teachout had a few choice comments to make about Twitter — then as now one of the more controversial of the social media platforms.

With the passage of time — as well as significant elections, referenda and other socio-political developments intervening — it’s interesting to go back and read Mr. Teachout’s comments again.

From his perspective, in 2015 Teachout had postulated that the essence of Twitter could be boiled down to four statements, as follows:

  • How dare you talk about A, when B is infinitely more important?
  • If I disagree with you, you’re almost certainly arguing in bad faith — and are probably evil as well.
  • You are personally responsible, in toto and in perpetuity, for everything that your friends, colleagues, and/or ancestors have ever said, done, or thought.
  • (Statements #2 and #3 do not apply to me.)

Looking at these statements, it’s pretty remarkable how little has changed.

Or has it? What do you think?

[In an interesting side-development, Terry Teachout’s own Twitter account was hacked in 2018 — several years after he published his statements above.  As he recounts here, trying to get all of that sorted out with the social media platform was it’s own special kind of misery, even if ultimately successful.]

Pandora’s Box: Spotify is poised to become the #1 music streaming service in the United States.

This past month, digital marketing research firm eMarketer issued its new forecast on music streaming activities in the United States. What it shows is that Pandora, which has dominated the market ever since the category was created in 2000, will likely fall to the #2 position, overtaken by Spotify.

Based on a calculation of internet users of any age who listen to music streaming on any device at least once per month, Pandora jas occupied a narrow band of between 72 million and 77 million listeners since 2015.

During that same period, Spotify users have increased dramatically, from ~24 million to ~65 million Americans. And eMarketer projects that Spotify will overtake Pandora by 2021.  The chart below shows the trajectory:

Actually, the trend had been building since even before 2015. In 2012, Pandora had ~67 million users compared to Spotify’s paltry ~5 million.  But Pandora has been shedding users in recent years.  As the chart above illustrates, by 2023 Pandora will have lost nearly 10% of its users since 2014.

To be sure, Pandora still holds a robust ~35% of audio listener penetration in the United States as of this year. But Spotify is nipping at its heels with a ~32% share.  Amazon Music (~18%) and Apple Music (~16%) are further back, but with still-significant chunks of the marketing.  (It should be noted that there is overlap, as some listeners may engage with more than one music streaming service during the month.)

What has caused the change in fortunes? Christ Bendtsen, an eMarketer forecasting analyst, says this:

“Pandora lost users last year because of tough competition from other services attracting people to switch. Apple Music has been successful in converting its iPhone user base.  Amazon Music has grown with smart speaker adoption, and Spotify’s partnerships have expanded its presence across all devices.”

Speaking in particular about Spotify’s rapid surge, Bendtsen notes:

“Spotify’s initial growth was driven by its unique combination of music discovery, playlists and on-demand features. But now that all music streaming services [possess] the same features, Spotify’s future success will rely on partnerships with other companies.  It has teamed up with Samsung, Amazon, Google and Hulu to be on all devices and provide bundled offerings.  We expect more partnerships to come, leveraging multiple brands, devices and services to drive user growth.”

As for Apple Music, there’s a reason it lags behind other music streaming services in the rankings. That service operates on a subscription-only model and doesn’t offer any form of advertiser-supported free usage.  Forecasters expect it to remain in the #4 position with its “premium-only” business model.

More information about the eMarketer music streaming forecast is available here.

What are your own music streaming listening habits? Have they changed in recent years, and if so, how and why?  Please share your thoughts with other readers.

What are the most stressful jobs in America?

Soldier, firefighter and police officer positions are obvious, but jobs in media are right up there, too.

It’s human nature to complain about workplace stress. But which jobs are the ones that actually carry the most stress?

If you ask most people, they’d probably cite jobs in the military, police and firefighting as particularly stressful ones because of the inherent dangers of working on the job. Airline pilots would be up there as well.

And yes, those jobs do rank the highest among the many jobs surveyed about by employment portal CareerCast in its newest research on the topic. But of the other jobs that make the “Top 10 most stressful” list, several of them might surprise you:

Most Stressful: CareerCast Stress Scores by Profession (2019)

#1. Enlisted military personnel (E3, 4 years experience): 73

#2. Firefighter:  72

#3. Airline pilot:  61

#4. Police officer:  52

#5. Broadcaster:  51

#6. Event coordinator:  51

#7. News reporter:  50

#8. PR executive:  49

#9. Senior corporate executive:  49

#10. Taxi driver:  48

According to the CareerCast research findings, based on an evaluation of 11 potential stress factors including meeting deadlines, job hazards, physical demands and public interaction requirements, more than three-fourths of respondents in the 2019 survey rated their job stress at 7 or higher on a 10-point scale.

The most common stress contributors cited were “meeting deadlines’ (~38% of respondents) and “interacting with the public” (~14%).

Upon reflection, it’s perhaps understandable why workers in media positions feel like they are under particular stress – what with “fake news” claims and a constant barrage of criticism from both the left and the right which can go beyond being simply irritants into some much more stress-inducing.

What if someone wanted to make a career change and switch to a job that’s at the opposite end of the stress scale? CareerCast has identified those positions, too.  Here are the “least stressful” jobs as found in its 2019 research results:

Least Stressful: CareerCast 2019 Stress Score by Profession

#1. Diagnostic medical sonographer:  5

#2. Compliance officer:  6

#3: Hair stylist:  7

#4. Audiologist:  7

#5. University professor:  8

#6. Medical records technician:  9

#7. Jeweler:  9

#8: Operations research analyst:  9

#9. Pharmacy technician:  9

#10. Massage therapist:  10

Interestingly, one might assume that the most stressful jobs in America would carry a commensurate salary premium, but that doesn’t turn out to be the case.  The average median salary for the Top 10 “most stressful” jobs in America is hardly distinguishable from those of the Top 10 “least stressful” jobs – differing by only around 4%.  It seems like those latter workers are onto something!

More information about the CareerCast findings can be viewed here.

Private label branding: Recession or no, it’s a trend that’s here to stay.

During the Great Recession of 2008-10, it was no surprise to see an increase in private label product sales – not just in food products but also in apparel, cosmetics and other consumer categories.

That was then …

It was much like a similar recessionary time in the United States history — back in the 1970s — when some supermarkets began selling “generic” packaged and canned goods. Those offerings celebrated their generic status by emphasizing their lack of branding – ostensibly to demonstrate that by cutting back on marketing and advertising costs, product pricing to the consumer could be kept lower.

The generic movement didn’t last. When the economic go-go times returned in the mid-1980s, consumers were more than happy to forego the cheaper offerings and go back to their favorite brands.

But the situation is different today. The Great Recession may now be a decade in the rearview mirror, but the private label brands they spawned are going strong.  In fact, they’re thriving as never before – and in some ways are eating the legacy brands’ lunch.

… This is now.

Several factors are fundamentally different from before. For one, products that compete on price are no longer being marketed as “generics” but rather as brands in their own right.  Brand names like Kirkland, Archer Farms and Essential Everyday look and feel like Kraft, Kellogg’s and other longstanding brands – and for the most part their quality is indistinguishable as well.

Equally important is that fact that there’s no longer any particular stigma associated with shopping “cheap” private label brands. It turns out that consumers in every income category appreciate a bargain; no one wants to feel like they’re being ripped off when there are good quality “best-value” alternatives available.

The usually prescient Warren Buffet appears to have been caught a little off-guard by the changing landscape, recently expressing surprise (and alarm) about this development. His Berkshire Hathaway enterprise took a $3 billion hit in the face of disappointing earnings as Kraft-Heinz share prices dropped more than 25%, thanks to strong competition from the private label alternatives.

Consider these eyebrow-raising statistics: Costco’s Kirkland house brand notched sales of $39 billion in 2018, which is substantially higher than Kraft-Heinz’s total brand sales of $26 billion.

Indeed, the consumer foods industry is witnessing this happening all over the place. Amazon may not be developing its own private brands like Costco or Target have done, but it is working diligently with food and beverage manufacturers to develop private label offerings to sell exclusively on Amazon’s own website.

Looking at the macro environment, the United States is running at historically low unemployment rates today, but that hasn’t stunted the phenomenal growth of discount grocery chains like Aldi and Lidl. Aldi has come from practically nowhere several years ago to threaten becoming America’s 3rd place grocery retailer, behind only Walmart and Kroger.  Aldi has done so by pursuing an über-aggressive private label strategy that’s targeting younger, middle-income shoppers in particular.

Note that Aldi is training their sights on more than just budget-conscious consumers, which have traditionally been the narrower audience for private label brands. It turns out that the “stigma” some might have attributed to the “cheap” image of private label foods isn’t there any longer.

For younger consumers especially, such “status” concerns are of no pertinence at all. Whereas the typical grocery cart today contains ~25% private label products, among millennials the proportion is more like one-third.

Based on these trends, it’s little wonder that a recently released Thomas Index Report reports that sourcing activity for private label foods is up more than 150% year over year.

And while the growth of private label products is most pronounced in the food, paper goods and household supplies sectors — and has had the most disruptive consequences there — other sectors like apparel and cosmetics are seeing similar developments.

[Let’s not forget private label pharmaceuticals, too, where price differences are often dramatically lower than just the 15-20% differential we see in the food sector.]

The bottom line is this: Recession or no, cheap has become chic.  It’s a trend that’s here to stay.  The legacy brands won’t be able to wait this one out and expect better days to come along again.

Restaurants face their demographic dilemmas.

There’s no question that the U.S. economy has been on a roll the past two years. And yet, we’re not seeing similar momentum in the restaurant industry.

What gives?

As it turns out, the challenges that restaurants face are due to forces and factors that are a lot more fundamental than the shape of the economy.

It’s about demographics.  More specifically, two things are happening: Baby boomers are hitting retirement age … and millennials are having children.  Both of these developments impact restaurants in consequential ways.

Baby boomers – the generation born between 1946 and 1964 – total nearly 75 million people. They’ve been the engine driving the consumer economy in this country for decades.  But this big group is eating out less as they age.

The difference in behavior is significant. Broadly speaking, Americans spend ~44% of their food dollar away from home.  But for people under the age of 25 the percentage is ~50% spent away from home, whereas for older Americans it’s just 38%.

Moreover, seniors spend less money on food than younger people. According to 2017 data compiled by the federal government, people between the age of 35 and 44 spend more than $4,200 each year in restaurants, on average.  For people age 65 and older, the average is just $2,500 (~40% less).

Why the difference? The generally smaller appetites of people who are older may explain some of it, but I suspect it’s also due to lower disposable income.

For a myriad of reasons, significant numbers of seniors haven’t planned well financially for their retirement.  Far too many have saved exactly $0, and another ~25% enter retirement with less than $50,000 in personal savings.  Social security payments alone were never going to support a robust regime of eating out, and for these people in particular, what dollars they have in reserve amount to precious little.

Bottom line, restaurateurs who think they can rely on seniors to generate sufficient revenues and profits for their operations are kidding themselves.

As for the millennial generation – the 75 million+ people born between 1981 and 1996 – this group just barely outpaces Boomers as the biggest one of all. But having come of age during the Great Recession, it’s also a relatively poorer group.

In fact, the poverty rate among millennials is higher than for any other generation. They’re majorly in debt — to the tune of ~$42,000 per person on average (mostly not from student loans, either).  In many places they’ve had to face crushingly high real estate prices – whether buying or renting their residence.

Millennials are now at the prime age to have children, too, which means that more of their disposable income is being spent on things other than going out to eat.

If there is a silver lining, it’s that the oldest members of the millennial generation are now in their upper 30s – approaching the age when they’ll again start spending more on dining out.  But for most restaurants, that won’t supplant the lost revenues resulting from the baby boom population hitting retirement age.