Digital Media Struggles To Scale; Google Continues Work On Header Bidding

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Thumb On The Scale

Digital media has a scale problem. Only a handful of publishers, including BuzzFeed, Vice, Vox, Refinery29, Huffington Post and Bleacher Report, have done $100 million or more per year, which Digiday calls “the arbitrary mark of a ‘scaled’ media company.” With limited ad revenue and oodles of venture capital poured into digital media over the past three years, these publishers are at risk of missing growth expectations and being viewed as “risky” by potential acquirers. Publishers are banking on higher CPMs and, especially, video to bridge the cash crunch. But relying on video means relying on platforms you’d rather, well … not rely on. More.

Header Wars

In some Google news unrelated to brand safety, the company will add “dozens of tech partners and hundreds of publishers” to its header bidding alternative, Ad Age reports. Google’s move to unify the ad auction, called exchange bidding dynamic allocation (EBDA), began in April 2016 [AdExchanger coverage] when it unveiled an early version of the product. The header bidding trend disadvantages Google, since it allows publishers to “see” bids from a wide range of exchanges at once – whereas AdX previously had first shot. More. The move comes after Facebook broadcasted its own header bidding plans last week.

Amazon Algos

“Just beneath the placid surface of a typical product page on Amazon lies an unseen world, a system where third-party vendors can sell products alongside Amazon’s own goods,” writes Wall Street Journal columnist Christopher Mims. The Amazon marketplace is actually starting to resemble a stock market – with price fluctuations, “day traders, code-slinging quants [and] artificial-intelligence algorithms.” The top Amazon sellers are driven by software makers competing for position in the Amazon “Buy Box,” which directs floods of shoppers. Some of these Amazon-algorithm specialists exist between the platform and direct manufacturers, and have become “sophisticated retailers in their own right.” More.  

Store Windows

VC newcomer Kirsten Green vaulted to the top ranks of investors in 2016 on the strength of early bets in Dollar Shave Club and, which were acquired last year for $1 billion by Unilever and $3.3 billion by Walmart, respectively. Before founding her current firm, Green also had made one-off angel investments in Birchbox and Warby Parker. Ecommerce players with strong customer connections are well placed for a potential retail and product manufacturer consolidation, Green tells The New York Times. “Now that people are bombarded with information, we are in a golden age where brands matter.” More.

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