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Declining engagement, conversions cast shadows on otherwise sunny Black Friday weekend

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Marketers breathed a bit easier as record-breaking retail sales rolled in from the Thanksgiving to Cyber Monday stretch. Cart checkouts kept apace throughout the Thanksgiving weekend, totaling a record $7.9 billion in online sales on Cyber Monday alone, according to Adobe. Still, it wasn’t all rosy. Issues such as lower average order values, higher cart abandonment and increased fraud dimmed some of the joy for many marketers.

Addressing lower engagement, conversions. Though the numbers shifted depending on who was doing the measuring, most data show that while sales were high, marketers struggled to engage and convert. Cart abandonment rates increased by 2.6 percent, conversion rates decreased by 9.7 percent and bounce rates increased by 12 percent compared to last year, according to personalization platform Monetate.

Search agency NetElixir reported a year-over-year decrease in average order values (AOV) of 4 percent.

All agree, though, that Thanksgiving Day and Black Friday results were better than the rest of the weekend, indicating a concerted effort by consumers to grab big-ticket items early.

Udayan Bose, NetElixir’s CEO, attributes a reported drop in average order value (AOV) to an increase in mobile customers, who tend to have a lower basket value.

“Marketers can work to make up for this loss by better understanding the mobile consumer and their buying behavior and customizing the 4P (product, price, place, promotion) mix accordingly,” Bose said, recommending that marketers offer incentives to encourage higher baskets like free shipping and discounts that kick in after minimum order amounts. Bose also touted recommendation engine plug-ins and live chat to help consumers find what they’re looking for.

Increased fraud. Ohad Hagai, SVP of marketing for Namogoo, says “during the peak holiday season with a surplus of online traffic and payment activity, bad actors have increased opportunity to commit and capitalize on fraudulent activity.”

“During Black Friday and Cyber Monday, online journey hijacking activity increased between 25-35 percent at various hours of the day compared to the regular season, where injected ads impact consumers during 15-25 percent of web sessions,” Hagai said. “Throughout the entire 2018 holiday season, this fraudulent activity is expected to cost online retailers $2.4 billion in revenue, a 17 percent increase from last year.”

Though marketers aren’t likely the ones responsible for combating fraud, it does impact the bottom line, so marketers should ensure their sites’ development teams tighten security and stay vigilant during the shopping season.

Why you should care. By any metric, more sales are good for marketers, and with an increase at this scale, we’re bound to see problems. And the holiday season is really just starting. NetElixir estimates that 76 percent of online holiday sales have yet to happen and that retailers still have time to adjust their strategies over the next few weeks.

“The holiday shopping period presents tremendous opportunity for retailers to win new shoppers and convert them into returning customers, Monetate’s CEO Stephen Collins said. “Retailers must reconsider their engagement strategies to ensure they are capitalizing on increased website visits. It’s imperative that retailers leverage every data point at their disposal to create the best and most relevant experiences for shoppers.”

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Amazon’s cashier-free Go store could be coming to London

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Amazon is reportedly planning to open a cashier-free store in London as part of the international rollout of its Amazon Go concept.

The retail giant is sizing up sites close to Oxford Circus to house the flagship UK store for its Go brand, according to a report from The Sunday Telegraph.

The claim comes just days after Reuters revealed that Amazon has also been drawing up plans to bring the futuristic grocery stores to American airports to cater for time-poor travellers.

The company opened its first Go store in Seattle in January and has since opened two more outlets in its home city as well as three in Chicago and one in San Francisco.

With their USP of having 'no lines and no checkout', Go stores have so far been pitched at city workers looking to pick up a quick bite on the move.

Instead of fumbling with cash, customers scan their phones on entry and then cameras and weight sensors identify which items they buy. When they leave the store they are automatically billed to the card Amazon has on file.

Amazon is said to want to open 3,000 such stores in the next three years.

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Online advertising has alienated our most valuable asset – the consumer

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It’s an understatement to say things have changed since I started my career in publishing 34 years ago, and mostly for the right reasons. The industry has moved on and some of those less palatable institutional barriers have been broken down. Yet there are certain industry behaviours that are having a real impact on original content creators, and they are so often borne from preventable consequences.

In many instances, these could be negated through the reapplication of ‘guiding principles’ that have perhaps been lost along the way.

It’s time we took a look back to make sense of what’s in front

The media industry has always been a sum of its parts, with different skills and disciplines working, mostly, in partnership. There was a sense you belonged to something special, and you knew you were directed by principles honed from many years of evolving media and advertising practices.

But it’s time to face the truth: today, consumers lack trust in digital advertising. In a quest for infinite online inventory, the crucial relationship between brand and consumer – that was built on shared values and respect – has become commoditised and jeopardised, quelling any desire for users to engage with ad campaigns. How have we got to a place where advertising that lives in the online world has all but alienated its most valuable asset – the consumer?

And no matter how many smart and inspiring examples of diversification and new monetisation models we see emerging, for original content creators, a base level of advertising remains essential.

There needs to be a change in behaviour

Many promises have been made to re-evaluate advertising practices and there’s an acknowledgement that quality and context matters. However, very little seems to have moved on and there remains limited evidence to suggest any measurable change in behaviour.

I’m not here to knock the technology that has enabled so much in modern life or the dominance of social media in which many users choose to consume news. Yet there is an obnoxious disparity around ‘standards’, accountability, and responsibility, and the right to compete fairly for advertiser funds that enable and sustain the creators of original quality journalism and content.

Despite all efforts to collaborate and support the industry’s wider call for greater parity, media owners with a long-established code of conduct and complete accountability for every single item present on their site continue to be at a disadvantage. Media organisations have always been defined by their transparent policies. So how is that an organisation like Facebook – that has such an impact and influence on the industry – is able to prosper and have a significant amount of revenue derived from online advertising, without being defined as a media business, and therefore does not need to adhere to any of the policies or codes of practice that is required by others?

As long as these organisations continue to be the principle benefactors from a type of advertising purchase behaviour, they have no motivation to change. It is only when we see a promised change in the advertisers’ behaviour, that the technology businesses themselves will be forced to re-examine their practices – meanwhile they will continue to enjoy all the spoils while residing outside of the union of all other media practitioners.

Driving better standards, and meaningful returns

As media owners, we continue to value the long-established trading partnerships centred on mutually defined policy and protocol, and relationships built on trust. These values matter.

This is a call to advertisers to check this current commodity driven behaviour, to take a moment to reflect, and work with publishers, as partners. But we also need to be sure that in striving for this goal we aren’t diluting standards, and the desire to improve accountability doesn’t just find us looking to provide a definition around practices that would otherwise be deemed as sub-standard.

Within the industry, we have in place numerous compliance guidelines. The IAB has been tireless in its efforts to bring the industry together to agree on a variety of advertising technology compliance standards. But what use are these if there is no accountability and seemingly no process to enforce compliance? While other established media channels have flight checkers in place – for both creative compliance and copy integrity – with all this wonderful technology, why does it not exist online?

And what about the extent of these standards? Premium publishers operate to much higher standards than laid out by these bodies, and always have done. They are self-regulated and they are accountable. And while I strongly support the adoption of universal standards for the good of the industry, it doesn’t change the fact they represent something that is significantly less than what we can actually provide.

At AOP, we’re committed to surfacing these challenges and we are striving to find practical answers, recommendations, and examples of best practice to help cement the future of advertising and publishing. But we must all commit to win back the trust of the consumer and return to a place of integrity – and continue to succeed as an industry I have always been proud to be part of.

Richard Reeves is managing director at AOP

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Blippar warns shareholders it is facing insolvency

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Augmented reality studio Blippar is “on the brink of collapse”, it has been reported.

The London-based tech firm is preparing to call in administrators, according to The Sunday Times, following a dispute between investors Nick Candy and Malaysian sovereign wealth fund Khazanah.

The report claims Blippar’s board warned shareholders on Friday that Khazanah had blocked emergency fundraising and it had been left with “no current option other than to give notice to start insolvency proceedings”.

Some 75 jobs would be put at risk by the company’s failure.

After launching in 2011 Blippar expanded into New York, LA, San Francisco, Chicago, New Delhi, Bangalore and Singapore.

Its image recognition technology has been used by major brands including Cadbury, Kellogg’s and McDonald’s.

The firm insisted it was in a “financially strong position” even as it shuttered its San Francisco operation to cut costs in the summer of 2017.

But in June this year it was reported that the company had raised an extra £20m from investors to stave off losses and help the company stay afloat.

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