Subject To Change

Instagram Launches ‘Join Chat’ Sticker, WPP to Sell Majority Stake in Kantar, Facebook Becomes Store-Front for DTC Brands #SubjecToChange

By July 10, 2019 No Comments

July 10, 2019: Instagram launches “Join Chat” sticker; WPP to sell a majority stake in Kantar; Facebook becomes store-front for a growing number of DTC brands; ad revenue among top social media platforms continues to drop; Facebook family of apps goes down

Here’s what’s worth knowing this week: 

 

Group Chatting on Insta and It Feels So Good


The Story

Instagram has officially launched its new “Join Chat” sticker for Stories, which when tapped, will connect Stories viewers into a private direct message or group chat. 

What else?

After first spotted in testing in May, the new sticker option, labeled “Chat,” will let Stories viewers request to join an Instagram Group DM connected to the post, with up to 31 viewers being able to join at a time. Similar to the “Join Live” option for Instagram Live, the original poster has the ability to approve/decline requests and decide how long the group chat remains open. 

STC POV

Across the board, users are spending more time in messaging and direct messages and less time in-feed, as evidenced by the fact that the top messaging apps now have more users than the top social networks. On Instagram, half of all users also use the platform’s direct messaging options, with 85 percent of the messages shared to the same three friends, highlighting users’ desires for more intimate sharing. 

With Instagram’s new “Join Chat” sticker for Stories, brands’ and influencers’ abilities to host in-depth interviews (IDIs) or virtual focus groups becomes even easier. Specifically, you can partner with influencers to rapidly test and iterate on content with a select group of influencers and their followers before content goes to market, or ideate on new products before launch. To further facilitate DM discussions, you can give influencers a script of questions or have an influencer/brand partner facilitate the discussion for research and insights generation. 

 

Not Unrelated: Let’s Discuss the Latest Disruption to the Research & Insights Industry


The Story

WPP confirmed it is in exclusive talks with Bain Capital to sell its majority stake in Kantar. According to WPP’s statement that confirmed an earlier Bloomberg report, the potential deal values Kantar at $4 billion. 

I’m listening. 

What’s also notable is that WPP is choosing to divest Kantar, when other holding companies are making investments. Publicis Groupe bought Epsilon for $4.4 billion in April; IPG acquired Acxiom’s marketing solutions business for $2.3 billion last year, and Dentsu Aegis Network bought data-marketing firm Merkle in 2016. 

So what’s actually going on?

TLDR; legacy market research and insights companies are struggling. Despite recent funding, ComScore’s stock continues on a deep decline with an exodus of talent, and Nielsen is shopping itself around to the highest bidder. All the while, next-gen research and data companies like Epsilon and Merkle are being acquired as assets integral to enriching holding companies’ core offerings and critical to maintaining agencies value to today’s brands. 

STC POV

Before you say ‘consultancies are the new agencies,’ it’s too soon to tell if Kantar’s acquisition by Bain is to improve the consultancy’s own research, insights, and measurement practices, or in the more traditional sense, to facilitate a turnaround. What is clear, is that traditional entities slow to evolve and adapt to consumers’ shifting preferences and marketers’ needs as a result, are now making the hard decisions to divest assets, play to the highest bidder, or acquire the new entrants to the market to stay competitive. 

It’s also indicative that, the quality of insights and measurement legacy market research firms are able to generate is compromised. With consumers’ shift to digital – and mobile in particular – can we really say with confidence that TV ratings and generic audience panels are the gold standards for insights and measurement? And while we don’t yet have the full picture of what’s influencing these changes, we are experiencing the shift first-hand when it comes to marketers’ needs for more accurate, richer research and insights. With that, in practice, we’ve observed that validating the expertise of influencer and consumer panels through social and behavioral data is foundationally a better approach to research.  

 

POV: Are DTC Brands Actually Facebook-to-Consumer Brands?


The Story

Facebook has become the storefront for a growing number of direct-to-consumer (DTC) brands. 

How so?

Most emerging DTC brands today are digitally-native brands that found its initial audience, audience growth and established product-market fit online. What’s the best, most cost-efficient way to engage new customers online? You guessed it, Facebook. The vast majority of DTC acquisition dollars (upwards of 75 percent) are being spent on Facebook and Instagram because they are the only platforms that have the combination of scale, targeting capabilities, and competitive price points to acquire new customers with direct-response (DR) advertising. 

What’s the industry saying?

Speaking at the recent Brand Innovators Summit in San Francisco, Jen Tank, the head of creative and brand at Brandless, discussed the “dirty truth” about DTC – that it’s actually FTC, Facebook-to-Consumer (not to be confused with the Federal Trade Commission). According to Tank, “It’s like trying to get into an exclusive club to meet cool people you want to have a relationship with, but you have to pay a friend of a friend to get through the door.” 

STC POV

DTC brands, due to their lean structures and ability to move fast and pivot quickly, continue to be industry disruptors, setting the stage for the next generation of brands to come. But as the adage goes, “what got you here, won’t get you there.” If DTC brands that built their businesses on Facebook are the future – they face a challenging reality today to maintain that growth. With FB’s relevancy declining, FB traffic declining, less ad inventory, and increasingly limited targeting options, advertising on Facebook is now more expensive than ever before. But we do know who is responsible for driving FB traffic: Creators. 

According to an Ipsos survey commissioned by Facebook, 68 percent of people come to Instagram to interact with creators. For DTC brands that want staying power, the continued investment in creators who love the brand not only helps to drive traffic to FB/Insta (in turn, lowering ad prices) but can introduce paid media efficiencies through amplified creator content. 

 

Stalling Ad Revenue Fuel Social Commerce Growth


The Story

Ad revenue among key social and messaging companies dropped in Q1 2019 to annual rate of 26.2 percent, compared to 52 percent in Q1 2018. 

But wait, there’s more.

In North America, the biggest market for social advertising at about $8 billion in Q1, user growth has stalled for social media giants, and time spent using the platforms has stagnated at about two hours a day for the past three years. However, despite slower growth rates in ad revenue and stalling user growth rates, ad revenue reached $17.9 billion in Q1, the second highest on record for Facebook, Pinterest, Snapchat, Twitter, Tencent, and Weibo. 

STC POV

Social ad growth, driven by declining user growth, is dropping – which makes sense as there’s more competition for fewer eyeballs. But now there’s also a premium: with every new e-comm feature, social platforms bring consumers a few clicks closer to the transaction. 

As social media shifts to social commerce, it changes the value proposition as a popular means of discovering and buying new products or services. According to Mary Meeker’s 2018 Internet Trends Report, 55 percent of respondents bought a product online after discovering it on social media, with 44 percent buying immediately. 

There’s a caveat: trust in social media companies is declining. What are fewer clicks worth to your business? It’s critical for brands to understand the risks and benefits to not just engaging within each social commerce ecosystem (and the shared data that goes with it), and the value of eliminating one or more steps in the purchase journey. As well, knowing that creators are the drivers of social platform engagement, how they fit into the overall social commerce strategy. 

 

T’was the Night Before the 4th and Facebook Was Down 


The Story

Facebook’s three social platforms – Facebook, Instagram, and WhatsApp – all experienced outages for close to twelve hours last week. 

Details. 

According to Down Detector, the whole world felt the effects of the outages but were most concentrated in the eastern U.S. and in parts of Europe and South America. According to Facebook, the outage was triggered during a “routine maintenance operation.” 

There’s never a good day for an Instagram outage to occur, but July 3rd is certainly one of the worst. Not only is it the day before one of the biggest American holidays of the year, but it’s also the day where brands often spend billions of dollars to launch summer campaigns. However, lucky for all of us, Instagram was back up and kickin’ by 8:06 PM EST and we were all able to see all the Stories of fireworks on the 4th. 

STC POV

This certainly isn’t the last time Instagram, or any other app/platform, will go down (it’s actually the second in four weeks). Outages are becoming the new norm. As such, for brands and influencers alike, the importance of diversifying your influence and influencer strategy beyond that of Instagram becomes even more important and critical to future-proofing your strategy (esp. If you’re a DTC brand like those mentioned above). 

For those of you executing campaigns on social, any time there’s an outage it’s important to double check your campaign reporting. Depending on the duration of the outage(s), campaigns will often generate lower volumes of impressions and engagements than what was projected or what is typically considered benchmark. As such, it’s important to adjust your campaign flight (if permissible) to allow for outage time, or the forecast of your results to account for the time lost. 

 

ICYMI


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