Tag Archives: Advertising and Marketing

Tolls

As you might have guessed from the name of my company (Keith Ritter Media), I’ve spent a great deal of time in the media business, both as a marketer and as a publisher. The business model used to be pretty simple. Create something about which people care, make them aware that you’re offering it, get them to read, listen, or watch it, and aggregate those people into a saleable audience. You hired salespeople to meet with the representatives of your real customer – the advertiser. Usually, these representatives were media buyers from an ad agency. You with me so far?

In TV, we’d offer a unit of time at a “gross” price and asked the agency to remit a “net” price, which was usually the gross minus 15%. That commission was the toll we paid to get the revenue. Obviously, how much of that the agency kept was between them and their client but it wasn’t really our concern. We did our budgeting on the expected net revenues we’d get which was pretty much a straight line derivative of the gross monies sold. Other media had similar models but in every case, the dollars received by the publisher were directly and clearly tied to the size and desirability (to marketers) of their audience.

That statement in no longer true for digital publishing and the fact that it isn’t has serious negative implications for other media as they shift to a more programmatic sales model. I have no idea how digital publishers are able to do financial plans since they can’t project revenue from audience size. That’s because they’ve allowed themselves to generate billions of dollars in ad revenue while only capturing somewhere around a third of what is spent. The 15% that used to be paid in tolls is now more like 67% although some estimates are even higher. More importantly, it’s usually impossible to predict the net revenues received from the gross revenues sold. Digital audiences are growing while publisher revenue is declining.

Where is the money going? A sponsor pays $1 for an ad impression. The agency still takes their commission, but added to the toll-takers are trading desks, DSP providers, data providers, supply side platforms, ad serving platforms, verification services (viewability, etc.) and who knows who else. In some cases, it’s the agency double-dipping, but most of the time these are third parties. Most of these ad services have no interest in either the publisher’s or the marketing client’s success. They aren’t about a quality ad environment. They facilitate a transaction. In some cases, a platform that connects both buyers and sellers charges each side a separate fee without disclosing that they’re doing so. In short, publishers, agencies, and marketers have created a system that works for no one but the VC’s that fund these ad tech companies. What happens when programmatic spreads to other media such as TV?

Publishers have many other challenges. Facebook, for example, makes more money off of some publishers’ content than do the publishers themselves without paying the publishers a dime. But the real threat to a healthy media environment is the toll-takers. When you create great content and grow your audiences, you should be the entity that benefits and not some opaque service provider. More eyeballs used to mean more money to the bottom line. Can we make that equation true again?

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Filed under digital media, Huh?

It’s A Scam

A couple of decades ago, as I began spending more and more of my professional time in the world of digital, I worked for a guy who wasn’t a believer in all of the hype. He thought that the prognostications of the coming demise of mass media (we worked in TV) and the rapid disruption of business models was BS. Actually, one of his favorite things to do was to pop his head into my office and say “You know this Internet thing is a scam, right?”

I used to laugh it off but 20 years later I’m thinking he might have been right. He certainly was when Web 1.0 blew up, washing away billions of investment. No serious person involved in digital business makes those same mistakes but there is a whole lot of grifting going on nevertheless. Let me explain.

First, there is the whole bots thing in programmatic advertising. If you dig paying real money to put ads in front of fake people, be my guest. The fact that the continuing race to the bottom with respect to pricing results in many legitimate publishers’ sites looking like an Arabian bazaar or a NASCAR vehicle should tell you there’s a problem. The fees taken at every step of the way by vendors who add little to nothing to the process and won’t disclose how their systems function nor the actual ways they’re blocking fake traffic is another scam. Obviously, putting profits before people (servicing your pocketbook before servicing your reader!) is a scam of sorts, too. You’re promising great content but you’re forcing your readers into suffering through a horrible; experience to get to it. Any wonder that Google is adding an ad-blocker to Chrome or that a third of US web users employ some sort of an ad blocker?

Then there are the “influencers.” As one executive who works in influencer marketing stated: 

It’s basically the biggest scam started by the countless influencer marketing platforms that popped up over the past two or three years, who find it a lot easier to recruit and work with super small influencers who will do anything for a $100 gift card. Everyone talks about how these “micro-influencers” have such high engagement, but who cares about a 20 percent engagement rate on a post when only 10 people liked it?

It goes beyond the little guys. The FTC had to once again send out more than 90 letters reminding influencers and marketers that influencers should clearly and conspicuously disclose their relationship to brands when promoting or endorsing products through social media. In failing to do so, these folks, many of whom are big-name celebrities, are scamming their fans by failing to tell them that they’re paid to say nice things about a product they may or may not even use.

I’m not meaning to fault the tools here. I’m just pointing out that one effect the democratization of media has had has been to facilitate many more scams. Easy access means for easy for everyone, including those with less than sterling intent. Back in the day, they would never have got past the Standards people every network had or the accountants than every media outlet had. Today, anyone with an ad and a credit card can get involved. It’s like anything else though. At some point, you have to figure out if you’re about lining your pockets at the expense of your customer in a dishonorable way or if you want to solve the customer’s problems in a way that rewards you for having done so. Your call!

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Filed under digital media, Huh?

Is There Anybody Out There?

Over the years, I’ve been privy to a lot of data. My own business analytics (my website, blog posts, social presences, etc.), as well as those of my clients, kick off a lot of information. Combine that with the ongoing streams of data from the various marketing campaigns – both search Engine ads and social media ads – I’ve administered over the years and I’ve seen a lot of information about how readers are captured and interact.

Except I don’t believe much of it anymore. Let me explain why and what it means to you.

A few weeks ago, there was a report that Facebook was breaking up an “extensive fake account scam” targeting publisher pages with false “likes.” The idea was to obtain more “friends” for the scammers they could later spam. USA Today was the biggest page hit, losing nearly 6 million “likes.“ because they were fake accounts. Facebook also came under fire for giving publishers and advertisers faulty metrics to evaluate audience reach. Even in the last day, Facebook found an error in how its video carousel ads were reporting and is having to give back cash to advertisers. I don’t think it’s news to anyone that a huge percentage of Twitter accounts are bots, and impressions generated against those bots are a complete waste.

If you read web analytics, you’ve probably encountered “referrer spam.” This has the effect of goosing your visitor numbers up while providing no value. It skyrockets bounce rates and kills conversion rates among other things, but the worst part of it is the added time it takes to address, either through filtering or other means.

Programmatic advertising, which is now nearly all of display and other ads on the web, is rife with fraud. The industry is struggling to verify if ads are seen by humans or even if they’re visible at all. Middleman after middleman “clips the ticket” as money moves from advertiser to publisher, and with over 2/3 of those dollars going to just two entities (Google and Facebook), it’s slim pickings in the publishing world. That means the pressure is on the generate big numbers and bigger results. Of course, if you can’t believe the numbers, how can you evaluate anything anymore?

Here’s how. I know I’m old school and what I’m about to say isn’t as efficient as a trading desk’s programmatic solution, but it actually works. First, take the time to look at the only results that matter. It may be revenue, it may be downloads or app installs, it may be the phone ringing, it may be physical store traffic. I used to worry about conversion rates but since we don’t really know who’s a human out there, the conversion itself is what’s key. Make friends with the sales reps from key publications. Have face to face meetings. You don’t want your sales rep to be a bot either. Pay premiums for premium content and premium results. Programmatic is a race to the bottom, even after you cut through the fraud and waste.

We need to rely on people and only upon the data that can’t be subverted or corrupted. Yes, there are people out there. Let’s go find them.

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Filed under Consulting, digital media

False Pretenses

It’s Foodie Friday and it’s also Cinco De Mayo. Contrary to popular belief, what’s celebrated today is not Mexican Independence Day. Rather, it’s a celebration of the Mexican victory at the Battle of Puebla during the Franco-Mexican War, which came after Mexico’s independence from Spain, the Mexican-American War, and the Mexican Civil War. It centers around Puebla which, coincidentally, is really the heart of Mexico’s food world.

Coat of arms of Mexico. Español: Escudo Nacion...

(Photo credit: Wikipedia)

Just as there really isn’t a lot of corned beef and cabbage eaten in Ireland on St. Patrick’s Day, so too is this not a day of taco and frozen margaritas in Mexico. Not that it stops damn near every “Mexican” restaurant in this country from pushing those things today. Hitting a Taco Bell up to celebrate doesn’t happen in Mexico. In fact, Taco Bell doesn’t exist there (they tried; Mexicans won’t eat there). Instead, the cuisine of Puebla features moles (the sauces, not the critter), chalupas, and Chiles En Nogada, a stuffed poblano pepper with a walnut and pomegranate sauce.

Why do I raise this? Because it raises an issue that applies to any business. Actually, it’s sort of the “fake news” issue. Just as political entities will raise money based on a widely believed, but false, narrative, so too are all of the places serving tacos and margaritas selling a lie of sorts. The question is should we as businesses engage in that?

Some people might say that “ethical marketing” is an oxymoron. A lot of marketers are happy to bend the truth if in their minds what they’re doing is inconsequential. In this case, I suspect that the perpetrators don’t even know they’re misrepresenting the facts and, frankly, I’m not very sure that it matters. But it raises a point that very much does matter. If a business is willing to stretch the truth on things that don’t matter, at what point do they cross the line and do so when it really does?

We’ve all seen ads that lie. Ads for “male enhancers,” cures for the common cold, or even just photoshopped photos are rampant. While promoting a frozen margarita to celebrate something that didn’t happen on this day is far from an outright lie, you take my point. There’s nothing wrong with selling and using the language of sales to promote but we need to remember that we live in a world where information is easily found and lies are rapidly debunked and the truth disseminated. And with that, I’m off to find a torta for lunch!

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Filed under Consulting, food

You Calling Me A Liar?

The screed is a little late today because I’ve been tied up on the phone trying to get the central air conditioning fixed. This saga started a week ago when I noticed that the house seemed rather warm. While the vents were blowing air, it was not cold air. I called the American Home Shield folks with whom we have a warranty and they set me up with a local repair firm. This is where the fun – and today’s business point – begin.

Last Wednesday, I set up an appointment for yesterday. They were supposed to arrive between 3 pm and 5 pm. I was not happy that it would take them almost a week to get to me, but I was told that’s the first appointment. On my calendar it went (not knowing that AHS has a 48-hour service policy, by the way, and that I could have asked them to set me up elsewhere. Doh!).

At 4:30 yesterday when no one had arrived or called to say they’d be arriving, I called the repair folks. The customer service rep had my info from AHS but didn’t have my appointment. In fact, she said they’d tried to call me, failed to reach me, and never set anything up.Obviously, someone screwed up and didn’t write down the initial appointment. I was told that after 8 minutes on hold, a hang-up, and calling them back. Needless to say, I wasn’t happy, but I became far less happy when I was told that the next available appointment was next week sometime, two weeks after I initially set up a repair with them. The manager got on the phone to inform me that I was making the whole appointment up. I offered to email him screenshots of my phone’s call log, showing that I spoke with them twice last week but he didn’t care. I asked him if he was in the habit of making up appointments and adding them to his calendar because I certainly wasn’t. He wasn’t either. I asked him if he was calling me a liar and he said he didn’t know what I was but I certainly never had an appointment. Finally, I mentioned that I wrote a business blog and that he was providing me with great material for what a business shouldn’t do and he laughed and said: “as long as you tell the truth.”

So I’m here to tell you the truth. None of us can ever call our customers liars or make them feel that way. None of us can ignore evidence that someone on our end screwed up and blame the customer instead. None of us can shrug our shoulders and tell a customer who has been harmed to get to the back of the line. Finally, none of us can ignore the potential social media backlash. Not that the screed is read by millions, but it only takes a few readers to start a backlash against your business. Hey – don’t you know who I think I am? The odds are you don’t know anything about the megaphone any of your customers hold but you should know that it doesn’t take more than a few minutes of writing to do a great deal of damage to your reputation.

AHS reached out to these bozos this morning. They again denied I ever spoke to them. We set up an appointment with another repair company, who called me 10 minutes after I spoke with AHS. By the way – when the new guys couldn’t see me until next week, AHS escalated my issue to a unit they have that will call all the area vendors to find someone who can cool me off (in both the physical and psychological sense at this point) in 48 hours or less.

So to the folks at Modern Mechanical HVAC, hopefully this will help you see why you can’t call your customers liars, along with the bad Yelp review, the link to this screed I’ll be posting on Nextdoor (a local bulletin board), and a bunch of other local information and review sites that will advise people to stay away from you. I’m just doing as you asked: telling the truth.

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Filed under Huh?

What Do You Know

It’s Foodie Friday and this week I want to reflect on an experience I think many of us have had. I’m not quite sure what to call it – an awakening? An education? It’s what happens when you have your preconceptions of what a food is blown away by a much better version. It’s what happens, for example, when you take someone whose idea of Mexican food comes from years of eating at Taco Bell or whose conception of pizza has been shaped by Papa John’s to an authentic taqueria or to a pizza place that uses great ingredients and a coal-fired oven. I’ve had that experience with a friend, who now refers to two kinds of pizza: pizza and real pizza.

English: Picture of an authentic Neapolitan Pi...

(Photo credit: Wikipedia)

The point of this isn’t that they had low standards or unsophisticated tastes before they experienced the real deal. They just didn’t know, and that’s something that’s applicable across many businesses. It becomes especially more relevant as your product gets closer to a commodity. Consumers probably have an existing opinion that’s based on something that’s usually fairly mainstream. Our job as marketers is to help them to know that there is a difference and why our product does a better job than what they might believe is possible.

How do we do this? Sampling is the most obvious answer. That’s not just giving out food samples on the street. It’s free trial periods of services. I thought that most online accounting software was the same, for example, until I needed to get some customer service help during my free trial period. One company was head and shoulders above the others I tried and they now collect $15 from me every month. They helped me to know.

My favorite taco place is just down the street from a Taco Bell. The menu is in Spanish, they offer goat, tripe, and lengua tacos along with some of the best fish tacos and tortas I’ve ever had. Would you know that as you drove past on your way to Taco Bell? Not unless I took you there. Our job as marketers is to help people know. Are you doing that?

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Filed under Consulting, food

A Lesson From Junior

I’m a fan of NASCAR, specifically of its top tier, now called the Monster Cup Series. For my non-gearhead friends and readers, don’t knock it until you’ve tried it, preferably in person (bring earplugs!).

      NASCAR.com

Some big news came out of the NASCAR world yesterday and it prompted a thought that is applicable to any of us in business. Dale Earnhardt Jr. is retiring after this season. Only 42, he’s been NASCAR’s most popular driver ever since his dad died on the last lap of the Daytona 500 in 2001 and leads an enormous fan base known as Junior Nation. Full disclosure: I’m a member. He’s really the spiritual leader and one of the last remnants of the NASCAR of old. As a USA Today article on his retirement stated:

A kid of means sent to work in an auto dealership by his father until he began racing, Earnhardt Jr. spoke the language of the fan, in a Carolina accent pleasing to the grassroots folks, was sponsored by a beer company and projected enough hell-raiser vibe to endear himself to the masses. A historian of the sport, he cited the exploits of Cale Yarborough or Richard Petty or Darrell Waltrip with a sharp recollection of fan and provided a generational and cultural bridge for NASCAR.

In other words, Junior isn’t corporate, is authentic, and because of that, is beloved. That’s really a lesson for any of us. Consumers adore personalities but only if they believe that what they’re seeing isn’t an act. Any of Junior’s interviews will show you that he’s real. His language is sometimes salty, often grammatically incorrect, and is definitely not the creation of some media trainer’s badgering. Consumers can tell when a brand is inauthentic just as any of us can see it in a person.

This is why I rant sometimes about engaging in conversations with and not in advertising to our consumers. It doesn’t mean boasting about how “real” you are but it does mean defining what your brand means and sticking to it. The definition should be expressed in the language of your consumer and be relevant to why they’d engage with you in the first place. It means participating in social interactions with your fans, not in demanding or leading them.

I guess I’ll need to figure out where my driver loyalty heads next. It seems that NASCAR needs to figure that out as well. As a long-time fan, I’ve watched them migrate from their Southern roots and identity to something much more vanilla, at least that’s how I see it. Junior is the last bastion of the old, authentic NASCAR. Wherever they go next, I hope it at least half as real as he is. Now ask yourself if you’re “being real” too.

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Filed under sports business, Thinking Aloud