Signal 20:11: Black Friday forecast / the workers driving the digital platforms / the CDT wants to fix digital advertising
Ben Shepherd
Signal: the media and marketing analysis newsletter.Momentum: the strategy system.Consulting: to organisations seeking commercially effective outcomes.
This week: What’s the outlook for Black Friday? Who are the workers powering the digital platforms we rely on every day? Can digital advertising be fixed? The CDT wants to try.
BLACK FRIDAY IS THIS WEEK – WHAT’S THE OUTLOOK?
What’s new:?Black Friday is taking place this Friday and its performance will be closely monitored as both an indicator of the Christmas retail period and a wider indication of household spending confidence. This year we have seen a pronounced increased in ‘pre–Black Friday’ sales and initiatives, as brands seek to take share of consumer wallets by offering steep discounts earlier than the traditional date. The Australian Retail Association is predicting Black Friday sales will be up 3% in dollar terms in 2024 to a combined $6.36 billion. Adjusted for inflation this would represent a decline on the prior year.
Why it matters: Black Friday has seen significant increases over the past 6-7 years and had been a reliable Q4 revenue booster for many retailers and a prime source of growth as consumers added a new ‘spending occasion’ to the repertoire. US forecasts are in line with Australian forecasts (topline dollar growth but declined in the context of inflation) and the broad sentiment for Australia and the US is that Christmas sales more broadly will be at the same level as 2022. Still, Black Friday represents a meaningful spending occasion for those who engage – BCG forecast that the average Black Friday shopper will spend around $410 USD on Black Friday specific purchases, with many of these Christmas shopping for others.
Marketer implication?:?For 2023 it’s likely Black Friday will be more an exercise that pushes forward demand that has in previous years and decades been spent closer to the Christmas date. For marketers it has meant, since 2016-2017, that Christmas is ultimately won and lost in November, which means that the job of winning hearts and minds is now beginning in mid-October. For the ad market it suggests that December will soften for retail and November will be a strong indication of the state of the ad market for Q4 and likely Q1 2024.
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AUSTRALIA’S DIGITAL PLATFORM WORKFORCE PROFILED -
What’s new:?The ABS has been conducting research into the workforce that powers the digital platforms in Australia. This is the people who work for Uber, Doordash, Amazon etc and power a new economy that is highly valued by households. The big headlines 1/ 53% of platform workers undertake the work in addition to the main job. 2/ the workforce skews <45 years of age (~70%), 3/ the majority are working in personal transport or food deliver, 4/ 68% work less than 19 hours a week in the platform role and 5/ the overwhelming main reason for working in platforms was to supplement income
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Why it matters: The old adage ‘what gets measured gets managed’ is a relatively accurate truism and the ABS monitoring this workforce is an important step to better provide more contemporary protections and conditions for digital platform workers. Most digital platform workers perform their work as independent contractors to these companies and the rules and legislation that protect an employee such as me don’t apply to them. It also provides live insight into the motivations of platform workers – which is, on the whole, to supplement income to help pay for the cost of living.
Marketer implication?:?This data presents another point around the challenges households are encountering around living costs. For marketers in b2b, this data helps understand this market and ways to help cater to them.
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THE CENTER FOR DEMOCRACY AND TECHNOLOGY WANTS TO FIX DIGITAL ADVERTISING
What’s new:?The Center for Democracy and Technology (CDT) is a nonprofit organisation “fighting to advance civil rights and civil liberties in the digital age”. It has co-ordinated a working group to create a better future for online advertising. The CDT argues that online advertising is at a point where it is not serving any of its key stakeholders. Advertisers are receiving a sub-par brand experience and reliant on a handful of “platform monopolies”; Publishers are seeing reduced revenue, loss of advertising content control, and lower commercial survival rates; Internet users are being relentlessly tracked and hounded; and Content creators are finding it harder than ever to receive fair pay.
Why it matters: The CDT initiative could be viewed as putting a band-aid over a flesh wound, but it is an important signal (amongst others) that the digital advertising ecosystem is continuing to struggle to serve its key stakeholders. The big question is whether the problem is too big, too valuable, and too complex for the stakeholders to come together to fix it. Or, whether fixing (or at least improving it) is too big a problem to not fix if we want the industry to survive in order to properly serve the different stakeholders.
Marketer implication?: This is an area where marketers and brands can play the leading role in driving change. Marketers ultimately control the ad ecosystem as the ad ecosystem is entirely reliant on their ad investment. At the same time, marketers and brands have primary roles to serve – building the value and size of their own businesses – and it’s unrealistic to assign them the responsibility of fixing what is a pretty dysfunctional system in parts.