The Rundown: Amazon and Walmart have vastly different streaming strategies
Both Walmart and Amazon offer advertisers the tantalizing prospect of being able to tie ads into high-quality video — movies and TV shows — to purchases. But how these two retail giants are going about their respective video businesses is very different.
Amazon is taking the old-school, Hollywood approach. The company, in search of a massive hit the size of “Game of Thrones,” spent $250 million just for the rights to produce a new series based on “The Lord of the Rings” franchise. (This does not include the exorbitant production costs that will go into making a fantasy TV series.) Amazon is also a frequent buyer at film festivals such as Sundance; for instance, it acquired Vice Media’s “The Report” for $14 million earlier this year.
Walmart, meanwhile, has no interest in spending hundreds of millions or billions of dollars on original programming. It’s focused on a dozen original movies and TV shows for Vudu this year, with plans to spend a few hundred thousand to a couple of millions of dollars per episode on these projects. Unlike Amazon, Walmart is also aggressively pursuing shoppable ads, with a product that’s aimed at getting people to buy products they see when watching ads on Vudu. For Walmart, the success of Vudu — which will remain free unlike Amazon Prime Video — is tied to how much product the service can directly help move off its shelves.
“When I sell to Amazon — when I talk to Amazon — they are old-school creative people and former movie and TV folks,” said an entertainment studio source. “Whereas the people who are running the creative shop at Vudu are very business-oriented; their mission is about connectivity with the customer. [Vudu execs] are creative, but their focus is on what the business purpose of that creative is — which is distinct enough from how Amazon is approaching it.”
This doesn’t mean that Amazon won’t one day look to directly tie commerce to its video streaming plans — and the company has been investing in free streaming services for movies, TV shows and news. But it’s clear that Walmart has direct commerce on its mind from the very beginning. — Sahil Patel
In-house buying’s HR obstacle
For a brand marketer looking to bring programmatic buying in-house, the company’s leadership is not the only constituent that needs to be convinced of its merit.
As a growing number of marketers bring marketing functions in-house, many are finding the HR department is proving a challenge of its own. Marketing teams are hiring for roles and skillsets that many companies just aren’t used to seeing or dealing with, and ones that don’t necessarily sit nicely with existing corporate structures, hierarchies and salary brackets.
It’s an issue pharmaceutical company Bayer faced head-on last year when building its in-house programmatic buying team. It got lucky when it came across a “significant pool” of ad tech experts who had enjoyed large exits from their former companies, Bayer’s head of programmatic and social Paul Gelb said on stage at the Digiday Programmatic Marketing Summit in Austin, Texas, last month.
But the challenge for Gelb wasn’t in convincing these people to join the company — they were already sold on the improved work-life balance that working on the client side might offer. Rather, the sticking point was in convincing the company’s HR department to approve new titles for them. While ad tech execs may be accustomed to fancy (and often inflated) job titles, larger, more bureaucratic companies often gravitate toward more humdrum designations.
This wasn’t going to sit well with the candidates. Offering a job with the title of associate manager “doesn’t really fly when you’re trying to recruit,” said Gelb.
The situation was eventually ironed out, even if getting titles approved ended up being more difficult than getting budgets approved. But the example illustrates how “taking media buying in-house” is rarely as simple as it seems, and not necessarily for the reasons you might expect. — Tim Peterson
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