Here’s today’s AdExchanger.com news round-up… Want it by email? Sign up here.
AI? More Like “Ehh, I Don’t Know About That”
Ad platforms are plowing ahead with AI-based software that is not ready to fill roles previously served by human expertise.
That means machine-learning-controlled ad products (Google’s Performance Max and Meta Advantage+ shopping campaigns are the usual suspects) and also AI-generated strategy and creative production.
But equally important changes happen behind the scenes, where AI is taking over customer service.
Meta dismissed thousands of employees in 2023, which Mark Zuckerberg dubbed the “year of efficiencies.”
But when a machine-learning glitch misappropriated hundreds of millions of dollars from Meta advertisers, even those who spent millions or tens of millions of dollars on the platform per year had little recourse aside from contacting a chatbot AI (which fixed a grand total of zero problems across tens of thousands of accounts).
Meta has lost the pulse of its customer base, and it doesn’t care much. (The people they’d complain to were fired.)
Google advertisers, meanwhile, have fretted since the company launched a paid account service tier in August, shunting more default free services to AI. The feedback is dismal, but the AI train doesn’t stop for that. Search Engine Land reports Google has big plans to expand AI’s role in customer service in 2024.
Faster Fashion
Since Etsy CEO Josh Silverman called out Temu and Shein on Etsy’s recent earnings calls and at a Needham conference, there’s been debate about the degree to which unbelievably cheap Chinese marketplaces – and their unbelievably high ad spend – distort Google and Meta shopper ad auctions.
Eric Seufert of Mobile Dev Memo does some fancy financial footwork to identify the dollars spent by Temu on Meta, which he roughly benchmarks at $1.1 billion in the previous 12 months. Seufert points out that isn’t enough to justify the hysteria by US ecommerce companies and product sellers, which are frustrated by Temu joining Amazon as a strong bidder across practically all shopping keywords.
Sefuert’s point is valid. But another way to frame it is: “Holy fudge! Temu spends more than $1 billion – and growing fast! – on Meta alone, likely even more on Google, and accounted for almost 6% of Meta’s North America ad revenue in the past 12 months.”
Temu isn’t inflating ad auctions web-wide or for social, but it’s a powerful revenue buoy for Meta and Google.
Think About The Children
The Federal Trade Commission made a proposal this week to beef up the Children’s Online Privacy Protection Act (COPPA) of 1998, The New York Times reports.
Privacy advocates and regulators have been squarely focused on finding new ways to protect children online. But a national data privacy act has yet to arrive, while more recent efforts to make the internet safer for children have fallen flat.
So the FTC is revisiting COPPA with feedback it’s been collecting since 2019 from tech and advertising industry trade groups.
The FTC’s proposed updates to COPPA include requiring certain online services to turn off targeted advertising by default for children under 13 – including push notifications that platforms often send to younger users to keep them on a mobile app.
The proposed changes also suggest narrowing an exception to COPPA that allows online services to track children’s online activity with persistent identifiers for noncommercial purposes (such as fraud prevention). The FTC would also further limit the amount of time a service can hold onto data it collects about children legitimately (such as for educational purposes).
The FTC will vote on these changes to COPPA after a 60-day public comment period.
But Wait, There’s More!
Paramount is reportedly in talks with Warner Bros. Discovery about a possible merger. [Axios]
Paramount is also apparently in talks to sell Black Entertainment Television network. [Bloomberg]
SiriusXM gets hit with a lawsuit for allegedly trapping customers in unwanted subscriptions. [CNN]
Jonathan Mendez: Five predictions for 2024, which could be a watershed year for customer data services. [blog]
Time and other publishers are doubling down on events in 2024. [Digiday]
Fubo becomes the latest streaming distributor to tap EDO for outcomes-based measurement. [NextTV]
You’re Hired!
Amit Deshpande joins RAPP as global chief marketing sciences officer. [release]
Pacvue adds several new execs to its senior team. [release]
Mediaocean promotes Nicole Brown to chief human resources officer. [release]
