Mobile Marketing September 2019 Edition by Mobile Marketing Magazine

ISSUE 32 SEP 2019

| NEWS | VIEWS | ANALYSIS

FIGHTING FRAUD THE SMARTER WAY Adjust co-founders on the tools and tech needed to beat the fraudsters

PROGRAMMATIC 101

LOCAL HEROES

INFLUENCER OVERLOAD

Everything you need to know about programmatic

How Bandsintown brings musicians and their fans closer

Your essential guide to influencer marketing

2020 SUMMIT SERIES United Kingdom

Europe

LONDON

FEB 5

AMSTERDAM JAN 30 MOBILE & APP MARKETING

LONDON

MAR 11 PROGRAMMATIC FOR PUBLISHERS

BARCELONA FEB 25 MOBILE MARKETING

LONDON

APR 28 APP MARKETING

BERLIN

LONDON

SEP 3

AMSTERDAM JUL 2

LONDON

OCT 21 PROGRAMMATIC FOR BRANDS

LONDON

NOV 24 APP MARKETING

MOBILE MARKETING

PARIS

APR 1

Australia

NEW YORK

FEB 25 APP MARKETING

SYDNEY

ATLANTA

APR 29 MOBILE & APP MARKETING MOBILE & APP MARKETING

LOS ANGELES

MAY 7

MOBILE & APP MARKETING

NEW YORK

MAY 20 MOBILE MARKETING

BOSTON

JUN 3

NEW YORK

SEP 23 APP MARKETING

TORONTO

OCT 8

MOBILE & APP MARKETING

APP MARKETING

OCT 14 MOBILE & APP MARKETING

North America SAN FRANCISCO MAY 5

MOBILE & APP MARKETING

MAR 19 MOBILE & APP MARKETING

Middle East DUBAI

APR 1

MOBILE & APP MARKETING

SAN FRANCISCO NOV 19 MOBILE TRENDS NEW YORK

DEC 8

MOBILE TRENDS

At the Mobile Marketing Summits, you will hear from experts who can help you turn your mobile plans into reality, through a series of short presentations, followed by interactive round table discussions. Proven over the past nine years, our event format delivers more insight and knowledge than you would think possible in half a day.

Find out more and register:

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SEPTEMBER 2019

CONTENTS

5G – THE SHAPE OF THINGS TO COME

05 MUSIC MAN Bandsintown managing partner Fabrice Sergent on how mobile builds bonds between artists and fans

08 Hello and welcome to the latest print edition of Mobile Marketing. In this issue, we look at two of the hottest topics out there right now, as Tyrone Stewart takes a deep dive into programmatic, and our US reporter, Alyssa Clementi, lifts the lid on the current state of influencer marketing. You can read Tyrone’s piece on p8 and Alyssa’s on p24. There’s also something of a musical theme to the issue, as we talk to Fabrice Sergent, managing partner of Bandsintown, about building engagement between musicians and fans. You can find that piece on p5. Then on p22 Ollie Deane, director of commercial digital at Global – owner of some of the world’s best-known radio brands, including Capital, Heart and Classic FM – offers his perspective on the stellar growth digital audio listening is seeing, and the impact it’s having on ad budgets. Finally, in our cover interview on p17, Adjust co-founders Christian Henschel and Paul H. Müller explain how the company is going all-in on the fight against fraud.

A GUIDE TO PROGRAMMATIC ADVERTISING With the help of a few industry experts, Tyrone Stewart offers an exhaustive guide to the wonderful world of programmatic

INFLUENCER MARKETING 101

MOBILE MARKETING GROWS UP Mobvista’s Clement Cao on how the mobile marketing industry is maturing

Alyssa Clementi lifts the lid on the fast-evolving world of influencer marketing

Teavaro’s Nico Pizzalato takes a closer look at the ICO’s recent ad tech report

CPaaS AND THE EXPERIENCE ECONOMY

Kumulos’s Caroline McClelland on how 5G will benefit smart cities, the IoT and apps

SAP Digital Interconnect’s Rohit Tripathi and Markku Helin explain the benefits of communications-platformas-a-service solutions

TIME FOR CHANGE

CLOSING REMARKS David Murphy looks back at the year so far in mobile marketing

FIGHTING FRAUD THE SMARTER WAY Adjust co-founders Christian Henschel and Paul H. Müller on the never-ending battle against fraud

– MOBILE VIDEO 34 YES CAN REPLACE TV

Enjoy the issue!

David Murphy Editorial Director

Global director of commercial digital Ollie Deane on digital audio’s golden era

Editorial director: David Murphy – david.murphy@mobilemarketingmagazine.com +44 (0)7976 927062

If you want to be sure of receiving your copy of the print edition of Mobile Marketing three times a year, you can subscribe today to go on our controlled circulation list. It costs just £30 (UK) or £40 (rest of the world). To take out a subscription, just send an email to subscriptions@ mobilemarketingmagazine.com and we’ll tell you what you need to do.

AdColony’s Matt Barash says mobile video’s time has come

Managing director: John Owen – john.owen@mobilemarketingmagazine.com +44 (0)7769 674824 Commercial director: James McGowan – james.mcgowan@mobilemarketingmagazine.com Reporter: Tyrone Stewart – tyrone.stewart@mobilemarketingmagazine.com US reporter: Alyssa Clementi – alyssa@mobilemarketingmagazine.com Marketing manager: Trish Pencarska – trish@mobilemarketingmagazine.com Design: Stef Mountjoy and Lee Penton – stef@stefmountjoy.co.uk / lee@leepenton.com Print: Oxford University Press – onlinequeries.uk@oup.com Mobile Marketing is published by Masterclassing Ltd., 57–61 Charterhouse Street, London, EC1M 6HA www.mobilemarketingmagazine.com

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SEPTEMBER 2019

MUSIC MAN F

or music fans, and indeed musicians themselves, there’s nothing like the thrill of a live performance. And equally, nothing more frustrating than finding out that one of your favourite bands was in town last week and you missed the chance to see them, or couldn’t get a ticket because you found out about the gig too late. In fact, though, while tickets to see really big artists sell out in no time, overall, almost half of all concert tickets don’t sell, representing a massive loss for performers and promoters. These were some of the key issues that concert discovery app Bandsintown aimed to solve when it launched back in 2012, as managing partner Fabrice Sergent explains.

David Murphy talks music and mobile with Fabrice Sergent, managing partner of Bandsintown “On one hand, 40 per cent of concert tickets go unsold, because people are not aware of when their favourite artists are in town,” he says. “So the first thing we tried to do was to help music fans by alerting them when their favourite artists come to town. The second point is that we know our users’ music preferences, so we can recommend shows to them that they might not have thought of going to. So the second need we serve is discovery. 50 per cent of our users say they have been to see an artist they had not heard of before. I think it’s fair to say we have become the most trusted voice in concert recommendations in the world. “Music fans who have the Bandsintown app go to twice as many concerts as they used to, and

they are also the ones booking tickets for their friends. They are the most passionate music fans and so, through the app, we provide a link between the artists and these influencers and trendsetters.”

ARTIST COMMUNITY The app also serves the needs of the artist community in other ways. “There is a very big need on the artist side to be able to publish and update their tour dates,” says Sergent. “In this respect, we are connected to Facebook, Google, Alexa, Instagram, Snapchat and all the other key digital channels, so we help the artists to display their tour dates online, on third-party sites, and on their own apps and websites. And because they surface their

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SEPTEMBER 2019

tour dates, they sell more tickets. Live music accounts for 60–80 per cent of an artist’s revenues on average, so by helping them to sell more tickets, we help them to make a better living.” The app’s dual role has helped cement its popularity with both the music artist and fan communities. There are currently more than 50m registered users and over 500,000 artists on the platform. Each month, Bandsintown sends out around 100m announcements

artists on tour in the US are registered on Bandsintown, and the app sends over 1m people to concerts in the US per month. But the app is also seeing rapid growth elsewhere, with around with 5,000 new artists joining per month. It has 3.5m users in the UK, and 1.5m users in both France and Germany.

ARTIST TRACKING From a user perspective, tracking your favourite artists couldn’t be much easier. The app can automatically track all artists whose

65 PER CENT OF ALL ARTISTS ON TOUR IN THE US ARE REGISTERED ON BANDSINTOWN, AND THE APP SENDS OVER 1M PEOPLE TO CONCERTS IN THE US PER MONTH via emails and app notifications, referring 9m clicks to ticketing companies and 2m individuals to concerts, all of which generates revenues for the app via an affiliate model. Three quarters of the apps’ users and artists are in the US. In fact, 65 per cent of all

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music you have on your phone, or which you listen to via Spotify, Apple Music et al. It then tells you which artists are due in town (all or tracked artists only) within a radius that the user can set to anywhere between 1km and 240km. In addition to personalised concert notifications, the moment tour dates are

announced, the app also enables artists to build fan engagement by posting personalised messages to their fans. While it started out purely as a concert discovery app, Bandsintown has evolved into a more holistic live music community, adding native integration of music streaming platforms to enable music discovery for its users, and creating detailed profiles of those users in order to enable advertisers to target them with relevant offers. In December 2017, it launched Bandsintown Big Break – a data-driven, emerging artist programme that identifies, spotlights and promotes artists who have shown significant growth within a six-month period on the platform. Bands to have benefited from the Big Break spotlight include Sneaks, Foxtrax, Sisters, Peach Pit, The Lagoons, and Sarah Shook & The Disarmers. Artists and venues can promote their concerts via Bandsintown Manager, an online portal where they can promote shows and sell tickets, sync shows across the web using Bandsintown’s Events widget, engage their audience by posting to trackers, and encourage fans to RSVP to shows.

MUSICAL DNA In revenue terms, Bandsintown’s most important assets are its users. It creates a

SEPTEMBER 2019

musical DNA for each user, based on their listening habits and the concerts they have bought tickets for, and then uses this to create target groups for advertisers on the platform. Typical advertisers include companies directly involved in the music business, such as record labels, artists, music streaming and merchandising companies, as well as those from outside the industry, such as drinks brands, mobile operators, travel and credit card companies. Additionally, through its Bandsintown Amplified network, the company enables its advertiser partners to target music fans on over 150 third-party music websites, simultaneously generating a revenue stream for these sites that have no ad sales operation of their own. “Through Bandsintown Amplified, we bring sites access to advertisers they don’t currently have access to, and we bring targeting capabilities to the brands, enabling them to target around 130m fans a month based on their music

tastes, rather than the more traditional targeting parameters,” says Sergent. “It’s a different approach, using music as a way to connect with fans, and outside of Facebook and Google, there’s no bigger platform to reach music fans than Bandsintown. We’re a very strong marketing partner for brands, using music as a passion point.” The Bandsintown app is currently available in seven languages – English French, German, Italian, Spanish, Portuguese and Japanese – and Sergent says the company is now working on strengthening relationships with music publishers, artists, managers, advertisers and brands to replicate the success it has seen in the US, elsewhere in the world.

To date, the app has been downloaded “tens of millions of times”, according to Sergent. “When we started out, we had competitors who had an app, but they were also on the web and mobile web,” he says. “We were the first to bet all our resources and product focus on our app. I knew at the time that we were a bit too early, but the reality is that at some point, it paid off, and we are now the biggest concert discovery app. All our growth has been organic; the brand was strong enough to be recognised by artists and fans and that’s how we grew. Currently, we get 500,000 new users per month with no advertising. That’s the magic and strength of this brand – it’s an authentic, organic brand that’s just loved by the fans and the artists.”

IT’S A DIFFERENT APPROACH, USING MUSIC AS A WAY TO CONNECT WITH FANS, AND OUTSIDE OF FACEBOOK AND GOOGLE, THERE’S NO BIGGER PLATFORM TO REACH MUSIC FANS THAN BANDSINTOWN

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A GUIDE TO PROGRAMMATIC ADVERTISING

SEPTEMBER 2019

Tyrone Stewart takes a deep dive into programmatic, looking at the good, the bad and the ugly, and finding out where the technology is headed

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SEPTEMBER 2019

n recent years, programmatic advertising has slowly grown to become the main way in which digital advertising is traded, with 65 per cent of online ads set to be bought and sold programmatically around the world this year. In the US alone, an estimated 86.2 per cent of digital display ads will be bought programmatically by 2020.

considerably, but it left the industry focused on the retargeting space, buying on blind inventory deemed unsafe to brand advertisers. Agencies also spotted the opportunity to cut out the ad network middleman and buy the effective media via RTB [real-time bidding] themselves. They set up trading desks and often kept a margin.”

At its most basic level, the definition of programmatic advertising is quite straightforward: it’s simply when digital ads are bought or sold using machines or any form of automation – meaning publishers don’t have to manually sell their inventory to advertisers.

As OpenX’s Stirrat notes, it was around this time that “almost overnight, the digital ad industry was flooded with new tech solutions – and acronyms – from exchanges, SSPs and DSPs to RTB, CPMs and CTR. This programmatic ‘Wild West’ scenario is what allowed the tech to grow so rapidly. It was clear programmatic had the potential to evolve from a vehicle for selling unwanted ad space into a sophisticated, critical piece of every marketer’s digital ad strategy.”

“The term is a broad one, but one which now mainly refers to the buying of display and video standard ad units within a real-time bidding ecosystem,” says Alex Rahaman, chairman at Nexd. Sounds simple enough, right? Well, it’s not. As is often the case in the tech world, there’s a lot more to address than just what appears on the surface. And programmatic has had quite the journey to get to where its at today.

A HISTORY OF PROGRAMMATIC “We’ve come a long way since the first digital advert in 1994,” says Gavin Stirrat, VP of partner services EMEA at OpenX. (That first digital ad that Stirrat refers to was a banner ad on HotWired.com, which you may now know as popular tech-related publisher Wired.) “It was a time where clicks were king, and ads were garish and obnoxious. And while programmatic erupted onto the scene only a decade ago, its massive growth and innovation has greatly influenced digital advertising for the better.”

We’ll look at what all those acronyms mean in good time, but first, we should consider two other factors that were crucial to programmatic’s development. The first was the rise of mobile. For years, people within the industry had been referencing ‘the year of mobile’, but this didn’t start becoming a reality until mobile programmatic began outpacing desktop in 2014. Initially, “mobile was plagued with challenges” in the shape of a lack of cookies, inexperience with mobile-first creative and brands unsure about investing, according to Stirrat. But, one by one, these challenges were overcome. The second factor was the introduction of header bidding into the programmatic space. This was significant because of the way in which it enabled publishers to offer ad space out to numerous SSPs and ad exchanges at once.

Indeed, a long way we have come. Fast-forward to 2009 and that’s when programmatic really starts to enter the ad tech lexicon. “Back in 2009, the nascent DSPs [demand-side platforms] and SSPs [supply-side platforms] offered unheard-of efficiency in a media landscape still controlled by annual TV buys and faxed insertion orders,” says Rahaman “With digital still a minority medium and relatively new, the growth in programmatic was slow and focused on performance advertisers who could see the opportunity to bid against a cookie ID they knew was in market for a product. This cut buying wastage

“Heralding an end to the publisher waterfall and the beginning of unprecedented access to inventory, header bidding took programmatic by storm in 2015 and has become the de facto way to buy impressions today,” says Stirrat. “Publishers seized greater control over their inventory, advertisers gained equal footing to purchase impressions and ad tech providers could finally compete with Google. Header bidding changed many a company’s fortunes, but has also placed significant overheads on many players in the industry, as ad opportunities are made available through many different connections and exchanges. Cue another acronym: SPO [supply path optimisation].”

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As more premium publishers and bigname brands began getting involved in programmatic, there began to be a huge growth in verification and analytics firms, as these businesses “demanded that their agencies buy premium inventory via private marketplaces, which were much more transparent from a brand safety and economics view,” comments Rahaman.

KEY PARTS OF THE PROGRAMMATIC ECOSYSTEM The programmatic ecosystem is made up of a bunch of different types of company, all with their own part to play and, more often than not, referred to by one of those acronyms mentioned earlier. If you want to understand programmatic, you need to know this key terminology and where each component fits into the programmatic landscape.

Though programmatic has been seen overall as a positive development over the last decade, its rapid growth has come in tandem with concerns around ad fraud, brand safety, poor user experiences, ad blocking, low-quality players and hidden fees, and these issues have led some big-hitting marketers, such as Procter & Gamble’s chief brand officer, Marc Pritchard, to question whether it’s in their best interests to continue using the tech.

The chain begins with the brand that wishes to advertise. It enlists media agencies to buy advertising on its behalf. A demandside platform (DSP) then helps those media agencies to buy advertising inventory through a software platform that enables buyers to manage and place ads across multiple ad exchanges, which broker deals between the advertiser and publisher.

The industry claims to be trying to address these problems. How successfully it does so will be key to programmatic’s future.

“The source of all money for advertising is the brands that advertise. They have apportioned some of that spend to media agencies to buy

on their behalf and target relevant consumers across multiple channels,” says Dave Castell, general manager of inventory partnerships EMEA at The Trade Desk. “The Trade Desk is one of the technology platforms that helps those media agencies best buy advertising digitally in a programmatic environment. This means its a DSP that plugs into all different inventory sources across multiple channels. And, in real-time, it provides those media agencies and those advertisers with the ability to have their budgets and their advertising bid upon to appear in the most relevant environment and in front of the most relevant consumer, at the right place, at the right time, in the right environment.” If we think of ad exchanges as the middleman, to the right of them we have the supply-side platform (SSP). SSPs are software platforms which enable publishers to add their advertising inventory to ad exchanges. Beyond an SSP, you have the publisher itself, where the advertising is served to the site visitor or app user.

ALEX RAHAMAN NEXD

BACK IN 2009, THE NASCENT DSPs AND SSPs OFFERED UNHEARD-OF EFFICIENCY IN A MEDIA LANDSCAPE STILL CONTROLLED BY ANNUAL TV BUYS AND FAXED INSERTION ORDERS

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SEPTEMBER 2019

“DSPs plug into SSPs. SSPs are another kind of technology company entity, typically with their own technology, to aggregate relationships with lots of different publishers. So, an example of an SSP we partner with would be Rubicon Project or even Google. Those SSPs are essentially a front of house for a lot of different publishers and they plug into them and help them manage yields,” Castell continues.

“An advertiser or media agency can use our platform and opt in to look at how the particular aims of the campaign for that advertiser match against different data sets. They can then tailor the strategy for buying that ad to hit certain consumers, at certain times, within certain environments. Data is the energy drink which powers the field.”

“We plug into all the global SSPs, who are essentially receiving our advertising and then placing that advertising into the ad slots across multiple different channels, multiple different inventory sources and publishers.”

Within programmatic, there are four main types of deal that media sellers can seek – open auction, private marketplace, preferred and programmatic guaranteed – each with its own advantages and disadvantages.

Another key player in the programmatic ecosystem is the data management platform (DMP). DMPs have more of a fluid role in the chain and pop on both the buy side (advertisers) and the sell side (publishers). They provide a location for advertisers to create targeting segments based on stored audience and campaign data, and are also used by publishers to house data about site visitors or app users that can be sold to advertisers.

Open auction

“We partner with many different data partners, data management platforms and data marketplaces to help inform the advertising buys that are happening within our platform. We also have our own DMP called the ‘Data Alliance’, which essentially aggregates a number of data sources and leverages those sources to inform the advertising in real time,” says Castell.

TYPES OF PROGRAMMATIC DEAL

Open auctions – also known as real-time bidding (RTB), open exchange and open marketplace – are pretty straightforward at their most basic level. Advertisers on an ad exchange, network or SSP receive an impression call, they all bid, and the one that bids highest wins. This all happens within the time it takes for a webpage to load. Often, advertisers will use a DSP to help them decide which ad impressions to buy and how much to bid on them. Despite the seeming lack of control for publishers, they can set block lists and price floors in order to make sure their inventory isn’t undervalued. Nowadays, open auctions are used to sell remnant (or scrap) inventory, but most major brands tend to stay away for fears of fraud and brand safety.

Private marketplace

These bear some similarities to open auctions and are also known as private auctions, invitationonly auctions and closed auctions. A private marketplace (PMP) is an RTB auction which is strictly invitation-only, with publishers selecting the buyers who can bid on their inventory. Unlike open auctions, there’s more control due to the exclusivity of PMPs and, as such, inventory here is considered premium. Here, the middleman of an ad exchange, network or SSP isn’t present, and DSPs plug directly into the publisher’s inventory source. The transaction happens within an auction environment, but the terms of the deal are negotiated between the buyer and seller beforehand. PMPs provide greater transparency and control for all parties involved, providing a clear look at the inventory being bought, what CPM (cost per mille/thousand) needs to be paid and the types of creatives being displayed. It also gives advertisers access to premium inventories before they are made available for open auctions. There is still potential for fraud through domain spoofing – when bad actors disguise themselves as premium publishers – but this is something that IAB Tech Lab’s ads.txt and app-ads.txt specifications were introduced to combat.

Preferred deals Within the private marketplace, there is an opportunity for buyers to reach out to sellers to negotiate fixed-price, first-look, priority

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access to inventory, before it’s made available to the other parties in a private auction. These ‘preferred deals’ are made when advertisers approach publishers about specific ad sizes, placements and audiences, and they negotiate a fixed price for the impressions. Though this deal is made between the two parties, it still all happens programmatically through DSPs and SSPs. This approach lends itself to highly targeted ads, stronger relationships between buyers and sellers, and more creative control for the publishers. However, if a buyer rejects an impression over price or segment, they cannot rejoin the auction for the same impression.

Programmatic guaranteed Programmatic guaranteed deals are based on a guaranteed volume of impressions at a fixed price. As with preferred deals, these are negotiated directly between the buyer and the seller. Inventory, pricing and run time are fixed, but buyers are able to apply additional audience targeting, filters and frequency caps during the campaign. These deals promise guaranteed revenue and, like preferred deals, create stronger relationships and give the seller a chance to review creatives before the campaign is executed. At the same time, there is a risk that inventory is either undersold or oversold.

PROGRAMMATIC TRENDS As with any major area within advertising and technology, there are several key trends to keep an eye on. Over the last few years, we’ve seen the shift from waterfall to header bidding (as mentioned earlier) and, in turn, this has led to a similar recent shift towards in-app header bidding on mobile. Within the in-app ecosystem, we’ve also begun seeing high street brands finally commit to in-app advertising, with the automotive and entertainment industries leading the way, and FMCG/CPG brands also dipping their toes in the water. We’ve also seen the introduction of both ads.txt and app-ads.txt in a bid to increase transparency and reduce fraud within the digital advertising industry.

The emergence of both video and audio has seen both areas achieve huge growth within programmatic over the last few years and, of course, native has been the success story of the past couple of years. More negatively, we’ve seen the impact that GDPR has had on the industry, with the likes of Drawbridge and Kargo forced to close their European operations over fears that they would be unable to comply with the new rules. There’s also the ongoing power of the Google and Facebook duopoly, perhaps soon to become a triopoly as Amazon flexes its muscles. This is obviously having an impact on the rest of the industry, with Sizmek filing for voluntary bancruptcy at the end of March and Amazon subsequently acquiring Sizmek’s ad server in June this year. Perhaps the most important trends, however, have been the increasing importance being placed on data, and the advance of programmatic technologies beyond web and mobile, into connected TV, digital out-of-home (DOOH) and traditional TV. Even prior to GDPR, the evolution of programmatic saw the industry begin to recognise the true value of data, and this move has been given an extra nudge in the right direction by the numerous high-profile data-related scandals and breaches that have occurred over the last few years. “Initially, this was driven by the Silicon Valley giants, but now brands are familiar with working to better structure, and developing and augmenting their own first-party data. This, together with last year’s high-profile data mishaps, is precisely why we see an increasing number of brands taking a ‘buildyour-own-algorithm’ approach,” says Cadi Jones, commercial director at Beeswax. “Currently, this trend is dominated by the directto-consumer, digital ‘D2C’ brands, but other sectors are gaining ground, including FMCG which, historically, has lagged in gathering firstparty data.” By building their own algorithms, brands are able to “own not just the data they input but also the resulting learnings,” according to Jones. As a result, legacy DSPs which take a ‘one-size-fits-all’ approach have become less appealing to the brands with their own algorithms.

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“They have come to realise that the learnings from an ad campaign for Coke, for example, could help inform the strategy used by Pepsi, if both were on the same legacy DSP,” continues Jones. “As brands wake up to the value of their first-party data, they may be reluctant to expose their data within shared infrastructures.”

apps. Attention spans are going that way so, for digital advertising appearing on all of those channels, the fastest-growing area within digital advertising is obviously programmatic,” adds The Trade Desk’s Castell.

As for programmatic’s expansion beyond web and mobile, that’s been driven by the need to reach people more easily across all the myriad channels that they interact with.

Despite all these generally positive trends within programmatic advertising, the industry does still have a number of contentious issues, as outlined below.

“Traditional display advertising paved the way for programmatic to be successful, as it thrived in a world where formats were a commodity. But with the rise of componentbased social formats, it was only a matter of time before these types of placements gravitated to the programmatic world,” says John Stoneman, general manager for Europe at TripleLift.

Brand safety

People haven’t entirely abandoned ‘traditional’ media; instead combining them with the wealth of digital options we now have at our disposal. To keep up with these consumers as they move across multiple channels, programmatic advertising has had to respond accordingly. “Modern generations are really shifting their attention across every single channel and experiencing content online in many digital forms. And that’s at a massive pace across audio, TV, connected TV, digital websites and

ISSUES FACING THE PROGRAMMATIC INDUSTRY

Brand safety is defined by the Internet Advertising Bureau (IAB) UK as keeping brands safe when they advertise online by not letting their ads appear next to inappropriate or illegal content. However, the term can also be used more broadly to represent general digital risk, creating a more umbrella term that covers contextual placement and ad fraud. We’ll begin with the more commonly highlighted contextual placement element. The most notable brand safety-related incident over the last few years involved multiple brands seeing their ads appear next to inappropriate content around the internet. Back in 2017, The Times revealed that a number of well-known brands, including

Sony, Mercedes-Benz, Honda and many more, had ads appear on sites from hate groups, and alongside YouTube videos created by terrorists and their supporters. This led to many brands rethinking their programmatic advertising strategy in a bid to prevent their image from being further tarnished. A bunch of them even pulled their ads from YouTube. “Tempting as the allure of cheap scale is, with hundreds of hours of content uploaded to social sites every minute, it’s inevitable that people will find ways of getting around the automated checks designed to ensure that advertising does not appear around inappropriate content,” says Fran Cowan, Inskin Media CMO. “A crude approach to contextual placement, such as excessive keyword blacklists, hugely restricts viable available inventory and overlooks the fundamental complexity of cognitive principles, such as the development of lasting associations. However, no brand or agency wants to risk a PR disaster; nor should it be criticised for a desire to spend its advertising money around quality content, in quality environments.”

Ad fraud Fraud is something that I’m sure most readers are familiar with but, in case you’re not, it’s defined as carrying out intentional deception in

FRAN COWAN INSKIN MEDIA

TEMPTING AS THE ALLURE OF CHEAP SCALE IS, WITH HUNDREDS OF HOURS OF CONTENT UPLOADED TO SOCIAL SITES EVERY MINUTE, IT’S INEVITABLE THAT PEOPLE WILL FIND WAYS OF GETTING AROUND THE AUTOMATED CHECKS DESIGNED TO ENSURE THAT ADVERTISING DOES NOT APPEAR AROUND INAPPROPRIATE CONTENT

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P&G’s top marketer Marc Pritchard has been highly critical of some of the processes and practices relating to programmatic

order to make an unlawful or unfair gain. This definition transfers over to advertising pretty seamlessly. “The issue of ad fraud is a serious one amounting to billions annually. According to eMarketer, recent estimates vary from $6.5bn to as high as $19bn. Display accounts for 39 per cent of all digital ad spend in the UK according to the latest IAB/PwC Adspend study, growing 22 per cent from the previous year to reach £5,249m,” says Cowan. “Meanwhile, the proportion of this display spend traded programmatically is increasing steadily, to up to 65 per cent of all digital media advertising in 2019, according to recent figures from Zenith. For all its wealth of data and workflow efficiencies, programmatic trading can be more vulnerable to ad fraud than direct trading: inventory can pass through multiple buyers and sellers, and too-good-to-be-true low eCPMS are rife with non-human traffic.” Ad fraud can come from bots (or non-human traffic), click farms, ad injection, domain spoofing or cookie stuffing. But what do these things actually look like? • Bots: Computer programs that mimic human interactions, creating the illusion that a human has seen an ad.

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• Click farms: When groups of people are hired to click on ads. • Ad injection: The placing of ads on a publisher’s site without their permission by overlaying or replacing existing ads. • Domain spoofing: When bad actors pretend to be premium publishers. • Cookie stuffing: Where multiple cookies from third-party websites are received on the user’s browser without their knowledge. “Like any way of buying, programmatic algorithms are subject to fraud. It’s just a different type of fraud,” says Robert Pawlowicz, technical director at Machine Advertising. “The biggest problem for programmatic is that, without careful supervision, algorithms can inadvertently optimise towards fraud and focus bidding on those sources. If left unchecked, this can cause reputational damage for the DSPs – who are ultimately the ones being defrauded in this situation.”

Viewability Viewability is a metric that tracks impressions which are actually seen by users. According to the IAB and the Media Rating Council (MRC), a display ad impression is considered viewable as soon as at least 50 per cent of

the displayed surface of the ad is viewed for at least one second continuously. Meanwhile, video ads must be viewed for at least two seconds continuously when at least 50 per cent is visible. “Ads must have the potential to be seen if they are to make an impact, which makes maximising viewability crucial for brands focused on optimising returns,” says Clementina Piazza, programmatic director EMEA at Integral Ad Science (IAS). “With the ad tech industry committed to ensuring brands aren’t paying for ads that never have the opportunity to be seen, the time has come for another evolution: to reach beyond baseline viewability and include more performance-based metrics that measure success.” Recent research from IAS found that programmatic advertising viewability rates are now outperforming publisher direct buys across both desktop and mobile web display. Breaking this down further, 69.1 per cent of UK desktop display ads met minimum viewability standards in the second half of 2018, rising 8.2 per cent from H1 2018. Meanwhile, 62.4 per cent of mobile web impressions did the same, representing growth of 16.6 per cent over H2 2017.

SEPTEMBER 2019

In comparison, publisher direct ads saw a rise of just 2.6 per cent, growing from 65.1 per cent to 67.7 per cent. Mobile app display viewability was well below all of the above, with only 42.8 per cent meeting the MRC standards. “With mobile ad spend in the UK set to surpass the £20bn mark in 2019, this increasing investment in mobile advertising presents an ever-growing need for independent verification. While for years, consistent and scalable in-app measurement wasn’t achievable, by adopting the IAB’s Open Measurement software development kit (SDK), publishers can now effectively cater for independent verification, enabling third-party viewability and measurement within mobile app environments,” says Piazza. “Creating a simple, unbiased and transparent viewability measurement within the mobile web and in-app environments will ultimately result in a better understanding of the channels. This therefore increases efficiency on every impression and maximises return on investment.”

Creativity Questions around creativity in programmatic advertising have been floating around for years. The industry has had to ask itself whether programmatic can actually be creative, and whether creativity and data can work in harmony to produce the most relevant, engaging advertising. “The rise of programmatic has widened the gap between creativity and media activation,” says Chris Childs, managing director at TabMo UK. “A key issue is that the average advertising campaign requires a variety of creatives to be run across several lines of targeting and across multiple channels. However, it’s rare that the creative agency is given full visibility of the complexity of the campaign at the point where it is developing the raw assets, making it difficult for the team to deliver across all the different consumer touchpoints.” With the wealth of data now available, it is possible to produce relevant creatives for an ad campaign that connect with consumers in the right place, at the right time. The problem is that creative professionals don’t tend to use big data in their work and data scientists aren’t creators. Added to that, there’s the need to

creatively engage consumers across channels in a consistent manner – with research suggesting that creative consistency across all digital ad formats leads to higher attention rates among consumers. “Solving the issue requires that every stakeholder is fully aware of every detail of how a campaign is going to run,” says Childs. “There is still too much of a gap between the various teams, especially the creative agency, the media activation team and the programmatic buying unit. There is also a lack of knowledge sharing. How many creative teams have seen how a campaign is run programmatically? Are they aware of the number of audience segments being used, or the geotargeting being deployed?”

THE FUTURE OF PROGRAMMATIC Looking ahead, experts predict that programmatic advertising will continue to go from strength to strength and become the primary way that digital advertising is traded across most – if not all – of the developed world. “Generally, if we carry on the trajectory that we’re on, we should reach a pretty good penetration level in terms of programmatic advertising being the way to buy all advertising,” says The Trade Desk’s Castell. “It’s better for advertisers, better for publishers, better for consumers, and it delivers better advertising across all channels.” Beyond that, there is also the continued trend of programmatic being used to power advertising in other areas, such as TV, DOOH and audio. “If we define ‘programmatic’ as ‘the automation of buying media that unlocks the magic of data’, then it’s clear why programmatic advertising is expanding to ‘traditional’ media,

with audio, out-of-home and advanced television advertising competing to move into the world of automation and data. In my mind, there’s no doubt that, within a couple of years, all media buying will be automated and datadriven,” says Beewax’s Jones. Despite Jones’ beliefs, she points out that programmatic advertising will only be able to continue its expansion across the media spectrum if legacy DSPs ditch their ‘one-sizefits-all’ approach to customisation and the pricing model evolves for both media buyers and sellers. “As TV and other, more expensive, media are traded programmatically, more and more buyers are switching to new DSPs, which are architected to be able to transact on a fixed monthly fee, instead of the punitive percentage of a media model,” Jones adds. Perhaps the biggest thing to look forward to in the near future, though, is the arrival of 5G. The next generation mobile network technology “is going to change the course of the mobile experience,” according to Castell. All in all, programmatic advertising has been on quite the journey over the last 10 years, and advances across the worlds of technology, marketing and advertising are only set to help fuel that journey for the foreseeable future. “The last decade has been a whirlwind. Advancements in technology have delivered new products and services that have improved the way marketers engage with consumers online,” says OpenX’s Stirrat. “Given the pace at which programmatic has grown in the last 10 years, we can only imagine what the next 10 years hold. With potential ad tech regulation, and the introduction of 5G, the future certainly won’t be boring.”

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SEPTEMBER 2019

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FIGHTING FRAUD, THE SMARTER WAY

Mobile Marketing talks user acquisition and ad fraud with Christian Henschel, co-founder and CEO, and Paul H. Müller, co-founder and CTO, of Adjust

t’s well recognised that the app market is a tough one. Whether you’re trying to find new users for your app, or trying to keep those users loyal and engaged once you’ve onboarded them, there are thousands of other apps competing for consumers’ eyeballs, and they all use pretty much the same channels and tactics to try to win them over. There’s no shortage of companies out there claiming to be able to help. Some are more credible than others; that credibility stemming from the number of years they have been doing what they do and the calibre of clients they have managed to attract. In both these respects, Adjust scores highly. The company was founded in 2012, principally to help app publishers with attribution and measurement, and these remain at the heart of the company’s offering today.

CLIENT ROSTER From a client perspective, the company also has a very respectable roster. Its tech is used in the apps of companies such as NBCUniversal,

Zynga, Robinhood, Pinterest and Procter & Gamble, along with around 25,000 others. Co-founder and CEO Christian Henschel says the company is driven by a passion to give its clients the edge. This means that Adjust’s search for other companies with smart tech that it can integrate into its platform is a never-ending one. “Besides what’s on our roadmap, we are constantly looking at opportunities to acquire companies that fit our vision,” says Henschel. In the past 10 months, it has made two such acquisitions. The first, in December 2018, was Acquired.io, a company that automates a lot of the time-consuming, manual, repetitive tasks involved in running hundreds of mobile ad campaigns across hundreds of channels. So how did the Acquired acquisition come about? “The first discussions were actually initiated by a customer of ours who was working with Acquired,” says Henschel. “The customer said it was a great company that was making their lives so much easier and that we really had to

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SEPTEMBER 2019

talk to them, so we did.” Henschel knew right away that he was on to something. “Through the Think Tank (our focus group, which brings marketers together to discuss innovations in the industry) and Mobile Spree events (Adjust’s own branded conferences that we host around the world), we meet around 1,000 customers every year. One thing we understand from talking to them is that they spend around 30 per cent of their time just adjusting and monitoring campaigns. This is a very time-consuming process, involving logging into multiple dashboards, and with some companies running as many as 1,000 campaigns at the same time, it’s a tall order for the human brain to constantly make adjustments to campaigns and creatives in such a manual way. Machines are better at this than humans, and that’s what the Acquired tech delivers.”

A month after the Acquired acquisition, Adjust bought another company, Israeli startup Unbotify. The cybersecurity and AI startup was named by Fast Company as ‘Israel’s most innovative company in 2017’ and listed as one of Gartner’s ‘2018 Cool Vendors in Advertising’. Müller explains the background to this deal: “We started building the prototype of our Fraud Prevention Suite in 2015. Now, the ideal scenario with ad fraud is to prevent it completely, but this is very difficult to do. The fraudsters are very clever and will do what they have to in order to protect their income. It’s a huge industry, worth hundreds of millions of dollars a year, and they are not willingly going to give that up, so they have developed some very sophisticated tech and types of fraud that are almost impossible to detect.

FOR EXAMPLE, WE WOULD SEE WHAT, TO US, LOOKED LIKE A REAL USER, ON A REAL DEVICE, USING A REAL APP. IN FACT, IT WAS A REAL DEVICE AND IT WAS THE REAL APP, BUT IT WAS BEING USED BY A BOT

So how does it do it?

SECRET SAUCE “The secret sauce is that Acquired took a step in a direction the market had not gone in before,” says Adjust co-founder and CTO Paul H. Müller. “All the partners you buy from require you to constantly log in and out of their dashboards; it’s a very manual process that no one had ever challenged before Acquired came along. Their tech automates a lot of the manual processes so that the human operator does not spend all their time entering their decisions into the machine. They just make the decision, and then the machine enacts it through simple automation.” Adjust’s first step with Acquired was to take the tech and run it off Adjust’s robust and scalable infrastructure. Since then, the company has been developing the solution further, and the Acquired team has relocated to Adjust’s global headquarters in Berlin from Saint Petersburg and San Francisco.

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“For example, we would see what, to us, looked like a real user, on a real device, using a real app. In fact, it was a real device and it was the real app, but it was being used by a bot.” This type of activity could be related to ad fraud, or, as Müller explains, other types of in-app activity. Up until recently, Adjust has mainly focused on preventing ad fraud. With the Unbotify acquisition, its capabilities now go beyond mobile performance ad fraud protection to protect an app’s business after an install.

losing to what they know must be a bot, then sooner or later they are going to get so frustrated that they will churn. It’s a massive problem for the games industry. “Then we met Unbotify. They are a team of data scientists working with some of the biggest brands in the world, and they have developed technology that takes the phone’s onboard sensors – accelerometer, gyroscope, battery, light sensor or duration and pressure of touch events – and uses the data from those sensors to identify whether it is a human or a bot that is using the app. This gives us so much more data to play with – hundreds of data points, just from a single session. Importantly, this data is compliant with all data privacy regulations, and is only ever used to distinguish a bot from a human, not humans from each other. “Once you can see the data behind the clicks and other actions in the app, it’s almost impossible for a bot to replicate how a human would use it. State-level actors might be capable of fooling this type of tech, but not the vast majority of regular fraudsters.” In-app bot fraud is a big issue across all verticals, but e-commerce is one it’s hitting particularly hard. On 29 March, the number one paid-for app on the App Store was a $20 Supbot, which helps its users get their hands on the latest Supreme drops before other shoppers, by letting them know the dates when the fashion brand’s new stock is unveiled. For many of the bot’s users, it’s an opportunity to buy the goods in bulk and resell these limited-edition items at a much higher price. For regular shoppers, it can ruin the user experience and cause long-lasting damage to brand reputation.

IN-APP PURCHASES

The Unbotify team continues to operate out of its Tel Aviv base, and the acquisition is unlikely to be the last, given that in June Adjust secured $227m (£187m) in funding. “The money will help us to find and acquire more good companies,” says Henschel. You need to be able to move fast and having the funds in place will help us do that.”

“If you take a game with in-app purchases, around one per cent of the people who play the game will buy stuff, and around one per cent of these will be the guys who spend thousands of dollars,” says Müller. “If you get someone like this playing a multiplayer online game and they see that they are constantly

The money will also enable Adjust to increase its footprint in its existing offices – it has 15 across the globe, in Berlin, New York, San Francisco, São Paulo, Paris, London, Moscow, Istanbul, Tel Aviv, Seoul, Shanghai, Beijing, Tokyo, Bangalore and Singapore. Headcount

SEPTEMBER 2019

currently stands at 400, around 60 per cent of whom are engineers. “We already have a large presence in South East Asia, but we will be adding more people in China, Japan and Korea,” says Henschel. “The same applies to our two US offices, and India and South America.”

ONE PLATFORM Looking ahead, Müller says that the company will continue to be driven by looking at what its

customers are doing every day, and at how it can use technology to make their lives easier – a laudable concept that the company’s clients will no doubt appreciate. “For us, it’s not about having the best tech around automation, AI or whatever,” he says. “It’s about having lots of different, complementary products in one platform that people can access easily with one login and one dataset, removing a lot of the manual work and leaving them free to work smarter.”

Henschel adds: “When apps launched around 2008, people said they were just a fad – but look at the industry now. Apps are still on the rise and will continue to evolve over the years. In the years to come, we want Adjust to be the backbone of this extensive and lucrative mobile ecosystem. Attribution and measurement will remain our main focus, but we’ll also continue to expand our services and fulfil customers’ growing demands – providing marketers with a single platform for all their needs.

HOW VIBER STOPPED MOBILE AD FRAUD WITH ADJUST, SAVING 10 PER CENT OF ITS MARKETING BUDGET Viber, the free instant messaging and calling app, now has over 1bn users worldwide. To increase its global footprint, the company decided to actively grow its user base across Europe, Asia and North America. But growth plans also mean apps often become targets for ad fraud. Viber turned to Adjust to help it get ahead of fraudsters and protect its marketing budget. Working with Adjust’s Fraud Prevention Suite (FPS) saved Viber from wasting its budget on fraudulent traffic. On average, the company saved 10 per cent of its marketing budget, which could then be reinvested in acquiring real users.

Importantly, the tool also gave Viber more freedom to experiment with different networks. With FPS activated, it could be more lenient with testing new partners, as they knew the data it received was filtered for fraud. Since working with Adjust, Viber has now changed its internal evaluating logic for network quality. It no longer just looks at the top KPIs but also includes fraud rate as an evaluator. Now, if a partner reaches more than 20 per cent fraudulent traffic, Viber stops working with that partner. A great example of effective fraud prevention in action.

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SOUND David Murphy talks to Ollie Deane, director of commercial digital at Global, about what’s fuelling the rise of digital audio

he MIDAS Summer survey from RAJAR, which looks at how, when and where digital audio content is being consumed, painted a picture of an industry in rude health. It revealed that 28.8m adults now listen to digital audio each week – that’s 53 per cent of the population and a 10 per cent increase on the year. Podcast listening is also on the rise, with 9m people listening to podcasts every week. The number of people listening to podcasts has almost doubled in the past three years. This opens up a brand-new audience to advertisers, as over half of podcast listeners do not stream music. The study also revealed that 20 per cent of digital audio is now consumed via smart speakers. They say that budgets follow eyeballs, and a recent study, ‘The Rise of Digital Audio Advertising’ from DAX – the digital audio advertising platform created and operated by Global – seems to bear this out. For the study, which was first released in July, DAX commissioned research firm MTM to interview 215 executives at leading UK media agencies and brands. The interviews revealed that 85 per cent of UK advertisers plan to increase their investment in digital audio

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over the next year, while 75 per cent plan to increase spend in podcast advertising.

GREAT NUMBERS As the man leading Global’s DAX (Digital Audio Exchange), a platform that enables advertisers to access high-quality digital audio ad inventory, Ollie Deane, director of commercial digital at Global, is understandably buoyed by the results of both studies. So, what does he feel is driving such great numbers? “If you look at podcasts first, there are two major factors driving the growth,” he says. “Podcasts have been around a long time, but recently, we’ve seen a massive increase in the number of quality podcasts being produced, with big media companies like ITV and Sky producing their own and using some of their best on-screen talent to do so. “Then with podcast platforms like the Apple podcast app and our own Global Player curating lots of really good content, it’s never been easier for people to find the content they like.” Ads within podcasts come in two forms. The first is a standard 30-second ad, inserted pre-, mid- or post-roll. The second is a host-read ad, typically up to 90 seconds in length. “It’s more like a piece of branded content,” says

Deane. “The host explains what the product is, maybe a newspaper or a magazine, why he or she reads it and what their favourite part is. As one of the respondents to our study put it: ‘Having a podcast host read an ad is verging on influencer marketing. If it’s the right person and it sounds natural, I think that it’s very powerful.’” The growth in smart speaker listening mirrors the growth in sales of Amazon Echos, Google Homes et al. “Two years ago, that 20 per cent was virtually zero,” says Deane. “On Christmas Day 2017 and 2018, we saw smart speaker listening more than double in one day. People might buy these things thinking they want to ask Alexa what their morning commute looks like or what the weather’s doing, but in reality, the first thing they tend to ask them to do is to play the radio.”

DYNAMIC AUDIO From an advertiser perspective, Deane feels brands are getting to grips with the new medium. He says: “The explosion of audio content on connected devices means that the toolkit advertisers have to work with is bigger and broader than ever. Dynamic audio has become very popular in the last couple of years.”

SEPTEMBER 2019

Dynamic audio supports brands’ specific marketing efforts by serving personalised ads at contextually relevant moments. To create the ad, a voiceover artist records the main part of the script, then subsequently records different variations of the weather, product references, locations, days and times of day. All these snippets of audio sit on a server and then at the point of serving the ad, a unique message tailored to the listener is delivered. eBay is of just one of the leading brands using dynamic audio to support its specific marketing objectives. A recent campaign generated over 6,000 audio ad variations. eBay was able to track and monitor the creative performance of the entire campaign and subsequent traffic to its website, using DAX’s Listener Insight ID tool. During the campaign period, eBay saw a 1.7 per cent uplift in website traffic to its home section and 1.5 per cent to its gardening section. Another tactic popular with advertisers, says Deane, is 3D audio, which plays to the fact that a lot of mobile listening takes place on headphones. 3D audio delivers an immersive surround sound experience and has been used to good effect by broadcasters. Channel 4, for example, employed it to promote a new series of The Hunted, with an ad that put the listener in the position of being hunted by the police, with sirens in one ear and the sound of a helicopter overhead in the other. “The key point here is that, as more of the web goes screenless and people spend more time with non-screen devices, advertisers are paying much more attention to their audio brand identity, says Deane. “They are working on how they should sound, even what type of accent

the brand should have, in the same way that, many years ago, brands started looking closely at their visual identity. It’s no coincidence that, parallel to this, we are seeing new agencies opening up, focusing purely on sound.” In a similar vein, Deane sees a great opportunity for in-car digital audio listening. According to a 2019 Which? report, this saw a 45 per cent year-on-year increase in 2018. “The in-car market is more nascent, but I see great potential for growth,” says Deane. “It represents a great opportunity to reach people in a true ‘captive audience’ state and to target them based on their interests and location.”

PROGRAMMATIC TRADING As the budgets invested in digital audio advertising increase, so the proportion of these budgets spent programmatically is also increasing. Just under half of the impressions on DAX are now traded programmatically through major DSPs like The Trade Desk, AppNexus and Adobe. “Advertisers see programmatic as a good way of aligning and synching the different digital formats they use,” says Deane. “They are also getting more savvy in terms of tying the different programmatic channels together, so, for example, being able to see whether a consumer exposed to an audio ad is more likely to convert when they see a display ad later the same week.” This cross-platform targeting is a key weapon in the DAX armoury, as Deane explains. “Outdoor was an obvious place to start when we first started looking at cross-platform targeting a few years back, and it’s even more appropriate now that we have bought three

outdoor companies,” he says. “Lots of people stream audio when they’re out and about and they also pass a lot of posters, so we have been experimenting with some simple targeting, where an advertiser can buy 2,000 billboards. We geofence those and then serve an ad when a consumer is near one of the sites. Not in the sense of ‘crowbarring’ an ad in, but more a case of the consumer walks past a poster site carrying an ad for a new movie, then the next audio ad they hear a few minutes later is an ad for the same movie. “The energy company E.ON saw a significant uptake in applications for smart meters when they ran an audio ad synched to a poster ad. We are very excited about the potential for this.” Excited he may be, but Deane recognises that there are still some challenges ahead. “Educating advertisers on the different ways they can measure audio has been a huge challenge for us,” he says. “When we started out, there was no clickthrough rate for audio ads and no post-listener attribution, but we have come a long way. Now we can tag an advertiser’s website, serve an ad, and once the consumer has heard it, we can see if they visit the client’s website, what pages they look at, how far down the purchase funnel they go. “300 advertisers are now using our Listener Insight ID dashboard to measure the optimum frequency of an audio ad, identify the best time of day to serve ads to a particular type of listener, and to look at the creative and how that affects performance. The challenge is to make sure advertisers are aware of these tools and using them correctly, but it’s one we think we are up to.”

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SEPTEMBER 2019

INFLUENCER MARKETING

101 Influencer marketing is going from strength to strength, but as new channels and types of influencer emerge, how are brands and agencies leveraging their potential? Alyssa Clementi reports

www.mobilemarketingmagazine.com

SEPTEMBER 2019

he influencer marketing industry has continued to grow at such an exponential rate, there is room for anyone to join, literally. From nano influencers to mega influencers, and every account in between, more and more people are looking for ways to get paid to post. By the end of 2019, the influencer marketing industry is expected to be worth $8bn (£6.5bn), and it’s on track to surpass $15bn by 2022, according to Mediakix. For brands, the use of influencers and social platforms to help drive revenue has been so successful, that according to the WFA (World Federation of Advertisers), 65 per cent of brands plan to increase influencer marketing spend this year. “Influencer marketing is an effective strategy to increase brand awareness, sales and brand affinity for businesses across the board. Unlike traditional advertising, which can feel overly branded and sterile, influencer marketing speaks to consumers in an authentic, personalised way. This is why nearly half of Americans have said that they make purchases based on influencer recommendations,” comments Eric Lam, cofounder and CEO of AspireIQ. “We’ve also seen massive success from many companies that have built businesses rooted in social media, such as Revolve’s IPO and Glossier’s billiondollar valuation. This is all further proof that influencer marketing and community building works, and that we’ll continue to see more and more brands follow in suit.”

WHO CAN BE AN INFLUENCER? While many influencers – also known as creators – already have a strong following before they start promoting products, anyone with a smartphone and a social media account can break into the industry. Influencers with a smaller follower count can utilise self-service platforms like AspireIQ, #paid and Popular Pays, which match creators with brands that fit their niche. “Honestly, these days, anyone can be an influencer; with the rise of micro and nano influencers, because of their authentic, trustworthy and engaged audiences, you don’t have to have a million followers to start building your personal brand and working with sponsors,” says Crystal Duncan, vice president, influencer marketing, at Edelman Digital.

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SEPTEMBER 2019

While racking up a high number of followers is an important factor, creators need to focus on more than just metrics. Some key factors to becoming a sought-after creator are transparency, storytelling, personalisation and inclusivity. Statistics from Microsoft Advertising reveal that 91 per cent of millennials and 93 per cent of mothers will switch to a brand that supports a good cause, while 70 per cent of millennials and Generation Z will choose one brand over another if it demonstrates diversity in its promotions. When brands are searching for an influencer to promote their product, they also want to make sure that each influencer has a good relationship with their audience and can properly delegate the brand’s message. “The great thing about being an influencer is that it’s not a new concept. People have been doing it since the beginning of time. Social media is just how we do it today. If you have a point of view, social can provide you with the platform to be influential,” says Aana Leech, director of marketing communications and creator experience at Popular Pays. “The key is to discover your community and create, create, create. Content is how influencers connect with their communities. Breaking into the industry requires that you find the message, platform and format that resonates most with your community, and then be prepared to adapt based on community feedback and new platform features.”

TARGET AUDIENCE Since there are so many tiers of influencers, brands and influencer marketing agencies have to look extensively at their targeted audience. Depending on the brand’s budget and specific product they are trying to market, they’ll have to pick between using a nano influencer (less than 1k followers), a micro influencer (1k–100k followers), a macro influencer (100k–1m followers) or a mega influencer (more than 1m followers). Mega influencers usually tend to be celebrities with millions of followers, so they’re able to charge a huge fee per paid post. If a brand wants Kylie Jenner to help promote a product on Instagram, they can expect to pay the beauty mogul $1.26m per post, according to the 2019 Instagram Rich List. Coming in second is singer Ariana Grande, who charges $996,000 per sponsored post. Lesser-known celebrities like YouTubers and former Vine stars can

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SEPTEMBER 2019

get away with charging around $85,000 for each paid post, depending on their current relevance in social media. For Instagram influencers on a much lower tier, the rule of thumb is as follows: $10 per 1,000 followers or $1,000 per 100,000 followers. Snapchat influencers start at around $500 per 24-hour campaign, and YouTube influencers can cash in $2,000 for every 100,000 subscribers. There are some factors when it comes to choosing an influencer that are not related to the number of followers, including amount of engagement per post (comments/shares), their preferred platform and the style of post (picture/story/audio). “We look to create partnerships for brands with people who are already big supporters of, or believers in, what the brand is doing,” says Adam Rivietz, co-founder and CEO of #paid. “Sometimes that’s more difficult to do than it sounds. When that happens,

we look for alignment between the brand’s mission and the lifestyle of the creators. For example, when Coke launched Coca Cola Life, their reduced calorie sparkling beverage, we matched them with creators who lived an active, health-conscious lifestyle, to massive effect, driving a 21 per cent lift in trial intent with creator content.” “When we are planning out a programme, we actually start by looking at what our KPIs are for the campaign and what other media is running for the programme overall,” says Edelman Digital’s Duncan. “By establishing goals up front, we can then work backwards to figure out which platforms are best for our programme, basically build an influencer channel strategy, before going into influencer selection. For example, if we’re looking to drive traffic to a website, eCommerce page, etc, we would probably avoid tactics that wouldn’t include clickable links (like Instagram in-feed posts) and lean into places that make it easy for an audience to click through (like Instagram Stories swipe-ups).

ADAM RIVIETZ #PAID

WE NAMED OUR COMPANY #PAID FOR A MULTITUDE OF REASONS, BUT ONE OF THEM WAS THAT WE STRONGLY BELIEVE YOU NEED TO MAKE IT CLEAR THAT YOU’RE BEING PAID TO ENDORSE SOMETHING

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“Once we align on KPIs and channel tactics, we can then start looking at other aspects of the influencers, like their demographics, age, content style, audience information, etc. By layering on these aspects of the influencer and their audience, we can then start to build out who our talent could be for the programme.”

INFLUENCER FRAUD So what do brands and agencies need to look out for when hiring influencers? Fraud is a key consideration: as more and more brands have turned to influencer marketing to reach newer and more relevant audiences, so the amount of fraud in the industry has increased. According to cybersecurity company Cheq, fraudulent activity among influencers will cost advertisers $1.3m in 2019. Dishonest influencers can easily purchase fake followers, which will fraudulently boost that influencer’s comments, ‘likes’ and shares. Advertisers will then pay that influencer more, owing to the misplaced belief that the account has a higher engagement rate. To avoid hiring a creator that has paid for their likes, agencies can take on the tedious task of going through the creator’s followers and seeing if anything stands out as looking suspicious or fraudulent, though there are tools and companies available to help them do this. On the other side of the coin, the creators and influencers themselves have a legal responsibility to be transparent and honest with their followers, and to disclose when they are being paid to promote an item. “We named our company #paid for a multitude of reasons, but one of them was that we strongly believe you need to make it clear that you’re being paid to endorse something. This is a major problem for the industry, because even if only a small portion of influencers fail to do this, people notice and everyone’s credibility takes a hit,” comments Rivietz. “Part of onboarding creators to our platform is an audit that checks for this kind of behaviour. We don’t want people who would do something like that representing our clients, because it risks the reputation of our brand partners.” Edelman Digital’s Duncan agrees. “Influencers should always be honest and truthful with their followers, because this is what their followers expect,” she says. “Edelman’s 2019 Trust Barometer Special Report: Online Influencer Survey found that in the last six months, nearly six in 10 young adults aged 18–34,

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have purchased a brand or product based on an influencer, and four in 10 say they trust a brand because of an influencer. Influencers are trusted because they aren’t always perfect; they share the good parts of their lives, but also the non-perfect moments. Doing this give us an insight into their lives and makes them feel like a friend, someone we can rely on for insights, perspectives and opinions.” There are several platforms where influencers are active. For creators, Instagram has always been the leading platform of choice, especially because of engaging features including the Explore page, Stories and IGTV. Trailing just slightly in popularity (and campaign results) are Facebook, YouTube and Pinterest, while newer platforms like Snapchat and, more recently, TikTok, have quickly gained momentum. Depending on the influencer marketing campaign strategy, each influencer may have their go-to platform. “In recent years, Instagram has figured out how to create an environment that makes it easy for brands to connect with their target audiences and convert them into customers, but new platforms are the friendliest for influencers as they’re the starting point for monetisation. For brands, look to new platforms for experimentation. It will be difficult to directly measure ROI at first, but emerging platforms are a green field for your brand’s story,” says Popular Pays’ Leech. “Instagram is definitely the platform for product promotion,” says #paid’s Rivietz. “CivicScience found that 34 per cent of Instagram’s daily active users have made a purchase based on an influencer’s recommendation. That level of influence is huge, and brands have taken notice.” After short-form video-sharing platform Vine was shut down in 2017, many of its bestknown creators jumped ship and transferred their following to YouTube. Some of the most famous Viners-turned-YouTube influencers include King Bach, Lele Pons, Gabbie Hanna, Jake Paul and Sarah Schauer. Most of these influencers continue to make a sizeable amount of money from their YouTube channels, product reviews and product placements. “YouTube remains popular for promoting products that take advantage of its longform video medium, which makes it an ideal platform for providing in-depth product

reviews and tutorials. These content creators are viewed as experts in their space, offering their audiences valuable tips or recommendations. In fact, 68 per cent of YouTube users have watched a video to help them make a purchase decision,” explains AspireIQ’s Lam. “Additionally, we’ve seen a surge in interest from brands building Pinterest into their strategy. 90 per cent of users rely on Pinterest to help guide their purchasing decisions, creating a huge opportunity for brands to connect with customers when they are already open and receptive to new ideas.” And Elena Kutsopal, managing director of WeQInfluencers, notes that, according to Apptopia, TikTok’s international downloads rose by 20 per cent between April and midJuly 2019, with US downloads up 25 per cent. “Currently, TikTok holds the number one spot for social media app downloads, beating Snapchat, Instagram, Facebook and YouTube,” she says. “While TikTok is still relatively new, marketers should seriously consider looking to this emerging platform to create video for younger audiences.”

HIDING LIKES Recently, there has been growing concern over the correlation between social media engagement and users’ mental health. Public metrics such as likes, comments and views have been deemed potentially damaging, as they could cause a user to have lower levels of self-worth or confidence. For most creators, though, likes are the way they measure the success of their campaigns – and how they cash in their cheques. “Likes have been a vanity metric for quite some time,” says Lam. “Like other third-party platforms and agencies, we’re provided with limited data from the social networks to measure performance. Unfortunately for the industry at large, this has continued to make likes one of the most important markers of performance.” As one of the most popular platforms for giving out and receiving likes, Instagram decided to see what a world without this magic number would look like. In April, it launched an experimental trial throughout Canada, hiding likes on certain accounts. While the post’s creator could still see who liked their picture, the like-count was hidden from everyone else.

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ERIC LAM ASPIREIQ

LIKES HAVE BEEN A VANITY METRIC FOR QUITE SOME TIME. LIKE OTHER THIRDPARTY PLATFORMS AND AGENCIES, WE’RE PROVIDED WITH LIMITED DATA FROM THE SOCIAL NETWORKS TO MEASURE PERFORMANCE

Creator media platform #paid decided to research just how much hidden likes affected its content creators. The Canada-based company found that 35 per cent of them either hated (19 per cent) or disliked (16 per cent) the ‘no likes’ experience. By comparison, only 24 per cent of users in the control group (those who could still see likes), hated or disliked the idea of the no likes experience. More than 50 per cent of creators saw their likes fall, and a third of the creators experienced fewer comments on their posts. Almost half of the creators saw a stall in follower growth once likes started to be hidden. “Since launch, I’ve seen extremely low engagement and interaction because posts are not gaining enough likes/comments to be deemed ‘good posts’ and therefore do not get shown to many people,” says one creator. Creators who had their likes hidden were 162 per cent more likely to disagree with the statement ‘Since the start of the experiment, I feel more freedom to be creative’. Two-thirds of creators also admitted that removing likes did not improve their happiness. It also

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affected creators’ engagement: #paid found that creators who had their likes hidden were 2.5 times more likely to strongly agree with the statement ‘Since the change, I post less often’.

the better,” says Rivietz. “It should increase the creative freedom of influencers and creators, while having a positive mental health impact for all users.

Another creator comments: “Since the change, I engage with the platform less, I post less, I feel worse about posting and do not enjoy creating content for it anymore. Seems like the focus/changes are always geared at ripping away more and more of our reach/influence with each change.”

“For brands, the change would necessitate a period of recalibration. A lot of brands put a lot of faith in likes as a metric of success, and their baselines will need to be adjusted, as this change will cause the average number of likes to go down for creators. This will ultimately be a change for the better, though, as hopefully more brands start focusing on metrics that really measure like return on ad spend.”

However, there were some fans of the hidden likes experiment, including the 23 per cent of creators who agreed they had the freedom to be more creative with their posts. 16 per cent agreed they could be more authentic with their content if likes were hidden. “Too many people rely on the numbers, when it usually ends up fostering unhealthy comparisons. I am all for quality over quantity. Creating quality and engaging content should be the focus,” says another participant. “Right now, people are really torn on this, but long-term, #paid believes this is a change for

INFLUENCER SUCCESS So what does a successful influencer campaign look like? Clearly, they come in all shapes and sizes. Back in 2017, M&M’s launched a new flavour – Caramel – and decided that influencer marketing was the way to go. Along with Popular Pays, M&M’s worked with 70 creators to publish 204 pieces of content on Instagram, throughout a span of one year. All 70 creators were paid to post three unique pieces of content, which were viewed by a total following of 6.49m Instagram accounts.

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“M&M’s effectively managed 70 creator partnerships through the Pop Pays platform to develop a diverse library of content for the brand to use throughout the first-year product launch,” says Popular Pays’ Leech. Lovesac, a US furniture chain, wanted to increase brand awareness and drive key metrics, including ROI. Originally, Lovesac used a handful of macro influencers to promote the brand’s products via Instagram, but the company was interested to see how far their campaign could reach. After partnering with AspireIQ, Lovesac was able to take advantage of the agency’s catalogue of creators. Lovesac

asked these creators to authentically integrate their products into the their Instagram content in a way that seemed seamless and organic. Lovesac now has a working relationship with 30–40 influencers per month, and has seen its ROI increase by a factor of 3–4 since partnering with the agency. Lovesac’s influencer campaigns have resulted in 18.5m impressions, 1.1m video views, $245,000 in media value and more than 577,000 clicks to the Lovesac website.

FROM INFLUENCERS TO CREATORS For some people and brands, the jury is still out on influencer marketing. It remains a

young, in many ways immature, medium, in which not all the key protagonists choose to play by the rules. On the other hand, influencer marketing provides brands with a way to target their key audiences much more precisely and cost-effectively, by using those people their customers and prospects see as role models to endorse their message. And as interest, and budgets, move away from influencers who are famous for being famous, towards creators who have real talent, the space is set for more growth and more exciting innovation in the months and years to come.

ERIC LAM ASPIREIQ

YOUTUBE REMAINS POPULAR FOR PROMOTING PRODUCTS THAT TAKE ADVANTAGE OF ITS LONGFORM VIDEO MEDIUM, WHICH MAKES IT AN IDEAL PLATFORM FOR PROVIDING IN-DEPTH PRODUCT REVIEWS AND TUTORIALS.

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THE CPAAS REVOLUTION Rohit Tripathi, senior vice president, head of products and go-to-market, and Markku Helin, head of product management, SAP Contact Center 365, at SAP Digital Interconnect, explain how to use CPaaS to improve engagements and service in the experience economy dictating which channels users can or can’t use to contact them – you now have to interact with individuals on their preferred channel and on their terms.

oday, we all expect a smooth experience in every aspect of our digital lives, whether that’s talking to friends or making a purchase, planning a trip or contacting a brand for customer support. All businesses and app developers today are participating in the experience economy, where the experience they provide to customers can have just as much weight as their product, service or app itself. When we’re thinking about businesses communicating with consumers, the experience economy means choosing the right channel at the right time and in the right context. It’s no longer a case of the business

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In its recent Ovum paper, ‘Understanding the Complexity of Messaging Channels and Digital Engagement,’ SAP Digital Interconnect has found that email is the preferred messaging channel by which consumers interact with their service providers for a number of use cases, followed by SMS, and then voice. This doesn’t mean that one channel is necessarily superior to the other, it’s just a matter of personal preference and context. Each channel has its own benefits and drawbacks, depending on factors such as the customer, use case, urgency and data connectivity limitations. There are simple interactions where SMS, WhatsApp or Facebook Messenger are the perfect means of communication between brand and customer, but for more complex cases, a voice call, email or live chat might be necessary.

Right now, however, this isn’t how most businesses are approaching the customer experience. We all know that it costs exponentially more to acquire a new customer than to retain an existing one but, as most companies have undergone digital transformations, many haven’t included customer service as part of that process. This is a huge opportunity. An SAP study showed that 92 per cent of leading companies have a mature digital transformation strategy in place to improve the customer experience, compared to 22 per cent for non-leaders. Achieving this kind of transformation requires an omnichannel approach – and this is where CPaaS comes in.

WHAT IS CPAAS? CPaaS, or communications-platformas-a-service, refers to a cloud-based platform which simplifies the integration of communications services – meaning SMS, email, voice, push, social, RCS, chatbots, any channel or microservice such as authentication you care to name – into existing backend systems and apps.

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As companies begin to realise the consumer demand for communicating via social and other messaging channels, it might be tempting to buy a separate solution – but this results in siloed processes for each channel. This is how you end up with that age-old frustration of customer service, where you begin a conversation with one representative only to be told they can’t help you, and you’ll have to ring a different number, with no continuity between the two conversations. By contrast, CPaaS offers a way of fully integrating all channels, allowing you to interact with

Next, say that the consumer responds to the notification, saying they need to change the delivery time or address – this information needs to be passed to the relevant business application, which may or may not be the same as the one that triggered this process in the first place. This simple interaction would require a degree of manual effort that couldn’t be scaled up to an entire business – and so instead we use APIs and intelligent interconnectivity to enable each service. A single API from a CPaaS leader

REVENUES FROM CPAAS ARE PROJECTED TO GROW TO $5.2BN IN 2023 consumers across lines of business in the channel-agnostic way they expect from an intelligent, interconnected enterprise.

can connect to all channels, whether it’s SMS, in-app push, social, or whatever is needed for the situation or customer.

CPaaS also allows for two-way communication and handovers between channels. To explain why this is important, let’s take the example of chatbots. Bots represent a great opportunity for automation, but they need to be deployed correctly – meaning that, if the bot cannot really provide proper help for an issue, it can pass the conversation onto a human representative who can handle it. In many applications of the technology today, this isn’t the case, and this kind of fallback functionality needs to be built in from the very beginning.

One SAP Digital Interconnect customer making the most of these benefits is Metropolitan Utilities District, which provides water and gas to nearly one-third of the state of Nebraska. It has complete 360-degree viewability of its customers, meaning that when one of them reaches out with a problem, whether it’s a phone call or a live chat, Metropolitan can immediately see the details of their current contracts and invoices. Customer service reps can then skip the usual introductory questions and get straight to the heart of the matter to resolve the problem during the first contact.

THE IMPORTANCE OF APIS

And in the case of an outage, the utilities company can detect where a call to its contact centre is coming from and play a specific outage prompt to all callers within the affected area, which can be updated with the latest details. It can even deploy proactive notifications, sending SMS messages to the affected consumers. This all adds up to a much better experience for those individuals who have already been inconvenienced enough.

This holistic approach applies not only to the channels being used, but to where it all fits within your wider business. It can be tempting to treat communication as a separate entity, standing apart from other operations, but this is seldom actually the case. Let’s take an example we’ve likely all experienced. Say you’re a delivery company about to deliver a package, and you want to notify the recipient that it will arrive shortly. To do this, your logistics application needs to be connected with your communications platform, so it knows when, where and how to send the notification.

needs of their customers, rather than locking them into a single solution. APIs are also easily consumable, which contributes to our overall goal: to simplify the underlying complexity of interconnectivity between multiple channels, apps, devices and data on the behalf of our enterprise customers, so that they needn’t worry about the technical aspect, just the experience they’re delivering to customers and partners. This is what CPaaS is all about – bringing secure and reliable omnichannel communications capabilities, scalability and agility to companies large and small, without any of the associated headaches and expense. It’s perhaps not surprising, then, that revenues from CPaaS are projected to grow to $5.2bn (£4.3bn) in 2023, and 67 per cent of enterprises expect CPaaS to have an impact on their organisation within the next three to five years. This will open up more opportunities in future – whether it’s improved analytics of the customer experience or creative use of technology, like automatic recognition of a customer’s tone of voice to understand the best approach – because CPaaS is a platform on which we can all build. The important thing is making sure you’ve got the right platform to build on in the first place. Which is why we at SAP Digital Interconnect are so focused on making it easier for our enterprise customers to make it easier for their end customers – ensuring a great, and interactive, experience at a time when that has never been more important.

MAKING IT EASY One of the key benefits of APIs is that they are configurable, enabling businesses to progressively build upon them to serve the

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YES – MOBILE VIDEO CAN REPLACE TV Matt Barash, head of strategy and business development at AdColony, discusses why it’s time for advertisers to stop looking to TV for reach and instead turn their attention to mobile video

oday’s consumers are buried in their phones – and they’re not just scrolling, they’re pausing and watching. Mobile video now accounts for more than half of all video starts, with mobile plays growing in double-digit percentages and showing no signs of slowing down. The mobile app is the new TV channel – many of the top-ranked apps in the Apple App/ Google Play stores have the ability to deliver broader reach than a primetime airing of ESPN’s SportsCenter. While the trend is certainly driven by millennials, mobile users of all ages are

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following suit. If you’re an advertiser today looking for massive reach with high frequency to a diverse audience (and who isn’t?) TV should no longer be your go-to. Just as print came and went, I would argue that linear TV has been supplanted by social media for reach. So why is this not an argument for social media as the number one channel for marketers today? Because social channels have severe limitations in two realms: creative capabilities and, of course, brand safety. The latter is important to note. We’ve found that 60 per cent of consumers are seeing non-brandsafe content on Facebook. On YouTube, which

seems to get more flak for it, the figure stands at 33 per cent. This is no joke for advertisers – 49 per cent of those we surveyed said seeing ads in proximity to this type of content negatively impacts their perception of the advertiser. As GroupM’s Susan Schiekofer told Digiday: “We have those conversations with our clients around what are you comfortable with in terms of the brand-safety spectrum? If you have the same stringent guidelines as you do on television, say, Do Not Air lists, you really should extend that into the digital media marketplace. “We’re [also] very careful when the big platforms extend off platform. That, to us,

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is a really critical area to look at, because a lot of times with extensions – whether it’s Amazon, whether it’s Facebook, whether it’s Google Display Network – sometimes the measurement is there, sometimes it needs to get better.”

INHERENT PROBLEM So not all mobile video is created equal, and certainly not all is going to deliver the level of brand safety (or viewability, or measurement) that brand advertisers require. Mobile video within social media sites like those mentioned above has the same inherent problem as user-generated content, and that is not going away. Many mobile advertisers have turned their eyes to over-the-top (OTT) as the next promised land. It seems ideal: the broad reach of traditional TV, plus the targeting, creative customisation and analytics that we’re used to in the digital buying world. But the truth is, we are not even close to delivering on that promise. Data is a complicated commodity in the OTT space today. And measurement? It’s also not there yet. The incumbent (Nielsen) came under scrutiny for not incorporating mobile and OTT in its ratings and has only recently innovated with Total Ad Ratings. So agencies are not turning to OTT to leverage media, data and creative in one fell swoop. They are turning to non-social, non-OTT mobile app environments. Realistically, what does that mean in terms of inventory? It means mobile games.

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–THE SHAPE OF THINGS TO COME Caroline McClelland, marketing manager at Kumulos, looks at the benefits of 5G for the Internet of Things, smart cities and mobile apps

G is the latest iteration of wireless network connectivity. The Internet of Things (IoT) has become one of the most important sectors in the technology field, with potential large-scale applications for consumers and enterprise organisations. 5G promises to unlock IoT capabilities that were previously unattainable on 4G networks. 5G will introduce major innovations, like higher connection speeds, greater capacity and lower latency. Over time, these benefits will lead to technological milestones that will have a significant impact on business strategy. So, how will 5G transform enterprise IoT? Let’s start by looking at 5G’s major innovations.

HIGHER CONNECTION SPEED At peak speed, 5G operates at 10Gbps. That’s 100 times the speed of current 4G networks, which top out at about 100Mbps. To put that into perspective, users will be able to download an entire HD movie in less than 10 seconds, a task that takes several minutes over a 4G connection.

GREATER CAPACITY 5G will allow for more high-demand devices to connect over a single network. Until the introduction of 5G, IoT networks couldn’t support such extensive connectivity. The ability

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to support more connections at a higher speed will help alleviate that strain, meaning more people can transmit data at the same time.

LOWER LATENCY Latency, or ‘lag time’, is the amount of time that passes between when a device is asked to perform a task and when it actually completes the command. On 4G networks, the average latency speed hovers between 40 and 50 milliseconds. Over 5G, latency speed will be dramatically reduced. 5G’s innovations will transform the IoT landscape in a variety of different ways. Let’s take a look at these.

TRULY CONNECTED CITIES By 2020, many experts have projected that there will be close to 30bn connected devices globally. A majority of these will be industrial connections, which are a critical component of smart cities. Experts don’t believe 4G networks have the capacity to manage truly connected cities. 5G networks, however, can support the enormous amount of data smart cities will generate.

STREAMLINED TRANSPORTATION Although autonomous vehicles have been a buzzword for several years, these self-driving

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cars can’t operate efficiently over high-latency connections. They need real-time awareness that’s only attainable over a high-speed, low-latency network. 5G’s innovations could eventually allow for autonomous vehicles to safely interact with each other, traffic infrastructure and even the roads themselves.

ENABLED IOT DEVICES 5G greatly expands what businesses can do with connected devices. This is because of the capabilities of 5G technology to support more simultaneous internet connections, require less energy from wireless radios, enable more IoT video applications and mitigate problems associated with wireless latency. According to Dr Jeff Loucks, executive director at Deloitte’s Centre for Technology, Media and Telecommunications: “The promise of IoT has long been touted, but the difficulty of setting up low-latency wireless networks capable of linking sensors and connected devices has typically been a serious barrier to widespread adoption. “Many of the most promising IoT use cases, such as industrial automation, asset tracking, smart city applications, autonomous vehicles and remote surgery require ultra-low latency.” Thus, the potential use cases within the enterprise could be limitless, particularly when it comes to creating cost-effective operational efficiencies and leveraging real-time data to future-proof the business. Currently, many enterprises use large-scale software solutions to track data and forecast trends, whose functionality could be enhanced with access to more enabled IoT devices than ever before.

WIDESPREAD CONNECTIVITY 5G networks will be able to reach previously isolated areas, including remote regions, rural landscapes and underground tunnels such as subways. Sensors could be placed in these locations to alert authorities of emergencies and to ensure people are safely connected. With its expansive network capabilities, 5G could also help close the ‘digital divide’ between easily connected urban areas and rural towns.

compete in a thriving marketplace. Forwardthinking business leaders will leverage digital tools for mobile app performance management in order to retain subscribers, garner indepth insights into engagement and location metrics, and deploy rapid crash reporting and diagnostics. But as application technology becomes more complex, companies must maintain the necessary tools and infrastructure to drive better business outcomes.

BETTER MOBILE APP DEVELOPMENT

IMMENSE POTENTIAL OF 5G AND IOT

Mobile app developers can use 5G technology to dramatically improve the user experience. For example, the speed afforded by a 5G download means users will experience shorter wait times for app downloads, irrespective of size. This should lead to lower app-abandonment rates.

The IoT’s potential is immense. With the onset of 5G, IoT can finally deliver on its promises. The IoT enables enterprise organisations to reach their target consumer at a greater scale, while also optimising their internal processes and improving their bottom line. Business leaders can see the beginnings of this technology at work in connected cities, optimised transportation systems, broader device networks and connectivity, and cuttingedge app development.

Another factor impacting user experience is the clarity of an app’s user interface. With 5G, users will see a marked increase in the quality and clarity of video and graphic in-app content over previous network generations. Just think of the benefits for rich push notifications. With 5G, mobile app developers can take advantage of better coverage, speed, connectivity and latency rates to integrate the latest technologies into their apps. Imagine a time when seamlessly incorporated augmented and virtual reality technology is a standard feature for apps. Within a 5G infrastructure, developers, consumers and business leaders can bring that to fruition. Developers will be creating superior mobile experiences, which means a focus on app performance will be paramount for apps to

5G is a key enabler for smart cities and driverless cars

5G networks will allow for growth across a wide range of business verticals in the near future, so long as business leaders work to invest in the tools and processes needed to manage such a vast number of connected devices. That said, IoT-enabled devices, and the data associated with them, will prove to be a valuable asset for businesses going forward. These are exciting times.

Create superior mobile experiences using Kumulos Kumulos Mobile App Performance Management platform comes with a comprehensive range of services covering the entire life cycle of the app. Its five integrated services include app store optimisation, analytics and reporting, backend hosting, crash reporting and endpoint monitoring, and its award-winning push notifications service, which has received awards from Business of Apps, Mobile App Daily and The Tool. It provides a management console that delivers comprehensive visibility on how the app is performing technically and commercially. It’s easy to set up and there’s no SDK required. Start monitoring now by signing up for a free trial or booking a demo. And, when you’re up and running with your free trial, make sure you download the free Kumulos Companion App to try out the push notifications for real.

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MOBILE MARKETING GROWS UP

Clement Cao, co-founder, executive director and president at Mobvista, considers whether this year’s developments are a sign that the mobile marketing industry is maturing and starting to put the consumer’s interests first

s Apple readies a more private log-in facility, Google is offering a choice of browsers and blocking rogue ads worldwide. Does this mean that mobile marketing is finally pivoting to put customers first? Sometimes a digital marketing channel can get a good idea of how mature it is by comparing its progress with that of older channels. If mobile marketers were to look across to what is currently happening on desktop, they’d see a channel in the midst of what desktop SEO execs might fondly describe as their Panda, and then Penguin, moment. These 2011 and 2012 revisions of the search giant’s constantly updated algorithm arguably did more to improve the quality of desktop and

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mobile search than any that had come before. They laid the groundwork for today’s content marketing industry, where it is more rewarding to invest in quality than to try and game the system through short-term trickery.

This summer has seen the start of Google’s Android operating system asking owners, when they set up a new phone, if they would prefer to search the mobile web with an alternative browser, such as Microsoft’s Bing.

It is the same for mobile marketing, and this year appears to be the time for it to grow up and put customers first.

Google is almost certainly not doing this as a goodwill gesture, but rather as a reaction to being fined €4.34bn (£4bn) by the European Commission a year ago for anti-competitive behaviour. This beat the record it had already set a year earlier, when it was fined €2.42bn by the European Commission for favouring its own services in its search results, particularly Google Shopping.

SEPARATE DEVELOPMENTS ALIGN If we look closer, there are several developments in this movement – and they are not all altruistic. The most obvious, which new Android device users will already have started to notice, is that there is now a choice of search engines. Previously, Google had only pre-installed its own search engine and set it as the default option for each smartphone or tablet.

BETTER AD EXPERIENCES One area where Google may be seen as acting a little more altruistically is in its attempts to

SEPTEMBER 2019

While this may sound unrealistically high, Google has pointed out that one in three sites that would have failed the standard fixed their issues before the new Chrome browser was released last February, possibly to avoid adverts being automatically blocked. In Asia it may well be a different story, with the suggestion that around half of publisher sites may not be compliant with the guidelines.

APPLE GOES PRIVATE WITH LOG-INS Warnings of a web-tracking ‘apocalypse’ with the change to how cookies are used never impacted mobile marketing. The fact that desktop browsers are pre-empting upcoming legislation, such as the ePrivacy Directive, by allowing web users to block cookies at browser level is largely irrelevant. Instead, mobile marketing has always been focused on ID tracking and using log-in information to identify who a site or app visitor is, so they can be served relevant content and, of course, advertising. Here is where mobile marketing is going the extra mile this year. The two most common ways in which mobile users identify themselves are via Google or Facebook log-in features. There is much mistrust over how both parties use that data. convince publishers to do the right thing by mobile web users. A new, more user-friendly version of Google Chrome has already been made available in several markets, including the US and EU, since February 2018. Google has now announced it will be rolled out globally by the end of the year. It should hopefully spell the end of those awful experiences where users are bombarded with advertising that gets in the way of them consuming the content that prompted them to click a link. The new version of Chrome uses recommendations from the Coalition for Better Ads to filter out adverts that stand in the way of a good user experience. The most obvious examples are pop-ups, auto-play videos and ad units that take up too much of the screen. This move to prevent publishers ruining user experiences is primarily aimed beyond the US and EU, as in both these markets the vast majority (believed to be as high as 99 per cent) comply with the Coalition for Better Ads standards.

When you consider Google’s use of data in programmatic advertising, it is hardly surprising that it is now the subject of an

iOS, it will offer an alternative means to log in to multiple sites and apps through the same credentials. The difference here is that Apple is promising that it won’t pass that data on to advertisers. The message is clear. Apple is not a company that relies on advertising, as Google and Facebook both do. It makes money through selling hardware and taking a cut of app sales. This means it has no need to collect data that would be useful for an advertiser but that users may feel is invasive of their privacy.

THE YEAR OF (RESPONSIBLE) MOBILE By the end of this year we will have a very different and far more responsible mobile marketing landscape. Google is already beginning to offer a choice over mobile search engines, and its latest browser technology will block adverts on sites which are still using units that are too large or running auto-play videos. Then, by the end of the year, Apple users will have a new log-in facility to replace those offered by Google and Facebook – one that will protect user privacy rather than harvest data for advertisers. It may be too early to say for sure what the outcome of all this will be, but it certainly feels as though what happened in the desktop search sector eight years ago is now starting to take hold in the mobile marketing world. Back then, it took search marketers a while to realise that tricking Google was not worth the

IT FEELS LIKE THIS IS A JOURNEY MOBILE MARKETING IS NOW TAKING IN EARNEST, BY TURNING AWAY FROM THE RUSH FOR MONETISATION AND FOCUSING A LITTLE MORE ON CONSUMER NEEDS investigation by the UK’s data watchdog, the ICO. The same body recently fined Facebook the maximum possible, under pre-GDPR rules, for the misuse of personal information relating to the Cambridge Analytica scandal. Hence, Apple has identified a way to add to its brand image through ‘Sign In with Apple’. When this is rolled out later this year on all new Apple products, and a new version of

effort, and that longer-term objectives could be better met through responsible, strategic content marketing. It feels like this is a journey mobile marketing is now taking in earnest, by turning away from the rush for monetisation and focusing a little more on consumer needs, with the result being a more enjoyable and private customer experience.

@mmmagtweets

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SEPTEMBER 2019

TIME FOR CHANGE In the wake of the ICO’s recent report claiming that the ad tech industry is violating data protection laws, Teavaro’s Nico Pizzolato discusses what can be done to help online advertising continue to flourish in the face of increased scrutiny

ith a stringent doctrine of data regulation being approved or in the legislative pipeline across the globe in the past few years, companies have recognised that they need to review the way they collect, use and store data for marketing purposes. In the UK, the data regulator, the Information Commissioner’s Office (ICO), has recently shaken up the industry with two remarkable actions, and in doing so, it has highlighted the sins of the industry against data privacy.

PUNITIVE ACTIONS The first is the ICO’s adherence to the new penalty structure for data privacy breaches. The ICO intends to fine British Airways £183m

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– though British Airways intends to appeal – for the data breach that occurred last September, exposing 380,000 transactions, including card details and personal data, to the eyes of fraudsters and hackers. This dwarves the £500,000 fine imposed on Facebook for the Cambridge Analytica scandal that took place before GDPR came into effect. For the first time, the GDPR’s promise of draconian penalties for mishandling data has been implemented in the UK. But the ICO is not waiting for this to sink in, issuing a notice of its intention to fine hotel group Marriott International £99.2m for a similar breach. With these actions, the ICO has laid out a new zealotry for data privacy. Stringent enforcement is now a reality. These punitive actions also lend a certain weight to the statements contained in the report that the ICO issued a fortnight earlier. The Update Report into Ad Tech and Real Time Bidding (RTB) offers a disparaging view of the state of data privacy in online behavioural advertising, a wide ecosystem that includes a large slice of the UK economy, from advertisers to publishers, and

everything in between. The report – a mustread for any marketer that is building a data strategy for their company – highlights several aspects of RTB that have been under scrutiny since the onset of the GDPR, due to a number of complaints across Europe. In a barely disguised way, the Commissioner is saying that ad tech is illegal at the moment, insofar as it relies on the real-time bidding protocol in its current form as a way to allocate publishers’ inventory. The report’s tone and conclusions are in line with the ICO’s counterpart in France, the CNIL (Commission Nationale de l’Informatique et des Libertés), which is investigating complaints of GDPR infringements while urging ad tech to self-regulate and reform. (Should encouragement not work, last January the CNIL levied a €50m [£46.4m] fine on Google for collecting users’ consent in ways that contravened the GDPR.) And so, a new regulatory wind is sweeping across Europe. But what exactly are the risks that RTB poses to marketers in terms of data privacy according to the regulators?

SEPTEMBER 2019

There is persistent confusion around the quality of consent required for dropping trackers like cookies. While companies could process some personal data on the basis of legitimate interest, consent for cookies should be actively and clearly given and the purpose of the cookies explained in simple terms. When setting up cookies, companies should be mindful of both the GDPR and the recently updated PECR (Privacy and Electronic Communication Regulation), and the way they combine together. Consent, not legitimate interest, may provide the appropriate basis for cookies other than the essential ones.

The report claims that the content taxonomies used by the IAB’s (Internet Advertising Bureau) and Google’s protocols for bidding contain data information that the GDPR identifies as sensitive, such as health, religion, ethnicity or political orientation. The IAB has made some progress on this, changing old categories such as ‘depression’ or ‘Catholicism’ into more comprehensive ones, such as ‘mental health’ and ‘Christianity’, but are users clearly informed that such information will be shared, or even captured? The regulator does not think that is the case.

Most companies are at fault for not carrying out a privacy assessment. The GDPR mandates a data protection impact assessment (DPIA) when there exists a “large-scale processing of special categories of data”, but companies have often negligently plugged into the existing RTB protocols without assessing the impact on the customer data that they are controlling.

Complexity is a major problem with RTB, in conflict with GDPR’s requirement to clearly explain and break down for the user the different services for which consent is collected (the basis of CNIL’s fining of Google, which was deemed to have failed in doing so). As it stands, in RTB, data is harvested for a number of purposes and fired off to dozens, even hundreds, of organisations in milliseconds. What users cannot understand, they cannot give consent to, according to the law.

Perhaps more damning and less remediable for RTB, the regulator finds it naive to design a system that relies simply on contractual obligations to protect personal data. Data leakage has been

dogging programmatic advertising since the onset and there is really no secure knowledge of what data the hundreds of entities in the chain capture and retain, or how they use it. The report reveals the Commissioner’s incredulity at the cavalier way in which customer data has been handled. Its list of high risks is not accompanied by examples of good practices within RTB, and therefore, while the report points the finger towards “some market participants”, it is really the entire industry that is under fire, echoing GDPR’s insistence on the responsibility of data controllers for data partners’ infractions. Finally, the report identifies the causes of such mess in a “lack of maturity” over privacy issues, but also in the “commercial incentives to associate personal data with bid requests” – an unholy mix of greed and ignorance. Such proclamations could be seen as commandments from upon high, urging the digital marketing ecosystem to convert to the new order.

as a way to become ‘GDPR-safe’, but this seems like a step backwards to go forward. Instead, Teavaro has long been passionate, even before regulation made change inevitable, about the design of systems to harness data within the customer relationship. This is a matter of sound business, rather than mere legal compliance. Recent research has vindicated this perspective by suggesting that the use of cookies has a negligible impact on publishers’ revenue, by extension casting doubts on the overall benefits for other stakeholders too. The architecture of such customised systems involves building a unified customer view by stitching together firstparty identifiers that companies can collect with clear permission, transparency and fairness, providing users with easy-to-use controls. With this as a base, data activation tools, such as Teavaro’s DataAction, can then harness such personal data with a protocol that ensures it is shared only with parties that have the clearance

BEHIND THE REGULATORS’ CAUTIOUS AND ITERATIVE APPROACH, STOPPING SHORT OF DISRUPTING A WHOLE INDUSTRY, THERE IS AN AWARENESS THAT WHILE THE PROBLEMS ARE CLEAR, THE SOLUTION REQUIRES A MAJOR SHIFT IN ENTRENCHED PRACTICES Behind the regulators’ cautious and iterative approach, stopping short of disrupting a whole industry, there is an awareness that while the problems are clear, the solution requires a major shift in entrenched practices. In its response, the IAB has reiterated its view that it merely provides an instrument that companies can use, but that it is not responsible for their compliance with the law – a view that is amply contested. In any case, legal responsibilities aside, it does not provide a solution to the woes of the industry. What the ICO report does not look into are the many companies and initiatives that prefigure a different, more transparent relationship between customers, their data, the data controller and the way that companies can market themselves. A return to contextual advertising, with more sophisticated contextual audience metrics, has been touted

to read it, from data controller partnership to individual user permissions. Such systems are designed to put the data controller, rather than the ad tech firms, in the driving seat. After the ICO’s prediction that fixing RTB won’t happen “without intervention”, the writing is on the wall for a cookie-based ecosystem. Such a revelation does not mean the end for digital marketing. Instead, it can be born again by activating first-party identifiers, and online advertising can continue to flourish. The question remains, will marketers take this opportunity to repent or continue down this path? The knowledge that there are viable alternatives to the current status quo makes these opportunities more tempting and will allow consumers to place new faith in how their data is being used.

@mmmagtweets

SEPTEMBER 2019

CLOSING REMARKS David Murphy looks back at the year so far in mobile So as Private Eye would put it, triples all round, surely? Well, maybe keep the champagne on ice for a little while yet. Because the flip side of the coin is less encouraging.

FRAUD PERSISTS

rying to take stock of the last few months in the mobile/digital marketing space is never an easy exercise, given the variety of issues at play and the speed at which things move. But looking back on the last six months, I can’t help feeling that the industry needs a reality check. Sure, there’s a ton of good news out there. On so many fronts, 2019 has looked like a very good year for ad tech. In May, figures from the IAB and PwC revealed that smartphones now account for 51 per cent of all digital ad spend, outpacing desktop for the first time. One week later, the Advertising Association and WARC revealed that the UK advertising market had grown by 6.3 per cent year-on-year despite ongoing uncertainty surrounding Brexit. More figures from WARC in May told us that internet advertising will account for more than half of all global media spend for the first-time in 2020, with mobile accounting for 94.6 per cent of the growth. These figures were backed up by forecasts from Zenith in July. In the same month, the 2019 edition of IAB Europe’s AdEx Benchmark found that the European digital advertising sector grew by 13.9 per cent in 2018, the fastest growth in the sector since 2011. Mobile’s part in this was significant, with mobile display ad spend up by 34.2 per cent at €11.4bn, or 48.9 per cent of total display ad spend.

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At the end of July, AppsFlyer’s State of Mobile Fraud report revealed that $2.3bn (£1.9bn) of ad spend was exposed to app install fraud in the first half of 2019. Unfortunately, or perhaps fortunately, this is not a measure of the amount of ad fraud actually perpetrated, only of the amount of ad spend that had the potential to be subject to fraud. The report does not have a figure for the amount of ad fraud actually perpetrated, but the mere fact that such a large amount of ad budget had the potential to be subject to fraud tempers those stellar digital ad figures. More worrying than this, however, was the report from the UK Information Commissioner’s Office (ICO), released in June, criticising the ad tech sector for falling short when it comes to compliance, 13 months after GDPR came into force.

could potentially see a person’s personal data shared with hundreds of organisations. While information commissioner Elizabeth Denham conceded that the ad tech market is an extremely complex one, involving many organisations and many technologies, she also said, ominously: “We are clear about the areas where we have initial concerns, and we expect to see change.”

AD TECH IS ILLEGAL As Teavaro’s Nico Pizzolato writes on p40 of this issue: “In a barely disguised way, the Commissioner is saying that ad tech is illegal at the moment, insofar as it relies on the real-time bidding protocol in its current form as a way to allocate publishers’ inventory.” And lest anyone should think the ICO is all talk and no action, they would do well to note that in July, the regulator revealed that it plans to fine British Airways £183m for a breach of customer data. The very next day, it said hotel chain Marriott was in line for a £99.2m fine for failing to protect personal data contained in around 339m guest records.

In particular, the report called out the use of personal data in real-time bidding (RTB) within programmatic advertising. In the RTB So celebrate the growth in ad spend, for process, advertisers on an ad exchange, sure, but let’s not assume all’s rosy in the network or supply-side platform (SSP) receive ad tech garden. The fraudsters want their an impression call when someone visits a pound of flesh, and so, in a very different and website. As the site is loading for that user, commendable way, does the ICO. ad spaces on the page are auctioned off by the publisher and the slots are filled by the advertisers that have bid to reach people that match that criteria. As such, advertisers gain access to information about the user without their direct consent. The ICO report took issue with the way in British Airways is facing a £183m fine from the ICO for a which a single visit to a website breach of customer data

September 11 & 12, 2019 in Cologne, Germany

Two Days on the Pulse of Digital Business

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