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Advertising’s COVID Consolidation

Phillip Nones Advertising, Business, Marketing Communications, Media, Social Media , , , , , ,

The triumvirate of Amazon, Facebook and Google surge to even bigger dominance in the field.

Fueled by their ability to target audiences by attitudinal and intentional factors in addition to demographic characteristics, the “Big Three” platforms of Facebook, Amazon and Google were already heavy hitters in the advertising realm well-before COVID-19 burst on the scene.

To wit, they accounted for nearly 50% of all advertising expenditures in the United States in 2019.

Then the coronavirus pandemic hit, resulting in changes overnight in how people work and live.  Thanks to lockdowns — and with more people than ever glued to digital platforms for everything from business communications to entertainment and online shopping — advertisers found the audience-targeting capabilities of the Big Three platform too irresistible.

So in 2020, even as every other kind of ad spending shrank – including double-digit drops seen in newspaper, TV and billboard advertising – online advertising continued to grow.  Even more significantly, the biggest gains in online advertising accrued to the Big Three tech giants rather than to digital media sites and publishers that sell online ads.

When the dust settled, 2020 turned out to be the first year the Big Three swept up more than half of all ad dollars spent in the United States, according to an analysis by ad agency GroupM. 

… And in online advertising specifically, the Big Three’s share jumped from an already dominant ~80% in 2019 to nearly 90% in 2020. Ad industry veteran Tim Armstrong (formerly in executive positions at AOL and Google), puts it succinctly:

“[The] companies that are data science-driven get stronger and faster with a tailwind of usage — and COVID was a hurricane.”

The coronavirus environment proved to be fertile ground for the Big Three even in areas previously inhospitable to them — including such categories as store promotions, catalogues and couponing.

As the nation emerges from the COVID environment in the coming months, one wonders if the newly dominant position of the Big Three will retrench in any meaningful way.  Speaking personally, I wouldn’t bet money on it.  But what are your thoughts?

Weighing in on America’s most trusted brands.

Phillip Nones Branding, Business, Social Commentary , , , , , , , , , , , ,

tutdIf someone were to tell you that the Unites States Postal Service is the most trusted brand in America right now, that might seem surprising at first blush. But that’s what research firm Morning Consult has determined in its first-ever survey of brand trust, in a report issued this past month.

Survey respondents were asked how much they trust each of the brands under study to “do what is right.” The ranking was determined by the share of respondents giving the highest marks in response to the question – namely, that they trust the brand “a lot” to do what is right.

The USPS scored 42% on this measure. By comparison, runner-up Amazon scored ~39% and next-in-line Google scored ~38%.

Wal-Mart rounded out the top 25 brands, with a score of ~32%.

The Morning Consult survey was large, encompassing more than 16,000 interviews and covering nearly 2,000 product and service brands. The size of the research endeavor allowed for evaluation based on age demographics and other segment criteria.

Not surprisingly, ratings and rankings differed by age.  Unsurprisingly, the USPS is ranked highest with the Gen X and Boomer generations, whereas it’s Google that outranks all other brands among Gen Z and Millennial consumers.

mibAnother finding from the research is that of the 100 “most trusted” brands, only two were established after the year 2000 – Android and YouTube. That compares to 20 of the top 100 most-trusted brands that were founded before 1900.  Clearly, a proven track record – measured in decades rather than years – is one highly significant factor in establishing and maintaining brand trust.

Also interesting is the study’s finding that brand attributes related to product or service “reliability’ are far more significant over factors pertaining to “ethics.” Shown below are the factors which two-thirds or more of the survey respondents rated as “very important”:

  • Protects my personal data: ~73% rate “very important”
  • Makes products that work as advertised: ~71%
  • Makes products that are safe: ~70%
  • Consistently delivers on what they promise: ~69%
  • Provides refunds if products don’t work: ~68%
  • Treats their customers well: ~68%
  • Provides good customer service: ~66%

By contrast, the following factors were rated “very important” by fewer than half of the respondents in the survey:

  • Produces products in an ethically responsible way: ~49% rate “very important”
  • Produces products in a way that doesn’t harm the environment: ~47%
  • Has the public interest in mind when it comes to business practices: ~43%
  • Is transparent about labor practices and the supply chain: ~42%
  • Produces goods in America unless it is particularly costly: ~40%
  • Has a mission beyond just profit: ~39%
  • Has not been involved in any major public scandal: ~38%
  • Gives back to society: ~37%
  • Has strong ethical or political values: ~34%

There is much additional data available from the research, including findings on different slices of the consumer market. The full report is accessible from Morning Consult via this link (fee charged).

The “woke” workplace? Employees vote thumbs-down.

Phillip Nones Business, Employment, Human Resources, Media, Social Commentary , , , , , ,

Most of us have probably heard the old adage that one should never talk about politics or religion at a party (unless its an election party or at the social hour following religious services, I suppose).

But what about at work?

In the “old days” – like when I started in business some 40 years ago – a similar unspoken rule applied; at the office, it just wasn’t “seemly” for people to wear their partisan or “cause” labels on their sleeves.

But that was before the bitterly disputed presidential campaign of 2000. Ever since those fateful 35 days following that election, it’s been downhill in the decorum department pretty much nonstop.

And after the election campaign of 2016, it’s gotten even worse.

Now we read stories about employees revolting against their own employers for seemingly “cavorting with the devil” (Wayfair selling furnishings to border detention facilities), employees losing their jobs – or at the least feeing compelled to leave their place of employment – due to the unpopularity of their political viewpoints (Google), and the like.

Add to this the social “virtue signaling” of some companies and brands who have become involved in social action initiatives (Gillette’s “shaming” of purported male personality traits in its “toxic masculinity” ad campaign).

With the 2020 presidential election campaign on our doorstep and the prospects of continued “high dudgeon” on the part of many people we can charitably refer to as being “highly sensitized” to the campaign, it’s worth wondering what everyday employees think of all this socio-political drama.

If the results of a new survey are any indication, the answer is … “not much.”

Recently, Washington, DC-based business management consulting firm Clutch surveyed ~500 full-time employees working at a cross-section of American businesses ranging from small employers to enterprises with more than 1,000 workers. The breakdown of the research sample included respondents whose philosophical leanings mirror the country’s as a whole (34% conservative, 25% liberal, 21% moderate, 13% apolitical).

What these respondents said should make everyone want to go back to the standards of yesteryear — you know, when socio-political advocacy in the office was considered the height of boorishness.

Among the salient findings from the survey:

  • Most respondents (~60%) don’t know if their political beliefs align with those of their coworkers. What’s more, they don’t care to know what their coworkers think politically.
  • Money, not socio-political alignment, motivates where people choose to work. Whether or not their personal views align with their colleagues’ is of no (or very little) concern to the respondents.  What’s more, few care.
  • Less than one in ten of the survey respondents feel that a “dominant” political viewpoint in the office that doesn’t happen to align with theirs is a source of discomfort. But either way, they’d prefer that such discussions not happen in the first place.
  • Despite the well-intentioned actions of some companies and brands, the majority of respondents feel that engaging in political or similar “cause” expressions adds no value to a company’s culture – nor does it create a healthy exchange of ideas in the workplace. Only about one-third of the respondents think that airing differing views will have beneficial outcomes within the office, while for everyone else, such discussions are viewed as having a “net negative” effect, adding no incremental value to a company’s “culture.”
  • At the same time that respondents wish for a less politically charged atmosphere in the office, a majority of them disagree with the notion of “codifying” political expression and expected behaviors in an employee manual or some other formal written policy statement. In other words, what constitutes “being an adult” isn’t something that should have to be spelled out in so many words.
  • What do respondents think of company owners or leaders expressing their political opinions or taking stands on controversial issues? That’s frowned upon, too. A clear majority of employees (~60%) disagree that company leadership should take stances on political issues – even if they’re relevant to their company’s own products or services. Instead, employees expect leaders to foster a culture of respect at work, including setting a standard that discourages political conversations up and down the chain.

There’s an important side benefit to discouraging discussion of socio-political topics in the office setting. All it takes is for a few “loudmouth” employees to risk creating a hostile work environment – and thus the open up grounds for complaints that could ultimately result in enormous financial costs to the company.

And one important final point came out of the Clutch research: For many employees, a part of their identities as people is connected to where they work.  Often, being an employee means more than simply having a job that pays the bills.  Anything that companies and brands can do to make that identity “work” for the vast majority of their employees will go a good way towards keeping morale high and avoiding the kind of fraught “drama” that can make it onto social media or even the news broadcasts.

[More information about the Clutch survey results can be accessed here.]

What about you?  What’s been your personal experience with employers in the “woke” era? Is your workplace one that is tolerant of all viewpoints while avoiding showing explicit (or implicit) support for any one view?  How successful has your company been in the current environment?  Please share your thoughts with other readers here.

Cookie-blocking is having a big impact on ad revenues … now what?

Phillip Nones Advertising, Business, Government, Marketing, Marketing Communications, Marketing Research, Media, Media Consumption, Publishing, Sales, Security , , , , , , , ,

When Google feels the need to go public about the state of the current ad revenue ecosystem, you know something’s up.

And “what’s up” is actually “what’s down.” According to a new study by Google, digital publishers are losing more than half of their potential ad revenue, on average, when readers set their web browser preferences to block cookies – those data files used to track the online activity of Internet users.

The impact of cookie-blocking is even bigger on news publishers, which are foregoing ad revenues of around 62%, according to the Google study.

The way Google conducted its investigation was to run a 4-month test among ~500 global publishers (May to August 2019). Google disabled cookies on a randomly selected part of each publisher’s traffic, which enabled it to compare results with and without the cookie-blocking functionality employed.

It’s only natural that Google would be keen to understand the revenue impact of cookie-blocking. Despite its best efforts to diversify its business, Alphabet, Google’s parent company, continues to rely heavily on ad revenues – to the tune of more than 85% of its entire business volume.

While that percent is down a little from the 90%+ figures of 5 or 10 years ago, in spite of diversifying into cloud computing and hardware such as mobile phones, the dizzyingly high percentage of Google revenues coming from ad sales hasn’t budged at all in more recent times.

And yet … even with all the cookie-blocking activity that’s now going on, it’s likely that this isn’t the biggest threat to Google’s business model. That distinction would go to governmental regulatory agencies and lawmakers – the people who are cracking down on the sharing of consumer data that underpins the rationale of media sales.

The regulatory pressures are biggest in Europe, but consumer privacy concerns are driving similar efforts in North America as well.

Figuring that a multipronged effort makes sense in order to counteract these trends, this week Google aired a proposal to give online users more control over how their data is being used in digital advertising, and seeking comments and feedback from interest parties.

On a parallel track, it has also initiated a project dubbed “Privacy Sandbox” to give publishers, advertisers, technology firms and web developers a vehicle to share proposals that will, in the words of Google, “protect consumer privacy while supporting the digital ad marketplace.”

Well, readers – what do you think? Do these initiatives have the potential to change the ecosystem to something more positive and actually achieve their objectives?  Or is this just another “fool’s errand” where attractive-sounding platitudes sufficiently (or insufficiently) mask a dimmer reality?

Roads to … nowhere?

Phillip Nones Advertising, Business, Content Creation and Content Management, Marketing, Marketing Communications, Marketing Research, Media, Media Consumption, Publishing, Sales , , , , , , ,

Google Maps admits its business listings are riddled with errors and outright fraudulent entries.

The news reports hit fast and furious this week when the media got wind of the millions upon millions of “faux” business listings on Google Maps, thanks to a new Wall Street Journal exposé.

It’s true that there are a ton of map listings displayed by Google on search engine results pages, but the latest estimates are that there are more than 11 million falsely listed businesses that pop up on Google searches on any given business day.

That number may seem eyebrow-raising, but it’s hardly “new news.” Recall the reports that date as far back as a half-decade — to wit:

  • In 2014, cyber-security expert Bryan Seely showed how easy it was to use the Internet’s open architecture to record telephone conversations and create fraudulent Google Maps listings and locations.
  • In 2017, Google released a report titled Pinning Down Abuse on Google Maps, wherein it was estimated that one in ten fake listings belonged to actual real-live businesses such as restaurants and motels, but that nefarious third-parties had claimed ownership of them. Why do this? So that the unscrupulous bad-actors could deceive the targeted businesses into paying search referral fees.

Google is owning up to its continuing challenges, this week issuing a statement as follows:

“We understand the concerns of those people and businesses impacted by local business scammers, and back in 2017 we announced the progress we’d made. There was still work to be done then, and there’s still work to be done now.  We have an entire team dedicated to addressing these issues and taking constant action to remove profiles that violate our policies.”

But is “constant action” enough? Certain business trades are so riddled with fake listings, it’s probably best to steer clear of them altogether.  Electricians, plumbers and other contractors are particularly sketchy categories, where roughly 40% of Google Maps listings are estimated to be fraudulent entries.

The Wall Street Journal‘s recent exposé, published on June 24th, reported on a search its researchers conducted for plumbers in New York City.  Of the top 20 Google search results returned, only two actually exist where they’re reported to be located and accept customers at the addresses listed.  That’s pretty awful performance even if you’re grading on a curve.

A measure of progress has been made; Google reports that in 2018 it removed some 3 million fake business listings. But that still leaves another 11 million of them out there, silently mocking …

Which brands are “meaningful” to consumers? Not very many.

Phillip Nones Branding, Business, Marketing, Marketing Research , , , , , , , ,

What makes a brand “meaningful”? Multinational advertising, PR and research firm Havas SA has studied this topic for the past decade, conducting a survey every other year in which it attempts to rate the world’s most important brands based on consumer responses to questions about select key brand attributes.

According to Maarten Albarda, the methodology behind the Havas surveys is solid:

“It looks at three brand pillars: personal benefits; collective benefits, and functional benefits — and then adds in 13 dimensions like environment, emotional, social, ethics, etc. plus 52 attributes such as ‘saves time,’ ‘makes me happier,’ ‘delivers on its promises,’ etc.”

The Havas research is both global and quantitative — including more than 350,000 respondents in over 30 countries.

The 2019 Havas research shows that ~77% of the 1,800 brands studied don’t cut it with consumers. This finding came in response to the question of whether consumers would care if the brands disappeared tomorrow.

That’s the biggest disparity ever seen in the Havas surveys. Two years ago, the percentage was 74%.

Which brands perform best with consumers? The top five ranked for 2019 are the following:

  • #1 Google
  • #2 PayPal
  • #3 Mercedes-Benz
  • #4 WhatsApp
  • #5 YouTube

Four of these five are brands that are all about “utility” — helping consumers deal with actions (watching, searching and sharing). The odd one out here is Mercedes-Benz — suggesting that there is something enduring about the time-tested reputation for “German engineering.”

What’s equally interesting is which high-profile brands don’t crack the Top 30. I’m somewhat surprised that we don’t see the likes of Apple and Coca-Cola in the group.  On the other hand, Johnson & Johnson comes in at #6, which seems surprising to me because I doubt that J&J has the same kind of consumer awareness as many other brands.

The Havas research reveals that the highest ranked brands are ones that score well on purchase intent and the justification of carrying a premium price. Repurchase scores are also higher, making it clear that a meaningful brand translates into meaningful business benefits.

In addition to reporting on international results, Havas also releases a U.S. analysis. Historically, U.S. consumers have been even more parsimonious in choosing to bestow a “meaningful” attribution on brands.  In fact, the percentage of American consumers earmarking specific brands as indispensable hovers around 10%, compared to the mid-20s across the rest of the world.

The reason why is quite logical: American consumers tend to have more brand choices — and the more choices there are, the less any one brand would cause consternation if it disappeared tomorrow.

Click here for more reporting and conclusions from the Havas research.

Any way you slice it, Google continues to dominate the search ecosystem.

Phillip Nones Advertising, Business, Marketing , , , , , , , , , ,

Just how big is Google in the world of search? I’ve seen percentages that are all over the map, but one thing is undeniable:  Google remains the overwhelming leader in search.

And it isn’t even close. Runners-up in the search engine derby include Bing/Yahoo and DuckDuckGo, but they’re so small so as to be mere asterisks at the bottom of the page.

… Which might be surprising to some. After all, as late as 2015 comScore was reporting that Google’s market share of desktop search was running around 64%, whereas the Bing family of search products (including Yahoo and AOL) was tracking in the low 30s.

But it’s all in how you make the calculations. At the very same time, Statista was reporting that Google’s worldwide share of desktop search was approximately 89%.

Moreover, Statista’s trend line for Google between 2010 and the end of 2018 is remarkably consistent, with Google’s share of desktop search charting in a narrow range between 86% and 90%:

But I think it’s the data from marketing intelligence and analytics firm Jumpshot that gets us closest to what’s actually happening in the world of search. Jumpshot licenses anonymized ClickStream data from hundreds of millions of users.  It finds that ~63% of all online searches are through Google’s “core” function.

But then one needs to factor in additional Google-related search activity that occurs on Google Maps, Google image search and YouTube, which is owned by Google. When those figures are added to the mix, Google’s market share of search is indeed in excess of 90%, with all other players way, way behind.

This graph shows the makeup of Google’s dominant position as compared to its search competitors:

Source: Jumpshot (based on ClickStream data), 2018.

These dynamics explain why Google remains so entrenched – and why advertisers continue to devote so much of their search engineering advertising dollars to Google properties.

A “constant” in Google’s market strategy over the years has been to make it easy and effortless for users to perform a Google search wherever they are.  In years past, that meant making Google the Home Page on as many Internet browsers a possible. In more recent times it’s taken the form of building activity on Google-centric browsers (Google Chrome), mobile market share (Android), acquiring the dominant video platform (YouTube), and making a major push into voice search with Google Home.

Essentially, wherever someone is … Google is there as well. It’s very much like a commodity or a utility.  (Indeed, its very name has become synonymous with the verb “to search.”)

In case anyone is counting, Google processes an eye-popping 3.5 billion searches per day.  Is it any wonder that any competitor – even a platform like Bing with resources to spend – would have a near-insurmountable challenge getting millions of people to just try a different search option (much less start using it regularly).

Could the situation change?  I suppose nothing is immutable.  The market share figures don’t yet factor in iPhone data at scale.  Some other search product might emerge that is dramatically better-performing than Google.

But none of those factors are likely to change the overall search ecosystem. The fact is, Google dominates search … it has dominated search for years … and it’s on track to continue doing so in the future.

I close with a question to readers. If any of you prefer using a different search product besides Google, please share your reasons why in the comment section below.

The ignominious end of Google+.

Phillip Nones Media, Media Consumption, Social Commentary, Social Media , , ,

… And who cares?

How many of us have predicted the demise of Google+? Over the years, the ill-fated social network wasn’t ever able to gain much traction.

Its “hangouts” and “rooms” functionality, trumpeted with great fanfare when launched, never really amounted to much.  The few times I attempted to engage with people in any of those spaces, it was akin to being the only person in a restaurant at 3:00 in the afternoon.

Several months ago, Google finally bowed to the inevitable and announced that it would be shuttering Google+, effective in August 2019.

But even this end-date has turned out to be star-crossed. In one final ignominy, Google discovered a bug in a Google+ API which appears to have affected potentially more than 52 million users.

Specifically, apps that have requested permission to view the profile information that users had added to their Google+ profiles – basic things like name, age, occupation and e-mail address – were granted permission to do so even when the users’ profiles weren’t set to “public.”

On a brighter note, the bug didn’t allow access to more sensitive information such as financial figures, passwords, or similar data typically used for identity theft, nor does it appear that any of the personal information has been misused – at least not yet.

But as a result of discovering this bug, Google has now decided to shut down the Google+ social platform this coming April – four months earlier than planned.

So, what we have is that the final exit of Google+ from the scene further underscores its underwhelming existence. As Ben Smith, a Google vice president of engineering, stated candidly, the social platform “has not achieved broad consumer or developer adoption and has seen limited user interaction with apps.”

Which is another way of saying, “It’s been a failure.”

And while a few souls may be lamenting its demise, for the vast majority of people, the platform expired years ago.

What about you?  Did you ever engage with this social media network?  And if you did, what was your experience.  Most tellingly, when did you cease you interaction?

Peeking behind the curtain at Google.

Phillip Nones Branding, Business, Employment, Human Resources, Manufacturing, Sales , , , , , , ,

A recently-departed Google engineer gives us the lowdown of what’s actually been happening at his former company.

Steve Yegge, a former engineer at Google who has recently joined Grab, a fast-growing ride-hailing and logistics services firm serving customers in Southeast Asia, has just gone public with an explanation of why he decided to part ways with Google after having been with the company for more than a dozen years.

His reasons are a near-indictment of the company for losing the innovative spark that Yegge thinks was the key to Google’s success — and which now appears to be slipping away.

In a recently published blog post, Yegge lays out what he considers to be Google’s fundamental flaws today:

  • Google has gone deep into protection-and-preservation mode. “Gatekeeping and risk aversion at Google are the norm rather than the exception,” Yegge writes.
  • Google has gotten way more political than it should be as an organization. “Politics is a cumbersome process, and it slows you down and leads to execution problems,” Yegge contends.
  • Google is arrogant. “It has taken me years to understand that a company full of humble individuals can still be an arrogant company. Google has the arrogance of “we”, not the “I”.
  • Google has become competitor-focused rather than customer-focused. “Their new internal slogan — ‘Focus on the user and all else will follow’ – unfortunately, it’s just lip service,” Yegge maintains. “A slogan isn’t good enough. It takes real effort to set aside time regularly for every employee to interact with your customers. Instead, [Google] play[s] the dangerous but easier game of using competitor activity as a proxy for what customers really need.”

Yegge goes on to note that nearly all of Google’s portfolio of product launches over the past 10 years can be traced to “me-too copying” of competitor moves. He cites Google Home (Amazon Echo), Google+ (Facebook) and Google Cloud (AWS) as just three examples — none of them particularly impressive introductions on Google’s part.

Yegge sums it all up with this rather damning conclusion:

“In short, Google just isn’t a very inspiring place to work anymore. I love being fired up by my work, but Google had gradually beaten it out of me.”

Steve Yegge

It isn’t as if the company’s considerable positive attributes aren’t acknowledged – Yegge still views Google as “one of the very best places to work on Earth.”

It’s just that for creative engineers like him, the spark is no longer there.

Where have we seen these dynamics at play before? Microsoft and Yahoo come to mind.

These days, Facebook might be trending in that direction too, a bit.

It seems as though issues of “invincibility” have a tendency to creep in and color how companies view their place in the world, which can eventually lead to complacency and a loss of touch with customers. Ineffective company strategies follow.

That’s a progression every company should try mightily to avoid.

What are your thoughts on Steve Yegge’s characterization of Google? Is he on point?  Or way wide of the mark?  Please share your perspectives with other readers here.

Welcome to the Ad Duopoly: Google and Facebook

Phillip Nones Advertising, Marketing, Marketing Communications, Social Commentary, Social Media , , , , , , ,

Unless you’ve been living under a rock, it’s pretty obvious that the advertising marketplace in America has changed radically in the past few years.

In short order, we’ve seen the largest concentration of digital advertising converge on just two players:  Google and Facebook.  In fact, according to digital advertising research firm eMarketer, those two firms alone are attracting two-thirds of all digital ad dollars in the United States.

But this development isn’t all that surprising.  The vast bulk of Google’s ad market share results from its search engine marketing platform (paid search). As for Facebook, it dominates digital display advertising not just in America, but in many other countries all over the world as well.

And both companies are the “big kahuna” players in the mobile advertising sector, too.

What’s interesting is that, despite the shortcomings that many people recognize in both types of digital advertising – banner blindness and often ill-targeted paid search results — healthy growth in both forms of advertising continues apace.

Google’s ad revenue growth has average around 20% for more than 30 straight quarters. Its growth in the third quarter of 2017 is right on pace at 22%.

For Facebook, the growth dynamics are particularly lucrative; its year-over-year ad revenue growth is pushing 50%.

Mobile ad revenues are growing even faster; they accounted for “only” $9 billion in revenues for Facebook in just the third quarter.  And just as paid search advertising revenues represent more than 90% of Google’s total company revenues, mobile advertising accounts for nearly 90% of Facebook’s overall revenues.

With so much advertising activity, one might wonder from where it’s emanating.

One answer to that question is that the “universe” of advertisers is exponentially higher than we’ve ever encountered before. With low barriers to entry and “anyone can do it” ad development tools, “Jane and John Doe” are far more likely to be advertisers in today’s world of digital marketing than was ever contemplated just a few decades ago.

To wit: Facebook estimates that its social platform has more than 6 million active advertisers participating on it at any given moment in time.  That’s the equivalent of 2% of the entire population of America.

It’s kinda true:  “We’re all advertisers now.”