Uncategorized - Tom Kennett

October 31, 2024October 31, 2024Uncategorized

Quarterly Earnings Week: How are the platforms doing?

Happy Halloween! In a week where Russia imposed an Austin Powers-esque fine on Google so big that you’d literally need all the money in the world to pay it, there were more grounded financial stories in social media with a range of quarterly earnings. The near-term future looks incredibly bright for a few platforms, notably Reddit and Snap.

Elsewhere, Meta has made some significant moves this week, while there are a range of other updates from the wonderful world of digital. Let’s get to it!

‘Tis the season for Quarterly Earnings! These are always great points in the year to get an overview of the state of play for different platforms. The headlines were:

Reddit’s user growth and revenue surged in Q3, driven by growing interest in its ad offering. I’ve written before that I think this is under-utilised and considered by brands, so it’s great to see a few more taking advantage of the targeting opportunities. Verdict: Great!
Meta’s Q3 2024 earnings report showed a significant 19% revenue increase to $35 billion, driven largely by advancements in AI technology and ad sales. This increase seems to follow Meta’s successful integration of AI across its platforms, working to enhance ad targeting and performance. The jury’s still out on Advantage+ for more complex activity, but ad spend is clearly being poured into the platform. Verdict: Unconvinced, but the numbers are hard to argue with.
Investors were cautiously optimistic following Snapchat’s quarterly earnings reveal; there was a sizeable increase in paid subscribers, while revenue was up 15% with a reduced overall net loss. Shares were up 9%, which is a useful indicator that they had a good quarter. Verdict: A surprisingly bright future
Elsewhere, the big headline from Google’s earnings call is that YouTube’s ad revenue was up 12%. We’re seeing more and more digital ad spend diverted away from core platforms; YouTube, Snap and Reddit are hardly upstarts, but at least in my experience with clients, they often don’t form part of the core mix, so it’s interesting to see. Verdict: Google continues to dominate
Obviously in a new world order, X doesn’t need to do a Quarterly Earnings call, but one reveal from the Meta call was that Threads is apparently on track to overtake X next year in terms of active monthly users. I don’t necessarily see that in my own experience of using the platform (at least within my world, it only seems to be publications posting, rather than peers), but your mileage may vary. However, X is now reportedly worth less than Truth Social, so it definitely isn’t going brilliantly. Verdict: Uh oh

Meta developing AI-powered search engine

Meta made a couple of other announcements this week; firstly, that they are reportedly developing their own AI-powered search engine, aiming to lessen reliance on Google and Microsoft.

This pivot could reshape the ad landscape and diversify search options, as well as offering some potentially very interesting targeting opportunities for media buyers. There was also an announcement that a news-focussed AI powered chatbot will be powered by Reuters.

This Week in Digital Marketing // Google testing AI-powered video ads

Temperatures are plummeting where your correspondent writes from; as we prepare for the clocks to change in the UK, the changing of the seasons means that we’re fast approaching the holiday period.

While this might be a magical time of year for consumerism, it’s a wretched time for digital marketers, who either have to work overtime to ensure the go-live of mission-critical ads or explain to stakeholders why CPMs have increased sharply. My thoughts are with you (us?) all at this difficult time.

Canva might be delivering some blessings for put-upon social media managers, however, with news this week of a new text-to-image generator. Meta is also beefing up security with facial recognition, and Google is testing AI-powered video ads. This paragraph would have been the stuff of science fiction not so long ago, but now this all feels very real.

With that said, let’s get to it!

Google’s AI-Powered Shopping Ads

Google is rolling out video-enabled shopping ads in search results, allowing product videos to play directly in the ad.

This can significantly boost engagement, considering how video ads consistently outperform static formats on other channels. This could mean higher CTRs and potentially better ROI. It’s definitely one to keep an eye on if you’re in e-commerce.

Google also announced a range of other Performance Max (AI-powered ads) roadmap features this week. While minor, I actually really like the shareable ad previews, as this has been a bane of my life over the last decade. But there’s some good stuff coming; I haven’t seen impressive returns from PMAX yet, but Google is betting big on it.

Meta Launching Facial Recognition

Meta has announced that it’s testing facial recognition features on Facebook and Instagram to help combat scams. As someone who has seen numerous clients and colleagues fall foul of hacks, this is a welcome development.

It’s also using this to better identify unauthorised uses of prominent figures in advertising, something that Money Saving Expert’s Martin Lewis has, for example, fallen foul of in the UK.

It’s pitched solely as a safety feature, but the privacy concerns are unavoidable in this day and age. Ultimately though it should offer more peace of mind, and improve security for customers.

Canva’s New AI Text-to-Image Generator

More AI news: Canva has launched a text-to-image generator powered by AI. This could save serious time on creative production.

This feature should help streamline design processes and reduce the need for expensive bespoke graphics, allowing for quicker turnarounds on campaigns; if you’re the kind of person already needing to use Canva, then you’re probably very pleased by this news.

This Week in Digital Marketing // TikTok knew about teen harm & did nothing

I have to hand it to TikTok; they are an absolute gift for newsletter writers focusing on digital marketing (a niche, I know). This is the 38th edition of this particular newsletter and the 12th time that the lead story has focused on the platform.

Some of those have been because of terrific ad platform advancements, an increasing influence in search, or its role in social shopping. Sadly, this week, it’s due to something much darker; executives knew about the harm caused to teens by the platform but did nothing about it.

Elsewhere, in an otherwise jam-packed week of updates, Google turns to nuclear power (a sentence I never thought I’d write), the EU has brilliantly delivered good news for X while at the same time giving it a massive slap in the face, and there’s been plenty of other news besides.

Let’s get to it!

TikTok execs aware of teen harm caused by platform

Newly revealed TikTok documents show that the company knowingly understood the harmful effects its platform has on teens, particularly regarding addictive behaviours and negative self-image.

Despite this, in a move that will surprise no one who has ever seen corporations represented in mid-size blockbuster films, internal strategies focused more on public image than addressing the issues.

TikTok isn’t alone in attracting increased scrutiny (Snapchat has also had some poor moral choices aired recently), but this isn’t a great look. Aside from any personal thoughts, if you’re working with a brand or product championing solid ethics and morals, these are serious watch-outs when planning activity – not to mention the potential for tighter regulations on these platforms.

EU doesn’t think X is famous any more

If you’ll excuse the football-chant-based subheadline there, X (formerly Twitter) has avoided being designated as a “gatekeeper” under the EU’s Digital Markets Act (DMA).

What does that mean? Being a gatekeeper would mean X was seen as a dominant platform controlling digital market access. Being labelled as such would subject it to significantly stricter regulations designed to ensure fair competition.

Not being subject to these regulations is good news for X. But the fact that this is because it’s not seen as significant or essential anymore fits alarmingly well with last week’s news that Fidelity is valuing it at 79% lower than Elon Musk’s purchase price. It could easily be painted as the latest in a line of humiliations for the platform.

X also announced this week that it will be diluting blocking; if you block an account, they’ll be able to see your posts, but they won’t be able to engage with you. It wasn’t all doom and gloom, however; X did reach an agreement with Unilever that means it’ll be dropping them from an ongoing lawsuit against advertisers, with the global giant due to resume activity (and, one assumes, ad spend) on the platform.

Google turns to nuclear energy to power AI

Google has signed a seismic deal to use nuclear energy to power AI data centres. This marks the first time a tech giant has turned to nuclear power to meet its energy needs, specifically due to the growing demand from AI.

It’s a real demonstration of AI’s real-world impact and the massive investments significant players are putting into it. It’s safe to say that it’s more than a fad.

Category: Uncategorized