DUOPOLY

There’s more to the digital world than Google and Facebook. By working with them, rather than against them, the whole digital ecosystem can evolve, writes Sojern’s Josh Beckworth.

As a child of the 80s, for me board games are dear to my heart, and Monopoly was a stalwart of family gatherings. I find it hard to reminisce about my early Christmases without feeling nostalgic about building a hotel on Mayfair, the paragon for any Monopoly player worth their salt. Fast forward some 30-odd years and I find my working life is now somewhat driven by a new game, Duopoly, but with rather less clear cut winners and losers.

A lot is made in the industry of the dominance of two key players, Google and Facebook, and the resultant race to challenge the duopoly, and frankly it’s not very hard to see why. Facebook has surpassed 2.2 billion monthly active users, with more than half accessing the platform from a mobile device. Google has just surpassed 2 billion active Android devices, not to mention its more than 1 billion monthly active users across Search, Maps, Chrome, Gmail, Drive, Play, YouTube… The list goes on.

As these audience numbers have ballooned, the ad dollars have flowed in. Looking to the US as a benchmark, in 2017 Google and Facebook accounted for 63 per cent of digital ad revenues, leaving the remaining third to be hard fought between a few players – Microsoft, Amazon and Oath to name a few, but also a lot of long tail. Which begs the question: if you’re working in the long tail, which still accounts for more than 60 per cent of the non-duopoly revenue, where should your focus be?

I would argue that for anyone other than Amazon, Oath or Microsoft the discussions about who will break away from the pack and join the top two seems redundant. Let’s instead challenge ourselves to best position our business to also prosper.

Let’s start with Facebook. In 2015 the Facebook Marketing Partner (FMP) programme superseded the Preferred Marketing Developer ecosystem, and today the programme lists 217 companies with whom an agency or client can work to (in Facebooks’ own words) “supercharge your marketing on Facebook and beyond”.

That is 217 business who have built standalone tech, data, measurement, creative solutions, who often verticalised to drive specialism. Each of those businesses has found ways to iterate in exciting ways not only to improve your use of Facebook but also, more importantly, to build a business that is unique and successful. So, as we see Snap Inc. discussed as a rising star to one day challenge the Duopoly, maybe we should first ask how we can leverage the recently opened API (application program interface) and build a business with them also.

Ad blocking was the theme of many an article and conference last year, and rightly so. And with Apple limiting cookie tracking after 24 hours, and now Chrome blocking ‘annoying’ ads, the big boys of our industry are once again making waves. While I acknowledge there will be a supply-side point of view on this that would differ from my buy-side position, there are examples of great executions that successfully leverage Google.

A recent case study by OpenX tells us: “Publishers on [Google’s] platforms using Exchange Bidding – Google’s answer to header bidding – have seen an average yield increase of 48 per cent in the 12 months since the two started working together.”

Just like with FMPs, we see the iterations of many ad tech companies building new mechanics that are changing the industry – Ads.txt, header bidding, supply path optimisation. All are processes that, irrespective of the duopoly, are working to improve digital media. Looking towards the future and regardless of who, if anyone, makes it big to join our friends with Rich Uncle Pennybags at the centre of the Duopoly board, there are more than enough ways for the ecosystem to grow so we can also win.

In the last 10 years Google and Facebook have completed close to 500 acquisitions, totalling about $140bn of investment. That’s a lot of exits for a lot of hard-working teams, but I do agree with Jeff Zucker, CEO of CNN, when he says: “We need help from the advertising world and from the technology world to find new ways to fund content, otherwise good journalism will go away.”

It is incumbent on us all to challenge our businesses to build specialised, differentiated, vertically relevant propositions that work for our clients. Be it via data, tech, service, AI or any number of ways, if we learn to add value to the ecosystem, the ecosystem will undoubtedly work for us, Duoply or otherwise. Josh Beckwith, sales director MEA, Turkey and India at Sojern