Two weeks ago, Credit Suisse's Omar Sheikh, one of the top media analysts on Wall Street, made a BIG call on the future of TV advertising. He believes that the introduction of data-driven targeting into conventional linear TV advertising -- where spots are bought and sold on the basis of the specific people viewing them and the measured business outcomes -- will generate an incremental $100 billion in annual TV advertising sales in the U.S. by the year 2030.
Some say content is king. Some say data is king. I think it's a duopoly, not a monarchy, and recent moves from Facebook and other Web giants just may be proving me right. There are rumors Facebook TV is going to be launching as early as mid-June. This strategy is consistent with what's been seen of late across the rest of the digital media ecosystem. Netflix, Amazon, Hulu, Snapchat and now Facebook -- everyone is getting into original video programming.
Two companies that didn't exist 20 years ago -- Google and Facebook -- now account for 20% of all global advertising expenditure. And the speed with which they're gobbling advertising budgets is accelerating. If you're a dilettante student of disruption, as I am, those are pretty amazing numbers.
Marketers are questioning the wisdom of sharing their confidential data, be it media, agency pricing or other proprietary content, with consultancies who are now themselves at the same time (digital) media management companies, data companies or creative agencies (or all of the above). While in the past the auditor or agency adviser was valued for its independence, for some these lines have become blurred, with their impartiality now in question.
According to IBM, we produce 2.5 exabytes of data each day. This is equivalent to 250,000 Libraries of Congress or 90 years of HD video - each day. This data exhaust results from our continual digital interactions, whether explicit - such as typing a search into Google - or implicit, like the location signals we give off as we move through the world with our smartphones.
In the past month, I've heard lots of complaining about data. I've been guilty of it myself, and (gulp) will be now. I recently saw something that said that if you don't have first-party data, you are nowhere, a loser in the great data race. That is simply not true. Second- and third-party data can be great, and first- party data can be garbage.
Many of you know the FCC recently rolled back its rules around ISPs gathering and utilizing data for advertising purposes. This move, while praised by many people in the industry, is actually not ideal because it means privacy is now a state-driven issue. Which means there could be 50 different sets of rules rather than one. What concerns me most is that the core of the media industry, the places where at least 80%-90% of ad dollars are spent, already over-index in favor of consumer privacy and are very aboveboard on what they are doing - but these state issues ...
Last week, a delivery truck pulled up in my driveway. As the rear door rolled up, I saw the truck was full of Amazon parcels, including one for me. Between the four of us that live in our house, we have at least one online purchase delivered each week. When compared to the total retail spending we do, perhaps that's not all that significant, but it's a heck of a lot more than we used to spend.
Last week we saw quarterly results for various blue-chip companies. Pepsi, McDonald's, Domino's, Amazon, American Airlines, Chipotle, T-Mobile and even Twitter managed to delight shareholders with positive results, or at least results that were deemed a break from negativity in prior quarters (Twitter!). Sadly (if you're one of their shareholders), that was not the case for the Coca-Cola Company and Procter & Gamble. These two pillars of the S&P 500 were punished for less-than-stellar results. The interesting thing was that both announced significant marketing news in response to their poor Wall Street showing.
Once a year, the good and the great converge on Vancouver, Canada for the TED conference: Technology, Entertainment, Design. Nearly 2,000 people gathered for a week to consider our past, present and future. There was something interesting about the talks this week. While there were a few technological marvels -- swarms of tiny, self-organizing robots, for example, or a personal cargo-carrying robot that follows you around with your shopping -- many of the talks dealt not with technology, but humanity.