SQADPOD: 5 Game Changers Every Advertiser Should Know – October 2018
Industry news and insights podcast curated from the world of advertising and marketing trends.
The leaves outside are quickly changing from orange to yellow to brown, and the cool temperatures are a not-so-friendly reminder that winter is right around the corner. But, before we replace the jack-o-lanterns and spooky decorations with turkeys and decorative gourds, it’s time to take a look at the advertising trends that are haunting the industry. This month, we’re diving into marijuana marketing, Adobe’s acquisition of Marketo, Amazon’s fight for the spotlight, Google’s data breach, and futuristic Alexa ad technology.
- Cannabis Marketing Puts the “pot” in Jackpot
- Adobe Makes a Big Move with Marketo
- Amazon Disrupts the Duopoly
- A Data Breach Means Google+ Gets the Ax
- Alexa, Your Personal Health Advisor
1. Cannabis Marketing Puts the “pot” in Jackpot
Marijuana is officially legal for recreational use in Canada, and as legalization continues to march across North America, some advertisers are getting ready for what may be a minefield of marketing opportunities and perils. Cannabis is projected to be a $200 billion annual industry, and advertising campaigns are already beginning to make their debuts. However, the industry has many obstacles to overcome – even when formally legalized, there are restrictions for how cannabis brands can advertise their products. They cannot explicitly show the drug being used in ads and the ads can only be placed on channels where at least 71.6% of the audience is above 21 years of age. Brands also cannot claim their products have “curative or therapeutic effects”, which is a major argument for the legalization crowd. On top of those restrictions, they face also limitations with digital advertising. Facebook and Google are currently prohibiting marijuana companies from buying ad inventory. Advertising complications will continue to grow so long as the federal government maintains their ban on the drug and more states open the doors. As such, companies are working around the limitations by building lifestyle branding to resonate with the younger millennial consumer – illustrating a carefree and relatable lifestyle of afternoon hiking trips, picnics in lush green valleys, and strolls along the shore during sunrise. Despite the advertising hurdles and legal obstacles, companies big and small see massive potential in weed legalization and are keen on getting ahead of the competition.
2. Adobe’s Makes a Big Move with Marketo
Adobe has long dominated the ad creation space with its variety of offerings like Photoshop, Premier, AfterEffects, Illustrator, Dreamweaver – and now it has bought itself a place in the marketing automation business with acquisition of Marketo. The $4.75 billion acquisition could be a game changer that may establish Adobe as a one-stop-shop for advertising creation and distribution directly to consumers. What is most significant in this story of corporate growth is how Adobe beat out Salesforce. The win puts Adobe in direct competition with Marketing Cloud by Salesforce, and may be a hint at their bigger plans to get more engaged in the transactional side of advertising. In a news release from Adobe, it stated that “adding Marketo’s engagement platform to Adobe Experience Cloud will enable Adobe to offer an unrivaled set of solutions for delivering transformative customer experiences across industries and companies of all sizes.” In response, Salesforce announced the purchase of Rebel, an email outfit platform – an acquisition that looks relatively miniscule when placed next to Adobe’s Marketo purchase. These massive moves will shake up the landscape for both content creation and creative distribution.
3. Amazon Is Disrupting the Duopoly
Amazon’s recent moves to increase their appeal as a viable advertising platform are paying off, with some brands shifting more than half their ad budgets away from Google to Amazon, according to executives at multiple media agencies. Google’s ad business made up 86% of Alphabet’s total revenue last year and seems to be going strong so far this year, although Amazon poses a clear threat to that business. Executives at multiple media agencies are seeing budget shifts to Amazon, particularly for consumer packaged goods and retail – while other brands like automotive and travel are still sticking to Google. Amazon is where retail brands are seeing the needle move in terms of real sales – according to Survata about 49% of product searches begin directly on the e-commerce site. An EVP at Havas breaks down the trend he is seeing at the agency: 20-30% of the company’s clients shift 50-70% of their budgets from Google to Amazon. The industry has been watching as Amazon continues to grow a competitive ad marketplace, moving into the position of a real disruptor to the Google/Facebook duopoly.
4. A Data Breach Means Google+ Gets the Ax
Google shut down its social networking platform Google+ and said it was due to a data breach (that it attempted to cover up) – and definitely not because almost no one used the platform and it had become a punchline for most people in the tech world. The distraction of Google+ aside, the actual breach was serious and impacted hundreds of thousands of users, with the height of the issue occurring around the same time Facebook was trying to put the fire out around the Cambridge Analytica scandal. Google covered up its security problem when it first broke, lest it threaten their reputation of being the most secure tech platform in the world. But with issues as significant as this, it was only a matter of time when the truth is finally revealed. Google decided to disclose the breach in October within the confusing announcement to shut down Google+ – a platform most were surprised to learn still existed. Cover-up aside, data breaches means new security protocols and tighter regulations. This heightened security will make life harder for advertisers who want access to third party data vital to effective ad targeting. On top of that, brands and agencies may need to spend more money to make sure they’re compliant with new regulations. In a way, Google’s ill-fated social network did change the industry… just not in the way they intended.
5. Alexa, Your Personal Health Advisor
You’re lounging on your sofa comfortably wrapped in your fleece throw, ready to watch “Home Alone” for the fifth time. You tell Alexa to turn off the lights and a small cough escapes you. Alexa does as you command, and follows up with a suggestion for a soup recipe as well as an offer for instant delivery of cough drops from your local pharmacy. Welcome to the new world of predictive advertising. This is all part of the new technology that Amazon patented for Alexa that can analyze speech to detect whether you are sick or not feeling well. This creative ad technology goes hand-in-hand with Amazon’s push into the pharmaceutical and healthcare industry (having recently bought Pillpack – a company sends prescriptions straight to homes via post). The new Alexa technology also covers emotional health, so if the device hears you crying, it may play an upbeat song that a record label would have paid to advertise. Or, if it detects from the sound of your voice that you are bored, it may suggest activities that will stimulate your mind – perhaps rock climbing or pottery making in your local neighborhood (all paid ads, of course). This advanced version of Alexa is an indication of how intuitive advertising technology is becoming. Feeling under the weather? Going through a messy breakup? Alexa may soon be the only friend you need.