AtSearch Insider Summit, this panel took the focus off the highly competitive search marketing channel and discussed the ideas of using alternative channels which behave like search engines – Amazon, eBay and YouTube. The panelists shared insights on alternative search advertising networks. Moderated by Neil Doshi, Managing Director, Sr. Internet Analyst, CRT Capital Group, the discussion included the following professionals:
- Roger Barnette, President, IgnitionOne
- Jeff Davis, president & CEO, Orabrush Inc.
- Marjorie Gray, Digital Brand Manager, Dish
- Jason Lehmbeck, Founder, DataPop
- Brian Valentini, VP/Director, Search Marketing, Digitas LBi
The video can be viewed on Ustream
And again the [inaudible 0:00:01] analogy that Apple, Google, Facebook, Amazon, you’ve Microsoft across the sea there. We’re creating these little walled gardens, where they’re going to use their data and create these sort of economies and these ecosystems and I think a lot of what these guys are going to talk about, sort of, dovetails on top of that, because a lot of those guys …when you think about Amazon and Facebook and Apple.
There’s a lot of search going on in there, but they are not traditionally thought of as a search engine and so how does that search and their data and their audiences and if you look at Google’s changes come January, right, and what eBay is trying to do, we’re trying to create ‘My Audience’ and use ‘My Audience’s’ data, but within my walls and that creates a very interesting dynamics for those of us in the industry. So with that I just thought I would share that, because it would be interesting to hear what these guys think about how that’s going on, because Amazon are…the economists was talking about that two years ago, so with that, Neil, turn it over to you.
Neil: Great. Thank you everybody. So this is a panel on alternative search properties; great to have everybody here. Now, one thing I would love to do, request everybody introduce themselves and you know, how they’re thinking about alternative search properties and then also just may be to get them to break the ice a little bit – what’s the most expensive Christmas gift that you’re going to buy and where are they going to buy it from or holiday gift? Roger, I’ll start with you.
Roger: Okay. I need to…my wife does all the Christmas shopping, so I need to phone a friend for where she is buying her gifts. She does buy almost everything online though, with the half-a-dozen packages showing up at the house every day now! So I am President of IgnitionOne, and IgnitionOne is a platform with a marketing hub that includes audience and media analytics, the DMP media mix modelling with channel execution capabilities in search display, email, site personalization and excited to be here; thanks.
Jeff: And I introduce myself. My wife is pressing me for a trip to New York for the holidays!
Marjorie: Hi, I’m Marjorie Gray. I work at Dish Network. I’m Brand Manager there, and my most expensive Christmas present is actually driving from Colorado to Merlin to see my parents, so even though it’s not expensive, it’s kind of a long drive! [Laughter]
Neil: Time is very valuable.
Jason: Jason Lehmbeck, CEO, co-founder of DataPop. We help retailers and brands connect their products and offers to shoppers across search social and display. My most expensive…cheap…buying the $20 elephant gift for the holiday party – I don’t know what it is yet! I’m going to go offline; I’m going to go old school, go to ‘Target’ next to our office and pick it up.
Brian: I am Brian Valentini. I work at Digitas LBi, out of a Chicago office. I lead a couple of our paid search accounts there. My most expensive gift is I am taking my son to a Chicago Bears game next week, so by the time I buy all these souvenirs, cotton candy and hopefully do not get arrested for child abuse due to how bad the bears are playing this year, it might cost me a lot of money, so…
Neil: Great, and my name is Neil Doshi. I am the Senior Internet Analyst at CRT Capital. Been coming to this Search Insider Summit for the past 4 years; glad to be here. One thing I thought to do, put the couple…little bit of data and I thought we can …fun to share, but just wanted to ask the panel: Where do you think the most queries, retailer related queries are happening, outside of Google? Roger, I’ll start with you.
Roger: It’s got to be Amazon.
Neil: Okay. Jeff?
Jeff: I would say Amazon too!
Jason: I have to say something, right? YouTube.
Brian: I’ve got a different answer – eBay.
Neil: Alright. I think Brian got the right answer. Rob, could you put the slide up? Here’s the next one. So eBay has about 800 million queries which is the highest. This is as of October 2014…although, Amazon is growing the fastest! Now this is desktop. My guess is vast majority of Amazon’s traffic has shifted to mobile, so this doesn’t capture that. If we go to the next slide, I thought it was also pretty interesting. If we look at shopping searches, shopping searches are actually over-indexed on retail sites, outside of core search engines, but you know, if we compare that to kind of travel, you know, travel-related queries actually happen a lot more on search engines.
So, you know, there is a lot to be said for retail and what’s happening with retail outside of the core search engine, and with that, you know, may be I thought we could dive in with Amazon, which is really the 800-pound gorilla. Google’s chairman, Executive Chairman, Eric Schmidt recently said, Google’s biggest competitor is not Yahoo, Bing; it is actually Amazon and Amazon has been investing a lot of money on it’s display advertising network and also is moving towards a text-based advertising network, both on-property and off-property. So just may be run down the list here, you know, what are your thoughts on Amazon as an advertising partner or an advertising, you know, opportunity and does it make sense for your multi-channel retail clients to market on the Amazon, given that they are also competing with Amazon?
Roger: Sure. Yeah, there’s a lot there. Amazon’s capabilities as a media company, I think that it is much more in line with their strategy than phones and drones would be, you know. If you think about the amount of unbelievably rich first party day that they have and the kind of audiences they can re-purpose on their own properties, owned and operated, but also re-purposed through the, you know, commoditization of data around the web, so you can use that for audience buying elsewhere, they have amazing assets and resources that they can re-purpose and I think it makes a lot of sense for them to do that. It could be a huge potential revenue source for them.
As it relates to whether it makes sense for all retailers to operate on Amazon, you know, may be just thinking about my own experiences on Amazon, you know, when I buy in Amazon, it’s because I want to find something that’s either really niche or I want to find the company that’s selling it for the cheapest by a penny and that’s where I’ll buy it. I don’t think that all brands that makes sense for our brands, so we are trying to protect their brand experience or user experience, it’s a huge [inaudible 0:06:53] for the retail marketplace, but I don’t think it’s going to replace, be a repository for all retail searches like the search engines are repository for all, you know, information searches.
Jeff: So I would just say one thing. So Amazon is known for disruption, for sure, and so if you look at the partner…I can speak for YouTube, so if you look at the partnership program on YouTube, you know, YouTube’s taken a 45% cut on that content for partners. On the paid models, it’s roughly around 5 billion. They’ve got a great system, but I would be very nervous if I were YoutTube executives, because if Amazon gets in, like they will, it will disrupt. The second comment I would make is about channels and my belief is the brand builder.
You want to be where the consumers are trying to go, so I would agree a bit with you that, I thought it was pretty interesting. I think 30 days ago, Amazon mentions the flagship store they’re building in Manhattan. Two days later, Walmart chief, I think it was the President of North America, said that the number one focus for Walmart was what? Did anyone catch that? eCommerce. Okay, I think that’s “wow, look out!” you know, that they’re trying to be where the consumers are and that’s what they should be doing and it’s going to be a very topsy-turvy ride.
Marjorie: So I think for Dish, we offer a service, not a product that you can just go on Amazon and click and get shipped to your house. But I think with Amazon launching Amazon Travel, and that being a service industry, I think 2015 is really year for us, as a service, to…the Amazon, in what they can offer, as far as payment capabilities or brand awareness or even who knows, you might be able one day to just order Dish network inside the Amazon platform! So I will be interested to see how the travel side pans out in the next couple of months.
Jason: I think what’s clear is the consumer’s spoken and this gets your point, in that, consumers are going to Amazon in search of a product, right, and the percentages are growing fast and it’s only going to get bigger, the reviews get richer, and the content – video content gets richer. The question for me is whether Amazon is truly committed to building an ad platform? They sort of jumped in, jumped out, it’s off to the side.
Do they really want to disrupt the ad space? And some of this gets to…you know, I think we should go deeper on what categories and you know, brands versus retailers, but somehow it gets to, if you’re Amazon, you’ve a liquid marketplace, whether you are a marketplace partners and the stuff you’re selling direct, you know, how does the ads fit into that? And so, you know, I think if you ask Jeff Bezos, I think everybody remembers his quote about advertising a long time ago, which is “If you’re doing advertising, you failed!”
So, you know, I don’t know how much of that he’s forgotten versus focusing on what he wants to disrupt or distributes; he drowns…more to the core of his business. He needs to find efficient ways to get products through house. That’s more important to him than a banner ad or a product ad or whatever.
Brian: Yeah, I think as we look at Amazon, the previous slide showed how they’re not the number one search – retail search engine right now, but they’re growing the fastest. They’ve the audience, they’ve the breadth of content, they’ve a bunch of product reviews, and plus they have their own community, where people are going on there and posting pictures, posting experience with different products. I believe it’s hard for brands and for marketers to ignore, because they are going to have a captivated audience, who is there, looking in actively for products.
Neil: Yeah, so it …like Amazon is really moving deeper into the content funnel. How do you guys think about which categories do well and, you know, Jeff, you know, with your products, you know, do you see that as a place to really build a brand or is it more just for, you know, really pushing out in selling at the end of the day?
Jeff: Yeah, so again this will be a contrarian view, so tongue-cleaners are 5 bucks, you know, the Orapops around 25. We’ve done products upto $250, but if you look at the biggest advertisers in the world, in the media, you know, automobile, insurance, you look at GEICO, you know, look at the automobile manufactures, so I would argue if you want to be doing this, just because it’s the best way to build brands, people are buying cars online, you know.
So I am not sure what the price…I think it’s more of an evolution, you know. Some people are afraid to buy anything online because you know, they’re going to give their credit card information out. I mean, my mother would never, you know, buy anything. My father, who is, you know, 77, he buys everything online. So it’s no longer…you know, the demographics are shifting and I think that just continues to evolve and so as I said, I am a big believer in digital as the core to build brands, all pieces of it, and then I would spend on traditional after I’ve started there.
Brian: Yeah, I think to add on that, I think if we think back to the Programmatic panel, we saw a few minutes ago, they didn’t have the audience, so it was atleast worth testing. You know, it may not perform the best for each individual brand, that may not connect as deeper with consumers as we would like, but it’s atleast worth testing and it’s atleast worth activating against and seeing how it performed.
Jeff: Yeah, I would agree. Just shot off to Ricko and he reminded me, “If you’re a search marketer…,” clearly we’re all search marketers here. Even if the volume isn’t huge, I think to tag on to every consumers out there, you should be experimenting and testing, whatever the category is, even if it’s a small slice of your overall pie, to learn to engage with the consumers. Some categories are rich, right? The niche categories on Amazon get high volumes as their percentage of traffic versus search another’s on Amazon product ads. The more sort of commoditized products, they don’t get high volumes, but still a great place to experiment, learn, engage with the consumer, do that testing and optimization that can be applied to other channels.
Neil: Also, it looks like Google is, you know, trying to move into Amazon’s real house. We have, you know, Google announce PLA couple of years ago, that’s now becoming a very material part of their business. Google Shopping Express for anyone who is in an area that has a benefit of that. Like for example, I live in a San Francisco Bay area. I can tell you my…the volume and the amount I’ve spent on Amazon has dropped dramatically because we now have a Google Shopping Express box, coming to our house almost every single day.
If my wife wants peanut butter, next day there’s a box of peanut butter, you know. Every little thing, Google Shopping Express now pretty much covers. So how do you guys think about, you know, when you’re thinking about allocating spend, you know, on Google versus, you know, on Amazon? What would you tell your clients or how do you think about, you know, using Google for marketing purposes versus some of these other search markets like Amazon?
Roger: Well, you know, for us, it’s almost always comes down to ROI. I certainly agree with testing. Testing every channel, you know, see where it’s most profitable, put the dollars there, you know. It’s a reasonably efficient marketplace and you should be able to allocate dollars on spots that are making you the most money in a world where you can understand how to use channel to interact with each other at all points of the funnel. That being said, it’s not just an ROI decision though, you know.
For a company trying to decide whether or not to place some of their products on Amazon, it’s a branding and positioning decision, you know, as much as it is for, you know, for just a straight advertising ROI decision. You know, is it making their brand more commodotized, because they are, you know, you’re a high end clothes retailer and all of a sudden, you know, you can buy those clothes on Amazon, does that make your brand lower in the eyes of people who shop on Amazon, who are not coming to your site to shop? And so I think it goes deeper than just ROI, but certainly testing a performance is how our clients judge where those [inaudible 0:15:43] goes.
Jeff: Yeah, I actually find it amazing that, you know, the traditional advertisers, we’ve done some work with P & G and I am sitting in the room, you know, as a former P & G’r and they are trying to put success criteria on the video digital campaign that they can’t achieve themselves in a traditional campaign. And I find it, you know, now I get we’re all trying to do that and there’s this pressure to do that, but I would argue.
“What is the real ROI, if you’re spending millions of dollars traditionally in a different way and only 30% of that, you know, let’s just say, TV and 30% of media is being…you know, 60% of media is being consumed online, so what show real audience are reaching?” and I just find it interesting. So I think it’s a translation of what ROI really means and I think, you know, just this morning, I’ve had several thoughts from you guys about that. What is the real ROI or the real integrated campaign, that goes the right way and spends at the right way and I think that would be worth some effort on all of our part, to try and figure that out.
Marjorie: Again, I think for Dish, as a service, it makes more sense for us to be in spaces like Google and Yahoo and Bing because our primary goal is to drive that new customer. I’m sure you can buy equipment on Amazon.com for a Dish…by satellite tailgater, that’s sure thing, but again, when it comes down to the ROI and what’s important there, is that new customer acquisition. But that doesn’t mean we’re not paying attention to the direction Amazon is going. We know Amazon is a data powerhouse. They know a lot about all of us, what we’re buying, what we’re doing, where we’re shipping stuff, and I think that is valuable information we can also use and leverage as we start to expand into Amazon.
Jason: Yeah, this…going back to your question Neil, offer that to the marketplaces versus ads, right? So Google is going arguably towards marketplace with product listing ads. You know, eventually you can buy potentially within the ad, they have their credit card, all those things start to look more like a marketplace rather than just pure advertising. Amazon potentially coming the other way; we’ve a marketplace; how do we build an ad ecosystem, build product sense, you know, the replacement for ad sense and so there is this potential that they come at each other and from my perspective, it’s an open question for the brands.
Would you rather be at the centre, mediate it again, like you know, Procter& Gamble sounds real old school stores, now may be Orabrush, selling through a marketplace rather than direct and getting those connections, that those deep connections that you’re getting through YouTube and so, as marketers, I think that’s a big opening question to be thinking about, is: Do you want Google to go all the way marketplace because that’s just more dis-intermediation?
Brian: Yeah, to dwell on a valid point about going deeper than just ROI, as we look at the mass scale reach that Google, Yahoo and Bing have, that’s unparalleled with any of our other retail search networks. So as we think about the value of an impression, whether or not a click occurs, I think it makes sense to at-least be on those two, one search engines, whether it be a paid search ad or whether it be a product listing ad, because the audience again is going to be there, and there is a value outside of just having an impression put there on the first page.
Neil: Are any of your clients worried that or yourself worried that if you put a product on the Amazon, you know, at some point, because Amazon keeps their customer data, doesn’t share it back with you, sees how much sales and volume you’re doing or you know, if it’s an ad, how much people are clicking on it, so demand for that ad and that product, that Amazon may down the road decide to source from the same supplier and sell it cheaper or like they’re doing with diapers now, make their own product and come at you that way?
Roger: Yeah, the diaper’s thing is crazy to me, that they would dip their tail in the water to potentially kill their golden goose. I mean, because that is exactly right. I would be very concerned if I was a retailer and I had other choices and I had a product that was not my own and I was buying through a third-party, slapped my own brand on it, that Amazon is not re-targeting the same thing.
Jeff: And I would just say we sell…so all of our products, we try to have our products through the [My Credo?? 0:20:24], you know, wherever they are wanting to be purchased. I would always maintain a personal eCommerce business, so for the caution you just gave because we’re selling a lot of tongue-cleaners on Amazon, a lot actually, but I still get all of my data through my own website to know how to adjust or how to react and so I think in the future, as we go forward and I think everyone…this is like stating the obvious to everyone, but you know, “He who has the data is really king” and Jeff Besoz really understands that.
So, even your own self as a product or service, you want to have a form of digital and ideally eCommerce, because almost everything is in eCommerce today, so you want to have that play. And you don’t have to build it all out inside. Often you see that there is actually a trend of bringing it all inside. I think it’s interesting. I’m not sure I agree with the strategy, and my main premise is because it’s moving so fast, internal resources, no matter a small or a large size company, could never really keep pace with the nimble companies probably sitting in the room, that actually you would probably just want to contract for some of that. So I would argue may be some of that you want to have inside, but I would not bring all of that inside; that does not make sense to me.
Marjorie: I think for us, if we were to move down the path of adding the Dish service to Amazon, we run into risk. You could actually say that Amazon Prime is almost a direct competitor to our TV service. So if we were to launch this, then Amazon has that data, they know who our consumer is. Again, we run the risk of them targeting for Amazon Prime, saying, “75 bucks a year and here’s all your free movies and TV shows or your site up for Dish and your bill.” Depending on what you get into…we won’t get into that. [Laughter] It would be a lot more expensive, your paying once a month, so I think that would be our biggest concern, as far as data and the consumer.
Brian: Yeah. I also think that brands would want to be a little fearful of the Amazon creating their own products. They also may consider embracing that, right, as Amazon is creating their own products, they can help build a category and we’ve seen this in retail, right? So Walmart, Target, all the major grocery stores, they sell their own generic brands. It probably for sure eats a little bit into brand’s overall sales, but if Amazon can help build the category sales, especially on Amazon.com, it could feed into brand sales later on.
Jason: Yeah, what is the Procter & Gamble view of that trend in offline?
Jeff: Yeah, I mean, you know, I’m gone 5 years now, so that’s…but what I will tell you of our discussions, so there is obviously, you see it even in the press. There is acronym for sure between big manufacturers and Amazon. I mean…so every week, and the main driver is that you’ve big players like Walmart or Target saying, “Procter & Gamble, you better get your pricing on Amazon fixed or we’re going to delist your products.” So it’s mainly the pricing issue.
Now Procter & Gamble doesn’t have any control on what the pricing is at Amazon, but you know, Target, Walmart and all of these big…you know, they see this issue of migration of the channel from their retailer to Amazon and they blame it on the manufacturer. I think the blame is misplaced and I think that’ll be an interesting one to watch, you know. Walmart says they’re going to be able to compete, you know; they’re going to focus on…and by the way they could! The one retailer that could compete is definitely Walmart. They know logistics, they have supply networks, they’ve distribution, they know pricing, they could actually compete. I think it’s going to be interesting to watch the Amazon-Walmart just as a fairly interesting side show.
Jason: Yeah, they’ve the data too! Amazon has a lot of data – just 10% of…
Jeff: Absolutely. You could argue Walmart’s probably got more data on the total integrated play.
Neil: May be switching gears, I would like to ask the audience, has anyone bought anything on eBay in the past six months? Alright, good enough. How do you guys view eBay as an alternative, may be this is less important for you Marjorie, but how do you guys view eBay as a kind of an alternative search property? You know, clearly there is a lot of search activity that’s happening on eBay; this is something that you or your clients would be interested to jump on, may be even also as a counter way to Amazon?
Jason: Yeah, I can speak to that. We’ve…probably 60% of our customers are on eBay, are optimizing their product ad elements on eBay and you know, they, I think, have struggled with kind of the consumer store. Recently they had the distraction of the PayPal spin out, but they are the furthest along in the sort of eCommerce network, from my perspective of having a ad platform that you can scale to optimize, get good engagement with the consumer, learn from those consumers. So we’ve seen good success. I mean, it’s still sub-10% of Google, but it’s a profitable channel for most of our customers.
Brian: Yeah. I think from eBay, challenge in the conversions base, if you’ve seen those, is that there is a perception that I think still exists, that eBay is an auction site for used goods. I think they need to move past that and their policies and improvements are moving past that. I think they need to really educate brands and educate advertisers that they’re, you know, on par with may be Amazon from a sales offering. I also think that they can work hard to build up their content, right, so they do a really good job doing stellar ratings, but what I haven’t seen them do is good job in product reviews across all categories and I think some categories have reviews like books, DVDs, may be music, but as far as like may be home goods, I don’t think you’ll find a lot of content as far as reviews and peer to peer opinions and experiences.
Neil: Jeff, would you sell your product on eBay?
Jeff: Well, I mean, all I would say is I really don’t have experience. I would say eBay and their strategy and their history and the executives that are there, they can figure it out and they’ve got a brand image issue right now. I think it’s really well said. You know, I did a lot of…just personally, again, at the end of ’01, I bought a lot on the auction platform, but I have not bought anything on eBay for a couple of years.
Neil: How about YouTube? Jeff went into quite a lot of detail on YouTube. Marjorie, I know you guys are doing some stuff on YouTube. How do you view YouTube as a alternative channel for reaching customers?
Marjorie: It’s definitely an issue for 2015. I don’t know if 2015 is the year of mobile or the year of video; I guess we’ll find out! But I think just looking at other brands that have had success there…I mean, if you look back to “This is Wholesome” by Honey Maid, and I think they’ve like over 30 million views within the first couple of days; Pantene Pro V was all about women and ‘Stop saying you’re sorry’ and it had millions of views there, and it’s more about the consumer and customer engagement and I thought you did an excellent job of presuming what opportunity is there and I’m very excited to venture down that path and see what we can do and then may be take a few tips and lessons from you. [Laughter]
Brian: Yeah. I think eBay is kind of three things for brand. Number one like amplifying their brand story; put their own branded video content or they would be like the video service or like Marjorie mentioned, the Honey Maid videos, is really pushing that message in their platform or their campaign author. But also number two is, how can advertisers and brands partner with influencers on YouTube, right? So YouTube is, like we talked about earlier, the second largest search engine.
A lot of times people will go there for product reviews, but they don’t necessarily want a brand, telling them how good their product is. They want to hear from people who have actual experience of how can brands partner with which influencers and content creators and [inaudible 0:28:50] there and then thirdly I think Jeff was…Orabrush did a good job with the annotations. So giving people clickable options, where they can click out of the YouTube and engage with the brand and engage with their products, and possibly buy directly from the videos, I think kind of brings it all together and makes it easy for someone to see a video, be inspired and click off the purchase.
Jeff: I’ve said enough probably, but I would just say two things that are important. So 60% of all media being viewed, it’s 40 to 60. It’s actually 60 for the categories I am in and so there is no way…so what happens today, if you view a YouTube video on mobile, what happens if you touch the screen? It stops the video! So they’ve got a test going on actually in the beta where you actually stop the….this is for digital goods, apps., but they will get there eventually for click-through, for websites.
But you touch the screen, it stops and then you can click to go to the iOS store and download the app. I think it’s just critical…they are way behind them on this. You know, they have not seen the wave of consumption of mobile and tablet and they are way behind. I mean, I would spend a lot more of my money right now on mobile, but it’s just not…the infrastructure on YouTube is not available to do that.
Jason: Yeah, it is interesting. The previous panel talked a lot about push versus pull and I don’t want to bash my friends in the display world, but you know, I think that’s a false construct, right? If you listen to Jeff’s presentation, if you weigh the three points that you talked through, all of that is largely about pull, creating content that pulls the consumers and gets them to pause, you know and engage with the content. You did some push, right?
You talked about…to see it and make sure that you do get people to engage in pull, but then once they started to pull the content, you drove down your push and so that’s what I love about YouTube. Like I am a text guy, so when I saw that YouTube was going to be…and I am glad you pushed this into the conversation, seeing how video gives a shit, but just hearing you guys talk through that, those components, that’s the power of how search fits in with our pull notion.
Roger: And I would say just more broadly that your Programmatic videos are absolutely exploding from an advertiser demand side, that we are seeing from my clients and you know, I think initially with video, clients were looking at it like with the same kind of ROI metrics that they were looking at for display of potential search and we’re seeing a shift away from that. They’re looking at it as more akin to their offline TV budgets because it’s the same content, it’s the same message, but then they can get richer data around how people are interacting with it.
So instead of holding on to the same standards, which I think isn’t correct, they’re looking at it as a way to get more reach and then get more insights around campaigns that they’ve actually going and be more omni-channel about it. But YouTube as a channel, you know, just looking at ‘My Kids’ and how they consume videos, it’s all online and it’s mostly on YouTube and that’s just not going to change in terms of trajectory, whether it is on YouTube or other online options.
Jeff: Yeah, let me just build on that, because I think you’re absolutely right. I can tell you, from all of the work we do, our search is a hundred times better, our display is a hundred times better because of our work on video. Re-marketing is spectacular! Results without video re-marketing, 50% less. So to your point, it’s really important an integrated approach with video because of the huge level of consumption and the volume that’s potential there, that’s where you really want to think through an integrated play. That’s why I was wondering why it was coming, you know; this is a search thing, and then the truth is, as I talked to my team again, a lot of what we do is search and display and re-marketing on the videos.
Neil: Do you guys think that Facebook with their auto-play will actually help advertisers, you know, on the video side? So you’re…the way I think about is, you know, I’m on the train, looking at my mobile Facebook app and you know, videos are playing and you know, because it’s auto-play, it’s kind of interesting and because, you know, it might be interesting, my click-through versus on YouTube with, you know, they don’t have the auto-play feature, so I’m just looking at static images, you know, do you think that Facebook might…can have an advantage because of this auto-play feature that they’re running, which might help advertisers down the road?
Jeff: Yes. And I would argue if you run page review and stream advertising on YouTube, it’s the same thing, right, so you’re going to watch a video, you search for a video, you get served up the Orabrush video, you’ve got 5 seconds to kill it or watch part of it, that’s…I may be wrong, but it’s an analogous for me, and I think Facebook is going to make a huge play here. I know, we’re doing some testing, and because of the significant reach and frequency that you are on Facebook, there alone is going to be a significant advantage for Facebook.
Neil: Jeff, not to put you on the spot, but to put you on the spot, in 3 years, do you think you’ll spend more of your video ad budget on Facebook or on YouTube?
Jeff: Yeah, it’s a great question. I actually feel like we who supposedly have lot of experience in video, we’ve been doing this for a long time, I believe I’m way behind on testing the alternative channels right now, and so my group is with dedicated, you know, this is how I run my P & L. I dedicate a certain level of advertising for which I don’t expect any return, to learn and we’re testing right now on Facebook extensively. We’re testing on Hulu, we’re testing on BrightRoll and we’re testing on Vimeo.
Those are the four I’m testing; those are, I think there is a play on those four platforms. There’s many others, but I can only do so much and so we’re testing a lot there. I would tell you this, just as a prediction. Because of the players that are out there, Facebook is incredibly capable. Amazon, you know, are incredibly capable and willing to invest to win this channel. I think what you said Jason is important.
Are they going to do it? Is Amazon…you know, it’s a choice. Amazon has got lots of things they could go, disrupt, and when you look at a 180 billion dollars in ad spend, looks like a pretty big category, I wouldn’t mind disrupting. So I think that less than, you know, today 99% of my spend is YouTube; 3 years from the day, I bet it’s less than 50%.
Neil: Just it’s a fun-fact for everyone – by the end of this year, Google will probably do about 67, 68 billion in gross revenue, that’s the size of the entire US television advertising market, so just a fun-fact for you guys! So video is going to be huge and with viewership declining on television, I think video is going to be a huge opportunity, going forward. Let’s talk may be about a few different other radicals, you know, may be travel. For example, Roger, you guys deal a lot with travel. How do you think about TripAdvisor and some of the other travel sites?
Roger: You know, we’ve seen massive growth in alternative ways to book hotels. As you look at hotels, for example, you know, has a niche. You know, Google has their own hotel price ads feature which is a feed-based product that you can check, you know, inventory and hot prices for hotel rooms. There was, you know, 80% of brand searches on Google have a click on the hotel price ad instead of the SERP, is that right? Yeah, it’s like 80% …and it’s the switch in last 3 years and again, the cost-per-click for that was like 3x or 4x, what the SERP is because this is a very…you know, has a little picture of the hotel and has…it only shows if it’s available and it has, you know, the number of stars underneath and the room price and you click on it and it’s like 3x or 4x, you know, and the same thing for TripAdvisor.
The difference though, you know, this industry, unlike retail, you know, necessarily is, you know, the OEMs, whether that be Expedia or TripAdvisor or others, can bid to the top of the search results page on Google to drive people to their site because they can monetize them so well, because they’ve their own HPA versions on their own sites as well, as well as social content, accurity content, but I just see this trend of kind of verticalized search and Google is trying to try to take their place in it, so they don’t lose retail like they did Amazon and get ahead of it, but it’s going to happen in travel, not only in hotels, but it’s going to happen in airlines, it’s going to happen in autos, it’s going to happen down the way. I think that is the future of the less keyword focused world going forward.
Jason: Yeah, this gets back to the consumer point, where the consumer is, they are leaving the box, they are leaving the search box, so TripAdvisor – that’s where you go to get review content, make sure you’re not sleeping in a hotel that has bed bugs, right? Google won’t tell you that. You go onto recipes, you go on to, you know, different places to get recipes; I’ve got say ‘House’ because that’s my favorite distribution stores now for clients in that category.
If you do want anything in home improvement, consumers are on Google searching for doors for elevators or different paints that are in-house on Pinterest, so consumers are out there, the question is: who is going to build the platform or how many people…the platform to make that an environment where retailers and travel advertisers and auto advertisers can generate content that connects to what the consumer is interested in, in the moment they are in those environments. That’s not just slapping an image and a couple of lines of text into those environments; that’s a field.
It has to be functionally connected to what the consumers are doing in those environments and you know, related to the foreman, everything else, shot out to those stream ads crew on Yahoo. I think they’ve this in mind as they think about what do they do…I have to say Rob, I’m going to use another buzz terminative ads. What do they do with all the rich content and the functionality that they give their consumers in Yahoo Health, Yahoo Shopping, Yahoo Travel and stream ads, I think, is a pretty cool foundation for that. It could be another platform to open up to engage these consumers in the environment.
Neil: Brian, I think you use…I think you tried to test out ‘HookLogic’ and some of these other scheme; may be tell us ‘HookLogic’ is in for those who don’t know it in what results you’ve seen.
Brian: Yeah, I don’t… HookLogic is something we tried to offer the clients which provides sponsor search results based on keyword searches done across retail websites. So sites like Target, Walmart, Kohl’s, the [Deflion 0:40:15] they’ve actually got a value to buy keywords, so for example, if I am going to bet that [inaudible 0:40:20] switch may be to a search for, you know, what’s the best food processor, we can push our clients ads to the top of the search results on the [Deflion 0:40:30]. It’s really efficiently for us to move on to track sales, like in the packing up of [Deflion 0:40:35], but also just a way for us to continue advertising on brand outside of the traditional search box, like Google, Yahoo and Bing.
Neil: Why don’t we open it up for some questions from the audience?
Chris: My name is Chris. I know since the moderator is a analyst, I’ll ask…I am sure you would want to know, which is, based on this discussion, if there is a public company that you think has a lot of stock upside, based on everything that has just been discussed, who would it be? [Laughter]
Neil: Well, I have a buyer rating on Google and Facebook, so…may be I will just…another question. You know, mobile is clearly a disruptive force. We’ve heard from a lot of people this, you know, yesterday and today that for the first time ever they’ve seen mobile queries on Black Friday and Cyber Monday outpays desktop queries for the first time.
Jason: Is that Smartphone?
Neil: I think it’s Smartphone actually, from what I’ve heard. And it might be people at the store on Black Friday, you know, doing price comparisons and may be buying on Amazon at the end of the day, but how do you guys think about, you know, mobile and allocating resources towards mobile? You know, everyone’s talked about mobile and I think for the first time consumer behavior, we’re seeing more consumers interact with content on mobile than they are on the desktop, but yet the advertizing dollars in mobile is, you know, under-indexes that behavior, so how do you think about that disparity and how do you bridge that gap?
Roger: Yeah, we talked about the year of x, the year of y, you know. I don’t think 2015 is year mobile; I think that’s past us in terms of consumer behavior, but I do think 2015 is the year where we can finally tie together what happens when users are on a mobile device, on their tablet and on their desktop and because truly, you know, to everyone in this room, I know I do, I do research on all three devices, and we end up buying usually on my desktop and those things aren’t tied together today, and especially this conference, which is so, you know, search marketers are so ROI focused and search marketing is genuinely bottom of the funnel, understanding how you can fill that funnel to get more traffic in the search is really critical.
You know, we’ve…the brands off their sales, but we’ve launched the product, but the initial data that we’ve seen is pretty dramatic in terms of the mobile [assist 0:43:21], that we’ve seen from what people are doing on their phone and how [inaudible 0:43:25] ways in buying products on their desktop. But mobile, as somebody said earlier, is not a channel. Mobile is, you know, it’s a device type that you would use on search or you would use on display or you would use across email or anything, you know, just something that you’ve to be adept in and is part of the search marketer’s duties to understand where it falls in the funnel.
Jeff: So I would just say if you look at e-marketer data shared, of the 180 billion dollars in the ad spend this year, 70 billion is digital, 13 billion is mobile and if you play out what the e-marketerare saying over the next 4 years, mobile is, you know, the fastest by far and second fastest is video and I think it’s kind of a strange break-up because I agree with what you said. It’s a device issue, and I think video on mobile is going to be the fastest growing of anything. That’s kind of what I think.
Jason: Yeah, so it’s interesting that you know…so we only think of mobile as Smartphone, like we throw our tablets because personally I don’t believe that’s a mobile behavior. You may be writing your cell-phone study or work desk at home, but…so if you look at Smartphones across 70 retailers we work with over the holidays, 30% of their product ads traffic was Smartphone search and the thing that I think, just to your point Roger, I think mobile, it’s done, like it was the year of mobile.
The thing that I think really comes out of that, if you think about traditionally for retailers, they had the team that was their search team, and those guys just printed money for them. Like “I give you budget, you give me 5x back.” And now, with mobile, getting to that 30% threshold, to a true mobile, and the conversion rates are 20% of desktop, you can no longer give the search team that budget and expect that same ‘x’ back and so I think it’s finally this is where I’m hopeful for in the omni-channels too! I think it’s finally the point where the team that runs the search budget and has been printing money for the big retailers and brands, can go in and say, “Hey guys, I can’t do that any more. I’ve got the 30% mobile; I need to do the attribution, I need to account for all these multi-channel touch-points and because the consumer is there,” and…
Okay guys, I think get back, when we touch you guys off on that. So we will get ready for the next panel. Thanks a lot guys, that was fantastic!
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