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The Digiday Podcast
Late night TV's shakeup, OpenAI's agentic AI tool, plus Walton Isaacson’s Albert Thompson on CTV’s ad product predicament
00:53:29
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- [00:00]
Kamika McCoy
Foreign.
- [00:11]
Tim Peterson
Welcome to the Digiday Podcast, a show about the business of media and marketing. I'm Kamika McCoy, senior marketing reporter here at Digiday. Later on in this episode, you'll hear a conversation from Digiday's CTV Advertising Strategies event. My co host, Tim Peterson talked to Albert Thompson, head of digital innovation at ad agency Walton Isaacson, about why the CTV ad industry needs to prioritize more native ad formats. So stick around for that later on in the show. But first, this week's juicy scoops, including some big moves and another blow in the war against the news and a big, big update to Chat GPT. You'll probably notice in the top of this episode, Tim did not chime in introducing himself. He's on vacation this week. So for this episode, I am joined by none other than Digiday's managing editor, Sarah Durdy. Welcome to the show.
- [00:58]
Kamika McCoy
Hi.
- [00:58]
Sarah Durdy
How's it going?
- [00:59]
Tim Peterson
How are you? So glad to have you join us.
- [01:01]
Sarah Durdy
It is just so delicious to be here. I'm so excited to dig in, excited.
- [01:05]
Tim Peterson
To talk about the war on Media and ChatGPT.
- [01:08]
Sarah Durdy
You know, there's never been a dull moment in media, but this really just feels like something all on its own. So, yeah, very excited.
- [01:16]
Tim Peterson
Perfect. Well, with no further ado, let's go ahead and get into it. The first topic that we've got on the Juicy Scoops docket, if you will. Like I said, there were some major moves that happened in the media world last week. I'm going to do a quick timestamp of these. On Thursday, CBS announced that the Late show with Stephen Colbert will end next May. So May 2026, and Colbert is not being replaced. The franchise as a whole, which has been on Air since 1993, is ending right then on Friday. You've got President Donald Trump filed a lawsuit against the publisher of the Wall Street Journal, alleging that the paper defamed him when they published an article last week about a letter that Trump wrote about to Jeffrey Epstein in 2003. The suit says that the letter, which includes like a drawing of a naked woman, doesn't exist and Trump is seeking this number $10 billion in damages. And then also on Friday, Congress voted to cut over $1 billion in funding for the Corporation of Public Broadcasting, which means npr, pbs, and their member stations will all lose federal funding. Sarah, I just threw a lot at you. What is your reaction?
- [02:21]
Sarah Durdy
Well, listen, there's a lot of dates, a lot of numbers that you mentioned, but what I think is really important that the industry and those covering it really reckon with is that news and its relationship to consumers is shifting. Sarah Guaglioni wrote a story. Now, I think this is about a month old, but the Reuters digital news report showed that for the first time ever, consumers are not turning to local news outlets, including TV or newspapers, and are instead favoring what I personally like to and am comfortable referring to as quote, news influencers. So the personalities who are not trained journalists, but that consumers have really become comfortable hearing news updates from on social media. You know, think of your TikTok floating heads who are going to summarize the headlines from these more legacy publications. And so I think with the Colbert show phasing out first off as a franchise, you're really seeing that news consumers are no longer really interested in seeing clips from late night shows to get their news or watching of course, the late night shows themselves on traditional tv. With the Journal, I'd say that it's really important to contextualize that Trump as a brand has always had this sort of tumultuous relationship to media and has not been quiet about his perspective on what news can look like and the relationship these sort of big brands such as his own can respond to or not respond to within the court system, without the court system. And lastly, you mentioned how Congress voted to defund some of these big sort of legacy public media businesses. I think it's just important to reflect that nobody at least personally goes into working in media for the money. It's sort of this long standing industry joke that it's almost like a charity project to be willing to be a journalist. And I think egos can sometimes reflect that. But I think that what's important to also keep in mind is that business models have always sort of operated with such thin margins that to have this sort of defund process start is really sort of harrowing and scary for the media industry. And so anyway, you gave me a lot and so I gave you a lot back in return. But it's really sort of, and this is an evergreen statement for the media industry, but it's another make or break moment and it's really scary and interesting and exciting. Everything everywhere, all at once.
- [05:01]
Tim Peterson
I do want to hone in on like the money aspect of this, right, because CBS says that the move to phase out Colbert show was like purely a financial decision. But you've got some naysayers here, right, because the cancellation comes after Paramount agreed to settle the 60 Minutes lawsuit that happened a while ago. There's also Colbert who has been himself critical of Trump during the show and then the middle of Paramount's attempt to merge with Skydance as a new parent company that has to be approved by the fcc. So you've got like the money situation on that side. And then to your point, like, the late night genre as a whole is not profitable as it used to be. According to the advertising date company guideline, late night shows on major networks made $439 million in ad revenue in 2018. You guess what that number is last year?
- [05:52]
Sarah Durdy
Tell me.
- [05:53]
Tim Peterson
$220 million. Which, like, really shows the cleave here about how that viewership is changing, what that means for how advertisers are showing up there. And to your point, if there is a weak point that's being capitalized on here, if that's the word that I want to use, which it is, and what that means for, like, how the media buyer, how the media business sustains itself. Because also, I mean, how viable are subscriptions at this point? Right. When you talk about subscription fatigue.
- [06:22]
Sarah Durdy
No, completely. I think too, the trouble with these late night shows, and you have reported extensively on this, is that we are living now in this fragmented society where we are turning to the algorithms to see the content that the bot overlords know I'm going to respond to. And so I think, though, it's also creating this situation in which it's difficult to have one person that we can relate to completely, which then I think leads me to say, like, what is funny anymore? Like, we're living in these sort of despondent times, a reality in which I am going to laugh and howl at comedy that you will laugh and howl at, you know, versus Sarah Patterson here at Tajoday with us too. And Tim, like, I don't know that that situation exists like it used to. And so as we are living in this, like, more fragmented society, I think comedy itself also becomes more fragmented and it just becomes more difficult to relate to each other.
- [07:23]
Tim Peterson
Yeah, there's no monocultural moments that exist anymore because, like, you've also got competition with the likes of Jon Stewart and John Oliver. And now you are adding in Chicken Shop Date and Hot Ones, which, like, really makes it an incredibly fragmented space. So the media on a whole right now is fighting, to your point, a very scary fight right now. And it'll be interesting to see kind of what comes of that. And that's just kind of from like the Late Show POV perspective. Right. Then you've also got public media, which has been fighting, has been fighting this battle for a long time. The larger flagship NPR won't be going anywhere anytime soon. But I would say there's kind of like this trickle down effect which we've already seen news deserts and whatnot. And now this is just kind of another aspect of that where radio and TV stations and smaller cities will be at risk of shutting down for losing those federal dollars. But there's still, there's still public money here, right?
- [08:19]
Sarah Durdy
Yeah. What I think is interesting to think about when you consider what is going to be happening with their funding models is that they have always gotten into the habit of asking for money from their avid fans and consumers already. And so they often have seasonal drives to ask for money. What I think is potentially scary, in addition to the news desert element that you have introduced, is also the idea that they're going to be competing for money among all the many other subscription services that are, that is already competing for our wallet share. I think what they'll really have to tout and try to distinguish themselves from is this idea of trust and balanced coverage and fair coverage, which is what public media has always sort of funded itself on despite sort of the public support. And so it'll be an interesting sort of race, I think, to build that trust and ultimately win over dollars from consumers.
- [09:22]
Tim Peterson
Did we just come full circle in that the business model should be for news is where we go back to subscriptions and reader subscriptions.
- [09:30]
Sarah Durdy
It is funny, it seems kind of obvious to say that you should build your business model around what people want to read and watch, but yeah, I think that's exactly right. I think public media will be challenged now more than ever to make sure the type of coverage they're doing accurately reflects these oftentimes local areas that don't have any other sort of news coverage. So it'll be interesting to watch.
- [09:55]
Tim Peterson
Well, not that these things were like funded heavily by like ad spend in the first place. Right. Because I mean that's something that I think local news and public media has been grappling with for a while. But you've also got this concept of like where brands are looking to spend in brand safe environments. You know, given there's the so called cultural wars now you've kind of got this, this iteration of like I want to spend my dollars where I know I'm not showing up against negative news. And like, can you do that if you are the news? So like not only are you struggling because you're in a fragmented landscape to compete with not just other news publications, but like to our point earlier, other mediums, news influencers, substack, models and things like this, but also like, can you, to fill in that gap that the federal dollars would be leaving, like, can you call on advertisers who are looking for like brand safe environments?
- [10:47]
Sarah Durdy
Yeah, I mean, I think it's a great point. I think, I think public media has become politicized, particularly now more than ever. And so I would be curious to hear a brand's perspective on whether they see participating in public media being brand safe. But I really hate that term so much because it's not being brand safe, it's being relevant. And I'm speaking clearly from a publisher's perspective. But for example, if you have the eyeballs on a news story that could be somewhat contentious or emotionally charged, then you're gonna be relevant as a brand to have your message near that story to capture those eyeballs and that inventory. But I see, though, opportunity for these public media outlets, not necessarily in terms of digital ad inventory, but to think about how brands could become integrated into a community, whether that is like a live event with that brand's messaging supporting that live event. I think what public media has done really well is that community integration piece simply because there are no other competitors, there are no papers. Oftentimes there's not sort of an indie tab because the business models have failed. So there is as much pressure right now to stand out as there is opportunity. That I think is a really exciting time for them. And I suppose we can still say exciting because they're not shut down yet. So that's also a fine line.
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Tim Peterson
A very hopeful look coming from Sarah Jeudy here. Thank you so much.
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Sarah Durdy
I know your in house cynic turns a new leaf headline.
- [12:26]
Tim Peterson
On the other side of the media, we've also got AI, another topic that we cannot escape. Sarah, where is your relationship at with AI? Are you a chatgpt girly?
- [12:37]
Sarah Durdy
That's a great question. Of the platforms. I do prefer ChatGPT and I prefer to use it for mindless tasks such as my nephew is coming to visit me in New York for a week. And so I've asked ChatGPT to prepare its thoughts for an itinerary on what we can do. I don't, rather I should say, because trust is a big word. I don't have the relationship to AI to turn to it to ask me to do any sort of professional tasks, even write emails. I think that the one big standout piece that humans have going for it when it comes to AI is the actual human element. And so AI is not going to relay an email or write an email, Like I'm going to write an email for the better. And so I am cautious about using AI as I also accept that it can help me find that the Brooklyn Children's Museum is going to be closed on Wednesday, so I should plan to go with Sullivan on Thursday, you know what I mean? So my relationship is just a little bit different. What is yours? Are you using it? I should probably know the answer to this question. As someone who reads your copy.
- [13:43]
Tim Peterson
I'm about in the same boat, to be honest with you. Love it for like meal prepping and activity planning and things like that. As many times as I've asked it to help me map out a schedule, will I stick to it? Who's to say? But I think you are on the opposite spectrum of where many marketers fall when we talk about agentic AI, right? So big news happened last Thursday. Open AI rolled out. It's a chat GPT agent. So it's another step toward, in my opinion, the uncanny valley. The AI agent can handle full on workflows like it's essentially a digital assistant that can do scheduling, create a slide deck, emails, navigate websites and other administrative tasks. To your point, we've reported pretty extensively that AI is reshaping how companies think about staffing. A few weeks ago, for a story on brand safety and AI, I actually talked to a CEO of a jewelry brand and the CEO told me that he estimates savings of like 1.2 million in payroll costs annually. Part of that is stemming from shifting roles to let AI hire, to let AI handle, excuse me, AI admin stuff, and the other is a hiring freeze. Right. So you've also got Meta, who says that their AI services should help, should take over marketing and creativity by 2026 and whatnot, which all speaks to like, you know, I guess I feel like AI is becoming like a third player here in the, in the ad business. You've got agencies, you've got clients, and now you've got like AI as well. Would you, would you give me credit for that?
- [15:14]
Sarah Durdy
I would give you credit for that, sure. I think that AI is creating the industry, is really touting its use for efficiencies. That word is being used over and over and over again. And I think AI as a concept, which in some ways has been just mislabeled machine learning. But as it matures, now that we're at this place, which I think is really interesting to think of as its life cycle, I think as more companies adopt AI and come up with a thesis for how they use it, it'll be interesting to see how they parse through working with one company over another or sign some terms of agreements with one company versus another. I think as the industry runs toward again this concept of efficiencies, it'll be really important to see where they also trip over one another to get there. How is this creating perhaps more difficulty in working with clients? How is communication affected? And when you introduce this concept of agentic AI, which we've written about as it pertains to advertisers and agencies and publishers, you really have to think of where does the human element then become more important than ever to introduce into the workflow?
- [16:30]
Tim Peterson
The question that, to build off what you just said, the question that I keep coming back to is like, what then happens to the junior copywriters, the junior, the like your next, your next C suite and managers, right. Like how do you prepare them? If they're, if the opportunity to cut their teeth on building slide decks or like sitting in meetings and summarizing notes and kind of that type of deal, if that is then taken over by AI, who then becomes the next cmo, the next C suite executive who's been trained for that?
- [17:01]
Sarah Durdy
Yeah, I think it's a really important and difficult question because I think that, you know, entry level talent really has been educated at some point during the pandemic. And I think we saw a really big sort of like workflow revolution as we had to teach the soft skills that are required from those generations in the working every day that we're not taught because they were unable physically to work alongside someone. Right. And so to extrapolate that now as you introduce AI, if the industry is unable or rather assigning that sort of quote unquote grunt work, writing the first drafted decks, doing the first round of social copy, I think you really then need to think about what sort of skills the industry can prepare for them to have when it comes to those entry level roles that theoretically the industry is going to be able to offer them. And so just to continue in place of devil's advocate here though, I think the industry would push back and say, well, we're going to evolve. By the time that they are going to be in the working eye in five years, we'll have a completely different use case for generative AI and the job itself, it's going to change and the CMO role will look completely different. But it's difficult, I think, to theorize and play out just because there are so many unknowns and so many inconsistencies, frankly, with which Company is using AI in what ways to really I guess put your arms around it. I mean what do you, what do you think? I mean what are, what are the skills that you, that marketers are interested in hiring right now? I know you wrote about this somewhat recently.
- [18:40]
Tim Peterson
Yeah, absolutely. There, there are a lot of like product development, AI driven roles that marketers are looking to fill right now within their own companies. I know, I talked to one CMO for a buy now, pay later brand zip who mentioned, you know, when it comes to how they hire people just like internally for themselves but also for external agency partnerships, things like that specifically they're looking for like somebody who is AI first. AI interested. Right. So that becomes part of the, part of the gig. I think the conversation has shifted from where we were this time maybe last year about you know, the faces that I see. This conversation is AI is going to take our jobs. We don't know how this is going to look. And then to your point just a second ago there became a pushback of like no, this is just going to shift and change. But I think it's, we can't deny that AI has like really upended the way that business is done and work is done. The IAB not too long ago also said they put out some research that said like 40% of all video ads by 2026 are going to be generative AI driven content. So again you've got like it's going to usher in a next phase of what work looks like. I, I feel like it'll be up to consumers how interested they are if it becomes like a consumer facing thing. Remember Coca Cola last year got a lot of pushback for their AI holiday ad. You know I've even talked to some creative agencies when the Meta, when Meta announced that they wanted AI ads by 2026 just in terms of like that human touch and the human element to agencies, at least creative ones will be what distinctifies. I don't even know if that's a word that makes the distinction between each of these agencies capabilities. Right. If you know it becomes like a selling point. We're not using AI and that's how you know that this content, this work can be trusted. Because to your point we don't have a checks and balances testing going on here.
- [20:42]
Sarah Durdy
No, that's completely right. I think that to our point earlier about consumers relationship to media marketers are driven by consumers perspective. And so if we are looking to see change within the industry as it pertains to AI, we should expect to see consumers drive that. I think the big sort of two big points there are going to come in terms of content creation. If consumers are uncomfortable with seeing AI generated images and video, then brands will be forced to not use them, which was the case with Coca Cola, as you mentioned in that holiday ad. And I think the other way too, that brands are really going to have to sort of reckon with their AI use is when it comes to climate change, which you've written about. I think brands are sort of just blindly using AI without reflecting on the consequences as it pertains to the climate, mostly because consumers aren't holding them accountable for it. And marketers have just bluntly said to you, Kamiko, that is what they're doing. They're unabashedly pursuing AI and emerging tech despite the, despite the resources that are required to power these tools. And so I don't think that there will be much change until consumers say that they don't want to see it. Do you feel differently? Do you feel like that's accurate?
- [22:03]
Tim Peterson
I think that's on the front facing in for sure. I think you know how brands and advertisers move about it that way will be at the whim of consumers. I think in terms of like internal use, that's, that's a signed deal. Right. Adage reported recently also that Yum and Mattel and other brands were like striking AI deals for marketing customer experience. And to me goes back to the point like they were striking deals with OpenAI, Microsoft and whatnot. To me that goes back to the point there's like there's a present third leg or a new middleman in the ad business that is here to stay when it comes to like content creation. You know, that's still up in the air in terms of like how consumers feel about it. But I think a lot of when I do, when we're doing reporting and things like that on like what the efficiencies are and cost savings, I think this is where you're starting to see that that show up in terms of like agentic AI. That's the word I was looking for.
- [22:56]
Sarah Durdy
No, completely. I also we spoke about entry level roles, but I think this conversation also warrants to say that we need to think too about what it does for the seasoned employees who have been in this industry who are going to have to learn this tech or not. We have to think about the rules then that are going to be in place for them and how we don't create another sort of phenomenon where we squeeze out those at the top because of the tech. So there's a talent gap as it pertains to both entry level roles and sort of like tech understanding. I think that's being introduced as it pertains to those at the top that we'll have to understand and contextualize.
- [23:40]
Tim Peterson
Well, I think if nothing else to say, between the media and the marketing business, there's a lot to be grappled with as H2 or the second half of this year kind of continues to get underway. But Sarah, I can't thank you enough for joining us for this chat.
- [23:56]
Sarah Durdy
Thank you so much. This was so fun.
- [23:59]
Tim Peterson
As I mentioned earlier, in this episode, my co host Tim Peterson talked to Albert Thompson, head of digital innovation at ad agency Walton Isaacson. Going to be a very interesting, juicy conversation, if you will, about why the CTV ad industry needs to prioritize more native ad formats. So have that conversation coming up. Thanks so much.
- [24:27]
Albert Thompson
So many of the ads that I watch on any streaming services are kind of just standard spots that I would see on traditional tv. I imagine there's good reason for it. Those ads are already being created for traditional tv. Why not just port them over to ctv? But to what extent are you having clients adopt CTV native ad products or are you having them say like, no, absolutely not. We just want to run our same stuff we're running on traditional tv?
- [24:54]
Kamika McCoy
Yeah, I mean, look, when you say there's a good reason, the good reason is that there's always been a matching luggage to whatever the waterfall is in marketing, which has been tv. So people take a TV spot and they just fit it into ctv, into social, yada yada, and it goes all the way down and then they rip the audio from the spot and make it a digital audio spot. What people aren't doing is understanding the rules of engagement of every platform and developing agnostic to the platform based upon what the user or consumer tells you to do. So there's probably no better way to describe it, but inherent laziness built in there. Instead of studying the platform in particular its algorithmic nature and understanding what the platforms will reward, everybody missed that part. So look, I think when you move into the space and I started in CTV when it was Yumi, so that's a decade. So yes, at that point you just ran the execution you had because no one knew what they were doing and what this was going to be and evolve to. In this era, you kind of have no business just matching luggage in the Internet. That's not really how it's built. That's not how the community is clustered. That's not how the mind orients contextually. All these platforms environments are very different. You can't just do the same thing because you just want to do the same thing because it's easy. So I think the education for clients is really understanding what platforms reward. Digital's reward was always depth upon over everything else. And the average TV spot doesn't have depth. It wasn't designed for that. Well, CTV rewards the depth. Not only the depth in data, depth in audience targeting, but the depth and layers of engagement. So if you are watching Love island like the rest of us, you start to see all these dynamic types of ads. You see the QR code ad where the video's in a pod and then you have a right hand and bottom rail and a QR code that's fixed on the screen for the entire ad rotation. You see the pause ads that are just ads. The pause or the ad that pauses the QR code. So finally, while the invention for a lot of these things was almost a decade ago, the innovation is finally showing up now. So people are starting to understand what they were doing wasn't working because they'd probably seen two years worth of data. That said, this is not really working. And why are response rates the same way as a display ad? But CTV is the killer app, meaning it gives the reward of linear. With all the targetability of mobile and all the data science that underpins web analytics, everything is there. People aren't packaging it and telling clients how to use the canvas. And we're now starting to see the experimentation happen is because people just didn't like it. They didn't like the QR codes, why they put it up on the screen for one second.
- [27:38]
Albert Thompson
I mean, QR codes are pretty ugly.
- [27:40]
Kamika McCoy
Yes, they are. But the utility of it is no one can get their phone out, unlock it in the speed in which it appears and disappears. So what was the point? Aside from the fact that the human brain can't make a decision, Are you speaking to me in three seconds, Let alone get the phone out, unlock it, take the picture and then do another action. So now we're getting to a place like, oh, it's gotta be up for 15 seconds, 30 seconds. That just kind of makes sense. So it's now part of the user experience. It's part of the user interface design, duh. So that it can actually deliver what it needs to deliver and be purposeful. And people can get beyond the bias in particular brands where I just want to see my ad in full screen. No, what you want them to do is like it and buy your stuff. So I think people are caught up in the wrong things. Not even vanity metrics. It's like the vanity when a client says, oh, I want to see my billboards talking about driving the work. No, what you want people to do is see your ad and buy your stuff. So those are the things that. It's not a mixed signal around KPIs. It's like a mixed signal in psychology of why certain investments are turned on and why certain executions are made in the space that really don't make any sense. But we have to wait for the repetitive failure of it or not meeting its expectations for people to decide, okay, maybe we should try something different.
- [29:00]
Albert Thompson
Yeah. Although I imagine there is something of a healthy tension of, okay, you want the QR ad on the screen so that people can act and they have it up long enough, but you still want to have the nice ad there anyway. Otherwise, doesn't it become a slippery slope where like everything just becomes. What was it, was it Coinbase who had the super bowl ad where it's just, we're just going to throw a QR code in front of your face for 30 seconds, you're going to deal with it?
- [29:26]
Kamika McCoy
Yeah, look, I think what people have to look at is the user journey of content consumption. It's okay to have a full screen ad because it looks amazing in the first sequence. In the second one, you tell them what it was about and why it matters and you use a different ad format or QR code. And then in the next sequence, you use a different format that gets them to transact because that's how we actually make choices. We see it in exposure, we hopefully remember it, then we think about considering it and then we will do something. I think it's impractical to think that the ad exposure sequencing doesn't have to map with how human beings still make choices about brands. So it's kind of like if you believe in dynamic or product placement in programming, the first thing is they see it in the show. They're like, ooh, what's that on the table? I don't know. Then when the ad slot comes up, it's an ad related to the product that was in the show that says what it was. And then the next ad has a QR code that says, here's how you buy it. Because that's how human nature works. And what you find is that that's not what the design is. People just run it and they're like, oh, it's not working. There's no measurement. We don't have tools, we don't have line of sight. But you know what we're gonna keep doing? There's an upfront coming up. Please, like we have to like slow it down and really think methodically about again. User experience was very big in the web development area. You had the user interface engineering, organization, you had UI and ux. Like you had hot spotting looking where eye tracking movements where we looked on a page. And that's why we have banners in certain places. A lot of information science, lot of observation. Then when streaming came along, because the OEMs have said it well, we just kind of created a homepage. It wasn't well thought out. That's why it's hard to at app. It almost doesn't even work. So then you start to understand, okay, this wasn't well thought. We need to start to work its way back and design home screens that are easy to navigate. Because right now it's a nightmare for the average user who's like, I don't know what I want to watch. And we saw.
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Albert Thompson
Yeah, but the home screen ads are just banners.
- [31:29]
Tim Peterson
Correct?
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Albert Thompson
I've seen those on every website for the past few decades.
- [31:32]
Kamika McCoy
Absolutely. But there's an ignition point that's part of it. Then when you get into the actual viewing exposure, you have to think through the entire movement and experience exposure to the brand campaign from home screen to end content to in ad slots, to a pause ad to a QR code. And now all of a sudden you have effectiveness. You turn it on like an ecosystem. The same way people do digital at home. They have a billboard and have amazing signage and they have something outside the store and then they have something at the register. They're like, hey, we're going to get wear in as the user moves down the block to the store into to the register at checkout. That's an experience design and it's amazing to watch that not happen in the area that has the most tremendous growth that is starting to outflank linear. It should just be a more well thought out designed canvas to do all the things linear could actually never do, which is totally fine. But then they would interlock and really complement instead of, as you said, this sort of healthy tension between we're gonna take the same approach as linear, but it doesn't really work. But it's what we know to do. But that's not why we built it in the first place. We built it to outflank linear and compensate in ways it couldn't so the two could complement each other. And that's not what you're hearing and seeing in the business in the conversations from the OEM side to the agency side and brand side. But that's what the consumer. That's what we need to make choices and the brands that get that first. And kudos to Unilever, who's kind of killing it with Love island with all their pause ad and ad slots and integrations. I mean they've taken a holistic view to the number one guest reality show to land it as all the way up to the finale. That was well thought out from a planning perspective about how are we gonna dominate and own mindshare and be immersive to the show experience and then have our moments for people to transact with us and use stars from the previous season. Like that's not an accident. That's a, that's a consumer experience design in that entire approach. And they turned on all the levers to find out what sticks.
- [33:35]
Albert Thompson
But does that mean this isn't really only available to a brand like that who could basically be sponsoring a show as opposed to someone who's just looking to run a better version of those old infomercial ads with the blue screen and the phone number at the end?
- [33:54]
Kamika McCoy
That's a very interesting question. One would leave you to believe that you had to have a hold code relationship and Unilever budgets to pull it off. But you can buy CTV, self serve Ryan Reynolds Co. Mountain, but it's just not as prable and he doesn't do upfronts. You can do dynamic ad placement through Rembrandt, Myriad and Riff, and you can do that directly with them. So you can recreate some of the moments. Maybe not at the scale, not with the gravitas, not with talent from previous shows, but you can mirror it within your respective budget and have the same experiences to learn to be able to challenge what behemoths do. I think the spoils of riches of the Unilever relationship has to probably stems from the fact that Love Eye and I believe is affiliated with Group M. So none of this is really an accident because it's kind of under the roof. But all these pieces, some of them have existed for a very long time. They are just not the ones that are most popular that are talked about. So people know how to turn these levers on and execute against them. But all the elements are essentially there.
- [34:59]
Albert Thompson
The diy, because that's one thing I'm curious about as you're talking about those things We've been talking a lot about frequency management today, and it feels like, well, if the frequency management thing wasn't an issue, then I could see how this is possible. But if I'm doing that where I'm diying the product placement, I'm DIYing the other things, how the hell can I make sure that the same person is seeing all the steps in that sequence as opposed to looking at the reporting a month later and just being like, well, I got actually a patchwork of people seeing the sequence and wondering, what the hell was this?
- [35:34]
Kamika McCoy
I think the challenge would be if you're using different platforms to pull this off. So if you're going to use a myriad and a riff and then you're going to use a mountain and then you're gonna deal with Peacock direct. Yes. I mean, you'd really have to do a lot of manual math and making assumptions around. Tune in time to really sort of plan the day. It wouldn't be perfect, but you wouldn't be tripping over yourself with your ad exposure. But the difference is, when you're talking about show inclusion, that's one context. When you're talking about just an ad full screen, that's another context. When you're talking about an ad with a QR code fix, that's another context. So we're talking about a series of contexts to build the story and a narrative to be memorable. Because the war is about to shift from being from clicks to memory, from AI agents, AI engines or answer optimization engines, whatever term we're coming up with today. Whereas you have to be part of the lexicon of intelligence put to the fore. Like, this is what you were looking for in terms of discovery. And that's really the pathway. That is a different way of looking at inbounding with campaigns and execution than we've seen previously for. Was like, oh, you just want visibility and reach. No, what you want is real intent. You want people who have the highest intent to buy what you're selling. Otherwise you end up with this word called waste. And I think that's the thing that needs to be recalibrated. It's okay to look alike and spend more and then spend more for incremental reach, if that's what you want in the budget you have. But we need to start with precision around who cares? It's kind of like when the debate about 15s versus 30s. Well, people were running 15s because the viewer completion rates is higher on 15 because the average attention span on the streaming platform is 9 seconds. So it's higher on the 15 and a 30 easy. Math looks better to a client. Oh, my God. Our viewer completion rates are higher because you're running a shorter ad. Okay, first of all, if multicultural doesn't even work, you can't even get enough Spanish out in 15 seconds. Okay. The second thing is.
- [37:22]
Albert Thompson
My grandma spoke very, very quickly.
- [37:24]
Kamika McCoy
The second thing only vices. We decided to buy in 15, 15 seconds and most of our selling vices. So when you get to the reality of it, it's like you need wear in of substance that has impact. That converts not gaming the machine and the math. And I think like that's this, this. The industry became very channel B2B focus, where only the consumer is guaranteed to win. So if they lose, budgets go to zero. And clients do what? Steal money. And clients steal money. Let's be clear. They're stealing money.
- [37:52]
Albert Thompson
Now who are they stealing money from? What money?
- [37:54]
Kamika McCoy
They steal it from agencies called reduction of budgets. Agencies take it from platforms called oh, we're making a shift. They do this when they don't get the expectations met. Yeah, it's cloaked in a whole bunch of headlines. And this, that, and the third. But I mean, look, I've stolen money, so I understand how the practice works and I've watched money be stolen. This is why we have to be vigilant about how we're going around planning this. If you look at the Love island model for Unilever, Unilever can be mad at that. Like they loaded up the sandbox. This is what you're supposed to do. Turn on all the levers, figure out what works, and then start to cull it down to what makes the most sense based on revenue return. That's not hard to understand. They can respect that because even if it didn't deliver, you're teaching us something about the consumer we're pursuing and their willingness and ability to receive what we're trying to shove in front of, which is cerave at this point. So I like the science behind it. It's respectable. You can see, you can recognize the game, as they say, but when you're not employing it, clients. I tell people all the time, clients aren't stupid. They're just busy. They're getting very unbusy and AI is like a smokescreen. But they're getting unbusy because they're starting to understand there are other ways to get to where they need to be with their money. One of the things they look at, it says, is this really not that effective? Is the measurement really that evasive? What's being missed? And that's why you have the movement of in house agency. It's to discover and get to the answers. It's not anti the agency business or do immediate direct. They're trying to get answers because that's what they're beholden to. And I think when you start to look at the new ad formats that you and I had shared, the six formats, it starts to get to answers based on all our different product classes. What type of ad format should we be running? And then do we need iterations that are more dynamic? People talk about personalization, but they don't talk about iterations of creative. You can't personalize if you have iterations of creatives. Like if there are 200 people in this room, that's 200 Personas. That could be 200 AD iterations. It should at least be 50. And we're running one. And then we don't even want to try the other formats to use the one, but put other things in right and left hand rail to give us more options, unlock the insight. Those are the teachable moments that are being missed.
- [40:07]
Albert Thompson
Although then you run into the challenge of if it's a mass reach medium and you're showing everyone different ads, are they gonna be able to connect and talk about the ads? This was a point that Dave Campanelli from Horizon was making earlier on. Why? Clients who are buying sports don't necessarily wanna be running different ads in that pod. They want everyone to be seeing the same ad.
- [40:28]
Kamika McCoy
It's interesting when you say that. I mean, look, if I were at the linear TV level, I would let linear do what it does. It does a great job of cascading one broad, sweeping message to galvanize the populace and get them all on frame. At least on frame. CTV has the ability to be more precise in the sandbox and start to pick individual Persona types out. Let it do that. So one is the air cover. In military terms. This is the airstrike. CTV is the ground force that takes out individual objects, targets. That's why we use military terminology. Like, it's not bad, it actually works. But the idea of the two competing, they're very different forces in what they are able to do. Each has their limitations and benefits. Let them work together, but explain the science to a client so they can get on board with it and they can decide. Instead of them picking their favorites, there's a lot of picking their favorites going on. Instead of a culmination or configuration of what's acceptive. We finally learned that Video is a stack. Consumers go from linear to CTV to TikTok to Reels to YouTube and then back up, and they go up and down the stack all day long. So if video consumption is a stack, then you have to figure out how your brand shows up and plays in the stack. And each lever of the stack has different things you should be doing. Hence, don't match the luggage to each one. It doesn't work. And then you start to understand and assign roles to what channel should and can and cannot accomplish. And then you can set budgets against the roles based upon to what degree that role needs to be accomplished at a higher level or lower level. Dialing up and dialing it down, that's what's not happening. But even still, if a client says, we don't want people seeing a different message. I don't know any brand that doesn't have multiple Personas and doesn't relate to the consumer in a different way. Two women won't relate to the same cleaning product the same way. Why would they? Human beings don't. That's not how we're wired. We have different things that break it down. We have different needs assessment, and we have different emotional connection to it, or we have different transactional connections to it. We need to start to get to that, to have greater success, to find growth. Because the idea of one message and shoving down everyone's throat like it's one band, one sound is not working. A lot of brands aren't growing, of course. Why would they? So that's what I don't see happening in the space is the figuring out a better alignment. Even if you do it in groups, that's not happening. We see the average job done just in multicultural. But let's move beyond culture, just the basic segmentation of Personas, and you start to understand every single version doesn't match. I mean, look, it's different for the Dallas Cowboys. You're just a Cowboys fan. Doesn't even matter. That's like religion. So you can go with one message. But a lot of things in life aren't about, like the Cowboys or the jets or your old Redskins fans. Not a Commanders fan. I mean, it's. It doesn't work that way. When you get into beauty and personal care and automotive, there are more nuances as to why we attach them. The other thing is, there's a notion that how you sold it is not why I bought it. The decision criteria for selecting to consider is different for why I fell in love. Okay, that's like a woman saying, hey, you know, he's be tall, darker Hampton 6 2. Why'd you fall in love with him? Oh, he just makes me laugh. That's nothing to do with 6:2. So the same thing happens in brand adoption with consumers and the same thing happens to message exposure. You may be selling it one way, but the reason we fall in love and we take on membership behind it is very different than the consideration frame. That's not considered because then you would say, well, look, we need to have consideration messaging at linear, but we need them to fall in love with it and romance it at the CTV level. And I think that's what you saw from Sarah Ve during Love island is they wanted you to fall in love with it as they personified it with the two winners of last season as to what it gave them as a glow up.
- [44:22]
Albert Thompson
You're a very persuasive speaker. That's one of the reasons why I enjoy speaking with you. At the same time, I feel like I could be hearing this conversation. And the takeaway from Albert is, oh, if I'm a brand, I need to be running more ads. And kind of everywhere is there a risk that especially as the streaming services and CTV platforms are finding new places to put ads in and that as a way to protect their ad loads, that we get a situation like we have on the web and have had on the web where banner blindness sets in, people are adopting ad blockers because there's just too many ads everywhere.
- [45:00]
Kamika McCoy
Look, I think if you're not judicious about the potential for overexposure, the short answer is yes. But the reality is every brand shouldn't be in every channel. Every channel's not for you. Some people are on TikTok, shouldn't be there, they should be on Pinterest. Some people are on Reddit and they should be on Instagram, but they're on it because of the noise. In what appears to be popular, I made the joke that Pinterest is the social network for the Etsy crowd. Really it is. So if you're Etsy, you're an Etsy buyer. Pinterest is your jam. Why are you messing with Facebook at that level of investment? Again, the Personas match and I think brands need to match the Persona with the platforms that reward their business model and their consumer type, in particular, super fans that are gonna keep them profitable. And that's not necessarily happening. It's this notion of feeling we need to be stunty and be in these places. You need to be on the beat on these places. Some brands need to be in out of home. Especially ones where a lot of the money's made at physical retail because you need to see the signage and walk down the block and go into Duane Reade and go buy it. So I think we have. I always joke that people, a lot of brands haven't looked the consumer in the eye since COVID Literally, they haven't. They don't even want to. A lot of them don't want to come outside, so. But it's changed. Look how fast it's evolved. Look how complex it is. Look at how diverse it is. Look at how transient it is. And now we have four and a half generations on the planet competing for who is ripe. The way to orient around a series of categories. I do remind my kids you all invented nothing. Gen Xers and boom, we invented everything. You're just rinsing and repeating it.
- [46:41]
Albert Thompson
You sound like a Gen Xer.
- [46:43]
Kamika McCoy
Yeah. So I mean, when you think about Boomers, Gen Xers, then you gotta go Alpha, Gen Z and Millennials. And they all have very different orientations to every category. Those are very different Persona classes. You can't run the same ad nested against one frame. Sports get to get away with it because it democratizes towards something above everyone, which is usually an athlete on the field in a jersey, who's our favorite, who we track stats around. But that doesn't happen like in P and G where we're all orbiting around Tide. That's not a thing. So you have to get a lot more smarter in the science as to why the selections are being made between brands the way they are. My thing is you need to test broad to narrow it down. That's the whole point. I mean, NFL teams don't have a problem overdrafting and then cutting players. We see it all over the place. You need to recruit information through advertising, deliver more than just impressions, deliver information to figure out the core of what levers you need to be turning on and then have a little money to experiment, to address new things that are popping and you don't see that. And I think you could be in social media and test creative all day long, organic to paid and make that CTV creative based on known metrics. Test 20, pick five, run five into CTV, take the number one and two out of CTV, put it into linear. That's how half the inventions on this planet have happened. There's nothing wrong with that. What we see is the waterfall. One TV spot and we need to go wider and we're almost like getting skinnier. That doesn't make any sense. So I think people need to reverse engineer the model of figuring out and gathering consumer intelligence to then figure out how to reinvest in the sandbox. And this is the time to do it. Because if you don't, if you don't take up the decisioning the agency, then we're going to be left to machines trying to do the job without the sentient nature of human beings to contextualize and make proper assumptions. But a brand will trust something with a 500 IQ over the advertising media person who's sitting at 130. That will just happen naturally, even if they make missteps because they're trying to calculate make calculations at a higher rate of speed because they're keeping up with the speed of the consumer and the speed of information.
- [49:03]
Albert Thompson
Yeah, it's rare for you and I to speak for less than an hour at a clip, but unfortunately we are out of town. Alberta, as always, thank you. Appreciate you doing this. Thanks for listening to this episode of the JJ Podcast. If you enjoyed it, please leave us a rating and a review on Apple Podcasts, Spotify or wherever you're listening. Get more from Digiday with our daily newsletter sent out each week weekday morning. Visit digital.com newsletters to sign up.