Friday Not So Funday . . .

January 5, 2018Uncategorizedgmtartaglia@aol.com

*** Editor’s Note: I know it feels like we just got revved back up, but I need to put the DG on hold next week while I’m at CES. Trust me when I say you don’t want me posting when I’m in Vegas! But rest easy knowing the DG team will resume the blogging on Tuesday, January 16^th. ***

THE LOGAN PAUL INCIDENT: Fair warning – this first story is really tragic. However, it’s an important cautionary tale about the content pitfalls of paid Social marketing. The attached AdWeek link explains an incident that occurred earlier this week involving a social influencer named Logan Paul. Mr. Paul is a professional influencer with about 15M YouTube followers. So when he decided to video a trip to Japan Walmart and Dunkin Donuts signed on as sponsors. The problem occurred when Logan Paul posted video of a visit to Japan’s Aokigahara forest, which is known as a place where people come to take their own lives. Unfortunately Logan Paul came across a body, made a light comment, and then posted the video. Obviously this was a bad move for both Mr. Paul and his sponsors. To make matters worse YouTube initially acknowledged that this video was vetted by a “human moderator”, who is supposed to review and approve content before it goes live. Since then Logan Paul and YouTube have taken down the video and issued apologies. But sadly this incident shows that Social media can never be truly brand safe.

FCC CHAIR + DEATH THREATS = NO CES: Staying on dark topics for a minute, yesterday the FCC announced that its Chairman Ajit Pai was cancelling a scheduled fireside chat appearance at next week’s CES in Vegas. While the Secret Service never elaborates on security issues, as reported in the attached Recode link, the cancellation is due to death threats made against Mr. Pai, which are related to his move to eliminate Net Neutrality last month. Since CES attendees have the most to gain/lose from the NN changes emotions (and tempers) are running high with this group. Unfortunately if a death threat caused Pai to cancel his appearance the whole industry has lost a chance for meaningful dialogue around this important topic. Crazy times!

THE BEST BAD YEAR: If you work in or call on any part of the US Auto Industry you know 2017 was a grind. After seven straight years of unit sales growth sales declined this past year. But as noted in the attached Auto News link, there was actually a silver lining in those stormy numbers. For a level set in 2016 automakers sold 17.55M vehicles in the US. During the early part of 2017 industry forecasts called for 16.5-17M annual unit sales, which would have been a huge buzz cut for the EOMs. But thanks to a late year recovery (probably from replacement vehicle purchases related to Hurricanes Harvey and Irma), total annual sales clawed back to 17.25 units – so only a 2% annual decline. Industry forecasts are for another mild decrease next year (another 2-3% drop), so maybe we’re just seeing a soft landing for an auto industry which had been on a seven year hot streak. Glass half full, anyone?

THE DARK SIDE OF THE “AMAZON ECONOMY”: Finally this week, I’d like to give you something to chew on over the weekend. According to CNBC in the attached link, Amazon garnered 4% of all US Retail sales in 2017, and an astounding 44% of all e-commerce sales. The primary driver of their growth is the ever-increasing percentage of e-commerce searches which begin on Amazon. As you can see by the graphic below in 2016 over half purchase-based searches started on Amazon, and the 2017 # (which isn’t out yet) is sure to be even higher. The cause-and-effect here is simple – if you start looking for things to buy on Amazon you’re way more likely to make the purchase on their platform. While this is terrific for Jeff Bezos and the gang, what does this mean for the rest of the commerce-sphere? We know competing retailers are getting killed, with over 6,000 B&M store closings in 2017 and another 4,000 closures expected in 2018. But what’s even more worrisome is the impact this the trend is having on product manufacturers. With more and more purchases concentrated on Amazon, manufacturers are basically forced into participating in their Marketplace platform. This is creating a phenomenon Seeking Alpha has deemed the Amazon Economy in the attached link. It’s a pretty scary picture of total Retail dominance by one company who gets to set the rules to benefit them while blocking would be competitors. This is a fairly long article, so maybe save it for when you have 20 extra minutes. Then maybe you’ll think twice before telling Alexa to add that next item to your Amazon shopping list.