Back in the peak of TV-central advertising days in the 60s, 70s and 80s, marketing was relatively straightforward. Advertising executives placed an ad against a TV show that both fit the brand and had high viewership with their target audience, and that ad would be seen simultaneously by viewers.
The only job for advertisers was to make sure their ads were entertaining enough to keep people glued to the TV, and memorable enough so they thought of the brand when they shopped.
That all changed in the last 30 years. Media channels exploded and a proliferation of data allowed brands to target audiences with precise and sophisticated techniques. This explosion became exponential with the rise of social media, where incredibly detailed personal data could be used to reach increasingly niche segments.
This data-fueled trajectory might have continued were it not for the delivery of a series of media curveballs over the last 12 months. We’ve seen a dramatic shift in how audiences engage with social media, and a shift in how platforms cater to these new behaviors. Social media users are increasingly served content according to their personal interests, not those of their friends. Platforms are moving from a network algorithm to an entertainment algorithm and with it come new challenges for how brands reach audiences online.
Today we'll be looking at why social media has moved to the entertainment algorithm, how that shift affects brands reaching audiences and why traditional marketing approaches are once again relevant thanks to these and other media shifts.
How did social media move to entertainment?
First let me unpack the differences between a network algorithm and an entertainment algorithm.
A network algorithm is one that delivers content to users on social platforms based on their network and the data they've provided to the platform. If my friends are engaging with NYTimes Cooking videos, chances are I'll also see those in my own newsfeed. Or if a platform knows that I follow cooking profiles, they’ll deliver cooking videos and ads from cooking-adjacent brands that want to reach home-chefs. This was how the algorithm powering Facebook, Instagram and to a lesser extent Twitter operated over the last decade.
Tik Tok was the first to introduce what I will refer to as the entertainment algorithm. An entertainment algorithm delivers content to users based on what they personally watch or engage with, not what their network is watching. If Tik Tok sees that I am more likely to watch a video on how to bake cakes than sports highlights they’ll rapidly deliver more baking videos to me, regardless of whether I follow baking personalities or have friends who follow sports stars. This algorithm makes sense: Users in your network don't always have the same interests as you, and if you like three videos on the same topic, chances are you’ll like more.
The new algorithm hits a note
The entertainment algorithm has proven to be incredibly effective, it helped Tik Tok hook over 1B users by 2021, and the time spent on the app per month was astonishing.
To respond Meta (the newish name for the company that owns Facebook/Instagram/WhatsApp) begun tweaking their algorithm to become more entertainment focused. They doubled down on Reels (their Tik Tok clone product) and begun feeding more creator content to audiences on Facebook and IG. IG feeds began to feature less pictures from friends, and more videos from content creators. Despite an avalanche of complaints from users, it was only after heavyweight account Kylie Jenner protest-posted, that Meta reverted some of its changes.
Circumnavigation
Why did Meta drag their feet in reverting from an entertainment algorithm, and why do I think that eventually they will return?
A look at the shifting state of social media advertising models helps reveal Meta’s strategy.
Meta’s ad model of targeting via demographic and psychographic data has been under attack thanks to Apple’s new iOS privacy rules. The rules restricted Meta’s ability to access data on audiences, making it harder for brands to target users and measure ad performance. Meta’s ad offering now had less people, who were harder and more expensive to target, spending less time on Meta platforms. Brands started to reduce their spend, ad revenue fell for the first time in the company’s history, and Meta’s stock fell disproportionately to the category and the market.
Meanwhile over at Tik Tok, ad revenue was soaring
Tik Tok proved that deep psychographic or demographic data isn’t necessary to build an effective ad machine. You just need to find out what people want to be entertained with.
Most commentary around the algorithm changes on Facebook and Instagram claim it was to keep more people on the platform for longer, but this is only half the story. The network algorithm that drove an advertising behemoth for Meta was facing rapid decline. Switching to an entertainment algorithm was their only chance to rebuild ad revenue.
What’s old is new
What is fascinating about this shift to the entertainment algorithm is that the fundamentals aren’t new. Cable TV was essentially a manual entertainment algorithm. While networks didn’t have engagement data on their audiences, they did know which shows were popular and which ones weren’t, and would make programming decisions based on that. In principle this isn’t that different from Tik Tok’s algorithm.
Alongside the social media shift to the entertainment algorithm, I’ve noticed a broader movement moving away from data and towards entertainment in digital media. These new media structures share striking parallels and fundamentals to traditional media formats, which led me to a theory: Perhaps the best way for brands to navigate contemporary media is to look back at proven traditional marketing principles.
Let’s explore three traditional marketing principles and how they can be applied to new entertainment-driven media opportunities.
Traditional Principle 1: Target Everyone at the same time
One of the most powerful advertising tactics is known as ‘Synchronous Exposure’. This is the practice of having a large group of people see the same ad at the same time. A shared moment is more emotionally resonate than fractured viewing. It’s why popular cable TV shows had such cultural impact, in the 90s everyone would talk about last night’s Seinfeld episode by the water-cooler the next day. Synchronous Exposure brings sports crowds together and drives crowds to the cinema despite the availability of streaming at home. It’s why Supebowl ads, as well as Olympic and World Cup sponsorships are some of the most expensive media placements: You get to reach a large group of people, experiencing a shared moment, at the same time, and that’s a powerful way to communicate a brand message.
New Opportunity: Synchronous apps and streaming
The ability to utilize Synchronous Exposure became increasingly difficult as media became increasingly non-linear: Video On Demand Streaming (VODS) replaced broadcast cable, streaming audio replaced radio and social media platforms curated individual content feeds based on personal data. However, there are some promising opportunities of late. The most prominent is the newest social app on the block: BeReal
BeReal is the anti-social-social-media app. In this simple camera app there’s no direct messaging between users, no newsfeed, and you won’t find much branded or creator led content. Quite simply the app puts out a prompt to all users, at random times of day, that it is ‘⚠️BeReal Time⚠️’ and they have 2 minutes to take a photo right there and then. Once your photo is posted you can then see the photos that your friends have taken. BeReal is social (in that you only see content from friends) but it’s also very much in the entertainment media canon. There is no network driven content recommendations, the only content pushes are photos from friends, and they are seen simultaneously by all.
The functionality is simple, but the impact of a shared moment cannot be understated, the Tik Tok below is a great illustration of this:
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There is no other app that drives such mass public behavior instantaneously, and seeing others engage in the same behavior is a powerful binding factor. BeReal does not currently offers advertising, but when it does (and there are tangible signs it will soon) it will be a powerful way to reach audiences in the same way advertisers used to through cable TV.
Synchronous Exposure is also creeping back to our TV screens. Cable isn’t dead, but it has been dying at an exponential rate, and the ability to target large groups of people at the same time was becoming limited. However there are signs that streaming is embracing a more old-school linear model. Amazon Prime recently brought a Thursday Night Football live stream to it’s platform and is running the same ads in each ad slot for every viewer as opposed to dynamically inserting ads delivered to specific groups. This is a remarkable throwback to old-school TV targeting and more proof of the timeless power of Synchronous Exposure. Other streaming platforms such as HBO are reintroducing the episode-a-week drop, look at this remarkable capture of households simultaneously watching a new Game of Thrones episode:
Traditional Principle 2: Context Matters
There’s a reason why luxury watches appear in luxury magazines, why high fashion billboards are found in trendy neighborhoods and why Red Bull started out by distributing only to nightclubs: the context that an advertisement is seen in adds as much meaning as the advertisement itself. For a premium product to justify a high price tag it needs to be recognized as a luxury item, aspiring brands consistently show up in luxury environments to cement the association. Similarly a sports brand such as Nike wants to be seen in elite athletic environments.
New Opportunity: Premium Contexts
The value of context seemed to be forgotten with the increase of data targeting. When you can reach wealthy people through data (who they are) why try reach them through context (what they read)? Due to this there weren’t many premium contexts available for advertising online. However this is changing, most notably with the advent of streamer ads.
A significant number of streaming platforms are beginning to offer ad-supported tiers, and healthy audience numbers signing up for them:
Netflix and Disney+ will have ad-tiers before the end of the year. Premium content contexts offer an opportunity to create contextually relevant ads that continue to entertain, not disrupt, during a streaming experience. Brands will not only be able to reach the right people, but now have the opportunity to reach them in the right context, with the right message.
Traditional Principle 3: Creativity Matters
The proliferation of data over the last few years has increased focus on how brands reach audiences not what they are reaching them with. Marketers begun to forgo memorable messaging for precise and increasingly frequent targeting of audiences. This favoring of tactic over message has led the marketing community to forget their competitive advantage - creativity. Even the data-specialists agree: Paul Cuckoo, Head of Analytics at one of the largest media agencies globally, summed it up well on LinkedIn:
The role of creativity as an effective driver of growth and other business metrics has been well supported with research, conveniently collated here by the A to Z media newsletter:
New Opportunity: Investing in Creativity
As marketers begin to focus on entertainment driven contexts over data driven contexts, creativity matters even more. The Wonder Podcast network has stopped offering dynamic ad-insertion (automatically data-targeted ad placements) to discourage brands from spray and pray approaches to advertising. Their co-founder, Shira Atkins recently stated their position:
“This concept of efficiency that media planners are asked to find for their brands, often, I think, is actually laziness. And I don’t think it’s efficient to just scale shitty ads.”
The shift to entertainment presents opportunities for creatively focused work for impact over scale or ‘prevision’. For advertising agencies to deliver on this they’ll need to re-prioritize creative impact over efficient delivery. Investing in creative talent as much as they have invested in marketing tech and focusing on impactful media units will help enable this shift.
Finally, an exciting time to be in advertising
I’ve written before about how the digital data-led marketing transformation has negatively impacted the advertising industry. Targeting tactics were prioritized over creative, and distribution was seen as more important than the impact potential of a creative message. With the rise of ad-blockers, ad-free streaming, programatic display and weak social media inventory, the future of advertising was looking less effective, less creative and less inspiring. It was getting impossible to find a spot for meaningful creative, brands were suffering whilst FAANG was cashing checks.
The last 12 months however, have given me optimism, there’s more opportunity for big creativity, for making memorable marketing plays and for brands to stop pestering and start persuading. For the first time in a while, I’m excited.