Q2-2021

MEDIA
INSIGHTS
REPORT
Key trends, data &
considerations

1
Key PLANNING
FOR RECOVERY
considerations
for COVID has forced brands across
all industries to accelerate
Q2-2021 digital innovation. While
vaccinations bring optimism,
there is still uncertainty
around the true “end” of the
pandemic. Therefore, brands
must continue to innovate,
remain nimble, and keep an eye
on consumer behavior – both
for signs of recovery and for
expectations that will persist
post-pandemic.
BUY NOW,
PAY LATER
Shoppers across demographics
have increased their reliance
on buy now, pay later (BNPL),
driven by tough financial
times and the necessity for
e-commerce. Retailers are
benefitting from this trend as
they connect consumers with
interest-free plans, not only
online, but increasingly in-store.
As bigger players enter the
space, mainstream adoption is
imminent.
2
 SHORT-FORM NEXT UP FOR SOCIAL iOS14 &
VIDEO MEDIA COOKIES

71% of people watch more video The first week of January 2021 As advertisers keep a close
today than they did a year was monumental for social pulse on the deprecation of
ago1 – and short-form videos media and messaging. The third-party cookies and the
are gaining momentum with ramifications from the President identity solutions that will
younger consumers, influencers, being de-platformed across arise to fill this gap, recent
and advertisers.2 For brands social platforms and the and need-to-know announcements
looking to gain visibility with recent changes in WhatsApp's have been shared from iOS14,
Gen Z and millennial audiences, terms and privacy policy will be Google, and The Trade Desk.
there are several mainstream felt for many years to come.3
and emerging social platforms In the immediate aftermath,
that offer brands a place to there’s been an explosion in the
showcase their human side adoption of alternative social
through videos. apps. It is an exciting moment
for innovation, discovery, and
digital marketing ideas.

1,2 Collins , Alicia, and Megan Conley. “The Ultimate Guide to Video Marketing.” HubSpot
Blog. Accessed March 10, 2021. 3 Hutchinson, Andrew. “WhatsApp Updates Privacy Policy, Paving the Way for the
Integration of Facebook's Messaging Apps.” Social Media Today, January 6, 2021.

3
PLANNING
FOR
RECOVERY

4
Key media trends in Q2-2021
PLANNING FOR RECOVERY

COVID has propelled Despite excitement Expectations have Given the uncertainty
digital into the future, over the global rollout changed after customers around the true “end”
giving us a new of vaccines, unknowns have grown accustomed of the pandemic, media
foundation for further and inconsistencies to certain conveniences strategies must be
innovation. will delay economic and procedures. nimble and flexible.
improvements.

5
COVID-era innovations will become the new normal
4

POST-PANDEMIC, BRANDS MUST CONTINUE TO INNOVATE TO MEET CONSUMER BEHAVIORS AND EXPECTATIONS.

80% of consumers expect brands to continue to offer online, virtual, and curbside services even after the pandemic ends.

57% would continue using 72% plan to continue to cook

contactless payments. at home. 57% shop online for
groceries more than they did
pre-pandemic.
41% plan to continue
39% will continue to work
using telehealth
remotely and 35% will attend
services.
virtual conferences.

Insurance customers have raised expectations 60% plan to continue to

around digital experiences; however, only 12% trust stream media on demand.
an automated, digital insurance claim process.

Recommendation: Consumers now expect brands to keep pandemic conditions in mind, making it easy, safe, and fast for them along the way. Marketers should scale up digital
engagement channels and solutions to meet these consumer demands for seamless digital experiences. As brands further evolve COVID-era innovations, digital marketers
should keep an eye on the competition, evangelizing and promoting what sets their products and services apart from the pack.

4 Staff. “Taking the Pulse | COVID19 Recovery Navigator Wave 15.” dentsu, January 2021.
6
Vaccine rollout not enough to inspire confidence
MANY AMERICANS LACK CONFIDENCE IN THEIR PERSONAL FINANCIAL SITUATION, EVEN WITH COMPLETE CLARITY ON THE TIMING
OF RECEIVING THE VACCINE.

Skepticism persists around COVID vaccines.

WEALTHY AMERICANS HAVE
70-85% of Americans need to be exposed to the pathogen to reach herd
immunity. But in the US, 29% say they don't want the vaccine.5 HIGHER POST-VACCINE HOPES
Americans who believe their economic situation will improve
• The US has been administering shots at a faster daily rate than any after the vaccine (by household income level)
country in the world, giving about 1.34 million doses per day.6
46%
Age, gender, and household income impact consumers’ views on
38%
whether the COVID vaccine will positively impact their finances.
33%
• A lack of confidence impacts consumer spending, which could slow
economic recovery.

• 51% of consumers believe the economy will recover quickly once

restrictions are lifted, and 40% of Americans expect their financial
situation to improve with widespread vaccine rollout.7

Under $50k $50k-$100k $100k

RECOMMENDATION: Consumers are more deliberate with their spending. The pandemic has had differing impacts across socioeconomic groups, but, for most, there is a trend toward
prioritizing saving over spending. Brands and marketers must examine what constitutes value for consumers and should position products and services accordingly.

5 Harris, Richard. “A Rocky Road On The Way To Herd Immunity For COVID-19.” NPR, February 3, 2021.
6 Cortez , Michelle Fay, and Emma Court. “U.S. Hits Pandemic Milestone With More Vaccinated Than Cases.” Bloomberg.com. Bloomberg, February 1, 2021.
7 Rowan, Lisa. “Are Americans More Optimistic Now That the Covid-19 Vaccine Is Here? It Depends On Who You Ask.” Forbes. Forbes Magazine, December 17, 2020.

7
Retail has been in need of change, and COVID provided
the extra push
CONSUMER EXPECTATIONS AND THE SHOPPING EXPERIENCE HAVE BEEN FOREVER CHANGED.

How Traditional Retail Has Changed What The Future Could Hold
• Signage to encourage distancing and proper • Built-in drive-throughs to facilitate BOPIS + curbside
hygiene
• Experiential showrooms
• Physical barriers
• Autonomous stores (Amazon Go)
• Sanitizing stations
• Outdoor/walk-up locations
• Product placement for speed + safety
• Shift in mall tenant mix (DTC, co-working spaces,
• Buy online, pick up in store (BOPIS), curbside pick- fitness chains)
up
• Localized stores
• Increased flexibility for returns

• Store closures + fewer flagship stores

RECOMMENDATION: Retailers need to stay ahead of what their customers want, with seamless experiences being critical. As brands innovate to improve their retail experiences,
marketers should make consumers aware of these advancements through messaging in media, organic social efforts, and site content.

8
Will wanderlust overrule caution this summer?
PENT-UP CONSUMERS CRAVE IN-PERSON CONNECTIONS WITH FAMILY AND FRIENDS.

81%
Spring & summer travel outlook:
Domestic leisure trips will prevail, such as exploring
the outdoors or beachy locales with a trusted “travel
feel more comfortable
54%
bubble” of friends and family.8 of Americans have
staying at hotels with
Excursions will be closer to home, dominated by road enhanced cleaning either booked travel
trip vacations of 2+ weeks in the same destination, and safety protocols.9 or are currently
potentially while working remotely. planning/expect to
travel in 2021.10

8 “AHLA’S State of the Hotel Industry 2021.” www.AHLA.com. American Hotel & Lodging Association (AHLA), January 21, 2021. 10 Airbnb Newsroom. “Report: 2021 Will Be the Year of Meaningful Travel.” www.Airbnb.com, January 28, 2021.
9 Romjue, Andy. “Life After COVID-19: How Hotels Can Prepare for the Future.” Hotel Business, January 7, 2021.
9
Will wanderlust overrule caution this summer?
PENT-UP CONSUMERS CRAVE IN-PERSON CONNECTIONS WITH FAMILY AND FRIENDS.

Spontaneous trips will be popular, with the

expectation there is flexibility to change or Business travel may not recover to pre-2020
cancel reservations without penalty. levels until 2025.11

Travel will be dependent on consumer International travel is complicated by ever-

confidence in a destination’s hygiene and changing border restrictions and potential
mask-wearing protocols. requirements to show negative COVID test
result or proof of vaccination.
"Vaxications" will emerge as a trend for
consumers who feel confident in traveling
post-vaccine.

RECOMMENDATION: Keep in mind why consumers are finally traveling for leisure. Craft promotional messages to inspire travelers through digital channels. Reassure them with
compelling visuals about your brand’s safety measures, and appeal to their desire to reconnect with loved ones. To build traveler confidence in choosing your business, highlighting
socially distanced outdoor activities is advantageous, as is reinforcing flexibility in cancellations and cleanliness of facilities.

11 West, Elizabeth. “GBTA Looks to 2025 for Business Travel Recovery.” Business Travel News, February 3, 2021.

10
BUY
NOW,
PAY
LATER

11
Key media trends in Q2-2021
BUY NOW, PAY LATER (BNPL)
BNPL usage is growing
most quickly among Gen Z
and millennials, but seeing
adoption across many age
groups.
The pandemic has been Though convenient, BNPL adoption will see
a catalyst for BNPL BNPL services pose risks another uptick with
growth, influencing for credit card networks, planned expansions to
the types of products retailers, and consumers. brick-and-mortar and
purchased using these availability on Amazon.
services.
12
BNPL services target Gen Z & millennials
Over one third of us consumers have used a BNPL service.12
• 87% of consumers aged 22 to 44 are interested in payment
installment plans.13

• 40% of millennials and 57% of Gen Xers are already using

these services.14

BNPL is appealing to credit-challenged and under-banked

consumers.
• 39% use BNPL to avoid paying credit card interest.15

• 38% use the loans to make purchases that would otherwise

not fit their budget.16

• 25% use it to borrow money without a credit check.17

Younger audiences are very open to BNPL option.

• 63% of millennials either love or view installment payments as
a helpful option.18

• 50% of Gen Z would spend more if given the option to use a

BNPL service.19

RECOMMENDATION: As BNPL services continue to scale and appeal to a broader demographic, look for opportunities to elevate this benefit in marketing
campaigns (e.g., creative, copy, email, search). This is especially important for brands with younger, under-banked, or credit-challenged customers.

12 Keyes, Daniel. “The Buy Now, Pay Later Report.” Insider Intelligence, January 7, 2021. 15, 16, 17 Keyes, Daniel. "The Buy Now, Pay Later Report."
13 “Buy Now, Pay Later Tracker.” Fast Facts. www.pmnts.com, 2020. 18 Dorsey, Jason. “The Future of Payments: Millennial & Gen Z Consumers' Attitudes Towards Installment Payments.” sezzle.com, June 4, 2020.
14 Willson, Amelia. “Buy Now, Pay Later: A Modern Alternative to Layaway.” Quadpay, March 8, 2021. 19 Cheng, Andria. “Why Retailers Are Embracing 'Buy Now, Pay Later' Services This Holiday Season.” Forbes. Forbes Magazine, December 16, 2020. 13
The rise of e-commerce during the pandemic has
been a catalyst for BNPL market growth
JOB LOSS AND ECONOMIC UNCERTAINTY HAVE BEEN DRIVING FACTORS AS WELL.

BNPL growth surged in 2020.

• Installs of top BNPL apps have grown 46% YoY.20 The most popular buy now, pay later services

• Monthly active users climbed by 186%.21 Bill Me Later/

PayPal Credit

• Point-of-sale lending is projected to account for 11% of total unsecured credit Afterpay

in 2021.22
Affirm

• Broader payment companies are also getting involved, allowing POS Klarna
financing to be better integrated into the purchase process.
FuturePay

Key products purchased with BNPL services include:

QuadPay
• 44% of customers using BNPL services purchased electronics, followed by
clothing & fashion (37%) and household appliances & furniture (33%).23 Sezzle

Splitit
• Affirm generated 28% of its revenue in the last fiscal year from Peloton
transactions.24 0 10% 20% 30% 40% 50%

• For Gen Z and millennials, the majority of consumer spend is on fashion

(specifically budget-friendly women’s fashion and sportswear), followed by
beauty.

RECOMMENDATION: As financial challenges persist, brands should prioritize offering payment options, particularly installment plans. While BNPL started out as a solution for
purchasing big-ticket items, it has gained for smaller, everyday purchases. Brands already offering these services can leverage data to understand which products are most purchased
using BNPL and merchandise and market accordingly.
20, 21 Chan, Stephanie. “U.S. Buy Now, Pay Later App Usage Climbed 186% Year-Over-Year in September.” Sensor Tower Blog, October 22, 2020. 23 “Buy Now, Pay Later Tracker.”
22 Woodward, Kevin. “It's Now for Buy Now, Pay Later.” Digital Transactions, December 1, 2020. 24 Clayton, Alex. “Meritech Capital / Affirm IPO: S-1 Breakdown.” Meritech Capital / Affirm IPO | S-1 Breakdown, November 25, 2020.
14
Opportunity to message a BNPL value proposition
RETAILERS HAVE BEGUN TO LEVERAGE CO-BRANDED CREATIVE + MESSAGING WITH BNPL PROVOIDERS.

50% of consumers think that a brand that offers the option to pay using installment payments stands behind its products more, is more
trustworthy, creates a better buying experience, and cares more about its customers.25

RECOMMENDATION: Over half of consumers (55%) indicated they would spend more if offered an installment payment solution. At 58%, this attitude is true for millennials more than
any other generation. Brands should clearly highlight BNPL throughout their sites (before checkout), as well as in search copy/site links, paid social copy, or in retargeting campaigns
to cart abandoners.

25 Dorsey, Jason.

15
How popular are BNPL loans across the globe?
GLOBAL BNPL VOLUME IS FORECASTED TO INCREASE TO MORE THAN $680 BILLION IN TRANSACTION VALUE BY 2025.

• The US has the highest • The BNPL app Klarna saw • 64% of BNPL users would • Paidy is the primary BNPL
adoption rate of BNPL usage grow 32% in 2020 vs. have postponed or not service offered in Japan.
among tier-1 markets. 2019.28 completed their purchase
without an installment option.31 • In Nov 2019, Amazon
• Over a third of consumers • 17% say finance options are partnered with Paidy.33
have used a BNPL service.26 the most important factor • 84% of BNPL users are
when purchasing.29 more likely to shop again
• Capital One bans BNPL at a retailer that offers
transactions on its credit • 36% would shop again at a installments.32
cards. retailer that offered BNPL
options at checkout.30 • In 2020, PayPal released its
• BNPL loan amounts have own installment option in
been steadily decreasing • The Financial Conduct France in response to the
and now average $150.27 Authority wants to regulate growing popularity of these
BNPL providers. options at checkout.

26 Keyes, Daniel. "The Buy Now, Pay Later Report.". 30 Johnson, Georgia-Rose. “Buy Now Pay Later (BNPL) Statistics: 2020.” Finder UK, March 1, 2021.
27 Woodward, Kevin. 31 PYMNTS.com. “PayPal Expands 'Buy Now, Pay Later' To France.” PYMNTS.com, June 30, 2020.
28 Taylor, Margaret. “Regulation Could Destroy Klarna. But It Could Also Save It.” wired.co.uk. Wired, February 22, 2021. 32 Editorial Team. “PayPal Releases Buy Now, Pay Later Feature in France.” Finextra Research. Finextra, July 2, 2020.
29 Nicasio, Francesca. “Trend Spotlight: Buy Now, Pay Later Makes Waves in the UK.” Vend Retail Blog, April 7, 2020. 33 Keyes, Daniel. “Amazon Wades into Point-of-Sale Financing in Japan.” Business Insider, November 27, 2019..

16
The future of BNPL
GROWTH IS EXPECTED, DESPITE CONSUMER CONCERNS AND POTENTIAL REGULATIONS.

BNPL OPTIONS WILL BECOME AVAILABLE IN BRICK-

AND-MORTAR STORES. 39% of US
e-commerce sales
• In 2021, Klarna plans to build out in-store capabilities in the are transacted BNPL
US and Europe through a partnership with Veriphone. companies
through Amazon,
making it a catalyst are investing
to mainstream BNPL in brand
COMPETITION AND INNOVATION WILL PROPEL BNPL TO across all ages.34 awareness.
FURTHER GROWTH.
• Amazon has introduced BNPL in Australia, India, and Japan,
and is testing in the US.

• BNPL platforms are developing loyalty programs and
optimizing their sites for product discovery.
• Some credit issuers are testing their own installment
lending solutions.
Will regulatory bodies look to implement consumer safeguards?
• 43% of BNPL users have been late to make a payment over
the past two years.35
• Too many installment arrangements can conceal the true
picture of a consumer’s finances.

• Some credit card companies are banning BNPL transactions

on their cards.

RECOMMENDATION: As BNPL becomes available on Amazon, be prepared to analyze impact on sales and other KPIs. Credit card companies should weigh the pros and cons of
allowing these types of transactions. Brands and marketers should keep an eye out for opportunities that arise from site enhancements and brick-and-mortar partnerships.

34 Ali, Fareeha. “US Ecommerce Grows 44.0% in 2020.” Digital Commerce 360, January 29, 2021.
35 Wang, Penelope. “The Hidden Risks of Buy-Now, Pay-Later Plans.” Consumer Reports, February 14, 2021. 17
THE RISE OF
SHORT-FORM
VIDEO

18
Key media trends in Q2-2021
SHORT-FORM VIDEO

As social media Video content on social Although people of all Marketers can appear
usage surges, more media drives more ages watch short-form more authentic and
people are turning to engagement than any videos, most of the build credibility with
short-form videos for other type of creative. format’s audience are Gen their audiences by being
entertainment. Zs and young millennials. visible in platforms
relevant to their brands.

19
The short-form video revolution is here
INCREASED ENGAGEMENT AND EMERGING PLATFORMS CREATE OPPORTUNITIES FOR ADVERTISERS.

In general, video has gained momentum during the Gen Zs have an attention span of about 8 seconds, which
pandemic; 71% of people watch more video today is a few seconds shorter than millennials, making short-
than they did a year ago.36 form videos a popular format for this audience.38

Video content gets 48% more views on social media Influencers heavily rely on short-form video, with
than images or GIFs.37 Instagram and TikTok being the platforms of choice for
influencers.

36 Collins , Alicia, and Megan Conley.

37 Team Colormatics. “Short Form Video Statistics and 2020 Marketing Trends.” Colormatics.com. Video Production Company, November 2020.
38 Law, Thomas J. “10 Vital Strategies to Use When Marketing to Generation Z in 2020.” Oberlo, January 7, 2021.

20
The short-form video revolution is here
INCREASED ENGAGEMENT AND EMERGING PLATFORMS CREATE OPPORTUNITIES FOR ADVERTISERS.

Short-Form Video Brand Example:

World-famous Italian fashion house Fendi launched
five in-feed TikTok ads to generate awareness and
engagement for their new brand profile. The campaign
was a success, generating 4 million views and a 5.8%
engagement rate. The ads also achieved an average
click-through rate that outperformed its benchmark
by over 158%, alongside a video completion rate that
outperformed by more than 59%.

RECOMMENDATION: Time spent consuming short-form videos will keep rising in 2021, as people look for new entertainment while continuing to socially distance. Short-
form videos should be considered as a media strategy to meet your audience on the social platforms where they consume most of their content.

21
Different platforms for different content
THERE ARE MANY OPTIONS FOR BRANDS TO CONSIDER, EACH WITH ITS OWN UNIQUE FEATURES AND AUDIENCE.

MAINSTREAM NICHE
The most popular video apps will reach a larger audience and maximize Platforms that appeal to more niche audiences are more likely to have
impressions. While the expected content and format across top platforms set schemas for the type of content they expect to see on platform. While
(Instagram, TikTok, YouTube) are very similar, Instagram recently these present opportunities to reach new users, remember that
announced it is limiting the re-posts from TikTok within reels, meaning authenticity is key to establishing credibility and driving engagement.
brands will need to create the video twice to post on both platforms.39

In beta - too early to Music videos One-joke comedy Dance challenges

Video challenges Tutorials AR lenses
tell Professional "Vine" 2.0 Duets
Dance Cooking Filters
musicians 8-sec loops Humor
Humor Beauty/Fashion Messaging

Gen Z Gen Z Gen Z

Gen Z Millennials Gen Z
Young millennials Skews female
100MM MAU40 Gen Z Young millennials
Latino and Black teens
115 MM MAU41 Skew female 46MM
MAU42

Mainstream > Niche

RECOMMENDATION: Be aware/informed of the nuances and differing user expectations of content, editing, and styling between video platforms. This will help guide your platform
selection and create content that is appropriate for the platform and aligns with your brand. You may not want to have a presence on all video platforms, but rather select the one or a
few that make most sense for your brand.

39 Hutchinson, Andrew. “Instagram Will Now Limit the Reach of Re-Posts from TikTok Within Its Reels Clone.” Social Media Today, February 9, 2021. 41 Tankovska, H. “Number of U.S. Instagram Users 2023.” Statista, January 27, 2021.
40 Sherman, Alex. “TikTok Reveals Detailed User Numbers for the First Time.” CNBC, August 24, 2020. 42 Tankovska, H. “Snapchat: Daily Active Users Worldwide.” Statista, March 5, 2021.
22
How brands can get started with short-form videos
USE CASES FOR BRANDS ACROSS PAID AND OWNED MEDIA
Video
Ads
Why: Capture the attention of customers and
prospects with an innovative, mobile-friendly brand
experience.
How: Video ad formats are available through most
social platforms and display partners and can be
an effective way to drive branding or conversions.
As with any campaign, align the goals of your video
campaign with your target audience to determine the
best platform on which to advertise.
User-Generated Content (UGC)
Why: Affordably leverage funny, educational,
inspirational, and relatable content created by your
customers or influencers relevant to your target
audience.
How: Identify opportunities to elevate organic user-
generated content (UGC), such as social content using
your brand’s hashtag, or collaborate with content
producers (i.e., influencers) to produce something
together.
23
How brands can get started with short-form videos
USE CASES FOR BRANDS ACROSS PAID AND OWNED MEDIA

Onsite & Owned Enhance Email &

Social Content Text Campaigns
Why: Add a human touch to your brand’s site, blog, Why: Add an immersive, creative element to email
or social handles with videos that are educational, and SMS campaigns.
inspirational, or even trendy.
How: Align the video to the campaign goal – if
How: Educational, how-to or explainer videos, you’re looking to drive the sale of a specific product,
product reviews, demonstrations or testimonials, consider a testimonial or visually appealing features
FAQs, expert opinions or interviews – all of which video; if you’re looking to generate an application,
should be authentic and engaging to prompt action. leverage a how-to video or address common
questions.

RECOMMENDATION: Whether your goal is to attract new visitors or to drive a conversion from visitors, start with a plan and defined goals. A thoughtfully produced video that comes
across as authentic and creative can be used for multiple purposes. Ensure your video is designed for your target audience and prompts an action. Allow additional time for campaigns
requiring net-new video assets. Ensure SEO best practices are applied to all video content, especially if it lives on site. Abide by varying audio best practices by platform (default on/
off). Monitor comments for videos posted on social channels.

24
NEXT UP
FOR
SOCIAL
MEDIA

25
Key media trends in Q2-2021
WHAT’S NEXT FOR SOCIAL MEDIA?
Society has hit an
inflection point with
organic social media and
messaging that could
alter the status quo.
The most likely There are a few emerging With much still to be
beneficiaries of any platforms growing resolved, there are some
user migration will be exponentially, so here is subplots to follow and
federated universes and your new must-watch list. opportunities to consider
dark social chat. for clients.
26
We've hit an inflection point
KEY PLAYERS TAKE ACTION.
• The 45th President of the United States was "de-platformed.”

• 64% of Americans said social media has a mostly negative effect on the way
things are going in the country43 and 79% said they’re not doing a good job
addressing online harassment.44

• Facebook announced it will build and test new advertiser topic exclusion
controls within newsfeed placements – a feature brands and advertisers have
been requesting for a while.45

MIXED MESSAGES MAKE A MESS.

• WhatsApp changed its terms of service and privacy policy.46

• This move caused big confusion, required many clarifications, led to a three-
month delay, and drove tens of millions of users to competitors Signal and
Telegram.

CAN YOU HEAR ME?

• US adults increased their social time by 16.4% in 2020, to 75 minutes a day.47

• With the pandemic accelerating behaviors like group video and audio chat,
social is poised for an explosion in new platforms with more user control.

RECOMMENDATION: Fast-growing social apps are emerging following a year of turmoil. In time, a few of them may become fundamental to media plans. As marketers wait for the ad
models to materialize, it’s worth becoming familiar with these properties by signing up and being the first to figure them out.

43 Auxier, Brooke. “64% Of Americans Say Social Media Have a Mostly Negative Effect on the Way Things Are Going in the U.S. Today.” Pew Research Center, October 15, 2020. 46 Mehrotra, Pranob. “[Update: Delayed] WhatsApp Is Updating Its Terms and Privacy Policy, Causing Mass Confusion.” xda,
January 15, 2021.
44 Pew Research Center. “Roughly Eight-in-Ten Americans Say They Think Social Media Companies Are Not Doing a Good Job at Addressing Online Harassment.” Pew
Research Center: Internet, Science & Tech, January 13, 2021. 47 “Social Networks: Average Time Spent in the US, by Platform, 2018-2022.” Insider Intelligence, January 1, 2021.
45 “Facebook To Test Topic Exclusion Controls for Advertisers in News Feed.” Facebook for Business, January 29, 2021. 27
Fediverses

What is a fediverse? Who are the key players? Why should brands care?
The term “fediverse” comes from the words Discord and Mastodon are arguably the two While fediverses are intended to keep
“federated” and “universe.” most significant players in the space: marketers out, it’s near-certain that a brand
will set up a Mastodon instance in 2021.
A fediverse is a decentralized social
Discord49 has 100 million monthly active
network running on free, open software Meanwhile, on Discord, there is a
users (MAU), and it’s fourth in the app
with multiple communities, rather than a marketing opportunity, albeit for sponsored
download chart. It is especially good for
central server owned by a business. content rather than paid media.
voice and group chat.
This is a not a new concept at all. It is how Short of that, note that listening tools
the Internet is supposed to work.48 Mastodon50 is a classic fediverse with can't track fediverses, and since there are
interoperable instances (sort of like thousands of communities, many are niche.
Initially, fediverses were a bit esoteric and @gmail being able to talk to @hotmail).
used for microblogging by the tech-adept, 3 million MAU. Any brand with a unique product or service
but they are way more accessible now and offering ought to consider exploration.
primed to go mainstream with millennials. Others to pay attention to are diaspora,
Funkwhale, PeerTube, and Twitter’s Bluesky.51

RECOMMENDATION: To learn more about Fediverses, read Twitter’s Review of the Decentralized Ecosystem.52 This report was prepared for Jack Dorsey. If you prefer to learn about this
topic in a drip-fed way, follow the main author of the report on Twitter, Jay Graber, @arcalinea.

48 Reuters. “Father of the Web Tim Berners-Lee Prepares 'Do-Over'.” Wire Service Content. U.S. News & World Report, January 12, 2021. 51 Matney, Lucas. “Twitter's Decentralized Future.” TechCrunch, January 15, 2021.
49 “How Discord Works in 148,000 Miliseconds or Less.” YouTube, October 27, 2020. 52 Robertson, Adi. “Twitter's Decentralized Social Network Project Takes a Baby Step Forward.” The Verge. The Verge, January 21, 2021.
50 “What Is Mastodon?” YouTube, March 22, 2018.
28
Dark social messaging
WhatsApp was always clear about its data collection, but the recent announcement mandating sharing is problematic.
Users are now turning to these alternatives for more control in their encrypted conversations.

Signal is best in class for Voice Strong security protocols, cool Doesn’t need a phone or email For people who wish to chat in
over Internet Protocol (VoIP) features, intuitive experience. address to register. No real super-secret.55 Can work offline.
and video. It’s easy to use, has a metadata, with info managed
Founded by the co-founder of
clean look, and is ideal for family on your device. Very secure.54
VKontakte. Utilized by millennials
and friends.53 Servers in Switzerland, popular in
and, more recently, the anti-
Germany. 8 million+ users.
Co-founded by same man who censorship free-speech brigade.
co-founded WhatsApp and then
Technically based in Dubai, this is
sold it to Facebook in 2014.
a Russian entity growing globally.
The app is popular in India and 500 million MAU.
has 40 million users, with 20
million added in January.

RECOMMENDATION: No messaging app has yet mastered monetization. However, Telegram is developing a model for its social networking component that will likely include native ads
and branded stickers. The question of whether it provides a brand safe environment is another matter altogether, due to its somewhat controversial approach to the handling of illicit
content. We recommend keeping an eye on these apps to understand upcoming advertising opportunities if and when they arise.

53 Singh, Manish. “Signal's Brian Acton Talks about Exploding Growth, Monetization and WhatsApp Data-Sharing Outrage.” TechCrunch, January 13, 2021.
54 “Threema Messenger Review.” messengerreview. Accessed March 11, 2021. .
55 “Briar – New Kid on the (Messaging App) Block - Review.” Decentralize.Today, March 18, 2020.

29
The fun stuff

GROUP VIDEO AUDIO CHAT

Houseparty was the “it” social network early in the There are different social audio apps,57 but the most
pandemic. interesting are Clubhouse and Cappuccino.

No wonder: it offers group-video, live debate, and Despite moderation problems, Clubhouse’s talk-
in-app gaming for eight.56 That sounds like millennial show-cum-chatroom format is so hot right now. Watch
word bingo. for advertising opps.58

Acquired in June 2020 by Epic Games (publisher Cappuccino is more of a twist on messaging, where
of Fortnite), there is real estate available, but the different audio clips can be recorded and stitched
app is quietly steering digital marketers to partner together to provide an intimate and ad-free daily
with influencers and use filters, backgrounds, or Q&A session with friends and family.
integrations.

56 Chaudhry, Aliya. “How to Use Houseparty to Video Chat with Your Friends.” The Verge, April 29, 2020. Link title to:
57 Basu, Tanya. “The Future of Social Networks Might Be Audio.” MIT Technology Review, January 28, 2021.
58 Hutchinson, Andrew. “Should Marketers Be Considering the Potential of Rising Social App Clubhouse?” Social Media Today, February 8, 2021.

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The fun stuff

LIVE BROADCAST MUSIC & CELEBRITY

Twitch enjoyed a profitable lockdown, and that was No platform can clone TikTok’s algorithm, but Triller
even before AOC changed the game.59 is close. Its celebrity exclusives look perfect for
advertisers.61
Caffeine is targeted at Gen Z, but keep an eye on it;
don’t confuse it with Cappuccino, and please respect Cameo lets users hire celebrities to create
their tech. personalized videos for any occasion, even
breakups.62 HiNOTE is “Cameo for music,” with artists
Right now, the assumption is there are clearer who will record custom songs on request.
marketing opportunities on Twitch, but Caffeine
feels ready to go for cool creator content.60 Expect Last, Community. Texting your hero? Sounds
branded broadcasts very soon. gimmicky yet case studies look mint for marketing.

RECOMMENDATION: There are several other platforms we could’ve spotlighted, but the above feels representative. Each of them is worth joining for
trendspotting, and marketers should watch for announcements of paid media pilots, especially on Houseparty, Clubhouse, Caffeine, Triller, and Community.
Brands may want to reserve @profiles on the above apps that are closely aligned to their audiences.

59 Kastrenakes, Jacob. “AOC's Debut Twitch Stream Is One of the Biggest Ever.” The Verge, October 21, 2020.
60 Keighran, Ben. “Creating a Safe Space during Challenging Times.” Medium, March 21, 2020.
61, Joseph, Seb. “What Is Triller? Here's a Primer on What You Need to Know.” Digiday, August 14, 2020.
62 Malin, Sean. “Want a Divorce? Try Cameo to Break the News.” The New York Times, January 12, 2021.

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So what?

We’re approaching a moment of truth for social Each conundrum is leading to an unexpected
media, with some conflicting demands63 to establish response, with users migrating to apps run on open-
acceptable norms for protection of free speech source software and to fun start-ups with innovative
versus moderation of hate speech. features perfect for use in a pandemic.

In social messaging, there are pressing debates This is not the last call for Big Social, but their
about how to square identity rights with a business response to the moment needs to be imaginative.
model that’s shifting to charge businesses to It is no longer alright to pass the buck, point to
communicate directly with individuals.4 “informed consent,” or to clone rivals.65

RECOMMENDATION: Social marketers must pay attention to evolving user behaviors and to the emerging platforms entering the social media sphere. Just like the
successful first-mover brands on TikTok, for the most part we recommend initial efforts be focused on contribution rather than interruption.

63 Siripurapu , Anshu, and William Merrow. “How Countries Regulate Online Speech.” Council on Foreign Relations, February 9, 2021.
64 WhatsApp Blog. “Making WhatsApp Free and More Useful.” WhatsApp.com, January 18, 2021.
65 Pardes, Arielle. “All the Social Media Giants Are Becoming the Same.” Wired. Conde Nast, November 30, 2020.
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UPDATE TO
IOS14 &
THE DEATH OF
THIRD-PARTY
COOKIES

33
Apple’s IOS14 update and ATT
OVERVIEW OF CHANGES & NEXT STEPS FOR ADVERTISERS
WHAT’S ALL THE FUSS WITH
iOS14?
• With the latest iOS14 update (version
14.4) released in late January 2021,
the ATT (App Tracking Transparency)
policy has been updated to require all
apps in the Apple App Store to give
users the choice to opt into Identifier
for Advertisers (IDFA) tracking. IDFA is a
unique identifier for mobile devices that
is used to collect and share information.
This is what
users will now
see when
opening all
iOS apps
WHY SHOULD ADVERTISERS
CARE?
• Limited retargeting capabilities
There may be a reduction in
retargeting audiences over time from
iOS users who choose to opt out.
• Limited conversion tracking
Many existing ad measurement
solutions were built around the IDFA.
Campaign performance measurement
can be impacted if users opt out of
IDFA tracking.
WHAT SHOULD I DO NEXT?
• If you haven’t already done so, follow Google
and Facebook’s recommended actions, and
talk to your other media partners about their
response.
• Implement the Google Global Site Tag.
• If running app campaigns, implement
or update the GA4F SDK, or implement
SKAdNetwork separately. If applicable,
update AdMob SDK.
• Update to the latest Facebook SDK
(version 8.1 or above).
• Verify your domain in Business Manager
Many performance marketers rely heavily
on ad retargeting to maximize efficiency,
so work on other ways to account for the
targeting and measurement gaps within
your organization.
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Other important identity updates
RECENT ANNOUNCEMENTS & IMPLICATIONS FOR ADVERTISERS

GOOGLE PRIVACY SANDBOX & FLOC What does this mean for advertisers?

Last year, Google announced that it would begin to phase out It’s still unclear if and how this will integrate outside of
support for third-party cookies in Chrome by 2022.65 This move Google’s universe. It will be important and highly beneficial
from Google follows similar updates from Safari and Mozilla. for advertisers to leverage first-party data wherever possible.
Since then, Privacy Sandbox66 and Federated Learning of For example, advertisers should work with publishers who
Cohorts (FLoC)67 have emerged as potential solves for these offer one-to-one, versus group targeting, through logged-in
major changes and to provide an alternative option to cookies environments.
for targeting and measuring ads.68

The FLoC will utilize machine learning to study browsing

habits for an anonymized group of users. The data is stored
and processed locally on one’s browser and device and is
anonymized as a group, which makes the data more privacy
compliant.

65 “Building a More Private Web: A Path towards Making Third Party Cookies Obsolete.” Chromium Blog, January 14, 2020. 68 Bindra, Chetna. “Building a Privacy-First Future for Web Advertising.” Google, January 25, 2021.
66 Joseph, Seb. “WTF Is Google's Privacy Sandbox?” Digiday, January 17, 2020.
67 Southern, Lucinda. “WTF Is Federated Learning.” Digiday, November 18, 2019.
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 Other important identity updates
RECENT ANNOUNCEMENTS & IMPLICATIONS FOR ADVERTISERS

UNIFIED 2.0
Following Google’s Chrome announcement around the This may not be the final solution or the only solution. There
deprecation of cookies, The Trade Desk has been working are others in the space who are aiming to develop options for
with other industry partners to create an open-source ID that advertisers or expand their offerings.
would be managed and operated by an independent, objective
third party and has submitted Unified 2.0 to the Partnership for
Responsible Addressable Media (PRAM).69

What does this mean for advertisers?

This could be a viable solution toward identity resolution in

a cookie-less world and could help map together many ID
targeting and reporting offerings such as dentsu’s Merkury
product, as well as LiveRamp’s Identity Link product (IDL).

69 Blustein, Andrew. “The Trade Desk Is Building Version 2.0 of Its Unified ID.” Adweek, July 28, 2020.

36
CHANNEL-SPECIFIC
OPPORTUNITIES

37
Channel considerations for Q2-2021
SEM
• Continue to highlight health and safety measures
being taken to keep customers safe.
• Travel brands should pay close attention
to regional differences in recovery (travel
restrictions, local businesses loosening
restrictions, etc.) and consider geo-specific
strategies.
• Travel brands should reinforce flexibility in
cancellations and cleanliness of facilities.
• If applicable, clearly highlight BNPL in ad copy,
on landing pages, and throughout site prior to
checkout.
SEO
• Take advantage of pandemic-related Google
My Business (GMB) attributes relevant to your
business.
• Regularly review and update content to align
with evolving consumer behaviors as recovery
occurs. For example, address the different
travel trends predicted for this summer like road
trips, workcations, and outdoor amenities and
attractions (patio dining, balconies, beaches,
hiking, etc.).
• Apply SEO best practices to any videos that live
on site; be prepared to see more short-form video
content populate in Google mobile SERPs.
38
Channel considerations for Q2-2021
DISPLAY
• Travel brands should pay attention to regional
differences in recovery and consider geo-specific
strategies.
• If applicable, consider testing BNPL services in
display creative.
• Leverage video ad formats to capture your
audience’s attention.
• To get ahead of iOS14 updates, act on Google’s
recommended steps:
• Implement the Google Global Site Tag.
• If running app campaigns, implement or update
the GA4F SDK, or implement SKAdNetwork
separately. If applicable, update AdMob SDK.
Social
• If applicable, consider testing buy now, pay later
services in creative and copy.
• To get ahead of iOS 14 updates, act on Facebook’s
recommended steps:
• Update to the latest Facebook SDK (version 8.1
or above).
• Verify your domain in Business Manager.
• As new social platforms and messaging apps
emerge, keep a pulse on where your audience is
spending time. Look for monetization opportunities
as they arise.
39
 Questions? Reach out!
CONTACT MERKLE MEDIA STRATEGY FOR PLANNING SUPPORT

Erin Spice Vanessa Cooper Graeme Jamieson Rachel Monfre Kristina Venieri Teka Phan Sarah Schuchman

Senior Director, Senior Director, Associate Director, Associate Director, Director, Senior Manager, Associate Manager,
SEM Media Strategy Media Strategy Media Strategy Media Strategy Media Media Strategy

40
 About Merkle
Merkle is a leading data-driven customer experience management (CXM) company that
specializes in the delivery of unique, personalized customer experiences across platforms and
devices. For more than 30 years, Fortune 1000 companies and leading nonprofit organizations
have partnered with Merkle to maximize the value of their customer portfolios. The company’s
heritage in data, technology, and analytics forms the foundation for its unmatched skills in
understanding consumer insights that drive hyper-personalized marketing strategies. Its
combined strengths in performance media, customer experience, customer relationship
management, loyalty, and enterprise marketing technology drive improved marketing results
and competitive advantage. With 9,600+ employees, Merkle is headquartered in Columbia,
Maryland, with 50+ additional offices throughout the US, EMEA, and APAC. Merkle is a dentsu
company. For more information, contact Merkle at 1-877-9-Merkle or visit www.merkleinc.com.

'Icons: Flaticon.com'. The icons have been designed using resources from Flaticon.com

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