May 24, 2019
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Advertising Tech

Measured promises a smarter approach to ad attribution

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Measured is giving advertisers a new way to determine whether their ads are actually working.

Many of those advertisers currently rely on multi-touch attribution, an approach designed to measure how each channel and each ad contributed to a purchase decision. In fact, that’s what Measured CEO Trevor Testwuide offered at his last startup, Conversion Logic.

But Testwuide (who co-founded Measured with CTO Madam Bharadwaj) said this approach has serious limitations, particularly when it comes to measuring social media channels like Facebook or Pinterest, as well as offline channels like direct mail.

“I would say that multi touch attribution, for nine out of the 10 brands that we see, is a fool’s errand because it measures such a small percentage of media,” he said.

Instead, Measured employs what it calls “steady-state test-and-control experimentation.” Testwuide described it as a sophisticated form of A/B testing that measures whether an ad will actually provide an incremental improvement in consumer behavior. He said this kind of testing is relatively straightforward when it comes to analyzing existing customers, but is “really, really hard” for finding new customers.

“How we deploy and manage a clean control for prospecting experiments without any bias — that’s where a lot of our breakthrough technology has been,” he said.

And while Measured is only coming out of stealth now, Testwuide said the company was founded back in February 2017 and is already working with 15 brands, including FabFitFun, Johnny Was, Hint, AB InBev, J.Jill, AARP and Soft Surroundings. In a statement, Johnny Was CEO Rob Trauber said the technology allows his team to “have a laser focus on the incremental contribution of paid media, providing us the data to make smarter investment decisions.”

Testwuide added that he and Bharadwaj intially funded the company with their own money, and that it’s now profitable.

“We have no plans to raise outside capital,” he said. “I won’t rule it out, raising some growth capital, but we’re a well-funded, organically-growing business.”

Mailchimp expands from email to full marketing platform, says it will make $700M in 2019

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Mailchimp, a bootstrapped startup out of Atlanta, Georgia, is known best as a popular tool for organizations to manage their customer-facing email activities — a profitable business that its CEO told TechCrunch has now grown to around 11 million customers, is on track for $700 million in revenue in 2019.

To help hit that number, Mailchimp is taking the wraps off a significant update aimed at catapulting it into the next level of business services. Beginning later this week, Mailchimp will start to offer a full marketing platform aimed at smaller organizations.

Going beyond the email services that it has been offering for 20 years — which alone has led to multiple acquisition offers (all rebuffed) as its valuation has crept up reportedly into the billions (depending on what multiple you use) — the new platform will feature technology to record and track customer leads, the ability to purchase domains and build sites, ad retargeting on Facebook and Instagram, social media management and business intelligence that leverages a new move in the artificial intelligence to provide recommendations to users on how and when to market to whom.

When the service goes live on Wednesday, Mailchimp also plans a pretty significant shift of its pricing into four tiers of free, $9.99/month, $14.99/month or $299/month (up from the current pricing of free, $10/month, $199/month) — with those fees scaling depending on usage and features.

(Existing paid customers maintain current pricing structure and features for the time being and can move to the new packages at any time, the company said. New customers will sign up to the new pricing starting May 15.)

The expansion is part of a longer-term strategic play to widen Mailchimp’s scope by building more services for the typically-underserved but collectively large small business segment. Even as multinationals like Amazon and other large companies continue to feel like they are eating up the mom-and-pop independent business model, SMBs continue to make up 48 percent of the GDP in the US.

And within that, marketing is one of those areas that small businesses might not have invested in much traditionally but are increasingly turning to as so much transactional activity has moved to digital platforms — be it smartphones, computers, or just the tech that powers the TV you watch or music you listen to.

In March, we reported that Mailchimp quietly acquired a small Shopify competitor called LemonStand to start to build more e-commerce tools for its users. And the new marketing platform is the next step in that strategy.

“We still see a big need for small businesses to have something like this,” Ben Chestnut, Mailchimp’s co-founder and CEO, said in an interview. Enterprises have a range of options when it comes to marketing tools, he added, “but small businesses don’t.” The mantra for many building tech for the SMB sector has traditionally been “dumbed down and cheap,” in his words. “We agreed that cheap was good, but not dumbed down. We want to empower them.”

The new services launch also comes at a time when an increasing number of companies are closing in on the small business opportunity, with e-commerce companies like Square, Shopify and PayPal also widening their portfolio of products. (These days, Square is a Mailchimp partner, Shopify is not.)

Marketing is something that Mailchimp had already been dabbling with over the last two years — indeed, customer-facing email services is essentially a form of marketing, too. Other launches have included a Postcards service, offering companies very simple landing pages online (about 10 percent of Mailchimp’s customers do not have their own web sites, Chestnut said), and a tool for companies to create Google, Facebook and Instagram ads.

Mailchimp itself has a big marketing presence already: it says that daily, more than 1.25 million e-commerce orders are generated through Mailchimp campaigns; over 450 million e-commerce orders were made through Mailchimp campaigns in 2018; and its customers have sold over $250 million in goods through multivariate + A/B campaigns run through Mailchimp.

There are clearly a lot of others vying to be the go-to platform for small businesses to do their business — “Google, Facebook, a lot of the big players see the magic and are moving to the space more and more,” Chestnut said — but Mailchimp’s unique selling point — or so it hopes — is that it’s the platform that has no vested interests in other business areas, and will therefore be as focused as the small businesses themselves are. That includes, for example, no upcharging regardless of the platform where you choose to run a campaign.

“We are Switzerland,” Chestnut said.

Given that Mailchimp took 20 years to grow into marketing from email, it’s not clear what the wait will be for future expansions, and into what areas those might go. Surprisingly, one product that Mailchimp does not want to touch for now is CRM. “No plans for CRM services,” Chestnut said. “We are focused on consumer brands. We think about small organizations, with fewer than 100 employees.”

U.S. digital advertising exceeded $100B in 2018 (IAB report)

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Digital ad spending in the United States exceeding $100 billion for the first time last year, according to the latest internet advertising report from the Interactive Advertising Bureau and PricewaterhouseCoopers.

Specifically, total domestic spending reached $107.5 billion, a 22 percent increase from 2017. Mobile advertising has become increasingly dominant, growing 40 percent year-over-year, to $69.9 billion. And video ad spending grew 37 percent to $16.3 billion.

Sue Hogan, the IAB’s senior vice president of research and measurement, said that in the past, mobile ad spend has lagged behind time spent on those devices. But now, she said, “That parity is almost being reached. Eyeballs are being followed by dollars.”

PwC partner David Silverman acknowledged that this leads to an obvious follow-up: Once ad dollars catch up to consumer attention, will growth slow? In Silverman’s view, “the industry has found ways to evolve” in the past, and it will again.

“There’s other shifts that are occurring now,” he added, pointing to the growth in digital audio advertising (up 23 percent to $2.3 billion), as well as other areas like out-of-home advertising and bringing ads to new devices.

One of the recurring concerns about the digital ad industry is its dominance by Facebook and Google. While the IAB report doesn’t single out specific companies, it does measure concentration in terms of how much spending is going to the top 10 ad sellers. In 2018, those sellers collected 77 percent of total spending — the IAB says the percentage has fluctuated between 69 percent and 77 percent in the past decade.

As for the effect of GDPR and other privacy regulation, Silverman said, “It certainly will have a significant impact, particularly on the use of data and AI in making advertisements more relevant and more effective” — but he suggested it’s too early to say precisely what the financial impact will be.

Hogan suggested that the California Consumer Protection Act could be more influential on U.S. ad spend. The IAB (which is a trade group representing online advertisers and publishers) has been advocating for federal regulation, rather than a state-by-state approach.

“I hope that we don’t get to the point where it becomes a strain on the industry,” she said. “I think more and more education is needed around that.”

Facebook unveils an automated ad builder and an appointment manager for small businesses

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Facebook said it’s launching a number of new products aimed at small businesses today — which is appropriate, since we’re currently in the middle of National Small Business Week.

These new features include Automated Ads, which Director of Product Management Nikila Srinivasan said are “really built for small businesses that are one- to two-person businesses with very little marketing expertise.”

The idea is that business owner can answer a few questions about what kind of company they are and about their goals are for the campaign. Then based on their answers — as well as the information on their Facebook Page — Facebook will create recommendations for the audience they should target, the budget they should set and even how the different versions of the ad should look and what they should say.

Small businesses can still buy ads the way they did before, but even if they go the Automated Ads route, they don’t have to accept Facebook’s recommendations. They can set their own budget, for example, and Facebook will predict the results. These ads can run on Facebook itself, as well as Instagram, Messenger and the Facebook Audience Network.

Srinivasan said there’s a “set it and forget it” element to the program, but at the same time Facebook will make sure to keep advertisers alerted to how the campaign is going and “it’s up to the business if they want to come in and be more active.”

“The main thing is, we don’t want there to be guess work, we don’t want there to be expertise needed to use this product,” she said.

And while Facebook said it’s provided lightweight support for booking appointments in Messenger in the past, it’s now expanding that functionality, so businesses can accept appointments and manage all of them appointments through Facebook and Instagram. These appointments can also be synced with the business owner’s personal calendar, or with third-party appointment tools like MyTime and HomeAdvisor.

Lastly, Facebook said it’s rolling out new video editing capabilities, making it easier to add text and image overlays to a video, and to automatically crop a video to accommodate the different aspect ratios of different ad environments.

Diving into TED2019, the state of social media and internet behavior

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Extra Crunch offers members the opportunity to tune into conference calls led and moderated by the TechCrunch writers you read every day. Last week, TechCrunch’s Anthony Ha gave us his recap of the TED2019 conference and offered key takeaways from the most interesting talks and provocative ideas shared at the event.

Under the theme, “Bigger Than Us,” the conference featured talks, Q&As and presentations from a wide array of high-profile speakers, including an appearance from Twitter CEO Jack Dorsey, which was the talk of the week. Anthony dives deeper into the questions raised in his onstage interview that kept popping up: How has social media warped our democracy? How can the big online platforms fight back against abuse and misinformation? And what is the internet good for, anyway?

“…So I would suggest that probably five years ago, the way that we wrote about a lot of these tech companies was too positive and they weren’t as good as we made them sound. Now the pendulum has swung all the way in the other direction, where they’re probably not as bad we make them sound…

…At TED, you’d see the more traditional TED talks about, “Let’s talk about the magic of finding community in the internet.” There were several versions of that talk this year. Some of them very good, but now you have to have that conversation with the acknowledgement that there’s much that is terrible on the internet.”

Image via Ryan Lash / TED

Anthony also digs into what really differentiates the TED conference from other tech events, what types of people did and should attend the event, and even how he managed to get kicked out of the theater for typing too loud.

For access to the full transcription and the call audio, and for the opportunity to participate in future conference calls, become a member of Extra Crunch. Learn more and try it for free. 

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