Marketecture: Get Smart. Fast.
00:32:15 · Eric Franchi, Ari Paparo
[00:32:15] S2: Who do they hire? Okay. Let's start with who do they hire? Who do they hire? Do they hire a media person? Do they hire an ad tech person? [00:32:20] S0: Well, that depends on the strategy. So so I think the theme in this article, which I think is accurate, is that Naylor was brought in to be more traditional ad sales oriented. They mentioned a couple times John Whitacomb as the head of product being more sort of programmatic leaning. And I think the senior execs don't know which way to go, so there's obvious conflict between those two. And then on top of that is this need for them to show results quickly, while they, frankly, are new, don't have a lot of clout in the marketplace. They would like to be Hulu tomorrow, but they aren't Hulu today. So so it's... That's the transition. What would I do? I'd probably go open to start to juice the revenue. I'd probably just be as friendly as possible to the programmatic world, have a have a senior sales force for big upfronts, but get a big portion of revenue in the most liquid way possible, and then just start... As we gain market power per country, start tamping down and and allowing less and less access over time to get back to where we think we should be ultimately. That... That's just my general take, but I think it's a pretty hard problem.
00:32:20 · Ari Paparo, Eric Franchi
[00:32:20] S0: Well, that depends on the strategy. So so I think the theme in this article, which I think is accurate, is that Naylor was brought in to be more traditional ad sales oriented. They mentioned a couple times John Whitacomb as the head of product being more sort of programmatic leaning. And I think the senior execs don't know which way to go, so there's obvious conflict between those two. And then on top of that is this need for them to show results quickly, while they, frankly, are new, don't have a lot of clout in the marketplace. They would like to be Hulu tomorrow, but they aren't Hulu today. So so it's... That's the transition. What would I do? I'd probably go open to start to juice the revenue. I'd probably just be as friendly as possible to the programmatic world, have a have a senior sales force for big upfronts, but get a big portion of revenue in the most liquid way possible, and then just start... As we gain market power per country, start tamping down and and allowing less and less access over time to get back to where we think we should be ultimately. That... That's just my general take, but I think it's a pretty hard problem. [00:33:28] S2: Yeah. It is. What... Beyond the the the the go to market strategy, the the sort of obvious being able to, you know, turn on a bunch of revenue in that way, would you focus on the customer data? Would you focus on ad formats? Like, what what are what are the things that you think are interesting that can, you know, help Netflix be what we all believe that it can be?
00:33:28 · Eric Franchi, Ari Paparo
[00:33:28] S2: Yeah. It is. What... Beyond the the the the go to market strategy, the the sort of obvious being able to, you know, turn on a bunch of revenue in that way, would you focus on the customer data? Would you focus on ad formats? Like, what what are what are the things that you think are interesting that can, you know, help Netflix be what we all believe that it can be? [00:33:50] S0: Yeah. So Netflix has amazing first party customer data because they have a subscription relationship with every household. They know the household. They know the credit card number. They probably know how many people are in the household. They know a lot of things that are very valuable. So I would definitely look to use that data either in PMP form or through a clean room of some kind. I think the content data is not very valuable. You know, genre or other context of the actual programs is probably not that valuable. You just wanna use it in broad swath so you don't show, you know, kids ads on adult content, that sort of thing. But I would definitely use geo. I would use household data. And I like what they're doing on the distribution side. You know, they don't, they started with Xandr through the Microsoft relationship. That was obviously gonna be short lived because Xandr is not a very popular DSP. Now they've opened up to the Trade Desk and DV360, which are the two leading DSPs. So this seems kinda smart to get that distribution. As for creative, you know, it... Everyone wants to do creative, but ultimately, just slap a QR code on your ad and call it a day.
00:33:50 · Ari Paparo, Eric Franchi
[00:33:50] S0: Yeah. So Netflix has amazing first party customer data because they have a subscription relationship with every household. They know the household. They know the credit card number. They probably know how many people are in the household. They know a lot of things that are very valuable. So I would definitely look to use that data either in PMP form or through a clean room of some kind. I think the content data is not very valuable. You know, genre or other context of the actual programs is probably not that valuable. You just wanna use it in broad swath so you don't show, you know, kids ads on adult content, that sort of thing. But I would definitely use geo. I would use household data. And I like what they're doing on the distribution side. You know, they don't, they started with Xandr through the Microsoft relationship. That was obviously gonna be short lived because Xandr is not a very popular DSP. Now they've opened up to the Trade Desk and DV360, which are the two leading DSPs. So this seems kinda smart to get that distribution. As for creative, you know, it... Everyone wants to do creative, but ultimately, just slap a QR code on your ad and call it a day. [00:34:53] S2: That's where we disagree, but that's okay. We could disagree. Tim, what you got?
00:34:53 · Eric Franchi, Tim Rowe, Ari Paparo
[00:34:53] S2: That's where we disagree, but that's okay. We could disagree. Tim, what you got? [00:34:58] S1: I think it's interesting that whether you're Netflix or a small budding digital out of home network that you probably have the same decisions to make. It sounds like the the the the problems exist at every, every level of scale. I'm thinking about the conversation that you had with Craig from Conde Nast and Mark Manino and kind of pulling those two things together of Mark talked about financial media networks and Craig talked about time on platform being kind of that new metric consumption being the new currency. It feels like there's an opportunity there to integrate more of that data to keep me on Netflix longer. So I don't know how that ultimately plays out, but maybe it's smart things like that. Because to me, Netflix is still a premium product. It's a premium product. It's gotta be smart. Don't do like what what Samsung... I don't need to see seven of the same Capital One ads in one one commercial break. So I look to Netflix to keep a premium experience. [00:36:00] S0: Tim, you did your homework before coming on this podcast. I'm very impressed by by all your callouts for our previous episodes. [00:36:06] S1: I love the Marketecture podcast, and I'm gonna be listening now, after we get off here because I think that what you do is you you bring together so many of those stories that seem disjointed and disconnected. To me, they they are all very connected. Man, we're gonna have
00:36:06 · Tim Rowe, Eric Franchi
[00:36:06] S1: I love the Marketecture podcast, and I'm gonna be listening now, after we get off here because I think that what you do is you you bring together so many of those stories that seem disjointed and disconnected. To me, they they are all very connected. Man, we're gonna have [00:36:21] S2: to have you back. And my god, we are never gonna hear the end of this from Mark Manino. Let's go, Mark. You've created a monster. We didn't put this on the we didn't put this on the on on the docket, worth noting that apparently Amazon had an incredible upfront. You know, numbers weren't provided, but, you know, sounds like, buyers who were surveyed said they increased their, spend with Amazon significantly, and they, they cited the, efficiencies in CPMs being one of the factors. So so just sort of, you know, kind of another data point hanging out there. Super interesting stuff. So a couple other things and we'll we'll call it a day. So IAB and MRC are collaborating for attention measurement, specifically around attention measurement accreditation. So we talked about Adelaide, who my fund invested in a couple weeks ago, and this idea of, you know, attention being an emergent category. Think... And, Ari, I'll ask you, tell me if I'm right or wrong. I think this is a good step towards validation of the category. Right? Like, something for this is needed.