Lab Weekly - 05/10/2024
NewFronts recap, Plus, the latest news on Apple's iPad ad spot, new streaming bundle, and more
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News from the 2024 NewFronts
Each year, the Interactive Advertising Bureau (IAB) hosts its “NewFronts” focusing on digital advertising and giving the major players in the online ad ecosystem to pitch their latest offers to the Madison Avenue crowd. This year, the focus seems to be on the impact of generative AI, with some additional emphasis on emerging channels like connected TV and retail media networks. Here’s an aggregated recap of the various trends and must-know announcements coming out this year’s NewFronts presentations.
Outlook 2024: Canadian POV
Led by Kelvin Mak, Senior Director, Digital Strategy and Partnerships at UM Canada, with contributions across the UM, Initiative, and Media Experts team in Canada, our northern neighbors analyzed how the four “downstream effects” trends from our Outlook report is playing out in their region.
In case you missed it…
The Rise of Video Podcasts
The recent surge of interest in podcasts on YouTube has made it the top platform for podcast consumption in the U.S., overtaking both Apple Podcasts and Spotify. Here is what the seemingly paradoxical format tells us about the state of the podcasting industry.
Meta’s AI & VR Strategies Are Aligning At Last
Meta has had a busy fortnight between launching the Llama 3 models and opening up its VR platform Horizon OS to third-party manufacturers, to bringing Meta AI to its smart glasses. At last, Meta is aligning its VR strategy to its open approach to AI, and it paints a fuller picture of the type of long game that Zuckerberg is playing.
Kids These Days: What Marketers Need to Know About Gen Alpha
As the children of Millennials, these digital and AI natives burst onto the scene with a unique sense of humor, attitude, and slang, reshaping where and how brands seeking after a younger audience conduct their campaigns and craft their media strategies.
Apple Faces Backlash For New “Crush!” iPad Commercial [AdAge]
On Tuesday, Apple announced new iPad Pros with OLED displays and thinnest design ever, along with a slew of other refreshed iPads and accessory products. Yet, the new products were largely overshadowed by an ill-advised commercial spot titled “Crush,” in which musical instruments and other creative tools are crushed by a massive hydraulic press to make a shiny, skinny iPad. Apple CEO Tim Cook's X post of the ad spot drew over 15,000 replies as of press time, with the majority of them criticizing the ad's visuals and message. On Thursday, Apple issued an apology for the spot, saying that it has canceled plans to run it on TV.
While Apple’s intended message is evidently “isn’t it amazing that we managed to squeeze all those creative tools into such an unbelievably thin iPad,” it ended up being quite tone-deaf in the current context of growing skepticism and criticism over big tech’s outsized influence over all aspects of life. Add in the prevailing anxiety among creative professionals around advanced AI models potentially upending their livelihood, it is easy to see how this ad spot missed its intended target by a mile.
While this round of backlash will likely be a minor misstep for Apple in the grand scheme of things, it does serve as a good reminder for brands of the importance of aligning your creatives and brand messages with the cultural zeitgeist. In an era where widespread nostalgia for analog tech has driven a surge in sales of vinyl records and “dumb phones,” a visual metaphor of crushing analog creative tools is certainly not going to play well.
Related: Apple introduces new iPad products [9to5Mac]; Apple’s new M4 chip is focused on AI [The Verge]; Apple Vision Pro a big hit in enterprise [Apple Insider]
Disney And WBD Team On Bundle Featuring Disney+, Hulu And Max [Variety]
The remaking of TV bundles continues apace. Following the upcoming ESPN-Fox-Warner sports streaming bundle, Disney announced it is teaming up with Warner Bros. Discovery will offer a streaming bundle sometime this summer, by offering the option to pay for Disney+, Hulu and Max subscriptions together in the US. The bundle reportedly will include both ad-free and ad-supported tiers, but the apps and content from each company will remain separate.
This move is significant in the post-streaming wars landscape, where every major entertainment company is trying to scale up their streaming business to more effectively compete with Netflix. Disney already integrated Hulu content into Disney+ for customers who have both services. And Hulu already has agreements to sell add-on subscriptions for Max and Paramount+. If this upcoming subscription bundle were to come with a decent discount rate, then it’d be a good way to help combat the high churn rates that the streaming services have been struggling with lately.
Related: Disney, Walmart team up for enhanced targeting, measurement across streaming [AdWeek]; Success of ESPN-Fox-Warner sports streaming bundle hinges on its cost [Variety]; Disney+ will start showing some live sports from ESPN this year [Engadget]
Netflix and Roblox team up for a digital theme park [Engadget]
Following LEGO-themed experience in Fortnite and the Walmart-branded experience on Roblox, another big branded activation has dropped on Roblox courtesy of Netflix. In the so-called “Netflix Nextworld,” players can freely participate in activities inspired by Stranger Things, One Piece, and other Netflix content and receive in-game collectible items as rewards. Moreover, there’s also a co-viewing space to watch Netflix shows and host events like “premieres and viewing parties.”
In November, Roblox started letting brand advertisers buy in-game display placements without having to create a virtual experience inside the platform. Earlier this month, they started rolling out in-game video placements as well. With over 77.7 million daily active users (DAUs) worldwide, it remains a key platform for brands to explore immersive experiences and reach younger audiences that are increasingly difficult to reach via traditional media channels.
Related: Netflix launches test of games on TVs, PCs and Macs [Variety]; The brand opportunity in Roblox hair is heating up [Glossy]
Situational Awareness:
Meta’s AI tools for advertisers can now create full new images [TechCrunch]
&
Meta is using AI to power brand and creator matchmaking on Facebook and Instagram [TubeFilter]
Meta continues to push AI as a part of its creative toolkit for brand advertisers, while also leveraging it to help creators monetize their content. Along with Google, Meta is setting a new standard for how AI can be utilized to amplify the capabilities of digital advertising platforms.
Online marketplaces like eBay & Etsy are counting on AI to supercharge shopping [WSJ]
With LLM-powered AI, a potential end-goal for retailers and ecommerce platforms could be a fully conversational online shopping experience that guides and responds to shoppers like a seasoned salesperson would in stores. But, considering how impatient online shoppers can be, most of the AI models in their current state may not be fast enough to ensure a smooth experience, yet.
Billie Eilish’s album listening parties are coming to movie theaters [Rolling Stone]
Movie theaters will just about try any type of fandom-driven events that will bring in the crowds these days, and given the shrinking box office results (an estimated 5% year-on-year drop in 2024 so far), no one can blame them for diversifying their offerings beyond cinema. After all, AMC theaters said that the ticket sales for the concert films by Beyoncé and Taylor Swift last year were entirely responsible for its Q4 revenue growth.
TikTok sues U.S. government over law forcing sale or ban [NYT]
Now that TikTok has made the expected move to countersue, the legal race is on. Based on the current commentary, the results of this legal challenge largely hinges on whether the courts treat the case as primarily a First Amendment issue or a national security concern.
Alphabet’s Wing unveils larger drones for heavier packages [The Verge]
Drone delivery continues to evolve in its capability. Being able to deliver heavier packages is certainly a major plus for its continued expansion. However, the additional cost associated with building and operating larger drones will have to be balanced out to make this approach worthwhile.
Pause ads may be the key to upping consumer engagement, according to a report from the Video Advertising Bureau. Around half of streaming viewers have taken some action upon seeing a pause ad, the report found. Moreover, certain shoppable ad formats received more engagement from viewers than others, according to the report.
Of the 1,600 TV consumers surveyed, 67% said they’d interacted with an ad that they could click on to receive information via an email or device, while explorable ads and “click to buy” ads also saw high engagement, at 62% and 58% each.
QR codes, meanwhile, were less popular: just 36% of survey respondents indicated that they’d interacted with one.
Disney reported Disney+ and Hulu had a $47 million operating income in Q2, vs. a $587 million loss YoY, the first time the streaming services had achieved a combined quarterly profit.
If you find our insights valuable and would like to have a deeper conversation on technology and media innovations, or need to sound smarter in a client meeting or a pitch, please feel free to reach out to Chelsea Freitas, our VP of Strategy, at chelsea@ipglab.com.
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