Best of the Week: The cookie apocalypse, the advertising recession, and The Tele wot lost it?

[View web version]( BEST OF THE WEEK And another thing... Welcome to Best of the Week, kicked off on Thursday evening in stormy Singapore, and finished on Saturday morning in windy Sydney. Today’s writing soundtrack: In preparation for last night’s Bowie Alumni gig at the State Theatre, Best of Bowie. (It was a terrific, joy-inspiring concert last night, by the way, although it made me realise that my biggest musical regret is never seeing a full David Bowie gig while he was alive. And the best thing about going to gigs full of middle aged people is that you don’t get your view blocked by someone else’s camera phone.) Walking into the Qantas lounge in Singapore always feels like I’ve taken the first step back into Australia. There are Aussie accents all around, ABC Australia is on the TV, and there are usually lamingtons. If you know the corner where they discreetly reserve the seats for first class passengers, there’s usually a minor Aussie celeb to be spotted. National treasure Dr Karl Kruszelnicki and Nova’s Ryan “Fitzy” Fitzgerald have been previous sightings in the glamour chair. Not to mention, you’ll be able to get your hands on slightly out-of-date print editions of the Aussie newspapers. Wednesday’s edition of The Daily Telegraph was on display when I walked in. Yikes. But we’ll come back to that… First though, the fundamental changes to the digital publishing ecosystem that we should be getting excited about, and the advertising recession nobody is talking about (much). What we’re not talking about Back in January, one of nature’s miracles occurred. A meme was born. A photograph began to circulate of a press conference. To the left of the picture, sits a man in a suit, next to a solitary microphone. To the right, a young woman, partially hidden behind a wall of microphones. The image originally dates back to 2014 and features Russian politician Natalia Poklonskaya. But in its new life as a meme five years later, it began to represent people’s preference for the shiny over the important. This week the meme went through my Facebook feed a couple of times, with the caption over the ignored man saying “Climate change literally means we’re facing extinction”, while the microphones pointed to “Scott Morrison got egged”. The suggestion being that if they were doing their jobs properly, the media would have given greater coverage to the latest, authoritative climate change report from the UN suggesting we’re already in the midst of the worst mass extinction event since the dinosaurs, ahead of a yob’s failed attempt to egg the PM. And yes, I am aware of the irony, nay hypocrisy, of mentioning climate change while on an environmentally-unfriendly four-day jaunt to another continent. Somewhat unwisely, on Tuesday I shared my growing discomfort about my own carbon footprint with Cathay Pacific’s global marketing boss Edward Bell after he gave the keynote at the Mumbrella Travel Marketing Summit in Singapore. [The airline launched its new “Move Beyond” brand positioning]( this week. I might as well have been speaking Martian. But on the subject of that meme, a lot of significant things are currently happening in media and marketing that are not getting the discussion they deserve. On Monday, we reported [the latest Standard Media Index data](. For a sixth month in a row, year-on-year media agency spend was down. If we take the economic convention that two quarters equals a recession, then we’re now in an advertising recession. The only people who are thriving at the moment are doing it at the expense of rivals. For instance, Nine’s relatively strong share price seems to mainly be because it’s won share of TV audience (and therefore spend) from its rivals. [WPP’s gloomy Australian outlook](, meanwhile, appears to be a function of both a group that’s far from the top of its game locally and globally, suffering doubly because of wider trends. On that backdrop, it wasn’t a surprise to see Macquarie Radio (these days with one foot in the Nine family itself, of course) issue its own [profit warning]( on Tuesday. And yesterday, [News Corp revealed a 7% revenue decline]( in its Austrtalian news operation. After years of describing a sluggish economy as the new normal (we first quoted WPP’s previous boss Mike Connaghan using those words more than five years ago), there’s now enough evidence to call it - in much of the industry, we’re not standing still, we’re going backwards . Much as I’d like to agree with the always-sunny [Ian Perrin’s guest post for us earlier this month that we’ve never had it so good](, I can’t. In this decade at least, we’ve never had it so bad. And unless it’s different this time, a drop in advertising spend is an indicator of wider troubles for the economy. The thought that falling real estate prices will be insulated from the wider economy seems like wishful thinking. If you’ve got a big apartment development near you (there’s one near our office), you may notice that work has slowed down or even stopped. That cafe that used to be full of fluro at 6.55am as tradies grabbed a coffee before clocking on, has gone back to a 7.30 opening time. Which means less revenue for the cafe and less paid hours for the staff. It’s little examples like that that take property prices beyond the theoretical. The drastic fall in new car buying is for a reason. The near certainty that the Reserve Bank will have to cut interest rates next month isn’t just about trying to shore up home values. It’s about the underlying state of the economy, which seems to have been stuck in neutral since surviving the GFC. But I do agree with Perrin on one point (and it’s a bit of a cliche, I admit). The downturn will find out the weaker players - those who don’t know what their customers want, or who haven’t taken the trouble to evolve their business models. That will genuinely create opportunities. Good businesses will do okay. And the other thing to remember is that downturns come to an end. If the price of finally moving on from six years of flatness is a bumpy six months, then maybe this is the advertising recession we need. The cookie apocalypse? But understanding the macro economic implications of agency ad spend is nothing compared to a couple of huge moves by Google and Apple in recent days which appear to have so far passed many people in the industry by. They’re wide ranging enough, and complex enough, that we’ll be talking through individual aspects - and their implications - for months to come. Admittedly it hasn’t come completely out of the blue for those who were watching closely. [Mumbrella commenter “y0z2a” warned of much of it in a post in September 2017](. The changes are hard to write about straightforwardly, because they are complex, and also at the far reaches of my own understanding of marketing technology and the intricacies of programmatic advertising. But over the last couple of days, the more I’ve talked to the people who understand it best, the more it has become clear that it’s a big deal. ([Since I started writing this, AdWeek in the US published a good overview](.) Remember how it took a while for digital publishers to realise that Facebook’s plans to change the newsfeed algorithm in January last year were about to mess up many of their business models? The changes Google has just announced for the next version of Chrome ([you can see the post on Google’s Chromium blog]() have the potential to fundamentally change the digital advertising ecosystem. Even if it’s not immediate, it’s a clear statement of Google’s intentions. With a market share of nearly two-thirds, Google Chrome is the internet. And on Tuesday (Wednesday, Australian time), Google announced that it will be completely changing the rules about how cookies are used to track browsers across the web. After years of giving the many ad tech middlemen of the internet the opportunity to respect users’ wishes when it comes to browsing privacy, Google appears to have unilaterally decided that it will now impose that privacy. Usage of cookies - simple snippets of code used to track user behaviour across websites - is likely to change radically. Chrome users will get a straightforward (in theory) dashboard where they’ll have a much clearer say in cookie usage. So a cookie dropped onto a user to allow them to save a password for a news site they subscribe may well count as a “good” cookie. A cookie used to track them around the web (and serve them ads) may well count as a bad cookie and be deleted. Those days of buying a chainsaw then being followed around the Internet by chainsaw ads (or is that just me?) may be coming to an end. The implications are many. For one, it could see a resurgence in contextual advertising. In other words, ads will be more likely to be served based on the content their user is looking at, at the time. Behaviour-based advertising - (research a new chainsaw and be treated for weeks afterwards as if you’re planning to start a collection) - may well fade out. Also facing a Chrome crackdown, is the practice of “fingerprinting” - using detective work, sopmetimes sneaky, to link up data. Remember that time you bought headphones and the shop helpfully offered to text you a link to that receipt? When you opened that in your phone and clicked on a link, they can now connect your number and email address with your browser. Which means they can determine what advertising you were exposed to, and what research you did online before actually buying. It’s the type of clever but murky behaviour that creeps out consumers. As Google puts it: “Making changes to how the browser treats cookies requires us to consider the broader web ecosystem. Blunt approaches to cookie blocking have been tried, and in response we have seen some user-tracking efforts move underground, employing harder-to-detect methods that subvert cookie controls. These methods, known as ‘fingerprinting,’ rely on various techniques to examine what makes a given user’s browser unique. “Because fingerprinting is neither transparent nor under the user’s control, it results in tracking that doesn’t respect user choice. This is why Chrome plans to more aggressively restrict fingerprinting across the web.” Even further into the grubby end of game, the practice of [creating “zombie cookies” which come back even after deletion should also come to an end](. You might wonder why Google - which makes most of its revenue through digital advertising - would do this. It’s part of a long game. Privacy is moving up the agenda, and the more that users feel their wishes are not being respected, the more likely they are to turn to the blunt instrument of ad blocking. Perhaps better for Google to be the one to hand this control to its users. As the former CEO of AppNexus, Brian Kelley, [suggested in a Quora post this week](, Google’s actions could trigger a similar process to the advent of the GDPR data privacy rules in Europe - uproar, followed by better practices which actually benefited the industry, and the public. The potential losers in this are those in the middle of the chain, the second tier tech companies, if you will. Cookies, and identity synching and sharing, are at the centre of how many of them work. But it will also have implications for marketers (and their agencies). Campaign strategies will need to change. And attribution - or at least how it works now - will go out of the window. For a marketer, if you can’t drop a tracking cookie, how will you be able to tell if the prospect converted to a customer further down the digital marketing funnel. It will also affect how Google itself does business, and the way it treats its own cookies in the future will be closely scrutinised. As O’Kelley wrote: “Bigger picture, if I’m an advertiser or publisher, I see this as one more sign that I should really be on the Google ad tech stack. Not because this explicitly biases the internet toward Google today (assuming that their cookies aren’t given special treatment) but because it’s so obvious that Google’s dominant browser market share will determine whether ads continue to work or not.” Potential winners are those who have good first party data. If your users have to log in, and stay logged in, advertisers will love you. This should work in favour of big publishers like News Corp and Nine. Back in late 2017, Fairfax Media, News Corp and Nine revealed they planned to explore a co-operative which would see anonymised digital identities shared between the three company’s media platforms. Even with Nine’s subsequent purchase of Fairfax, and frostier relations with News Corp as a result, I understand this project is continuing. These changes give the potential cooperative even more significance. I wonder if it will tilt the world even further towards a subscription-based internet, or at the very least to one where publishers can once again control their own inventory. That said, publishers’ tech partner options have recently narrowed, particularly if they don’t want to make huge investments in their technology themselves. AppNexus has been purchased by Verizon, while Sizmek has declared itself bankrupt. That means publishers have few alternatives but to revert back to Google’s publisher technology and exchanges to commercialise their inventory. That of course, is if it unfolds as Google wishes. The murky players in the programmatic world have always been good at circumventing the privacy barriers put in their way. Meanwhile, almost as big are changes coming for Apple’s Safari browser, which will have the biggest impact for those seeking to reach those iPhone, iPad and Mac users who stick with the pre-installed Safari browser. About a fortnight ago, WebKit, the browser engine underpinning Safari, made its own big privacy announcement. [It revealed “Intelligent Tracking Prevention 2.2”](. It’s an escalation of an arms race, aimed at finding ways of stopping the likes of marketing technology firms from using sneaky ways of tracking users. To (perhaps over) simplify it, cookies will be deleted much more quickly, so the ability to track user behaviour, to remarket to audiences, and to market to customers across different sites, as well as work out if people who were served an ad eventually bought the product, will be greatly diminished. [As Digiday puts it](: “If a person clicks on an ad for a product on Friday and decides to take the weekend to think about buying, then the cookie wouldn’t be around on Monday to register when the person returns directly to the site to buy the product.” Again, that changes the game. The signal will also be heard by the big tech stack players. Whereas Adobe and co have been finding workarounds to beat the first version of Intelligent Tracking Protection, they’ll be more wary this time. What’s the point of pushing it, if it means that in another three months even more gets shut down? I don’t think we will know for a while yet just how this will all unfold. In the coming days’ we’ll be asking the experts to help us understand the implications, and sharing those views on Mumbrella. But it has the potential to be big. Not as big as climate change, maybe. But it still deserves some attention. Tele’s Bill blunder What has been a pretty dull election finally took off on Wednesday. With friends like The Daily Telegraph, the Liberal Party might be forgiven for wishing the newspaper had stayed on the sidelines. The Tele spectacularly shot itself in the foot with an oafish, partisan front page story about Labor leader Bill Shorten’s mother. It attempted to make the case that Shorten has been “slippery” in his story of how his mum compromised her ambitions to be a lawyer and took a teaching scholarship in order to provide for her family. The entire story - draped across the front page and a spread on pages four and five, relied on the premise that when Shorten discussed his mother’s career on Q&A on Monday night, he did not reveal that towards the end of her career she finally qualified as a barrister. Except he had told this story on many other public platforms. The backlash, and Shorten’s authentic, near-tearful, rebuttal helped humanise the political warrior who once went on Sky News to say of his then leader Julia Gillard: “I haven’t seen what she said but let me say I support what it is she said.” Yet ironically, the episode also demonstrates that while the News Corp papers may generally lean heavily to the right, they do not operate directly under a single centralised control. An east coast versus Victoria divide seems to be apparent. The Telegraph in Sydney is still in its first few months under the editorship of former Gold Coast Bulletin editor Ben English. Meanwhile, The Courier Mail in Brisbane is about 18 months into the editorship of Sam Weir. Where The Tele leads, the Courier Mail seems to follow. Just as The Courier Mail republished The Tele’s libelous story about actor Gefforey Rush, it also republished the Shorten attack. But notably, in both of those cases, News Corp’s Melbourne tabloid, The Herald Sun chose not to. In the case of the Shorten story, that wouldn’t be because of politics - this is the paper that publishes Andrew Bolt - but because it knows which stories it is sensible to leave alone. Editor Damon Johnson’s five years at the helm of the Hun appears to have given him some good judgement. Despite a sense from many commentators this week that News Corp has entered new territory, its partisanship in elections is nothing new. However, Rupert Murdoch usually back the winner. On the day of the 1992 election in the UK, widely expected to be won by Labour leader Neil Kinnock, The Sun went with the front page splash "If Kinnock wins today will the last person to leave Britain please turn out the lights." The Conservative party retained power. And The Sun boasted on its front page “It’s The Sun wot won it”. Perhaps what’s different this time though is the level of disquiet being shared publicly and privately by former, and even current News Corp employees. Certainly, the campaigning has been more clumsy this time round. And what seems more of a miscalculation is that News Corp seems to have made an out-and-out enemy of Labor. Usually media companies benefit from governments being slightly afraid of what they could do if angered. But News Corp has already done it, so Labor has little to lose by going to war once in office. If the Coalition loses, I wonder, will it be The Tele wot lost it? Subs in the house And finally, it was good to see Nine announce yesterday afternoon that[it will bring most of its newspaper production back in-house](. As a former print journo I struggled to conceive of how to bridge the gap between reporters and sub editors when they’re not in the same company. Weekend rules For more on The Tele’s misstep, do give [this week’s Mumbrellacast]( a listen. We also had a good chat to Spinach’s Ben Willee. I’m, meanwhile, looking forward to a week of getting back on the tools. I’ll be dusting off my copywriting to help out our marketing team in the run up to Mumbrella360, and on Friday I’m back on the newsdesk. And today our media writer Hannah Blackiston - hannah@mumbrella.com.au - will be at the helm of the weekend newsdesk for the first time. I’d love to hear from you at tim@mumbrella.com.au. Thanks for all the cat emails this week. It would seem there are a lot of animal lovers out there. Toodlepip... Tim Burrowes Content director - Mumbrella Mumbrella | 46-48 Balfour Street Chippendale NSW 2008 Australia This email was sent to {EMAIL}. If you would rather not receive Mumbrella's Best of the Week email you can [unsubscribe]( or [manage subscriptions](. [Facebook]( [LinkedIn]( [Twitter](