NEWSLETTER #132 / September 30, 2018
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FEDS INVESTIGATING AGENCIES
The Wall Street Journal reported on Thursday that federal prosecutors in Manhattan, aided by the FBI, are investigating the buying practices of media agencies.
All I can say is, it's about f*cking time. Over five years ago I started writing about the sleaze in the media industry. Two years ago the ANA issued its report on media buying practices and asserted that shady practices, including kickbacks (IMHO especially in the online media industry) were "pervasive."
Last week I wrote about a report by ID Comms claiming that only 10% of agency clients have a high degree of trust in their agencies. This investigation ain't gonna help that one little bit. Some thoughts...
- While devious buying practices cross all media, I expect the investigation will center on the corrupt pile of crap that is online advertising.
- The investigation will focus on the big holding companies and their financial wise guys who play fast and loose with client contracts.
- Big brand CMO's who have pissed away billions of shareholder dollars by being asleep at the wheel will, once again, get a pass by pointing fingers at agencies.
- The worst thing the ad industry ever did was become the lap dogs, cheerleaders, and de facto sales department for the liars, creeps, and crooks in the online media industry.
- The leadership of the 4A's - who are supposed to protect the interests of the agency industry - have stood by and done less than nothing about the destruction of our industry's reputation while everyone with half a brain knew exactly what was going on.
Sadly, hard-working, principled agencies will unfairly get the smell of this all over them.
Facebook's Meltdown Week
It was a bad week for Mark Zuckerberg... and about 50 million other people.
Part 1: First, of course, was the security breach that allowed criminals to get their hands on the "private" (don't make me laugh) information of 50 million Facebook subscribers.
There is no doubt in my mind that Zuckerberg has to go. Facebook is a danger to democratic society and Zuckerberg has shown himself to be completely incapable of running that company with any degree of integrity.
Part 2: Six years ago Facebook bought Instagram for one billion dollars. This week, the two founders of Instagram suddenly quit. Speculation in tech world is unanimous about the cause -- conflict with Zuckerberg.
Meanwhile Brian Acton, the founder of WhatsApp, another company bought by Facebook, expressed his regret at having sold his company to Facebook, "I sold my users' privacy... I made a choice and a compromise. And I live with that every day." According to AdAge, Acton "...hates targeted ads..." which is Facebook's bread and butter. .
Earlier this year, Jan Koum, a co-founder of WhatsApp and a Facebook board member, also quit. According The New York Times, "Mr. Koum had grown increasingly concerned about Facebook’s position on user data in recent years."
Part 3: Computer scientist Professor Alan Mislove had a hunch that Facebook was using undisclosed methods for collecting and selling "data" (personal, private information about us.) He did an experiment. What did he find?
"Facebook is not content to use the contact information you willingly put into your Facebook profile for advertising. It is also using contact information you handed over for security purposes and contact information you didn’t hand over at all."
Read how Facebook uses "shadow contact information" -- including how it uses information that is supposed to protect your privacy to invade it -- here.
Part 4: GroupM, the world's largest buyer of media, publicly called bullshit on Facebook.
"Facebook doesn’t operate with real-world metrics. I would urge every agency to hold Facebook to account and interrogate the data that comes out from them,” said Robin O’Neill, managing director of digital trading for GroupM.
As I have said for years, anyone who believes Facebook's numbers is an idiot.
O'Neill went on to say, “We are still not able to verify delivery of our clients’ advertising via Facebook or YouTube...They control the delivery of consumption data back to us. We also have major issues with the quality of the environment our ads are delivering in... Also, completion rates on Facebook are appallingly low.”
What makes this story so pathetic? The impotence and hypocrisy of the agency industry. According to Digiday, "...despite the tough talk, GroupM continues to pour money into Facebook on behalf of clients."
Apple To Back Privacy Regulations
Apple will reportedly break ranks with the body snatchers in the tech industry at a Senate hearing this week and advocate for federal privacy legislation.
According to press reports, Apple executives will "convey Apple’s support for comprehensive federal privacy legislation that reflects Apple’s long-held view that privacy is a fundamental human right."
In all likelihood, Apple will be in opposition to privacy abusers like Google, Amazon, Twitter, and AT&T who make billions by providing their advertising clients access to data mined from our web activities. These creeps will probably present the argument that data abuse is critical to the economics of the web. It's bullshit. The economics of web advertising can be very robust, thank you, without relentless surveillance.
Even if tracking were ultra-important, the privacy of citizens is a lot more important than the convenience of marketers.
WPP Kills Y&R
On Tuesday I wrote a piece on The Ad Contrarian blog called, "How Ad Industry Destroys Brand Value" about how the agency holding companies were cheapening some of our industry's most valuable brands.
Right on cue, the next day WPP put a bullet in Y&R - one of the industry's great brands - and merged it with with VML (who?) to create a new "super-agency" (god help us) called (are you ready?) VMLY&R. No, you can't make this shit up.
Cadillac Kills NY
Three years ago, Cadillac moved its headquarters to Soho in NYC. The rationale had something to do with some idiocy about "tapping into the Millennial mindset."
Apparently the brilliant strategy went like this: if you move your offices to Soho and set Soho as the location for your TV spots, suddenly Millennials would start driving Caddies. Right. I wonder which planning genius came up with this brilliance.
At the time I ridiculed the move and the ad campaign (called "Dare Greatly") that accompanied it. I did it in a blog post called, "Daring Greatly And Failing Miserably." This week Cadillac announced that it had had enough of Soho and the "Millennial mindset" and was moving back to Michigan, where it belongs.
The "Dare Greatly" campaign three years ago featured a bunch of celebrities endorsing Cadillac. One of which was Apple co-founder, Steve Wozniak. Cadillac's announcement this week reminded me of a limerick I wrote at the time...
Some ads are merely regrettable
And some are completely incredible
I can't see Steve Wozniak
Buying a Cadillac
Unless the damn thing was edible
This Should Be Fun
On Oct. 17 in NYC, some great speakers (and one dumbass blogger) will be talking about provocative stuff in support of a new ad book called "Eat Your Greens." There are only about 200 seats, so go here quickly for info and tickets.
