TWITTER GETS ITS LIVE VIDEO ON: During Twitter’s Q4’16 Earnings Call they reported some bad news in the form of flat earnings. While their traditional display business has been eroding, there was one bright spot in the form of live video consumption, which increased to 6.6M hours in Q4 alone. Video content consumption on Twitter is important because it creates OLV inventory which can be sold at far higher CPMs then display. Now Twitter is doubling down on that strategy, and following the lead of Facebook, by launching a new Live Video functionality which can be uploaded by individuals without having to go through Twitter-owned Periscope. The tech side of this is a little complicated, so I’ll leave it to this Business Insider article for the details. In the meantime know that Twitter is fully committed to chasing the mighty digital video dollar as a way to reignite revenue growth.
THE OTHER SIDE OF THE RETAIL CONUNDRUM: Yesterday I featured an interview with Walmart’s CEO which focused on the retailer’s challenge of melding a traditional B&M core operation with consumers’ shift towards eCommerce. Now for the opposite perspective consider Amazon’s challenge of solving the most complicated pillar within retail . . . Grocery. No doubt the “steaks” (sorry) are high, with annual grocery sales in the US approaching 1 trillion dollars – that’s with a T, not a B! But the delivery model Amazon has mastered for other products doesn’t work well for grocery because of two reasons – produce and meat. Consumers want the ability to hand pick the freshest, best looking items. And even if they do order groceries online, the return rate is so high that it’s hard for eCommerce vendors to make any money. The attached IBJ article delves into Amazon’s plan to break into the grocery game. Their strategy is still evolving, but it feels like a hybrid of their current Amazon Fresh grocery delivery, and the new Amazon Go register-less stores their testing in Seattle. Get ready to watch this one play out.
THE FIRST STREAMING-ONLY RECORD LABEL: In a sign of the times Warner Music Group is launching the first streaming only specialty label within their portfolio. They’re positioning it as an emerging artist platform – sort of like the farm team to their regular label. I think Warner is doing this to appease current artists under their main label who might feel like they’re stuck on the old platform. My guess is within 5-10 years there won’t be a streaming-only designation for labels, because all labels will be completely concentrated on streaming and concerts, as physical album sales become a relic of the past.
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