07 August 2022 |
Kicking the crumbled cookie down the road
By Adam Ryan
Google announced last week that it was delaying the destruction of the 3rd party cookie one more time.
Here’s the TLDR:
- The cookie has been instrumental for Google’s advertising business. Due to privacy concerns they decided to kill the cookie by the end of 2022, then the end of 2023, and now it’s been pushed back again until 2024
- The delay appears to be due to the lack of confidence in the advertising market and the response to a non-cookie world
How I’m thinking about this:
- Newsletters have been a great sweet spot for advertisers. They can have down funnel performance while also serving as a great way to build a new top of funnel users to the site. For performance marketers the newsletter channel has served a great purpose for the dual opportunity. Without the cookie, how does that change how newsletters play with top of funnel since the ability to retarget will, in many ways, disappear.
- On the flip side, media companies that are collecting 1st party data around intent will win big when this switch finally gets flipped. Marketers are eager for high-intent audiences and the more a media company can build the infrastructure and tools to support this, the more dollars will slowly move from Google to digital media co’s.
- Data will now have a clear use for your marketing team. We all talk about data, but it’s almost like some operators get confused how to use the 1st party data they collect. Well, data will now be more important to the marketing team than ever before. Creating look-a-like audiences, understanding behaviors, and, I believe, there will be many “matching” ad tech co’s that media companies will use to share and identify through a single source of truth.
How are you all planning for the flip in 2 years? Anything interesting enough to share?
Next week, I’m happy to share some of the best practices that I hear from all of you.
Pinterest Stock Soar
By Alan Soclof
A couple weeks back, activist investors Elliott Management took a 9% stake in Pinterest ($PINS), sending the stock up 25%.
Pinterest has had a rough go of late including founder & CEO Ben Silverman leaving the company as well dealing with a significant decrease in users in the US, Canada, and Europe.
What might Elliot be intrigued by when it comes to Pinterest? Here are a couple of my theories.
First, Pinterest does have a reasonable valuation @ $19 a share & a valuation of ~$13B.
Other key financials include:
- $2.5B in 2021 revenue (representing 5x revenue multiple)
- 50% revenue growth over past two years
- Net income of $300M in 2021 – a stark contrast to Twitter & $Snap who lost ~$220M & ~490M last year.
Also, even though $PINS has recently lost users in the UCAN region, many attribute the decrease to a pull forward effect fueled by the pandemic. In 2019, Pinterest added 44M MAU’s & in 2020 added 92M MAU’s.
- Product & Market
A couple years back, Ophir Gottleib of CMLViz had an interesting point regarding Pinterest:
It is one of the only social media platforms that lacks “hostility.”
There is no arguing between users like on other platforms. Rather, Pinterest serves as a safe haven for people interested in an enjoyable, peaceful experience. What a concept!
Additionally, Pinterest’s user makeup is unique and a powerful value proposition for advertisers:
- 77% of users are female
- 90% of users go onto Pinterest with the intention of making a purchase
Wrapping It Up
There is a lot to like in Pinterest as a stand alone entity, but also, I wonder if Elliot has plans to push Pinterest towards a sale – a common strategy deployed by the fund.
Keep your eyes on PayPal as a possible acquirer as in October ‘21, PayPal considered an acquisition of Pinterest.
Another reason why it could be PayPal? Two days ago, Elliot Management announced a $2B stake in the online payment giant.
Is the fix in? We shall see!