TMW #017 | Advertising with 1st party data, Spotify turning musicians into customers, business strategy and experimentation

Nov 6, 2020

Welcome to The Martech Weekly, where every week I review some of the most interesting ideas, research, and latest news. I try to look to where the industry is going and make sense of it all.

👋 A Quick Note

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👨 The Movember Thread

I'm fundraising with the fine people at The Lumery to raise $10,000 for Movember!  This year I'm doing things a little bit differently. I'm committing to writing at least 200 words per day reflecting on marketing, technology and customer experience for the 30 days of November. The first 5 are about the appeal of AI in marketing, how product teams decide things, vanity metrics, meritocracy in digital business and content marketing. Link

😛 Cheeky Plug

Next week I’ll be going to a conversation happening on the foundations of personalisation as part of Tealium’s Solve My Problem series. The chat is between Ben Fettes, head of strategy  at The Lumery and Kieran Smith, senior solutions consultant at Tealium. It’s a great way to get into what personalisation is, how to leverage customer identity as a strategy and contextualise to customers based on what stage of the journey they are in. Also there will be heaps of Q&A. Link

👌Top #3

📰  Advertising with 1st party data

As third party cookies are continuing it’s slow march of death in the world of programmatic advertising, new solutions in the ad markets are cropping up. The Washington post released some information on it’s new first party cookie powered advertising engine called “Signal.” It brings in data from partner companies to target customers based on context like most likely day to buy or on channels to articles. What’s interesting here is that we’re now seeing the next phase of programmatic, where contextual and 1st party data driven advertising models are becoming increasingly important to advertisers and marketers. Contextual advertising, which offers a little less detailed targeting than what’s possible with 3rd party cookies is growing considerably, with some predictions putting the contextual market somewhere in the vicinity of $450 billion by 2027. Link

🎧 Spotify is turning musicians into paying customers

In an interesting move this week, Spotify announced they are releasing a feature where artists can trade off royalty rates for a visibility boost in the algorithm. Without a doubt this has definitely caused some backlash in the music community as royalties for music streaming are already quite low. Just last week, four thousand artists, who are part of the union of musicians and allied workers, have started a petition against Spotify to bring the royalties up to at least one cent per stream (artists are estimated to be paid between $0.004 and $0.007 per stream).

This is what happens with economies of scale, Spotify now enjoys a reported 16 billion artists discoveries every single month. And now that Spotify has a stable market lead, it is now diversifying revenue lines into other areas, like podcasting. The benefit of such a move is that for artists there is no upfront out of pocket expense to promote music on platform, however it does mean that the trade off for streaming royalties may not be worth staying on platform. This is a classic case of revenue diversification - when you own the marketplace you own the rules, and because Spotify was the first player in music streaming it gets to be the judge, jury and executioner of the music industry. Link

🐌 Experimentation is becoming a vital business strategy. Some thoughts on how experimentation is becoming increasingly important to larger companies. This one is in the subscriber version of TMW. Sign up here to get a link to the full version.

📈Chart Of The Week

This week a look at  growth in the cloud computing space and where some of the key players are shifting into new markets. Sign up here to get a link to the full version and the chart.

📚 Everything Else

Election results and cognitive bias. An interesting little visualisation went viral this week highlighting that even though a lot of states in the US presidential election are red, the majority of those states have tiny populations of people. Link

Should marketers care about identity resolution? A great read on five reasons marketers now need to invest in and think deeply about how customers are identified. The argument is that you can’t really pull off great experiences without solving on identity first. Link

Missing CRM data. A story on how one person realised that he was responsible for a lot of missing data in his CRM. If you’re working in a startup this is a good one for you. Link

What’s causing the decline in traditional media? One argument is that, besides the pandemic shutting down much of the market for traditional advertising, the major advertising platforms can offer both recognition (make you want to buy) and distribution (make it easy to buy) seamlessly. Link

Investing and product market fit. A great little thread on how startups realistically find product market feed, while battling investor expectations and a limited runway. Link

An easy to read Q&A on what’s next for third party cookies and how marketers can prepare. Link

Shopify now has over a million merchants. The company is on track for $100 billion in GMV in 2020. Shopify is kind of like the inverse of Amazon, decentralised ecommerce is making significant progress. Link

Baby Shark becomes the most streamed video on youtube, reaching 7 billion views over four years. At full length this equates to 30,000 years of human attention. Longer than civilisation has existed. Link

Wayback machine and fact checking. In an interesting move, wayback machine, the archive of the internet are now applying fact checking notices to stored sites. Wondering why it took them this long to make this change. Link

Stay Curious,

Make sense of marketing technology.

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Juan Mendoza

Juan Mendoza is an expert in researching global media, marketing, data, and technology trends. He is the CEO of The Martech Weekly, a media and research brand with subscribers in over 65 countries.

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