Social resilience, trendy offices and headline hysteria
The key figures for some social media platforms show costs are up while engagement is down – so why are advertisers choosing to ride it out, asks Dominic Mills. Plus: How media became an estate agent’s wet dream, and annoying headline writers.
A word of warning: if you’re looking to this column for the last word in topicality, look again. By the time you read this I will be many miles and a few time zones away – hence the fact that this has been written well ahead of my deadline.
And I’ll be taking a week off. Back on November 19th. In the meantime…
I’ve long stopped going open-mouthed at Facebook’s ability to ride out all the crap that comes its way.
No, not even the latest fine, data hack or the news that it is being sued by advertisers in a case linking back to one of its earliest ‘miscounting’ errors, seem to make much difference.
None of it ever sticks, as demonstrated last week by its Q3 results, with revenue (90% of which is advertising) up about a third to $13.7bn year on year. Yes, user growth is flat-lining. But advertiser demand shows no signs of abating. Read a summary here.
Other than counting his stock options, you wonder how Nick Clegg will fill his time as the acceptable frontman for Facebook. There seems little link between reputation and results.
And by and large this resilience is shared by its peers too. Somehow, their supply-side screw-ups have no bearing on demand. Market forces…pah! Irrelevant.
I got the figures below from a social media specialist mainly active in the US and UK. They cover several hundred million dollars worth of Q3 spend by 750+ advertisers across Facebook, Instagram, Pinterest, Snapchat and Twitter. While the scale of spend may not be enormous, the advertisers represent verticals including fashion and apparel, health, electronics and homewares.
But with some exceptions, the picture for advertisers is not exactly rosy – the key figures for some platforms are going the wrong way: costs up, response or engagement down.
Take Facebook: over all categories, CPMs are up 6%, CPC +23%, but CTR is down 14%. The same trends can be seen at Pinterest: CPMs up 6% and CPC up twice that at 12%, but CTR down 5%. [advert position=”left”]
The Instagram figures are overall better and at least don’t defy logic in the same way: CPMs are down 11%, with CPC tracking that at 12%, and – hooray – CTRs up 1%. In two key verticals, however, all the figures are going the wrong way.
Snapchat in Q3, meanwhile, did seem roughly to follow more standard rules: as swipe-up rate (SUR, for anyone who wants a new acronym) declined by 14%, so cost per swipe-up (CSU) and CPM fell, by 9% and 7% respectively.
And all this, remember, assuming a) no fraud or bots and b) we can trust the platform stats.
I asked a social media expert to explain this apparent conundrum to me. I’m paraphrasing their answer, but essentially it’s this: it’s a blip, driven in the most part by moves by the platforms to Stories-style formats where ad engagement is lower than other formats. Lower click rates mean advertisers have to pay more to get the same level as before – hence the rise in CPM and CPCs. Over time advertisers will get better at the new formats and users more accepting. This may take a few quarters.
We shall see. But Q4 is manic for a lot of categories – Thanksgiving, Black Friday, Christmas and post-Christmas sales. For a lot of brands and retailers it’s make-or-break time.
Advertiser demand is likely only to go one way. They may just decide to swallow the pain for now, but over the longer term they may no longer be prepared to pay more for less.
Media – estate agent’s, er, wet dream
I saw this estate agent’s sign in Clerkenwell a couple of weeks ago. I had no idea that media – in the generic sense – was both so fashionable and desirable that it could be used to market something as humble as office space.
You can imagine a prospective renter: “Wow. We provide data analysis to the credit checking industry. Even my mum thinks that’s dull. But if we rent a media-style office…”. Yeah, right.
But why is media a selling point and not advertising?
If you hang around adland like I do, you get to see a lot of media offices. I’m not sure I could define them collectively, other than to say they tend to be: open plan; have creative stuff on the walls; a kitchen/bar; breakout room with orange walls; and soft cushions.
Some are cool, some aren’t. But generally these days, if you want a generic statement of cool, it would be better to say tech. As a desirable work environment, it’s left ‘media’ behind in the lane marked ‘yesterday’.
But this doesn’t seem to bother the likes of Metrus, a property agent and manager, from bigging up several ‘media-style’ properties on its books. This one in NW1, close to Euston, is described as a ‘media-style warehouse office floor’.
Among the building’s ‘media-style’ qualities are: wooden floors; a large open plan area; meeting rooms; and (weirdly) ‘demised [sic] WC facilities’. I have no idea what a ‘demised’ WC facility is, but it sounds just like any other office to me.
Meanwhile, as McCann prepares to move to Bishopsgate in the City, it’s clear the geography of adland is further stretching and fracturing. Financial specialists apart (and discounting Maxus’ temporary residence in Finsbury Square and Ebiquity in Moorgate), McCann will fly a rare adland flag in the Square Mile.
It’s moving into a former RBS building, and there’s a certain logic to that. Bank trading floors are open plan and have large footprints – suitable for new-style agency working habits.
It’s a bit wordy, but I can see a new type of estate agent’s sign: ‘Former bank. Ideal for de-siloed ad agency’.
Headline hysteria
Like most people, I scan headlines to decide what to read. One rule is to avoid anything with the word ‘must’ – as in this from last month: ‘Creative industries must lead the way on the four-day week before it’s too late’. It’s here if you’re that interested.
Oi, headline writer, don’t lecture me. The only ‘must’ as far as I’m concerned, is avoid.
I found it hysterical – first, in the sense that it is so overblown I had to laugh; and second, that the tone – note that warning of impending doom in the ‘before it’s too late’ – is one of panic and near hysteria.
So many questions. Why must creative industries do this? Which creative industries? When is too late – next week, next month, after Christmas, next decade? And what happens if they don’t?
And then I thought of the Jaguar Land Rover car workers. Lucky them. They’re going on a three-day week and they didn’t even have to strike to get it.
I bet they’re thrilled. At least it won’t be too late for them. Just in time for Christmas too.