New Orbit Dispatch #1
This month, we dive into a variety of intriguing topics:
The complexities of using PMax for lead generation
Google's subtle reshaping of search results to favor brands
Contrasting strategies platforms use for ad-blocking versus monetization
The burgeoning realm of ad-supported streaming services.
Each section is crafted to be succinct and informative - we promise not to waste your time.
The PMax Lead Gen Challenge
Performance Max (PMax), Google's latest automation push, aims to revolutionize e-commerce marketing. PMax is particularly catered to e-commerce, where the journey from click to purchase is brief. But when it comes to lead generation, PMax presents a unique set of challenges.
Google aggressively promotes PMax for all advertising needs, including lead generation. However, this approach has a fundamental flaw. Not all leads are created equal, but PMax doesn't discriminate – it treats them identically. Consequently, businesses often find themselves flooded with low-quality leads, as Google optimizes for quantity over quality.
To counter this, one strategy is to upload offline conversions daily from your Customer Relationship Management (CRM) software. This approach allows businesses to qualify each lead before sending the data back to Google. It's an effective workaround, but it's labor-intensive, unless automated.
Enabling the form captcha helped reduce spam leads, but created a worse user experience in the sales funnel.
We utilize a similar automation at New Orbit to upload e-commerce revenue files for accurate sales attribution. However, our experiments with PMax in lead generation have yielded consistently disappointing results. The campaigns quickly became inundated with spam. Disabling PMax's default URL expansion feature, employing internal audience lists, and integrating on-form captchas helped mitigate the spam influx, but these measures weren't foolproof.
Brand Bias In Google Search
A search for “kids clothing stores” yielded product listing blocks, prioritizing certain brands.
Google's manipulation of search terms to favor brand names has recently stirred controversy, challenging both users and advertisers. An article, now deleted but archived here, exposed Google swapping user-entered search terms with specific brand names. This practice not only skews organic search results but also confuses marketers about how their keywords reach users.
Despite Google's swift denial, evidence of this practice is compelling. Moz.com analyzed 10,000 keywords and found numerous instances where Google's results diverged from the user's original query. This trend is especially pronounced with portmanteau brands like Snapchat, WordPress, Evernote, Fitbit, and Facebook. These brands often overshadow related keywords, dominating search results.
Another example of Google's brand bias is its recognition of entity relationships. For instance, after Quicken Loans Arena changed to Rocket Mortgage in 2019, Google automatically replaced searches for the former with the latter, without user consent or notification.
A striking Moz.com finding was that a search for "kids clothing stores" yielded product listing blocks, prioritizing certain brands. Such results undoubtedly serve Google’s financial interests. While they might be more user-friendly, the underlying commercial intent is clear.
For advertisers, understanding this shift is crucial. Google's search engine, once a neutral ground, now seems to subtly favor certain brands. This change alters the playing field for online marketing, making it imperative for marketers to adapt their strategies in light of Google's evolving search dynamics.
Inline Ads: Block or Buy
Major platforms are adopting divergent strategies towards ads and user preferences. YouTube is tightening its grip on ad blockers. In a "global effort," they're implementing two distinct approaches. Firstly, YouTube is detecting users with ad blockers, urging them to whitelist the platform. Secondly, they're limiting the number of videos accessible to such users, effectively blocking them from content after a certain threshold.
In our tests, we’d typically see this message after three videos.
In contrast, companies like Meta and X (formerly Twitter) are exploring alternative monetization methods. They're introducing subscription-based models offering ad-free experiences. Meta's approach targets Facebook and Instagram, aligning with EU privacy standards. X, on the other hand, has launched a pricier global version of its ad-free platform. These initiatives cater to a segment of users willing to pay for uninterrupted browsing.
However, the adoption rate of these subscription services is projected to be low. For advertisers, this means a significant portion of the audience will remain accessible through traditional ad-supported models. But those opting for the ad-free experience will fall off the radar, becoming invisible to data tracking and ad targeting.
This split strategy highlights a pivotal shift in digital advertising. As platforms experiment with user preferences, advertisers must stay agile, adapting to these changing dynamics. The choice for users—tolerate ads or pay to avoid them—will reshape how brands engage with their audience in the digital space.
Ad Supported Streaming Soars
The streaming industry is witnessing a significant shift with the rise of ad-supported services. A year ago, Netflix introduced an ad-supported tier, a strategic move considering their declining revenue. This lower-priced option, bolstered by ads, attracted an impressive 15 million subscribers, far exceeding the initial projection of 6 million by the end of Q3.
Netflix’s strategy didn’t stop there. To encourage users towards this new tier, they increased prices on ad-free plans and tightened controls on password sharing. The message was clear: if you want affordable streaming, ads are part of the deal.
The Free Ad-Supported Streaming TV (or FAST) model is growing rapidly, experience broad acceptance among users.
This trend isn’t limited to Netflix. Disney+ followed suit, launching its own ad-supported version. Other major players like Hulu, Max (formerly HBO Max), Paramount+, and Peacock have also embraced this model. Additionally, entirely free, ad-supported TV services like Pluto TV, Peacock, Freevee, Tubi TV, Roku Channel, and Sling FreeStream are gaining traction.
The success of these platforms indicates a broader acceptance among users for ad-supported streaming. This shift opens a promising avenue for advertisers. As viewers flock to these platforms, the opportunities for targeted advertising expand. For advertisers, it's a chance to reach audiences in a more integrated, contextually relevant way, making the most of the streaming revolution.
