Edition #297 Shiny toys
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One big thing

This week I write on shiny toy syndrome. How can a piece of technology claim 90% gain over another? You’d think the incumbent knows what they're doing. 

Often when you see a comparison like this, its because the market dynamics aren’t the same. Let me give you an example, if I buy an ad on Google, whatever my targeting, I am competing against thousands of other companies. If I buy on a new platform, I may only be bidding against a dozen or so. In the latter there are probably many situations where the bids can be lower because there’s less competition.

Once all things being equal, it may be that the rates aren’t as good. Or the new thing isn’t as effective. But right now it is. This lack of market dynamics can hide real performance. 

A finance analogy is that it is easier to double $100 than it is to double $1m. It’s easier to get big gains on smaller numbers. 

Now you can be pessimistic about that - but this is why diversity is important. You use the tried and true tactics but you should be trying new things. If you can get 15% of your goals met below market, that’s a significant gain. In fact there’s a pricing analogy, increase prices 1% to increase profits by 10%. 

Every bit counts. So when you see these claims, do look under the hood and remain open minded. It might be it works well - because everyone hasn’t arrived yet. So what if it's a shiny new toy, the CFO doesn’t care - if it delivers. 
Notable stories this week Deals/M&A
  • AT&T is exploring selling Xandr, “As long as it’s affiliated with another media company, there’s going to be that perception of conflict of interest,” said Forrester principal analyst Jim Nail. “Xandr under WarnerMedia, or even sitting next to WarnerMedia, is challenging to grow outside of the WarnerMedia world.”
Campaign of the week
Smartest commentary
  • “Digital ad spend just surpassed Traditional ad spend last year. And here is latest on attention share from @eMarketer. 7:31 will be spent consuming digital media per day. 3:49 will be spent watching TV. Cue Mary Meeker chart. Digital ad spend still has a ton of growth ahead.” -Ryan Pauley, CRO, Vox Media
  • “Digital has gone from the corner to the center... Where will the next 25 years take us? There are more signs of optimism in the trajectory so far.” -Meredith Artley, Editor in Chief, CNN
  • [On creating subscription revenue] “Metrics like these are great for understanding nuances in churn for scaled products. but for smaller publishers the takeaway is simple: focus hard on making great content people actually consume.” -Jack Marshall

Datapoints of note

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