Marketing BS Links 8/25 - eCommerce acceleration, Cross linking, and "Cuties"

The stuff you need to know as a Third Way CMO from the past week

Follow-up from yesterdays essay on bundling: A few of you questioned why I did not mention Amazon Prime (the “ultimate” bundle). It was mentioned in the original essay, but got cut before reaching the final version. Prime is a fantastic example of a bundle that meets all of the criteria around fans and superfans, but there is a lot more to it than what the essay was taking on. Amazon Prime is a significant driver of churn reduction, customer acquisition (See “Happy Double Prime Day”), and more. There is a fair argument that Apple’s bundles are a defense against the Prime Bundle, but if so Apple’s choice of “tiering” plan is a mistake. More for another time.

Onto the links.

Meta: Last week I was on the B2B Growth podcast talking about how some of my Marketing BS thesis apply to the B2B space. You can listen here.


TikTok: Big news in this ongoing story was Oracle launching a bid for the app (with Trump’s support). The bid is being driven by General Atlantic and Sequoia Capital, but I am sure Oracle is happy for the short term jump in their stock regardless of what happens. And having more bidders is definitely better for Bytedance who get a little more leverage where otherwise they are negotiating at gunpoint. So win win?

Epic/Apple: Originally Apple kicked Fortnite out of the store (but left existing installs functional). The existing installs are almost all choosing to buy credits outside the Apple ecosystem (for 20% discounts). Apple is not happy about that. Rather than disabling the apps completely (which they have the power to do, but would presumably turn public opinion against them), they are demanding Epic change the app back to their previous version on threat of taking away the parent company’s developer license. Epic doesn’t care that much about losing new iPhone installs, but they definitely DO care about their developer license. Epic operates the Unreal engine which powers thousands of games on all the major platforms. If they lose their developer license all of those third-party games running on their engine will lose future access to both iPhones AND Macs - which makes the competing engines much more (relatively) attractive. As a developer, if you have a choice, why utilize an engine that might limit the TAM of your future game? Apple found Epic’s Achilles heal and fired an arrow for a direct hit. Epic is asking for an emergency injunction to stop Apple, but the horse has left the stable - if you are a developer building deciding between Unreal and Unity do you really want to risk not having access to Apple devices? In the meantime Apple is counter-suing: “There is nothing stopping you getting back in the store while your anti-trust case goes through the courts - just follow the rules that applied since 2011”. Epic’s entire play has been more about public relations that legal arguments and Apple is calling their bluff. More “Good for Apple” news: Epic lost the lottery on judge selection. And “Good for Epic” news: Developers are demanding to know why Amazon pays half the commission everyone else does. Late breaking: The court ruled yesterday that the app store removal can stand, but the developer license cannot (yet) be revoked.

Uber/Lyft: New California laws would require the two companies to treat their ride-sharing drivers as full employees. This has been a mess from the beginning. The law was targeted at the ride sharing companies, but broadly written so as not to SEEM to be spear-fishing. The result was the original law made all contractors in all industries employees (including hair dressers, and ironically Vox reporters) and has required piecemeal legislation creating make series of one-off exceptions to get back to the original purpose of targeting Uber, Lyft and the delivery platforms. Both ride sharing companies responded by ignoring the law at first and saying it to not apply to them, and then, when the courts forced compliance, they announced last week they would be shut down operations in the state. The courts quickly reversed course at the last minute and agreed to hold off on enforcement so we are back to the status quo for now. Related to yesterday’s essay: Jobs are a type of bundles, and “gig economy” is a form of unbundling - which the previous bundle owners don’t like very much. Scott Gorlick (an early Uber employee) shared how disruptive Uber was to Limo companies - “Word spread that Uber changed the game for drivers. If you drove for a limo/taxi co, you'd keep only 30% of your fares or have to rent a car for $500/week. Drivers left limo cos, bought cars & started making more money w Uber” (Uber’s 30% take seems like a better deal!). Also related: Data on driver hours and earnings in Seattle (median full time driver ~$17.40/h; median driver ~$23.25/h; with huge standard deviations)

Retail/eCommerce: A bunch of numbers announced last week. Walmart eCommerce sales almost double YoY in Q2. Target eCommerce sales up almost 3x (same store sales up 24%). Home Depot same-store sales up 23% YoY. And Amazon increased marketing spend by 70%. Benedict Evans has a short essay showing just how much eCommerce has accelerated in since March, “The UK went from 20% ecommerce penetration to over 30% in two months, and the USA from 17% to 22%.”

Democratic Convention: By most accounts the remote model went very well - many commentators thought it was more entertaining and effective than an in-person event would have been. I was very impressed and surprised. Generally I believe there are two type of good employees: Those that can run existing things and those that can build new things. They are usually different people. To pull off this convention required a team who was good at creating something new, but within a system that was set up to run existing things. Someone was able to shift the talent on team to pull off this success. Unfortunately viewership of the final night was still down 17% from four years ago.


Influential Ads: Google sheet with a list of the most iconic ads of all time (with links)

TikTok: Launched a big (expensive!) ad campaign on traditional media. TikTok obviously has a very uncertain future. Brand advertising has a long (long!) tail. Brand spend is not a good choice for high 90-day ROI. But Bytedance turned into TikTok largely by spending a ton on brand and acquisition marketing (over $1B in 2018). Companies find it hard to not just continue doing "what they know". Details on the campaign. The headlining 30-second spot.

Podcast Fraud: As a channel gets bigger, it makes it worthwhile for fraudsters to figure out how to defraud it. Here people are launching podcasts with identical names to well known podcasts. When someone (mistakenly) downloads one of the mislabeled episodes they are served ads and the fraudster is paid per download.

Disney Creative: Hulu has launched a new program to help build ads designed for digital video (i.e., for Hulu). Mostly by re-purposing existing ads to modify them so they work with the format.

Diagio: The spirits company is buying Aviation Gin (Ryan Reynold’s company) for “up to” $610MM. Aviation Gin build their brand through smart, fast moving creative pushed out through Ryan Reynolds personal distribution channels (Followers: 2MM YouTube, 16.4MM Twitter, 36MM Instagram). The two innovations together created a killer combo. You might remember their mockery of Peloton’s Christmas commercial pushed out three days after the original using the same actress.

SEO Cross Linking: The original Google algorithm was based on the value of inbound links. Links are still (very) important. Less important, but still significant is how a site links to itself internally. Optimizing internal links was a significant driver of performance for both Expedia and APFM when I was there. Kevin Indig has written a guide for how to manage your internal links. And Searchpilot has some details on a spit-test case study on the impact of internal linking (impact was a 25% lift to the pages “lower” in the hierarchy with no loss (or gain) to the top tier pages)

Google: The Information profiles the new head of search at Google. Key sentence: "He’s expected to move more aggressively than his predecessor to jump-start revenue growth from search engine ads, which fell 10% in the second quarter”. The last few years has seen more and more shift from organic to paid clicks on Google - expect this to accelerate under the new leadership…

Social Monetization: From July. ARPU for Facebook vs Snap vs Twitter.


Amazon: Dan Rose worked in Amazon retail in 2002. Last week he shared his inside account of how Amazon built Amazon Marketplace. Great story.

Google: Google has announced the launch of “career certificates”. These are six-month programs to (it claims) entry level jobs in Data Analysis, Project Management, and UX Design. Lots of chatter about how this will disrupt traditional education, but I am skeptical. Google is not the first to try this. When I was at General Assembly it was clear “education” was not the hard part. The hard part was getting the students jobs after they finished - which was only partially driven by the education we provided. I doubt Google is up to the task of getting their hands dirty on the part that matters.

Uber: Is launching their subscription program broadly (it has been in beta in many markets for some time). $25/month gets you 10% off rides, no surge pricing, 15% off and free delivery on UberEats. I don’t expect many people are spending $250/month on Uber these days, but maybe it will help consolidate delivery $$s.

COVID and the New World Order

Palantir: Moving its office from San Francisco to Denver. Start of a trend?

Airbnb: Has banned parties from all properties on the platform.

Corona Beer: There was concern early on that they would take a hit due to the beer sharing a name with a deadly virus. They are doing fine.

Marketing Channel Spend: Not doing fine.

Email: Email open rates have been WAY up since March. And CTRs (given opens) have stayed constant.

GetResponse Email Response Rates During COVID 19 Aug2020

Google Local: Huge collapse.

Merkle LIA Share Google Clicks Retailers Aug2020

AI / Machine Learning / GPT-3

Netflix: Netflix is releasing the film “Cuties”. They promoted it with the poster below right. There was immediate backlash, including a petition from 150,000 people to have it taken off the platform (it is not being released until September 9th, so this is from people who have not seen the film). The poster combined with the title seems pretty damning, but the screenplay won the Sundance global film-making award, which gave the writer the budget to have it produced. And when the completed film was shown the following year it won best direction - and was picked up by Netflix. The film is decidedly NOT for pedophiles, but Netflix changed the poster from the original version (left) to the version on the right. How could that happen? I assume Netflix was letting its algorithm figure out which images were getting the most engagement. Another example of the problems with using “data” to make choices instead of “judgement”.

Netflix Apologizes for Highly Controversial "Cuties" Poster


Washington Post: The Trump campaign ran a splashy ad on the front page of the Washington Post right on top of the “Harris accepts VP” headline. Many people were upset. But as Alex Stamos says, “I would love to look up the statistics about this ad, who is seeing it and whether it is targeted at all, but not a single major newspaper offers a political ad archive where I can do that”. The subtext being: Facebook DOES provide all the information, but has been criticized far more for accepting (Trump) political ads than traditional media (who does not provide that transparency), who have been given a pass on the whole discussion.


Trust: New data from Gallop on consumer confidence in institutions post-Pandemic. Tech coming in above newspapers, television news and “big business”, but well below “small business”. But I’ll bet when asked directly: “Who is more likely to to rip you off, Amazon or a small merchant you have never heard of”, people may have answered differently…

Cancel Culture: Americans getting more nervous about what they say in public


Ten Types of Problems: His list has since expanded to more than thirty. It needs more structure, but it’s a really great list.

Interactive TV: The first interactive TV show as in the 1950s - it had kids drawing pictures on their TV screens with markers. Love these weird bits of history most people have never head about.

Keep it simple,