Search results for: “programmatic advertising”

  • End of culture

    This post on the end of culture as inspired by a presentation. Pip Bingemann of Springboards.ai presented at Cannes in Cairns – a marketing festival for Australians who wouldn’t be able to go to the Cannes Festival of Advertising. Pip’s presentation touched with things I had seen about the end of culture and had some interesting points within it. I didn’t agree with a lot of Pip said, some of it was down to nuance, but appreciated the journey that it took.

    I have built the main headers around Pip’s slides, strap in for the end of culture.

    What’s wrong with advertising?

    Bingemann’s presentation as in praise of the disruption that (generative) AI was bringing. The thesis he put forward was that ‘machines’ had already messed up the advertising and media industries. 

    • Advertising became self-service in nature. 
    • There had been a move in online media to relevance over distinctiveness
    • We became slaves to numbers

    Let’s look at those elements first. 

    Advertising became self-service in nature

    Like the technological disruption of banking in the past with: 

    • Postal banking
    • Automatic teller machines
    • Telephone banking 
    • Online banking 

    Meta and Google’s advertising platform democratised media buying. Years ago a guy I have lost touch with used to be a manager at a McDonald’s branch in the west end of London. 

    Before cellphones became commonplace he had a side hustle. He used the restaurant telephone to phone up the newspapers, to book small ads. The newspapers had advertising sales teams, that he would speak to. He did it once for a friend and then word got around. Eventually, he was calling for businesses across Soho. Premium line suppliers, porn publishers and adult mail order catalogue companies. Eventually they needed the ads to be designed. This work was done alongside creating porn DVD covers and other marketing material. 

    Ovid was a pimp

    He built a small successful agency off the back of it based in Soho. The agency remained in Soho until it was priced out by the fund management firms who moved in. Lots of other small businesses did the same for their plumbing business or hair salon. Their adverts would run in local newspapers across the country. 

    newspaper ad...

    For more sophisticated ads like large print ads, television or cinema advertising; help was needed. This help got the ad ready, made sure that the publication received the artwork on time and in a format that they could use. They made sure that the artwork was presented in the manner agreed. With the likes of television, the advert might have to go through regulatory approval prior to publication. 

    If you were a larger brand with a national or international campaign, further help was needed in pre-testing and orchestration. Expertise might be needed to access more regulated markets while remaining on the right side of the law. 

    Technology allowed newspaper type adverts to be easily accessed by both agencies and brands. 

    TLDR: Advertising has been self-serving for decades, but I will grant that online allowed more sophisticated formats such as videos, colour photos and carousels. AND regulation has been slower to police advertising online, for instance YouTube ads don’t get the scrutiny that TV ads get.

    Relevance over distinctiveness and slaves to numbers

    The move to relevance over distinctiveness in online media was down to where online media was in the customer journey. It was (and for the most part still is at the bottom of the funnel).

    Relevance made sense, particularly in search advertising. The first online adverts such as Craigslist classified and display ads were conceptually similar to their equivalents in the back pages of newspaper advertising. Newspaper ads were served in sections: cars for sale, homes for sale, local businesses, cinema listings, vets or pharmacies with a late closing time.

    Search and many banner ad campaigns for that matter are about the last step (hopefully) before purchase. In the old pre-internet world, they would be direct mail or the direct response adverts that used to appear in magazines or the special offers beloved of shopper marketing.

    Vintage 1960s Columbia Record Club Ad Double Page Advertisement 1962

    Distinctiveness appeared further up in the funnel building long term memory models through brand building. It was TV advertising, radio jingles, magazine print advertising and billboards that evoked emotion and still evoke nostalgia decades later.

    Silk Cut cigarette ad
    Saatchi & Saatchi for Gallaher

    I would argue that the issue is less about relevance at the expense of distinctiveness, instead it’s about short-termist mindsets facilitated by numbers. The media industry is about to double down on this error, with initiatives like the European Programmatic TV initiative. And so I can empathise with Pip’s last point about becoming slaves to numbers. It’s ironic that the PowerPoint-friendly charts used by Google search advertising to explaining its value for marketers took off and drove marketing thinking.

    Technology marketing itself came from broken origins and still is basically sales strategies by another name. A good deal of what data is created is based on what technology companies can see; rather than what marketers need to measure to get the balance between long term and short term marketing needs.

    This MIGHT BE about to change if marketing expert Mark Ritson is to be believed. He posits that marketing technology start-up Evidenza.AI will provide business-to-business marketers with the kind of insight previously driven by market research, but much faster. From then on he sees it doing a better job at communications and media strategy. I am trying to keep an open mind on this at the moment.

    TLDR: Advertising hasn’t become about relevance at the expense of distinctiveness, but instead about short-term at the expense of long-term marketing effects; partly down to technologists having a poor understanding of marketing.

    Technology outputs data which marketers paid an inordinate amount of attention to; reinforcing the short term bias. Machine learning techniques now becoming available might turn this around by providing better marketing insight.

    Machine learning tends towards the mean

    Pip’s presentation went on asserting that machine learning tends towards the mean. Generative AI synthesises content based on what has already been done, which why Pip assumes that everything tends towards the mean. But that depends on how one uses these tools that we’ve been given.

    As a strategist, I have used generative AI to knock out too obvious propositions, so I give the creative teams something interesting to work with in the creation of distinctive assets.

    Apparently creative teams have been taking a similar approach in terms of ideation.

    One thing I’ve heard more than once recently is how creative teams are using LLMs for brainstorms. But not quite how you’d expect… Because these algorithms answer back with the most likely predicted outcomes based on available data, you get the mean. The average. In creative terms that means the well worn “cliches”. So when starting a brainstorm or ideation session, quizzing the LLMs leads to a list of suggestions of what creative teams are generally most likely to suggest. At which point the team knows what NOT to do. The already well trodden ground. The list of the obvious. That also somehow gives a wonderfully smug angle on the use of AI in the pursuit of original work.

    Nic Roope on LinkedIn

    TLDR: generative AI will tend towards the mean, BUT that can be used creatively.

    Agencies and clients screwed advertising

    Pip’s slides don’t necessarily dig into the reasons why this happened. But I can put together some hypotheses and provide evidence that may indicate their validity or lack of it.

    Clientside factors

    • Shareholder value ethos – Shareholder value the way we understand it now can be traced back to the 1960s. While Milton Friedman popularised it in an essay A Friedman Doctrine: The Social Responsibility of Business Is to Increase Its Profits, the idea had surfaced years earlier in an opinion editorial published in Fortune magazine. The so-called Friedman doctrine became a lode star for investors and boards including the likes of ‘Neutron’ Jack Welch at General Electric. While this thinking still dominates the tyranny of the quarterly numbers that CEOs of publicly traded companies operate under; it is not the only perspective in the c-suite.
    • The financialisation of businesses – related to the Friedman doctrine, businesses became increasingly financialised thinking about short term financial decisions. A classic example of this is how post-regulation, legacy airlines in the US have been managed. Another example is Brazil’s private equity firm 3G Capital who managed to destroy billions of dollars in shareholder value with marketing cuts. Financialisation has definitely had an impact, but it varies from company to company. We also see it showing up on the agency side, with the move to using more freelance staff and burning out those staff that they do have. They have a fig leaf of mental health care in their talent acquisition literature, but it’s largely BS.
    • What gets measured gets done – Google advertising’s success was as much down to it being easy to tell a story about the marketing spend conducted on the platform as it was about effectiveness. The dashboards lended themselves to being easily reproduced in PowerPoint and spoke in the universal c-suite language of line graphs and pie charts. This was really important for Google to survive and thrive in the post dot com bust and the 2008 recession.
    • Marketing literacy – since before I have gone to college the c-suite was largely marketing illiterate. It doesn’t matter if they are a self-starting boy or girl made good, or minted from an Ivy League business school with an MBA. I have worked with both and they had a similar marketing knowledge level, the only thing that varied was the level of self confidence despite this gap. Neither do the management consultants that they may employ. Which is the reason why the team at 3G Capital were surprised when they cut marketing costs and destroyed brand and shareholder value.
    • Procurement – practices to systemise purchasing and avoid issues like nepotism and corruption have introduced a muscular procurement function who know the price of everything and the value of nothing. Margins across disciplines have been squeezed to breaking point. This has led to a decline in entertainment and side benefits, my LinkedIn feed had advertising folk explaining that the cost of attending the Cannes Festival of Advertising was likely paid through budget cuts in: training, subscriptions for tools and publications and even head count. We might not have had an end of culture, but this is no longer the industry portrayed in Mad Men.

    Agencyside factors

    • Splitting creative and media – prior to the mid-1970s creative and media buying were two departments in the one advertising agency. That allowed the free flow of research between the departments and the creative use of context as well as content. It also meant that margins had to support two management teams. Secondly, the options to best defend margins was in the media-buying side of the house, depending on how integrated into the media technology stack the the media buying agency became.
    • Change in north star from FMCG to technology companies – the rise of the internet completely changed the nature of marketing. Prior to the internet becoming mainstream, having FMCG experience as a marketer helped your career. In the early 2000s, Google, Yahoo! and later Facebook became the brands marketers wanted on your CV. The difference was that FMCG brands had subscriptions to the likes of the Ehrensberg-Bass Institute for Marketing Science. Yet American and British academia saw that most thinking from even the most prestigious schools can be boiled down to being the considered common sense opinion of tenured professors like David A. Aaker and Philip Kotler. Kotler was reportedly not interested in engaging with marketing science as consumer behaviour was too complex and difficult to model.
    • Relative recent awareness of marketing science. For reasons that I don’t fully understand marketing science is both old and a new phenomenon. The late Andrew Ehrensberg originally founded his Centre for Research in Marketing in the early 1990s and had been turning out marketing science academic papers for decades before that. Ehrensberg eventually moved to His work on the myth of ‘heavy consumers‘ and polygamous brand buying (smaller brands suffering a double jeopardy of fewer people purchasing them, and those that did purchase them, did so less often) was done back in the 1950s for Attwood Consumer Panel (would eventually become part of TNS). Some agency strategists knew about Ehrenberg, such as Stephen King of JWT. Some of this thinking was likely hidden by the decline of market research projects in agencies and the split between media buying and creative. In addition, Andrew Ehrenberg theorised why marketing science had a low adoption outside his center’s FMCG clients, which also encapsulated the gatekeeper role American academics played in overall mainstream academic adoption:

    I also realised slowly that our kind of theorising – which at base describes and explains already-established and generalised empirical discoveries and which thus post-dicts them – was anathema to many American academic marketing colleagues. They espoused much more ambitious and complex-looking econometric procedures which never worked in practice, with the recent citation for a Nobel typically not referring to any established empirical patterns

    My Research in Marketing : How It Happened by Andrew Ehrenberg
    • Channels – I don’t know who thought that a video view could be just a couple of seconds, but digital platforms benefited from it. Some of the wisdom from this years Cannes Festival of Creativity was that short adverts don’t work that well as they fail to build memory structures. Somehow agencies, platforms and brands suspended belief to develop marketing campaigns that only made sense in 1980s cyberpunk fiction like Max Headroom. Even at Cannes, platforms like Tiktok believed that they operate like, and a have similar impact to a TV advert…
    • Research – like most strategists I have found that I am often operating with less qualitative research than I would like. One of the biggest programmes I managed to work on the research for was the global launch of a now famous weight management product. Even then we didn’t do enough interviews around the world to understand cultural nuances in play. I remember reading about strategists in the 1970s spending a good deal of time listening to focus groups hosted around the country. There was a mid-week ritual of taking a drive or a train to a city or town outside London for this research. Social listening has been touted as a possible research for product tracking and can be a useful source of consumer soundbites sometimes.
    • Testing – hand-in-hand with a decline in research has been a decline in types of testing. Content still gets tested, but brands and agencies didn’t test channels to the same degree. Which is why we’ve had short form ad formats for years, yet the knowledge that they’re not as good at building memory structures doesn’t seem to be embedding into clients and agency teams.

    OK, but that’s advertising, what about the end of culture?

    Pip claims that advertising is just one part of our world that has been under attack (from technology). Alex Murrell’s essay The Age of Average was cited as the source of this insight. Murrell makes his case on the common looks in car designs driven by developments in aerodynammic design over time, architecture and cityscapes, coffee shop styles, logos, book covers, video game franchises, packaging design and product design.

    Part of the reason for the architecture was Le Corbusier and his his function over form theory of design and architecture (modernism) captured in Towards a New Architecture.

    Murrell harked back to a time of distinctive cities like Victorian London. However what Murrell’s explanation overlooked was that even back in Victorian times London was becoming ‘standardised’. Chimney pots, bricks, cast-iron beams, windows and even church stained glass windows came out of catalogues. The same designs repeat over-and-over-again. The church stained glass windows went around what was then the British empire. It is a similar situation today. Buildings are made of standardised materials and design tools as we understand more about engineering.

    Technology over time allowed buildings to get taller and let in more light thanks to improvements in construction, lifts (elevators) and environmental control. Where things get interesting is when governments and societies make decisions on what they want to keep or rebuild. Shanghai has preserved only a little of the Bund and few of its hutongs. Hong Kong has so far managed to keep some examples of its composite buildings. However once you get to street level you see a distinct evolving local culture despite their apparently similar skylines.

    This mix of standardised components bought from a supply chain, improved engineering and regulation has also driven similarities in other products, such as motor cars which Murrell cited as an example. But again those similarities are more about operating at a macro-viewpoint. On closer examination, diversity in car culture and driving experiences start to build clear lines of distinctiveness.

    And the car industry for decades has indulged in badge engineering where one vehicle truly does look like another.

    Wolsley Hornet
    Wolesley Hornet
    PBWA Hammersmith and Fulham
    Austin Cooper Mini
    1975 Innocenti Mini 1300
    Innocenti Mini
    1967 Riley Elf
    Riley Elf

    The examples I used above were all based on the Austin Mini. Wolesley was a luxury brand owned by BMC at the time. Italian care manufacturer Innocenti licensed the Mini from Austin until the agreement was cancelled by British Leyland. Lastly, the Riley Elf was a slightly more expensive alternative to Wolesley, both were owned by BMC.

    General Motors were the masters of badge engineering using ‘common platforms’ as far back at 1909.

    As for the complaints about logo design, books and later the web allowed influential design motifs like Neville Brody’s work at The Face, Arena and The Guardian went around the world, collected in three volumes by Thames & Hudson. His cover designs were in Tower Records stores from New York to Tokyo. Design is an industry sensitive to global influences that you see spread around the world. A second reason for the simplification and flattening of logos is the world that we now live in. Before the web logos only existed in the physical world. Digital brings common requirements:

    • Works in a website template that can be used globally.
    • Works in email headers and footers.
    • Works in a favicon and in a mobile app button.

    One interesting point came out when Murrell (and Bingemann) looked at media where there was a coalescence of homage images and content based around a success. But these in turn created their own genres like the sweary covers on self-help books. How is this marking a low point in culture was beyond me.

    I thought of genres like the European ‘gallo’ films or the European takes on the western films of which spaghetti westerns are the most well known. A lot of the films were dreadful. In the case of European westerns many of them borrowed a characters name from more successful films. So you saw ‘apparent’ franchises around ‘Ringo’, ‘Django’ and ‘Sartana’.

    Western saloon, cinema studio tabernas (Almeria)

    (Film director Alex Cox published one of the best works on the Italian western film genre 10,000 ways to die. It’s based on his university thesis and a fascinating read, if you choose to jump down that rabbit hole.)

    You had a similar experience in the Asian martial arts film industry with countless variations on the the star name Bruce Lee, as the industry coped with the loss of most famous star.

    To quote Sturgeon’s revelation:

    90 percent of anything is crap.

    This doesn’t mark the end of culture, but the manufacture of culture. What’s good or great is then strained through the filter of time and changing social attitudes.

    As for the cinematic superhero cul-de-sac, there are clear parallels with the end of the western and the New Hollywood movement. This time its distribution in the driving seat rather than a new generation of directors. Like the New Hollywood movement there will be both successes and car crashes along the way and I am largely excited by it.

    Bingemann also cites Adam Mastroianni’s essay Pop Culture Has Become an Oligopoly. Mastroianni hits on what is called a long tail. In scale-free networks with preferential attachments, power law distributions are created, because some nodes are more connected than others – so Taylor Swift will sell more because of the size of fan base she has grown over time. They have been studied since at least 1946 and Benoit Mandelbrot who is better known for his work on fractals was one of the main researchers. Wired magazine touched on it in 1998 when it published The Encyclopaedia of the New Economy written by John Browning and Spencer Reiss and the influence showed up in Wired contributor Kevin Kelly’s work New Rules for the New Economy. So one can guess that the ideas were being thrown around then.

    Wired editor Chris Anderson wrote about it in a magazine article for Wired in October 2004, and turned it into a book. Algorithms in online services create bubbles and rabbit holes in different areas and surface media winners like MrBeast. But again culture has thrived despite of popular culture out of sight of the general public for decades will continue to do so. Examples include Northern Soul, punk, the Chicago house music scene, UK garage, grime, drill and donk, the long tail does not mark an end of culture.

    TL:DR: Could the current culture eco-system be better? Yes, absolutely. But it isn’t broken in the way and extent that Bingemann believes. We definitely aren’t at the end of culture and it doesn’t need to be ‘saved’ by generative AI.

    So what can AI do?

    Bingemann believed that generative AI offers society a way out of the end of culture. So presumably it offers a way to enhance and create culture. He believes that it creates, I would finesse this a bit to say that it emulates, synthesises and combines elements to meet consumer instructions – since it is the sum of its training data.

    Ironically, Bingemann bases his thesis on how surreal and abstract art represented the ‘death of traditional art’ and reinvented the meaning of art and unleashed a large amount of creativity. Traditional art didn’t die per se, there are still several artists selling realistic pieces including painting and sculptures alongside the ‘new art’ movements.

    Generative AI puts tools in the hands of creatives that previously would have meant a lot of work. In the same way that desktop publishing and Photoshop reduced the cut-and-past compositing on layers of glass panels which were then photographed and image retouching done by hand in the past.

    In advertising Bingemann sees five opportunities enabled by generative AI:

    • Move to value-based pricing (presumably based on substantially reduced cost of production). It’s what Huge tried to do with their pivot and what thinkers like Michael Farmer have been recommended. We’ll see what happens when this aspiration meets client procurement teams. I hope Bingemann is right.
    • Design AI around people. So far the progress has been mixed around this. We have been some companies like Klarna using ‘good enough’ generative AI to automate jobs out of existence. Adobe have taken more of a creative enablement approach. Based on my experience working on ads in the past with collaged backdrops and photoshoots for global campaigns, this could save tens of hours or more in art working.
    • Embrace the newcomers. Just like social and digital before it, when we had new agencies like Crayon, AKQA and Poke; Bingemann thinks that generative AI is likely to bring new businesses to the advertising eco-system.
    • Spend 10x more effort developing the next generation. Given that the advertising industry manages to continually churn experienced people out of the industry and no one was found to have retired last year from the industry according to the IPA – this is going to be a tall order. It would make more sense if AI was used to make advertising more representative.
    • Unite. Clients, agencies and technology. It’s a nice aspiration, but when clients are looking for good enough and efficient content, agencies looking for a margin and trying to put effectiveness in there as well and technology companies trying hold back their natural instinct to suck all the value to themselves, it will be a hard feat to achieve.

    Bingemann argues that this is necessary for advertising, but also for creativity and considers advertising’s role to break culture rather than just reflect it. Culture and creativity will exist without advertising. Even during the Soviet Union, there was still creativity, art and culture – both mainstream and underground.

    A Final Thought To Leave You On

    GZero Media quoting Douglas Rushkoff (of Media Virus fame) on what generative AI means for culture moving forward.

    While its not the end of culture as we know it, Springboard.ai are putting out some interesting tools that I could see competing with the likes of Julian Cole, Mark Pollard and others who are filling the ‘how to strategy’ gap for brand planners.

    More related content can be found here.

    More information

    The ‘Pernicious Nonsense’ Of Maximizing Shareholder Value | Forbes.

    Customer Value, Shareholder Wealth, Community Wellbeing: A Roadmap for Companies and Investors by Denis Kilroy and Marvin Schneider

    CIA appoints ex-MindShare chief de Pear | MarketingWeek

    Vici – The evolution of display advertising

    Profit squeeze for ad agencies | MarketingWeek

    3G Capital discovers the limits of cost-cutting and debt | The Economist

    My Research in Marketing : How It Happened by Andrew Ehrenberg

    Creative Impact Unpacked: 11 effectiveness trends from Cannes Lions 2024 | WARC

    The Age of Average by Alex Murrell

    Modern Man: The Life of Le Corbusier, Architect of Tomorrow by Anthony Flint.

    10,000 ways to die by Alex Cox.

    The New Hollywood: From Bonnie and Clyde to Star Wars by Peter Kramer.

    Pop Culture Has Become an Oligopoly | Experimental History.

    New Rules for the New Economy by Kevin Kelly.

    The Long Tail: How Endless Choice is Creating Unlimited Demand by Chris Anderson.

    AI and creativity | renaissance chambara.

  • Warped media constructs

    Where did warped media constructs come from?

    Warped media constructs as an idea originated from a few observations I made. The first was an article by Magic Numbers that examined the distribution of marketing spend across various media channels compared to the percentage of profit they generate. It was based on a piece of research done called Profit Ability 2.

    A chart in the article caught my attention. While all channels contribute to profit, some have more comprehensive long-term effects than others. Any channel below (or to the right of) the red line represents a greater proportion of contribution to overall profit returns than the proportion of the marketing budget allocated to it.

    profit ability 2

    Based on this chart: linear television, radio and podcasts and print advertising offer the best value for money for businesses.

    What’s interesting is that two out of three of these channels are viewed as legacy media that brands are keen to move away from. When I worked at Unilever, the global media spend for the brands I managed amounted to about 92 per cent on television advertising. Some markets allocated even higher percentages.

    The second influence for this post on warped media constructs was a post by Tom Goodwin.

    Goodwin spent the best part of a decade working in senior roles for media buying businesses in very technology-centred roles.

    It’s only just dawned on me that the reason Traditional Advertising is quite good and Digital ads are uniformly terrible is this.

    Media owners always knew they were in the business of selling eyeballs.

    Digital media companies think they are in the business of selling clicks.

    Our core competence becomes how we see the world.

    If you were a traditional media owner , your “job” was to attract , to respect , to inform, to tantalize, to satiate attention and repeat business

    If you were a digital media owner, you were a tech company using algorithms to trick, harass, optimize, chase , game, attention by trying out any one of Billions of bits of content , made for free by users.

    So while TV companies and traditional media owners are selling attention and eyeballs.

    Digital media companies are selling clicks and data that show they create success.

    The philosophy of traditional media is actually far more useful for longer term business success with advertising

    For MOST companies of any scale, taste and longevity, digital media thinking is entirely wrong

    But tech thinking swayed the market , they became so dominant and valuable, and profitable, nobody has the balls to call out how dumb this actually is and how much it’s degraded advertising.

    I just wish we could apply the thinking of traditional media , the need to respect , to seduce , to value , to reward human attention , to digital media , because that’s where most people spend ALL of their time.

    Tom Goodwin on LinkedIn

    His post made me wonder about why such warped media constructs were widespread, when the flaws of lower performing media were readily apparent?

    What does the data tell us about media?

    The Profit Ability 2 research is a robust study of the UK media market. It took data from five media buying agencies looking at 141 brands in 14 sectors. it was based on a three-year media spend (2021-2023) and across ten media channels. Over a third of the brands matched pre-and-post COVID.

    Retail media is one area that I would have liked to see examined in a bit more depth, given its rising popularity and ability to challenge generic PPC and online display advertising.

    Media that is often the most lionised and championed by media agencies, notably paid social and programmatic display media were outshone by media types that have been declining investment by marketing teams over the past two decades.

    This isn’t a new phenomenon as Ebquity research back in 2018, showed that there was a considerable gap between what marketers and agencies thought were effective, versus real-world evidence.

    perception vs reality

    Secondly, this data indicates that brands are not using the channels in the best way for the long term interests of their business. There is also a correlation with declining campaign effectiveness rates.

    Why do we have warped media constructs?

    This pivot towards warped media constructs has benefited everyone but advertising agencies. And it would be reasonable to hypothesise that agencies chasing incremental growth, enterprise software vendors and consultancies have been leading large corporates up a digital focused route that provides data and efficiency at the expense of effectiveness and marketing ROI.

    Agencies’ legacy businesses are fading as the vast majority of
    incremental marketing spend is directed online. Digital growth is
    accruing to leading publishers, enterprise software and consultancy
    firms, while technology enables marketers to do more in-house.
    Market share loss is already evident in slower organic growth, but
    trading multiples fail to recognise the heavy dependence on M&A.
    Fragmentation. Almost 80% of every incremental advertising dollar spent globally accrues to digital. As their legacy traditional media businesses are fading, agencies are failing to capture digital growth, resulting in a lower market concentration in favour of new entrants empowered by technology

    Redburn Atlantic (equity research paper): Ad Agencies Marginalised (2016) by Bianca Dallal, Matt Coupland and Mandeep Singh.

    Advertising industry commentator Michael Farmer alluded to this change in his newsletter Madison Avenue Insights back in 2020.

    Creative agencies have mastered the requirements of integrated campaigns, from TV to online video, websites, Facebook, Instagram, ad banners and e-mail marketing. It’s a pity, then, that this victory is being undermined by agency price-cutting strategies that leave agencies understaffed and underpaid. Senior agency executives need to create winning business practices – they’re losing the business war.

    Madison Avenue Insights | Creative agencies: winning the battle but losing the war

    Platforms like Facebook have repeatedly tried to prove that they can substitute for linear TV in advertising campaigns since the late 2000s with varying degrees of success.

    The Devil is in the details.

    Remember the question about what the data tells us about media? Let’s examine the data in more detail.

    One of the key phrases on the slide plotting out the different media sources is ‘full profit returns’. This term is quite important to bear in mind. Consider how these media channels work.

    Long-term memory model or brand-building channels

    • Linear television adverts
    • BVoD (Broadcaster Video on Demand)
    • Radio and podcasts
    • Cinema
    • Online video
    • Print advertising

    Good brand building content that we are sufficiently exposed to can stay with us for decades and even become part of culture.

    Short-term brand activating channels

    • Generic PPC (Pay-Per-Click)
    • Paid social
    • Display advertising

    This means that once you have clicked on the ad and gone to a destination, the advertisement has largely had its effect.

    The Long and the Short of it

    Now if we look at the performance of these media types over full payback, sustained payback and immediate payback we see that each these media channels serve short-term or longer-term goals. Time matters, Profit Ability 2 found that 58 percent of advertising’s total profit generation happens after the first 13 weeks.

    If you are a digital-first organisation, or looking at ‘last-touch’ attribution, your measurement is capturing less than 40 percent of profit generated by advertising depending on the marketing mix of the campaign. Your organisation’s marketing culture could be leaving substantial marketing generated profits unharvested with an overly short term focus and less efficient over longer timelines than a financial quarter.

    Binet and Field established some useful heuristics for thinking about marketing spend, which can help shape media choices from a macro perspective of brand-building and brand-activating activities.

    full sustained immediate
    • Immediate payback – profit derived in the same week as the advertising.
    • Sustained payback – profit derived from week 14 to 2 years of advertising.
    • Full payback – profit derived over the full 2 year period.

    Anything above the yellow line makes a positive contribution relative to the proportion of marketing investment. Linear television works when used consistently and has a long-term impact.

    Paid social media is about achieving immediate results, being a very tactical channel by nature.

    Print advertising is unique in serving equally well across immediate goals, sustained campaigns, and delivering long-term results.

    Each media channel can play its role based on the communication objectives. Their effectiveness also depends on how they work together.

    A second consideration is the channel’s reach in the population. Print is interesting as a universal channel for consumers who read print publications, from older Telegraph readers to Monocle magazine-toting hipsters. However, it’s less useful if you’re looking to reach a football-mad teenager. Ebiquity in its analysis of Profit Ability 2 talks about a related concept called saturation:

    The study analysed the saturation point for each channel, which is the last point where every pound invested in a channel generates at least £1 profit.

    It found that TV has the highest saturation point. Advertisers can increase investment in TV to a higher level than other media and it will continue to generate a profitable return.

    Based on immediate payback (i.e. payback within one week of investment), Linear TV advertising on average hits saturation at the highest spend level – £330,000 – nearly triple the equivalent scale of the next largest channel (Print) and over 8-times the scale of Online Video.

    Profit Ability 2: The new business case for advertising | Ebiquity

    Reflecting on my experience at Unilever: I wasn’t brought in to help digitise the marketing mix away from television because digital was an ineffective channel, but because linear television wasn’t as good a platform for reaching busy young mums as it had been previously. We had to broaden the media mix to reach them, which meant more investment in online video and paid social media.
    In retrospect, we focused on reach, deprioritising consideration of the communication objectives. BVoD, radio, and podcasts might have had greater weighting if I were to do it again.

    This might all change

    If a channel became more expensive, you would get less value for your money; it would be equivalent to raising the yellow line. Conversely, reducing the cost of the media would be equivalent to lowering the yellow line.

    Cost inflation

    Price inflation for larger clients likely endangers cinema, display advertising, online video and BVoD in client budgets first. There may be a strong case at present to allocate more spend to channels that would encourage branded searches, to improve the effectiveness of a reduced PPC spend. Examples of these channels would include public relations, print advertising and television.

    Job to be done / payback period
    SOTD: Eau Sauvage

    An emergency locksmith will have a very different budget and timeline for marketing return compared to an aftershave brand. The emergency locksmith wants to rank top in local search on mobile devices to get a call-out; they are far less likely to consider brand building and word-of-mouth. The exception to this rule would be at the top of the market, like Banham in central London, which would be providing more of a concierge security service.

    Regulation

    I have worked with pharmaceutical clients where most of the communications we were doing had to be addressed directly to healthcare professionals. In that case, you have a much more limited palette of possible communication channels.

    Silk Cut cigarette ad

    You face a similar situation if you are looking to market regulated consumer products like sports betting, gambling, alcohol, cannabis and tobacco-related products or vapes. The channel limitations are based on screening off protected audiences or reducing the chance of positive brand attributions. Regulators don’t want smoking to appear cool.

    The Cholmondeley Pageant of Power 2009

    So what’s the best media channel based on our warped media constructs?

    It depends. The good news is that all advertising channels analysed in Profit Ability 2 generated a positive payback from advertising when sustained effects are accounted for.

    You can find similar posts here.

    More information

    How Brands Grow: What Marketers Don’t Know by Byron Sharp.

    Madison Avenue Insights | Creative agencies: winning the battle but losing the war

    Profit Ability 2: Thinkbox report, Ebiquity write up, The new business case for advertising presentation.

    What the latest effectiveness stats reveal about moneyball media choice | Magic Numbers.

    The Long and the Short of it: Balancing Short and Long-Term Marketing Strategies by Les Binet and Peter Field.

    Ebquity | Intel (2018). Re-evaluating Media: What the evidence reveals about the true worth of media for brand advertisers. United Kingdom: RADIOCENTRE. (PDF).

    Facebook is a lower quality medium than TV, says marketing academic – Brand Republic News

    TubeMogul Partners With Facebook to Help Brands Extend TV Audience Reach to Digital | Adweek

    Do TV Ads Drive Facebook, Twitter Engagement? (Study) | AdWeek

    Mediatel: Newsline: Starcom: TV is now twice the price… but not twice as good -“There’s still nothing better than [a 30 second ad],” Dan Plant said on a panel at Future of TV Advertising Global. “Unfortunately it costs twice as much now – and it hasn’t got twice as good at what it was doing. You pay twice as much to achieve the same thing.”

    Facebook suffers setback in quest to topple TV ad dominance | Digital – Ad Age – couldn’t get sufficiently high rates on ads that it was showing on connected TV devices.

    Facebook and Google, Two Giants in Digital Ads, Seek More – The New York Times – Facebook combining Nielsen TV data, treating its ads like TV. and Google plays catch-up with targeting by email address.

    What’s behind P&G’s cutback on targeted Facebook ads? | EJ Insight (Hong Kong Economic Journal) – To reach 5,000 targeted viewers on Facebook, the spending needed can reach the equivalent of that required to reach a million TV viewers, according to Peter Daboll, chief executive of Ace Metrix, which tests ads for effectiveness

    Thinkbox Media Mix Navigator.

  • IT director powers up + more stuff

    The IT director is seeing a return to power and its thanks to the power of hackers and AI. The smartphone, the resurgence of Apple and SaaS saw IT decisions become more organic thanks to increased access to online services that provided better features than traditional enterprise software companies and the rise of knowledge working. IT teams found management of mobile devices onerous and faced hostile users.

    TSB -  8th Chief Technology Officers (CTO) Meeting
    Michiko Fukahori of the Japanese National Institute of Information and Communications Technology at ITU TSB – 8th Chief Technology Officers (CTO) Meeting

    This meant that the IT director became less important in software marketing. A decade ago marketing had pivoted to a bottom up approach of ‘land and expand’. This drove the sales of Slack, Monday.com and MongoDB.

    Two things impacted this bottom up approach to enterprise innovation:

    • Cybercrime: ransomware and supply chain attacks. Both are not new, ransomware can be traced back to 1989, with malware known as the AIDS trojan (this had much cultural resonance back then as a name). Supply chain attacks started happening in the 2010s with the Target data breach and by 2011, US politicians were considering it a security issue. Over COVID with the rise of remote working, the attacks increased. The risk put the IT director back in the firing line.
    • AI governance: generative AI systems learn from their training models and from user inputs, this led to a wide range of concerns from company intellectual property leaving via the AI system, or AI outputs based on intellectual property theft.

    The most immediate impact of this is that the IT director is becoming a prized target on more technology marketers agendas again. This takes IT director focused marketing from back in the 1980s and the early 2000s with a top-down c-suite focus including the IT director. This implies that established brands like Microsoft and IBM will do better than buzzier startups. It also means I am less likely to see adverts for Monday.com in my YouTube feed over time.

    This doesn’t mean that the IT director won’t be disrupted in other parts of his role as machine learning facilitates process automation in ways that are continuing to evolve.

    Target data breach: Why UK business needs to pay attention | Computer Weekly

    Supply chain security – DHS finds imported software and hardware contain attack tools | Inquisitr

    Software is not dead | Kevin Xu

    The bizarre story of the inventor of ransomware | CNN Business

    Silicon Valley steps up staff screening over Chinese espionage threat

    Business

    The whole supply chain is subsidised’: inside the EU’s blockbuster Chinese EV probe | South China Morning Post

    Brands plan for a quiet Pride Month | News | Campaign AsiaThe hesitation around Pride may also be related to executives’ increasing reluctance to speak out on social issues more broadly. Wolff pointed to Edelman’s Trust Barometer, which found that 87% of executives think taking a public stance on a social issue is riskier than staying silent. “Essentially, nine out of every 10 executives believe that the return on investment for their careers is not worth the support during this turbulent time,” said (Kate) Wolff. “This is clearly problematic for both the community and the progress we have made in recent years.”

    Apple, Microsoft, SpaceX talent jumped ship after return-to-office mandates, study reveals | Fortune

    China

    The whole supply chain is subsidised’: inside the EU’s blockbuster Chinese EV probe | South China Morning Post

    Resignation Bordering on Despair – by Stephen Roach – economics of China and Hong Kong – more here: An Audacious Wake-Up Call – by Stephen Roach. Roache was the head of Morgan Stanley Asia.

    China’s Global Ambitions – Part 1: A Violent Thrust Into Modernity – Preston Stewart – quite a nice China primer.

    Consumer behaviour

    Brands have misjudged the politics of youth | WARC – STRAT7 Research on how woke has become a negative terms for some as the term takes on ambiguity and polarity in societal discussions.

    Why Companies Should Add Class to Their Diversity Discussions | HBR

    What triggers brand boycotts? | WARC | The Feed – interesting research, but I would like to have seen China and South Korea in this due to the interest boycott behaviours that happen.

    People Like Harrison Butker Are Taking Over Catholicism | The New Republic – looks like the evangelical catholics

    An uneven commute | Mastercard Services

    The death (again) of the internet as we know it | Noah Smith

    THE SILVER CULTURE PROJECT – interesting project by BBH London though the age bias in marketing and adland is strong

    Culture

    Rebecca F Kuang: ‘I like to write to my friends in the style of Joan Didion’ | The Guardian

    Design

    Pedestrians Aren’t Hearing EVs on the Road | Extremetech – engine sounds in EVs would be a solution. Imagine if your EV could sound like the dignified rumble of a 1980s vintage Mercedes 560 SEL?

    Nokia’s Classic 3210 Returns With Modern 25th-Anniversary Upgrades – DesignTAXI.com

    IKEA hosts flea markets at European stores to ‘keep good things going’ | Trendwatching – its a pity that most Ikea products are now built for margin rather than quality.

    Emoji history: the missing years  ⌘I  Get Info

    Making the Band: An Oral History of the Livestrong Bracelet | Texas Monthly – history of the early 2000s social object

    Economics

    The Foundation of American Folly – by N.S. Lyons

    Finance

    StanChart’s Iran transactions subject of fresh whistleblower claims | FT

    Chinese underground banks shaking up money laundering.

    FMCG

    CosMc’s: Brand Launch — Macaihah Broussard • Art director

    Nestlé Introduces Vital Pursuit Brand to Support GLP-1 Users, Consumers Focused on Weight Management

    Gadgets

    Oral-B Hopes You Didn’t Use Your $230 Alexa-Enabled Toothbrush | Hackaday

    Germany

    German parliament will stop using fax machines : NPR – I knew fax machines were still important in Austria and Japan. Interesting to see that they were still important in Germany as well

    Health

    Benchmarks for digital marketing in the pharmaceutical industry – phamax Digital

    Hong Kong

    This city never slept. But with China tightening its grip, is the party over? | CNN Business

    HEY YU, DREAMER: Vanity car plates in Hong Kong prove an endearing, enduring trend | The Straits Times

    China’s Economic Worries Spur a Different Kind of Shopping Spree – WSJ – sales of Hong Kong based insurance policies surge again representing middle class capital flight.

    Ideas

    Is human creativity fading away? – by Joel Stein and The age of average — Alex Murrell

    Pop Culture Has Become an Oligopoly – by Adam Mastroianni

    Tony Robbins on How to Make Tough Decisions – Real Leaders

    IPA | Top Ten Practical Stress Busters | IPA

    Is modern life bad for creativity? | LinkedIn – Contagious on Sir John Hegarty’s opinion on how modern life is making great advertising campaigns harder:

    • A lack of shared cultural references
    • Pivot towards sales due to wealth of customer data
    • Remote working preventing collaboration

    IP

    Harley-Davidson sues Next over alleged trademark infringement | FT

    Luxury

    Chinese Firms Are Investing Heavily in Whisky Market | Yicai GlobalAlthough international liquor giants have developed the local whisky consumption market for many years, the market penetration rate of overseas spirits in China, including whisky, is only about 3 percent. This means domestic whisky producers will need to develop new consumption scenarios, Yang said. Whisky consumption in China centers mainly around nightclubs, gift-giving and tasting events held by affluent consumers, Yang noted, but in these scenarios, imported whisky brands with a long history tend to be more popularly accepted,, so it will be difficult for domestic rivals to compete. According to the latest report from alcohol market analysts IWSR, China’s whisky market was worth CNY5.5 billion (USD758 million) last year, having grown more than fourfold over the past 10 years. It is expected to reach CNY50 billion (USD6.9 billion) in the next five to 10 years.

    Yoox Net-a-Porter exits China to focus on more profitable markets – Multi-brand luxury clothing sales platform Yoox Net-a-Porter is closing its China operations, this against a backdrop of other brands also pulling out of Chinese e-commerce including Marc Jacobs fragrances. The corporate line from Richemont was “in the context of a global Yoox Net-a-Porter plan aimed at focusing investments and resources on its core and more profitable geographies”.

    LVMH’s unit put under court administration in Italy over labour exploitation | Reuters – shines a light on the eco-system of Chinese manufacturers inside Italy that use Chinese and immigrant staff to cut costs

    Step Into The Next Chapter Of Oakley’s Future

    Fashion Matters on the big trends from FT Business of Luxury conference and Watch live: Kering deputy CEO Francesca Bellettini in conversation with Jo Ellison

    Ignite the Scent: The Effectiveness of Implied Explosion in Perfume Ads | the Journal of Advertising Research Scent is an important product attribute and an integral component of the consumption experience as consumers often want to perceive a product’s smell to make a well-informed purchase decision. It is difficult, however, to communicate the properties of a scent without the physical presence of odorants. Through five experiments conducted in a perfume-advertising context, our research shows that implied explosion, whether visually (e.g., a spritz blast) or semantically created, can increase perceived scent intensity, subsequently enhancing perceived scent persistence. It also found a positive effect of perceived scent persistence on purchase intention. In conclusion, the research suggests that implied explosion can be a powerful tool for advertisers to enhance scent perception, consequently boosting purchase intention.

    The great fashion Brexit? Why UK designers are decamping to Milan | Milan fashion week | The Guardian

    Marketing

    How SEO moves forward with the Google Content Warehouse API leak | Searchengineland, original leak here: An Anonymous Source Shared Thousands of Leaked Google Search API Documents with Me; Everyone in SEO Should See Them – SparkToro and How independent websites are dealing with the end of Google traffic – The Verge

    CHARLOTTE TILBURY CELEBRATES A YEAR IN GAMING • Women in Games

    The Problem With Behavioral Nudges | WSJ

    Touchpoints and the Omnichannel Revolution | BCG

    Marketers’ Meta habit is reshaping the ad industry | WARC

    Bank on it: Financial media networks are the next big opportunity – The Media Leader

    Fan Bingbing tasked by Malaysia’s Melaka to lure in 1 million Chinese tourists | South China Morning Post

    Mat Baxter’s Huge turnaround job | Contagious – interesting perspective on his time at Huge. What I can’t square it all with is what we know about marketing science and declining effectiveness across digital media

    Celebrate the Unique Ways You Listen With ‘My Spotify’ — Spotify – a judo move on the sinister nature of algorithms in consumers lives

    On my LinkedIn, I couldn’t escape from the Cannes festival of advertising. Partly because one of the projects I had been involved in was a shortlisted entry. One of the most prominent films was Dramamine’s ‘The Last Barf Bag: A Tribute to a Cultural Icon’. It was notable because of its humour, which was part of this years theme across categories.

    Materials

    Renewcell secures a future | Vogue Business – manufacture a fibre that uses recycled cotton instead of wood pulp in viscose

    震災復興から生まれた刺し子プロジェクトをブランドに! 15人のお母さんの挑戦!  – CAMPFIRE (キャンプファイヤー) – ancient Japanese craft – KUON and Sashiko Gals are part of a new generation of designers keeping the traditional Japanese technique of sashiko alive. And together, they are bringing the decorative style of stitching to our favorite sneakers (including techy Salomons!). Sashiko is a type of simple running stitch used in Japan for over a thousand years to reinforce fabrics. It’s typically done with a thick white thread on indigo fabric and made into intricate patterns.

    Media

    The new dot com bubble is here: it’s called online advertising – The Correspondent – old article but useful in the way it calls BS on much of the cheerleading for online advertising.

    The Epoch Times faces a federal money laundering indictment : NPR

    Canon made a special lens for the Apple Vision Pro’s spatial videos – The Verge

    Pinterest ads set for 17.1% growth to reach $4.2bn next year | WARC | The Feed

    Streamers like Netflix, Max, and Peacock are raising prices — here’s why | Yahoo! Finance and The Dream of Streaming Is Dead – The Atlantic

    The Rot-Com Bubble | Ed Zitron

    CEOs Go to War Against Creatives – by Ted Gioia

    Meet AdVon, the AI-Powered Content Monster Infecting the Media Industry

    DVD special features draw fans back to physical media. | Slate – a digital roadmap for streaming services and also shows the power of physical artefacts

    Adtech vendors join forces for European Programmatic TV Initiative – The Media Leader

    The New York Times And Instacart Integrate For Shoppable Recipes | AdExchanger

    Online

    Apple set to be first Big Tech group to face charges under EU digital law | FT – interesting that they are going after Apple first. Japan moves the same way: Japan law forces third party App Stores on Apple & Google | Apple Insider

    Labour raced to outspend Tories online before spending caps kicked in | FT

    Nationalism in Online Games During War by Eren Bilen, Nino Doghonadze, Robizon Khubulashvili, David Smerdon :: SSRNWe investigate how international conflicts impact the behavior of hostile nationals in online games. Utilizing data from the largest online chess platform, where players can see their opponents’ country flags, we observed behavioral responses based on the opponents’ nationality. Specifically, there is a notable decrease in the share of games played against hostile nationals, indicating a reluctance to engage. Additionally, players show different strategic adjustments: they opt for safer opening moves and exhibit higher persistence in games, evidenced by longer game durations and fewer resignations. This study provides unique insights into the impact of geopolitical conflicts on strategic interactions in an online setting, offering contributions to further understanding human behavior during international conflicts.

    The Internet: Now you see it, now you don’t

    Bumble buys community building app Geneva to expand further into friendships | TechCrunch

    TikTok ‘law violations’ complaint referred to US justice department | FT

    Gambling addiction’s growing grip on the frontlines – ripping through Ukrainian armed forces and causing havoc at home

    Retailing

    Sellers Call Amazon’s Buy Box ‘Abusive.’ Now They’re Suing | WIRED

    eBay will no longer accept American Express cards over ‘unacceptably high’ fees – The Verge

    McDonalds removes AI drive-throughs after order errors – BBC News

    Security

    Huawei exec concerned over China’s inability to obtain 3.5nm chips, bemoans lack of advanced chipmaking tools | Tom’s Hardware – this is rather different to the picture that The Economist portrays of an all-conquering Huawei: America’s assassination attempt on Huawei is backfiring | The Economist

    The Stanford Internet Observatory is being dismantled | Platformer

    The West Coast’s Fanciest Stolen Bikes Are Getting Trafficked by One Mastermind in Jalisco, Mexico | WIRED“Not so long ago, bike theft was a crime of opportunity—a snatch-and-grab, or someone applying a screwdriver to a flimsy lock. Those quaint days are over. Thieves now are more talented and brazen and prolific. They wield portable angle grinders and high-powered cordless screwdrivers. They scope neighborhoods in trucks equipped with ladders, to pluck fine bikes from second-story balconies. They’ll use your Strava feed to shadow you and your nice bike back to your home.” – not terribly surprising, you’ve seen the professionalisation and industrialisation in theft across sectors from shoplifting, car theft and watch thefts so this is continuing the trend.

    Fortinet Acquires Lacework | Forrester Research – looks like its a move to prevent supply chain hacks.

    China’s Nvidia Loophole: How ByteDance Got the Best AI Chips Despite U.S. Restrictions — The Information – interesting that Oracle have been caught sanction busting and Chinese firms building US data centres that Nvidia can shop to.

    West grapples with response to Russian sabotage attempts | FT

    “Everyone is absolutely terrified”: Inside a US ally‘s secret war on its American critics – Vox – Indian black ops in the US and Canada

    NVIDIA technology found in Russian military drones | Defence Blog

    Armed gangs stage bank heists in Gaza | FT

    Software

    What’s going on with AI in Sequoia? – The Eclectic Light Company

    Google AI Gemini parrots China’s propaganda – by Wenhao Ma

    Apple Intelligence for iOS 18 is here. But can Apple beat AI rivals? | Quartz

    Anthropic course on Claude generative AI · GitHub

    Consumer Trends unveils the AI-Powered Future – Ericsson – god this is dark.

    Aptoide’s iOS game store launches on Thursday – The Verge

    The Top 100 Gen AI Consumer Apps | Andreessen Horowitz

    Which media companies have made deals with OpenAI? and Media Companies Are Making a Huge Mistake With AI – The Atlantic – sold themselves cheap.

    Microsoft can remember it for you wholesale – net.wars and Windows 11 Recall AI feature will record everything you do on your PC | BleepingComputer

    Apple plots creating AI ‘black box’ for iCloud | AppleInsider

    Future of Software development/SDLC with AI and Gen AI | Forrester Research

    OpenAI Just Gave Away the Entire Game – The Atlantic – The Scarlett Johansson debacle is a microcosm of AI’s raw deal: It’s happening, and you can’t stop it. This is important not from a technology point of view, but from the mindset of systemic sociopathy that now pervades Silicon Valley.

    Goldilocks Agents | Sequoia Capital – the quickening evolution of more capable and reliable AI agents.

    Apple Intelligence is Right On Time – Stratechery by Ben Thompson Apple’s orientation towards prioritizing users over developers aligns nicely with its brand promise of privacy and security: Apple would prefer to deliver new features in an integrated fashion as a matter of course; making AI not just compelling but societally acceptable may require exactly that, which means that Apple is arriving on the AI scene just in time.

    Style

    Can the runaway Hoka boom last? FT

    ‘Rare, vintage, Y2K’: Online thrifters are flipping fast fashion. How long can it last? | Vogue Businessas secondhand shopping becomes increasingly commonplace, this latest outburst brings to light the subjectivity of resale. What determines an item’s worth, especially in an age of viral micro-trends and heavy nostalgia? Is it ethically moral to set an item that’s the product of fast fashion — long criticised for not paying workers fairly — at such a steep upcharge, and making profit from it? If someone is willing to pay, does any of it matter?

    Tools

    YouTube Channel Statistics – ViewStats

    Web of no web

    HyperCinema | Hyper-personalized AI experiences for global attractions – although this is aimed at shopping mall events and theme parks, I could also see it being used in B2B contexts at trade shows and conferences.

    Congress unconvinced by Space Force GPS resiliency plan • The Register

  • Pipes by Yahoo

    I discovered something at the end of last year. The belatedly missed Yahoo Pipes was, in fact, officially called “Pipes by Yahoo.” I made that mistake, despite being well-versed in the brand guidelines, having spent a year working there with a copy consistently at my side.

    Now, why this journey down the memory superhighway? That’s a valid question. The inspiration for this post came from Bradley Horowitz’s initial post on Threads. (I had to go back and re-edit the reference to post from tweet to include it in the previous sentence, force of habit). In his post, Bradley shared the history of Pipes by Yahoo. I’m acquainted with Bradley from my time at Yahoo!. During that period, he was one of the senior executives in Jeff Weiner’s Yahoo! Search and Marketplace team.

    Consider this article as complementary to the Pipes by Yahoo history that Bradley pointed out. I will share the link where it makes sense to go over and read it in my depth. My commentary provides context prior to Pipes by Yahoo launching, the impact it had and why it’s pertinent now.

    Origins

    To comprehend Pipes by Yahoo, a fair amount of scene-setting is necessary. The contemporary web experience is now a world apart from the open web of Pipes, just as Pipes was distant from the pre-web days of the early 1990s.

    Boom to bust

    During the mid-1990s through the dot-com bust, Yahoo! generated substantial revenue from various sources, with online display advertising being the most pivotal. Launching a blockbuster film from the late 1990s to the early 2010s often involved a page takeover on Yahoo! and featuring the trailer on the Yahoo! Movies channel and Apple’s QuickTime.com. A similar approach applied to major FMCG marketing campaigns, with large display advertising initiatives.

    San Francisco billboard drive-by

    Yahoo! profited significantly during this period, as the internet was the new trend, and display advertising was a cornerstone for brand building. Money was spent generously, akin to contemporary budgets for influencer marketing programmes.

    Yahoo! occupied a space between TV, magazine advertising, and newspaper advertising. The design of the My Yahoo! page mirrored the multi-column layout of a traditional newspaper.

    Similar to a newspaper, Yahoo! developed various departments and services:

    • Search
    • News (including finance)
    • Music services
    • Shopping, featuring a store for small businesses, auctions, and a shopping mall-type offering
    • Sports
    • Communications (email, instant messaging, voice calls, early video calling)
    • Web hosting

    Then came the dot-com crash. Advertising revenue plummeted by around a third to 40 percent, depending on who you ask. Deals like the acquisition of Broadcast.com shifted from appearing speculative and experimental to extravagant wastes of money as the bust unfolded. This experience left scars on the organization, restraining the size of deals and the scope of ambition. Opportunities were second and third-guessed.

    Yahoo! Europe narrowly survived, thanks to a white-label dating product. Love proved to be a more dependable revenue source than display advertising. A new CEO from the media industry was appointed to address shareholder and advertiser concerns.

    The advertising industry was in a constant state of learning. Performance marketing emerged as a significant trend, and search advertising gained prominence.

    The initial cast in this story

    Jeff explains something to the phone

    Weiner was hired into Yahoo! by then CEO Terry Semel. Semel knew Weiner from his work getting Warner Brothers into the online space.

    Bradley

    Yahoo! had started getting serious about search by acquiring a number of search technology companies and hiring talented people in the field. Bradley Horowitz had found an image and video search startup called Virage and joined Yahoo! (a year before I got there) as director of media search.

    Tim Mayer Yahoo

    There was former Overture executive Tim Mayer who was VP of search products and drove an initiative to blow out Yahoo!’s search index as part of a feature and quality battle with Google, Bing and Ask Jeeves. It was a great product, but with the best effort in the world we didn’t have the heat. The majority of Yahoos internally used Google because of muscle memory.

    how many points for visiting the metro?

    Vish Makhijani was ex-Inktomi and was VP – international search and has more of a focus on operations. He worked on getting non-US Yahoo! users feature parity – at least in search products.

    Former Netscaper, Eckhart Walther was the VP in charge of product management.

    Aside: where did Ged sit?

    Where did I sit? Low on the totem pole. To understand my position in the organisation, imagine a Venn diagram with two interlocking circles: the European central marketing team and Vish’s team. I would have sat in the interlocking bit. If that all sounds confusing, yes it was.

    Downtown San Jose

    Search wars and web 2.0

    Pipes by Yahoo emerged from the confluence of two technological trends that developed in parallel, extending all the way to early social media platforms.

    Search wars

    I had been discussing the prospect of working at Yahoo! with a couple of people since around 2003. I had an online and technology brand and product marketing background. I had been blogging regularly since late 2002 / early 2003 and managed to incorporate online reviews and forum seeding into campaigns for the likes of Aljazeera and BT. The business was emerging from survival mode. As an outsider, it wasn’t immediately apparent how precarious Yahoo!’s situation had been. However, the threat posed by Google was undeniable.

    At that time, Google didn’t have the extensive workforce it boasts today. One of my friends served as their PR person for Europe. Nevertheless, Google had embedded itself into the zeitgeist, seemingly launching a new product or feature every week. If there wasn’t a new product, stories would sometimes ‘write themselves,’ such as the time the face of Jesus was supposedly found on Google Maps photography of Peruvian sand dunes. The closest contemporary comparison might be the cultural impact of TikTok.

    The geographical impact of Google’s cultural dominance was uneven. In the US, Yahoo! was a beloved brand that many netizens were accustomed to using. Yahoo! held double the market share in search there compared to Europe. Part of this discrepancy was due to Europeans coming online a bit later and immediately discovering Google. But Google didn’t do that well with non-Roman derived European languages like Czech. It has similar problems with symbolic languages like Korean, Chinese and Japanese.

    Google explosion

    I can vividly remember the first time I used Google. At that time I was using a hodge podge of search engines, usually starting with AltaVista and then trying others if I didn’t get what I wanted. This was before tabbed browsers were a thing, so you can imagine how involved the process became.

    Google appeared in an online article, which I think was on Hotwired some time during late 1998, less than a year after it had been founded. I clicked on a link to use the search engine. Google looked every different to now. It had a clean page with three boxes beneath. The first one was a few special searches, I think one of them was Linux-related, which tells you a lot about the audience at the time. The second was set of corporate links including a link explaining why you would want to use Google – although experiencing one search was enough for most people that I knew. The final box was to sign up to a monthly newsletter that would give updates on what developments Google was up to.

    From then on, I very rarely searched on Alta Vista, though my home page was still My Excite for a long time. This was more because I had my clients news set up on the page already and they had decent finance overage at the time.

    The difference in searches was really profound, there were a number of factors at work:

    • Google’s approach seemed to give consistently better results than the vectored approach taken by Excite or AltaVista.
    • There was no advertising on the SERP (search engine results page), but that was to soon change.
    • You could use very directed Boolean search strings, which isn’t possible any more since Google optimised for mobile.
    • Search engine optimisation wasn’t a thing yet.
    • The web while seeming vast at the time, was actually small compared to its size now. Web culture at the time was quirky and in aggregate nicer and more useful than it is now. Part of this was was down to the fact that early web had a good deal of 1960s counterculture about it. Wired magazine would write about the latest tech thing and also profile psychedelic experimenters like Alexander Shulgin. Cyberpunk, rave and psychedelic tribes blended and found a place online. You can see the carcass of this today with Silicon Valley’s continued love of Burning Man. (Note: there were rich dark seams if that was the kind of thing you were into. There wasn’t the same degree of social agglomeration that we now have, nor were there algorithms that needed constant new content to feed diverse realities.)
    • Content creation on the web was harder than it is now. Blogging was at best a marginal interest, the likes of Angelfire, AOL Hometown, Geocities and Tripod provided free hosting, but you couldn’t put up that much content to pollute the search index even if you wanted to.

    The impact was instantaneous and by early 1999, it was much a part of the nascent netizen culture as Terence McKenna.

    Homage to Terence McKenna

    McKenna spent the last bit of his life interrogating the search engine for four to five hours a day. He was convinced that the online world it provided access to represented some sort of global mind.

    Sometimes he treats the Net like a crystal ball, entering strange phrases into Google’s search field just to see what comes up. “Without sounding too cliché, the Internet really is the birth of some kind of global mind,” says McKenna. “That’s what a god is. Somebody who knows more than you do about whatever you’re dealing with.”

    As our society weaves itself ever more deeply into this colossal thinking machine, McKenna worries that we’ll lose our grasp on the tiller. That’s where psychedelics come in. “I don’t think human beings can keep up with what they’ve set loose unless they augment themselves, chemically, mechanically, or otherwise,” he says. “You can think of psychedelics as enzymes or catalysts for the production of mental structure – without them you can’t understand what you are putting in place. Who would want to do machine architecture or write software without taking psychedelics at some point in the design process?”

    Terence McKenna’s Last Trip – Wired.com (May 1, 1999)

    A year after that McKenna interview, Google was running over 5,000 Linux servers to power the search engine.

    At first, Google also powered search on some of the web portals and saw itself as a competitor to search appliance businesses like Inktomi and Autonomy. The advertising kaiju started operation in 2000 and it was tiny. This violated patents held by GoTo.com – a business subsequently acquired by Yahoo!.

    Post-bust

    Once Yahoo! had disentangled itself from the carnage of the dot com bust, search was a much bigger deal. And Google had become a behemoth in the space of a few years. In 2002, Google launched Google News – a direct challenge to web portals like Yahoo!, MSN and Excite. Around about this time Google started to be used as a verb for using a web search engine.

    While display advertising had taken a dive, search advertising had took off for several reasons:

    • It was performance marketing, even when a business is just surviving sales are important
    • Behavioural intent – if you were searching for something you were likely interested in it and may even purchase it
    • So easy to do at a basic level, even small and medium sized businesses could do it
    • Advertising dashboard – Google did a good job at helping marketers show where the advertising spend had gone.

    We’ll ignore on the difficult facts for the time being, for instance:

    • The role of brand building versus brand activating media
    • What attribution might actually look like
    • That Google advertising is a rentier tax, rather than a business generator

    Google listed on the stock market in August 2004. Investors ignored governance red flags like the dual share structure so the founders could retain voting rights.

    Yahoo! in the search wars

    Yahoo! had come out of the dot com bust battered but largely intact. Yahoo! was scarred in a few important ways.

    Identity crisis

    Yahoo! came about pre-Judge Jackson trial when Microsoft spread terror and fear into the boardroom of most sensible technology companies. I know that sounds weird in our iPhone and Android world. Rather than the bright cuddly people who give us Xbox, it was a rabid rentier with a penchant for tactics that organised crime bosses would have approved of. It took a long time to work that out of their system.

    Another big factor was the fear of Microsoft. If anyone at Yahoo considered the idea that they should be a technology company, the next thought would have been that Microsoft would crush them.

    It’s hard for anyone much younger than me to understand the fear Microsoft still inspired in 1995. Imagine a company with several times the power Google has now, but way meaner. It was perfectly reasonable to be afraid of them. Yahoo watched them crush the first hot Internet company, Netscape. It was reasonable to worry that if they tried to be the next Netscape, they’d suffer the same fate. How were they to know that Netscape would turn out to be Microsoft’s last victim?

    Paul Taylor – ex Yahoo and founder of Y-Combinator

    Yet Yahoo! went on to hire media mogul Terry Semel as it went through the dot com bust, shows that this thinking must have coloured views somewhat.

    Cheque book shy

    Even Mark Cuban would admit that Broadcast.com was not worth the billion dollar price tag that Yahoo! paid for it. It was a high profile mistake at the wrong point in the economic cycle which haunted Yahoo! acquisition plans for years. Which is one of the reasons why may have Yahoo! dropped the ball when it had the chance to buy Google and Facebook.

    The game has changed

    But the game had changed. Display advertising was no longer as profitable as it had been. Search advertising was the new hotness, fuelled by online commerce. By early 2004, Yahoo! is confident enough in its own search offering to drop Google who had been providing its search function.

    Yahoo! acquired search appliance business Inktomi in 2002 and then Overture Services in 2003. Overture services provides the basic ad buying experience for Yahoo! search advertising.

    In 2004, Yahoo! realises having search is not enough, you have to offer at least as good as product as Google, if not better. This is where Tim Mayer comes in and for the next couple of years he leads a project to build and maintain search parity with Google.

    You had a corresponding project on the search advertising side to bring the Overture buying experience up to par with Google with a large team of engineers. That became a veritable saga in its own right and the project name ‘Panama‘ became widely known in the online advertising industry before the service launched.

    Search differently

    Googling is a habit. In order to illicit behavioural change you would have to

    • Have an alternative
    • Change what it means to search in a positive way

    Yahoo! approached this from two directions:

    • Allowing different kinds of information to be searched, notably tacit knowledge. I worked on the global launch of what was to become Yahoo! Answers, that was in turn influenced by Asian services notably Naver Knowledge IN. This approach was championed internally by Jerry Yang.
    • Getting better contextual data to improve search quality providing a more semantic web. This would be done by labels or tags. In bookmarking services they allowed for a folksonomy to be created. In photographs it provided information about what the pictures or video content might be, style or genres, age, location or who might be in them.

    Web 2.0

    Alongside a search war there was a dramatic change happening in the underpinnings of the web and how it was created. While the dot com bust caused turmoil, it also let loose a stream of creativity:

    • Office space was reasonably priced in San Francisco only a couple of years after startups and interactive agencies had refurbished former industrial buildings South of Market Street (SoMo).
    • Office furniture was cheap, there was a surplus of Herman Miller Aeron chairs and assorted desks floating around due to bankruptcies and lay-offs.
    • IT and networking equipment was available at very reasonable prices on the second hand market for similar reasons. You could buy top of the range Cisco Catalyst routers and Sun Microsystems servers for pennies on the dollar that their former owners had paid for them less than one computing generation before. This surplus of supplies be bought online from eBay or GoIndustry.com.
    • Just in time for the internet boom wi-fi had started to be adopted in computers. The first wi-fi enabled laptop was the Apple iBook. Soon it became ubiquitous. Co-working spaces and coffee shops started to provide wi-fi access connected to nascent mainstream broadband. Which meant that your neighbourhood coffee shop could be a workspace, a meeting space and a place to collaborate. We take this for granted now, but it was only really in the past 25 years that it became a thing. It also didn’t do Apple’s laptop sales any harm either.
    • Open source software and standards gave developers the building blocks to build something online at relatively little financial cost. Newspapers like the Financial Times would have spent 100,000s of pounds on software licences to launch the paper online. In 2003, WordPress was released as open source software.
    • Amazon launched its web services platform that allowed developers a more flexible way for putting a product online.
    • The corresponding telecoms bust provided access to cheaper bandwidth and data centre capacity.

    All of these factors also changed the way people wrote services. They used web APIs building new things, rather than digital versions of offline media. APIs were made increasingly accessible for a few reasons:

    • Adoption of services was increased if useful stuff was built on top of them. Flickr and Twitter were just two services that benefited from third party applications, integrations and mashups. Mashups were two or more services put together to make something larger than the ingredients. The integration process would be much faster than building something from scratch. It worked well when you wanted to visualise or aggregate inputs together.
    • Having a core API set allowed a service to quickly build out new things based on common plumbing. Flickr’s APIs were as much for internal development as external development. Another example was the Yahoo! UK’s local search product combining business directory data, location data and mapping.
    local

    There was also a mindset shift, you had more real-world conferences facilitating the rapid exchange of ideas, alongside an explosion of technical book publishing. One of the most important nodes in this shift was Tim O’Reilly and business O’Reilly Publishing. Given O’Reilly’s ringside seat to what was happening, he got to name this all web 2.0.

    Finally, a lot of the people driving web 2.0 from a technological point of view were seasoned netizens who had been exposed to early web values. The following cohort of founders like Mark Zuckerberg were more yuppie-like in their cultural outlook, as were many of the suits in the online business like Steve Case or Terry Semel. But the suits weren’t jacked into the innovation stream in the way that Zuckerberg and his peers – but that would come later.

    This was the zeitgeist that begat Pipes by Yahoo.

    The approach to a new type of search needed the foundational skills of web 2.0 and its ‘web of data’ approach. Yahoo! acquired number of companies including Flickr, Upcoming.org and Delicious. At the time developers and engineers were looking to join Yahoo! because they liked what they saw at Flickr, even though the photo service was only a small part of the roles at the business.

    Web 2.0 talent

    The kind of people who were building new services over APIs were usually more comfortable in a scrappy start-up than the large corporate enterprise that Yahoo! had become. Yet these were the same people that Yahoo! needed to hire to develop new products across knowledge search, social and new services.

    There were some exceptions to this, for instance the 26-person team at Whereonearth who operated a global geocoded database and related technology had a number of clients in the insurance sector and Hutchison Telecom prior to being acquired by Yahoo!. The reason why Yahoo! became so interested was a specific Whereonearth product called Location Probability Query Analyser. The technology went on to help both the Panama advertising project and Yahoo! search efforts. George Hadjigeorgiou was tasked with helping them get on board.

    I knew some of the first Flickr staff based out of London, they sat alongside technologist Tom Coates who would later work on FireEagle. They all sat in a windowless meeting room on a floor below the European marketing team sat in.

    Most people didn’t even know that they were there, working away thinking about thinks like geotagging – a key consideration in where 2.0 services and mobile search.

    Going over to the Yahoo! campus in Sunnyvale made it clear to me that the difference in cultural styles was equally different over there, from just one cigarette break with Stewart Butterfield of Flickr.

    Secondly, there was the locale. The best way I found to help British and Irish people get the environment of Silicon Valley was to describe it as a more expansive version of Milton Keynes with wider roads and a lot more sunshine. One of the biggest shocks for me on my first visit to the Bay Area was how ordinary Apple and Google’s offices felt. (This was 1 Infinite Loop before Apple Park construction started). The canopy over the main building entrance looked like an airport Novotel, or every shopping centre throughout the UK.

    In the same way that Milton Keynes is not London; Silicon Valley’s quintessential campus laden town Sunnyvale is not San Francisco.

    This is not the dystopian doom spiral San Francisco city of today with failed governance and pedestrianisation projects. At this time, San Francisco was on the up, having been clobbered by the dot com bust in the early noughties, financial services had kept the city ticking over. Technology was on the rise again. Home town streetwear brand HUF was making a name for itself with its first shop in the Tenderloin, the DNA Lounge had consistently great nights from west coast rave and goth sounds to being a haven for mashup culture with its Bootie nights.

    There was great cinemas, vibrant gay night life and the sleaze of the Mitchell Brothers O’Farrell theatre. The Barry Bonds era San Francisco Giants won more than their fair share of baseball matches.

    If Yahoo! were going to keep talent, they’d need a place in the city. It makes sense that setting up the San Francisco space fell to Caterina Fake. Fake was co-founder of Flickr and was given a mandate by Jerry Yang to ‘make Yahoo! more like Flickr’. So she decided to set up an accelerator for new products.

    Brickhouse

    According to Caterina Fake on Threads:

    I dug around on the company intranet and exhumed an old deck for an initiative called “Brickhouse” which had been approved by the mgmt, but never launched.

    Caterina Fake (@cefake on threads)

    This tracks with my experience in the firm, projects would form make rapid progress and then disappear. And during the first dot com boom, San Francisco was home to online media companies, such as Plastic (Razorfish SF), Organic and Agency.com, many of whom also had offices in New York. Wired magazine had its office there, as did a plethora of start-ups.

    Fake goes on to say that Brickhouse managed to use the same office space she had worked in while she had worked at Organic over a decade earlier.

    The 60 Minutes episode Dot-com Kids marked an acme in this evolution of San Francisco. At the time Fake was doing this exercise, there was probably a Yahoo! sales team based in San Francisco proper, but that would be it.

    Fake cleans up the Brickhouse deck and gets it through the board again with Bradley Horowitz with the then Chief Product Officers Ash Patel and Geoff Ralston, president Sue Decker and chief Yahoo Jerry Yang being the board champions of the project.

    Fake hands off to Chad Dickerson to realise Brickhouse as she heads off on maternity leave. Fake, Dickerson and Horowitz assemble the Brickhouse team (aka the TechDev group) and ideas that would eventually build Pipes by Yahoo!, Fire Eagle and other projects.

    This is where my origins viewpoint on Pipes by Yahoo finishes. For the download on its creation, go here now; the link should open in a new tab and I will still be here when you get back to discuss the service’s impact.

    Pipes by Yahoo was launched to the public as a beta product on February 7 2007. Below is how it was introduced on the first post added to the (now defunct) Yahoo Pipes Blog. At this time product blogs became more important than press releases for product launches as information sources to both tech media and early adopters.

    Introducing Pipes

    What Is Pipes?
    Pipes is a hosted service that lets you remix feeds and create new data mashups in a visual programming environment. The name of the service pays tribute to Unix pipes, which let programmers do astonishingly clever things by making it easy to chain simple utilities together on the command line.

    Philosophy Behind the Project
    There is a rapidly-growing body of well-structured data available online in the form of XML feeds. These feeds range from simple lists of blog entries and news stories to more structured, machine-generated data sources like the Yahoo! Maps Traffic RSS feed. Because of the dearth of tools for manipulating these data sources in meaningful ways, their use has so far largely been limited to feed readers.

    What Can Pipes Do Today?
    Pipes’ initial set of modules lets you assemble personalized information sources out of existing Web services and data feeds. Pipes outputs standard RSS 2.0, so you can subscribe to and read your pipes in your favorite aggregator. You can also create pipes that accept user input and run them on our servers as a kind of miniature Web application.

    Here are a few example Pipes to give you an idea of what’s possible:

    • Pasha’s Apartment Search pipe combines Craigslist listings with data from Yahoo! Local to display apartments available for rent near any business.
    • Daniel’s News Aggregator pipe combines feeds from Bloglines, Findory, Google News, Microsoft Live News, Technorati, and Yahoo! News, letting you subscribe to persistent searches on any topic across all of these data sources.

    What’s Coming Soon?
    Today’s initial release includes a basic set of modules for retrieving and manipulating RSS and Atom feeds. With your help, we hope to identify and add support for many other kinds of data formats, Web services, processing modules and output renderings.

    Here are some of the things we’re already got planned for future releases:

    • Programmatic access to the Pipes engine
    • Support for additional data sources (such as KML)
    • More built-in processing modules
    • The ability to extend Pipes with external, user-contributed modules
    • More ways to render output (Badges, Maps, etc…)

    Pipes is a work in progress and we’ll need your help to make it a success. Try building some simple pipes and advise us what works well and what doesn’t in the online editor. Tell us how you’d like use Pipes, what we can do to make cool things possible, and show us ways you’ve found to use Pipes that never even occurred to us. In return, we promise to do our best to make Pipes a useful and enjoyable platform for creating the next generation of great Web projects.

    And please have fun!

    The Pipes Development Team

    Pipes impact

    I had a good, if exhausting time at Yahoo! It was first inhouse role and my part of the central marketing team had an exhausting workload. By the time Pipes by Yahoo launched, I had left Yahoo! Europe. There has been a re-organisation of European arm and the business had been ‘Kelkoo-ised’; a few of us on the European central marketing team took the opportunity to take the money and run.

    I remember bringing Salim (who headed the European search team) up to speed and getting his support to push for me getting a payout, rather than fighting my corner.

    Peanut Butter Memo

    Brad Garlinghouse’s peanut butter manifesto was made public towards the end of the year portraying a game of thrones type power play which would have seen the kind of structures that were put in place in the European organisation rolled out globally.

    On the face of it, some of it was pertinent, but it lacked a wider vision.

    While Garlinghouse has gone on to have a really successful career at Ripple; the Yahoo! business unit he ran had several problems. He was in charge of Music and the Comms & Community BU. At the time it had a poor record of building products fit for early adopters like music properties that aren’t Mac-compatiable, this was when the iTunes store and Apple iPod springboard off the Mac community and into the mainstream.

    The then new Yahoo! Mail which didn’t work on Safari and a Messenger client which was worse to use than third party clients like Trillium or Adium. All of which made it hard to build a buzz that will bridge to mainstream users. Yahoo! Messenger, could have been Skype or WhatsApp. It became neither.

    For a more modern example, think about the way Instagram and Threads were Apple iPhone first to build a core audience.

    At the time, I was less charitable about the memo. And the memo raised wider questions about the business; like was the CEO facing an executive revolt?

    The launch of Pipes by Yahoo helped to inject some more positive energy back into the Yahoo! brand. Remember what I said earlier on how talent wanted to join Yahoo!’s engineering and development teams because of Flickr. They started to want to join Yahoo! because of Pipes.

    The outside world

    I was back agency side when Pipes launched. I had friends within Yahoo! still and kept an eye on the various product blogs. I got the heads-up on Pipes and put aside an afternoon and an evening to explore it fully. A quick exploration gave one an idea of how powerful Pipes by Yahoo could be. While Pipes was powerful, it was also relatively user friendly, like Lego for data. It was more user friendly than Apple’s Automator, which inspired Pipes by Yahoo! in the first place.

    At this time in London the amount of people working on social media and online things was still relatively small. Knowledge was shared rather than hoarded at grassroots events and on an ecosystem of personal blogs. This was a group of eople with enquiring minds, a number of whom I can still call friends.

    We shared some of the public recipes on Pipes by Yahoo and learned from them, just as I had learned about Lotus 1-2-3 macros in the early 1990s, by picking through other peoples examples. (I put this to use automating data records in the Corning optical fibre sales support laboratory that I worked in at the time.)

    The agency I worked with had a number of large technology clients including AMD, Fujitsu Siemens personal computing devices – notably smartphones, parts of Microsoft and LG.

    AMD and Microsoft were keen to keep track on any mention of their brand in a number of priority blogs or news sites at the time. Social listening was in its infancy and there were a number of free tools available, which I got adept at using.

    We managed to build and sell both AMD and Microsoft respectively a custom feed which provided them with links to relevant content in near real-time, which they then published on an internal site so that key audiences always had their fingers on the pulse.

    This was all built on top of two free Pipes by Yahoo accounts which used a similar but tweaked recipes to make this happen.

    On the back of that work, we managed to sell in a couple of small websites to the Microsoft team based on WordPress. I had long moved on to another agency role by the time the Pipes by Yahoo feeds would have died.

    Discussing Pipes by Yahoo with friends, they said it had inspired them to learn to code. Pipes by Yahoo spurred creativity and creation in a similar way to HyperCard.

    Zeitgeist

    While all of this has talked about Pipes by Yahoo! and how great the launch was, the ending of Pipes was much more humdrum. The service had been glitchy at the best of times and wasn’t being maintained in the end. In conversations I had with friends, it was compared to a British sports car: unreliable but loveable. Yahoo! closed it down on September 30, 2015.

    Which begs the question, why is Pipes by Yahoo, which was shut down eight and a half years ago being celebrated amongst the digerati?

    I think that the answer to this is in the current online zeitgeist. The modern web isn’t something that anyone involved in web 2.0 would have signed up for. Algorithms have fragmented the global town hall archetype envisaged for social. The web no longer makes sense in aggregate, as it’s splintered by design.

    The modern web feels ephemeral in nature. This seems to have gone hand-in-hand with a video first web exemplified by TikTok.

    The social platforms the fragmentation seem to be declining in relevance and its isn’t clear what’s next. The people-driven web of knowledge search and web 2.0 is under pressure from AI content providing a mass of ‘just good enough’ content. Even influencers are being usurped by digital avatars. Even the audience engagement is often synthetic. All of which leaves the netizen in a state of confusion rather than the control that Pipes by Yahoo offered.

    Taylor Lorenz is a journalist who made net culture and platforms her beat. Taylor Lorenz’ book Extremely Online feels like she is reporting from another planet rather than the recent web and it was published in October last year.

    More information

    Mediasaurus no more? The Well

    Let’s Get This Straight: Yes, there is a better search engine | Salon.com (December 21, 1998)

    The Original GOOGLE Computer Storage Page and Brin

    Notre histoire en détail | Google

    How Google Became a Verb | TLF Translation

    Facebook Yahoo! patents case | renaissance chambara

    Yahoo! Answers Adoption | renaissance chambara

    Sadowski, J. (2020). “The Internet of Landlords: Digital Platforms and New Mechanisms of Rentier Capitalism.” Antipode 52 (2): 562-580.

    Amazon.com Launches Web Services; Developers Can Now Incorporate Amazon.com Content and Features into Their Own Web Sites; Extends ”Welcome Mat” for Developers | Amazon.com newsroom

    Nobody Knows What’s Happening Online Anymore – The Atlantic

    Extremely Online: The Untold Story of Fame, Influence and Power on the Internet by Taylor Lorenz

    The Age of Social Media Is Ending | The Atlantic

    AI is killing the old web, and the new web struggles to be born | The Verge

    Is the web actually evaporating? | Garbage Day

  • Chinese bank risk+ more things

    Chinese bank risk

    A story caught my eye in Hong Kong’s English language establishment paper related to Chinese bank risk. Goldman Sachs issued a report on (maybe) five Chinese banks, changing their ratings to neutral and sell. Eastmoney.com is a subsidiary of government newspaper People’s Daily, came out to stoutly defend the banks against concern about Chinese bank risk.

    Communist Party mouthpiece takes issue with Goldman Sachs report calling a ‘sell’ on some major Chinese bank stocks | South China Morning Post – I had a look at the article in question. From a Chinese bank risk aspect of things a number of things caught my eye:

    • Ping An Bank and China Merchants Bank have the largest exposure to real estate, accounting for 8% and 6% of total assets which the report authors are flagging as a canary in the coal mine for Chinese bank risk
    • CMB real estate loans accounted for 5.61% of about of total loans and advances
    • Ping An Bank real estate-related business bearing credit risk totalled 322.093 billion yuan, also down from the end of the previous year, and if this is taken as the numerator and divided by its total assets of 5.456 trillion yuan, it yields a share of about 5.9% – interesting choice of wording
    • Overall, the non-performing rate of the mainland real estate industry is still in a period of accelerated exposure in 2022, and the overall non-performing rate of listed banks for public real estate continues to rise to over 4.3%
    • There was a reference to “Industrial Bank” that has “deteriorating assets and liabilities” – I think that this is Industrial and Commerce Bank of China better known as ICBC. ICBC is recognised as a systemically important bank

    Systemically important bank means that Chinese bank risk becomes global economic risk. While it is state-owned (being one four original institutions that spun out of the Bank of China in 1979), it still exposes retail shareholders and bond holders around the world. Word on the grapevine is that a number of Goldman Sachs partners had long term holdings in ICBC for well over a decade, which explains the banks irrational exuberance for China AND means it would have been extremely hard for the analysts to name check ICBC in this kind of report. During the 2006 IPO, Goldman Sachs purchased a 5.75% stake for US$2.6 billion, this apparently was the largest sum Goldman Sachs has ever invested at the time.

    ICBC. Foggy night.
    ICBC. Foggy night. – QuantFoto released under a CC licence

    Of course issuing this kind of report in China means that they can’t talk about associated Chinese bank risk. For instance:

    • Property development company bonds which just a few months ago Goldman Sachs thought would deliver high returns partly down to Chinese government support in the sector.
    • Local governments depend on property development for their main source of revenue and have issued a lot of debt which they may now find harder to pay off resulting in further Chinese bank risk. Given that this is more directly linked to government, it may get less scrutiny
    • Finally China’s industrial and services economic growth seems to be an issue with youth unemployment running very high at 20%

    Business

    Scaling up or selling out: a German take on a corporate dilemma | Financial Times

    China

    The ‘Curse of 35’ in China: Job-hunters battle age discrimination — Radio Free Asia

    Consumer behaviour

    Meet the Psychedelic Boom’s First Responders | WIRED– this is likely to end very badly for some people. Having known p eople who had bad experiences growing up, I am leery of the trend towards psychedelics

    Interesting research from IPSOS, it sounds like the Cold War all over again circa early 1970s through to the mid-1980s.

    Economics

    Did supply constraints tilt the Phillips Curve? – Bank Underground – trying to understand global supply chains

    Trying to get reliable economic data on China as the government data tends to ‘harmonised’. Part of the problem is the information that local governments provide the central government and part of it is central government choosing to ‘tell the best China story’.

    Energy

    Will Toyota’s solid-state battery win bring back the magic? | Financial Times

    Clean public transport: Consortium pioneering hydrogen-fuelled buses in Hong Kong set to build city’s second refilling station | South China Morning Post 

    Expect China to increase solar panel dumping due to massive over-capacity. In addition these panels seem to be of low quality with a lower than expected panel life. Given the challenges that the Chinese are experiencing recycling the materials, they represent an environmental problem with a substantial risk of pollution.

    Finance

    Another nail in the coffin for private sector pension capitalism? | Financial Times

    Don’t lose the exponential benefits of fractional share trading | Financial Times

    Hong Kong

    Hong Kong national security law: who are the 8 targeted with HK$1 million bounties? Calls for sanctions, links to 2019 protests among alleged offences | South China Morning Post 

    Hong Kong police arrest five for helping exiled activists — Radio Free Asia

    Hong Kong government ‘spends millions’ to advance Beijing’s interests in Washington — Radio Free Asia

    Innovation

    Military briefing: Ukraine provides ideal ‘testing ground’ for western weaponry | Financial Times

    Ireland

    Changing demographics in Northern Ireland and unification

    Korea

    South Korea allows new bank entrants for first time in 30 years | Financial Times – echoes UK government criticism of banking sector

    Marketing

    Beyond belt-tightening: How marketing can drive resiliency during uncertain times | McKinsey – interesting read that’s about 50 percent right, probably too much of a bottom funnel focus and a more critical consideration of the marketing technology stack McKinsey are about 50 percent right. One thing that they haven’t done is leverage the marketing science research supported by the Institute of Practitioners in Advertising on relative marketing spend and relative impact on market share. Also in-house agencies have serious problems due to cultural issues in clients.

    Tech brand TCL hands BCW global comms duties | Marketing-Interactive – makes sense given BCW’s history taking Chinese brands abroad with Huawei and DJI

    FTC Finalizes Revisions to the Endorsement Guides, Proposes New Rule for Consumer Reviews and Testimonials and Updates FTC Staff Guidance | Retail Trend Spotter 

    Materials

    Toyota claims battery breakthrough in potential boost for electric cars | Automotive industry | The Guardian

    Start-ups: smart clothes have been wearing experience for investors | Financial Times – smart fabrics didn’t win out over wearables

    Why is China blocking graphite exports to Sweden? | The Economist  – China was trying to cripple Sweden’s electric battery industry before it even got off the ground. This wasn’t about national security but economic domination

    Stella McCartney-backed leather alternative Mylo halts production | Vogue Business – US startup Bolt Threads has called time on its mycelium-based leather alternative Mylo — backed by Stella McCartney, Kering and Adidas — after failing to secure the funding necessary to scale

    Media

    The Eagles Announce ‘Final’ Tour Dates – Variety – following the lifecycle of their customer base. The Eagles attitude to covers, remixes and sampling always sat badly with me which is why I never bought any of their music new. I am sure this tour will keep them wealthy for the rest of their lives however

    TikTok for Business | Marketing & Advertising on TikTok

    Nineteen minutes inside Sir Martin Sorrell’s head | Unmade – interesting comments on media planning, will this range of technology actually get programmatic right?

    Irish Voice newspaper ceases print after 36 years | Irish Central – print edition finishes with the publication continuing online only as Irish Central

    Daring Fireball: GQ Shits the Bed 

    Online

    Who’s behind all those weird product ads on Twitter? | Financial Times – fascinating bit of investigative journalism that ends up with a Vietnam based company that fuels drop shipping

    Daring Fireball: Threads 

    Retailing

    Japan Airlines gives tourists chance to reduce baggage by renting clothes | Financial Times – this could impact Japanese companies like Uniqlo tourist sales.

    Interesting to see the reasons why US retailers have failed when looking to expand internationally. Target’s failure in Canada is fascinating.

    Security

    Russia deploys ‘Albatross’ made in Iran-backed drone factory | Financial Times

    Daring Fireball: Le Monde: ‘France Set to Allow Police to Spy Through Phones’

    Software

    The environmentally conscious Fairphone 4 is finally coming to the US – The Verge – interesting focus on privacy within the software that Fairphone is using for the US market launch

    Interesting YouTube clip about how open source software is being used to extend the lives of Nissan Leaf electric cars. It raises interesting points for consideration about the right to repair debates that have been happening in areas like agricultural machinery through to Apple smartphones.

    The devil is in the details of the claims and the research with regards ChatGPT driven trading. TL;DR ChatGPT didn’t trade any better and ChatGPT 4 did worse than earlier versions, implying random chance rather than ability

    Style

    Highsnobiety to cut 10 percent of jobs in cost-cutting measures | Fashion United