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Unlocking the power of generative AI to improve paid social media strategies

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By Josh Dorward

Generative AI tools promise to solve digital marketers’ creative challenges, but they fall short on brand consistency and quality, says Josh Dorward (general manager, Creative Automation). Here’s the missing piece of the puzzle.

Imagine that you’re a digital marketer responsible for managing paid media across Facebook, Instagram, Snapchat, and TikTok.

Chances are that at least three of your hair-on-fire problems boil down to not having the video and image assets that you need, on time, at scale.

  • Ad fatigue: The dropoff in performance (and the related increase in cost per result) when your audience has been overexposed to the same creative. This is primarily driven by a shortage of fresh campaign creative. (Meta’s guidance on combating ad fatigue: “Create a new ad with a new video or image that is materially different from the original creative.”)
  • A/B testing limitations: A/B testing is wildly popular – with 77% of companies reporting running A/B tests on their homepages. But it’s less common to see robust A/B testing in digital advertising – with ads missing from the list of most common A/B testing domains (website, landing page, email, and search). That’s because ads are significantly more resource-intensive, as they require tens–if not hundreds–of alternative video and image assets to properly test everything from calls-to-action and headlines to product displays and vfx overlays.
  • Personalization challenges: Every digital marketer dreams about delivering perfectly tailored ads based on everything from the local weather to a user’s next-best action. But it can be time-consuming and impractical to create multiple versions of a creative asset for each granular audience segment.

So, you’re under the gun to deliver ROAS and can’t magically multiply your creative team.

What can you do?

Where generative AI soars – and where it falls short

Generative AI (genAI) tools – like Dall-E and Midjourney – promise to transport digital marketers to a paradise free of creative bottlenecks. (Check out this article for a breathless review of the march of progress and some cool inspiration.)

Here’s the premise: instead of requiring costly photoshoots and dedicated design work, what if genAI tools could enable marketers to automatically specify every element of their ideal digital ad?

Want to alter the look of your model based on the demographic of a customer segment? Easy. Change the background of your photoshoot based on the weather conditions across 50 local markets? Nothing simpler.

It’s a great vision. The problem is that, well, it doesn’t work all that well. (Yet.)

As recapped here, generative AI tools tend to struggle with brand consistency (e.g., making sure that images match your e-commerce brand’s winky, irreverent personality) and quality control (e.g., making sure that all humans have five fingers).

It’s clear that there’s a missing piece in the creative stack for marketers to truly take over.

Marketers need creative “connective tissue”

Digital marketers need a new type of technology to help connect the raw potential of genAI platforms with the practical constraints and needs of digital advertising platforms.

Think of it as creative connective tissue. The translation layer between raw creative assets – whether it’s manually-shot photos or genAI-produced imagery – and the specific requirements for scaling on-brand imagery for digital advertising. The glue that brings together your brand’s creative DNA (look and feel) and the specific requirements (size, resolution, etc.) of your ad platforms.

Platforms like Creative Automation – the latest offering from image and video leader Cloudinary – exist to transform output from generative AI platforms into immediately useful digital ads at massive scale. Creative Automation takes your favourite design and maps each element to a spreadsheet, leaving marketers and creatives to simply add new data rows to quickly generate your new design variations. In the process it offers digital marketers:

  • Brand control: Full control over design elements in templates created in popular Adobe design tools, and the power to determine its placement, size, animation style, and final appearance without dragging and dropping for every variation.
  • Dynamic templates: Creative Automation streamlines tasks such as resizing, substituting, moving, and translating visual elements across different aspect ratios for all your audiences, products, etc.
  • Streamlined quality control processes: Generating and testing on-brand design variations is as easy as editing a spreadsheet, allowing marketers to overcome the back-and-forth with designers that come with scaling to all audiences.

Revolutionizing the digital ad world

GenAI has the potential to unleash digital marketers’ imagination and ultimately deliver ad experiences that are more relevant (and enjoyable) to consumers.

But for now, digital marketers need a creative translation layer to go from raw genAI output to on-brand experiences at scale. Platforms like Creative Automation can unlock immediate performance improvements across your ad landscape by harnessing – and channeling – the power of genAI today.

By Josh Dorward

Sourced from The Drum

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A How-to Guide for Local Marketing

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By Scott Clark
Local marketing aims to build a strong presence in the local market, increase brand visibility, attract local customers and drive traffic to physical stores.

The Gist

  • Geo-targeting essential. Social media offers geo-targeting for precise local advertising, increasing community engagement.
  • SEO optimization. “Near me” searches are frequent, making a Google Business Profile and mobile-first strategy critical.
  • Traditional Tactics. Traditional methods like radio and event presence alongside digital strategies amplify local marketing reach.

Local marketing refers to the strategies and activities that are used by businesses to target and engage with customers in a specific area or local community. It focuses on promoting products or services to customers within a particular region or area. Local marketing aims to build a strong presence in the local market, increase brand visibility, attract local customers and drive traffic to physical stores. This article will examine tactics, strategies and tips for brands interested in local marketing.

What Are Some of the Types of Local Marketing?

Many types of marketing practices are included under the umbrella of local marketing. One example is a brand that sells gift products that tourists often buy when they visit destinations such as the beach, the mountains or specific locations, such as the Grand Canyon or Niagara Falls. In each case, businesses that sell such products simply reach out to companies near each locale to see if they would like to carry the brand’s tourist products in their stores. Additionally, they participate in Facebook Groups for each tourist destination.

Another example of local marketing is when businesses adjust the products or services they sell based on the tastes, habits, culture and beliefs of the people living in the area of the service. Such a business would also adjust the marketing or advertising copy to reflect the social norms of the people in the area. One can see examples of this in international brands that sell their goods or services across the globe to people with very different tastes, habits and beliefs.

Yet another example of local marketing is the use of geolocation apps that send customers a text message or alert when they are physically near a brand’s location, such as driving by in their car, walking past a store or restaurant, or strolling through a large store that has other businesses within its premises. One example would be a fast food restaurant in a Super Walmart. When a customer that has downloaded the restaurant’s app to their mobile device is in Walmart, the app sends an alert to the customer’s phone, letting them know that they are offering a two-for-one deal on Quarter Pounders, for instance.

Finally, many businesses operate exclusively as local brands. Buckeye Donuts, which is located in Columbus, Ohio, is not trying to market its goods to people in other states. Its marketing and advertising campaigns are mainly based on word-of-mouth, local advertising, radio, local periodicals and participation in community events.

How Are Brands Using Local Marketing?

Many brands today are using local marketing in their communities and around the world. One unique instance of local marketing involves a collaboration between Mattel and Airbnb. Initially launched in October 2019, Airbnb announced that the Barbie Malibu Dreamhouse, located in Malibu, California, would be available for rent by one lucky guest, who could bring along three guests of their own, for the low price of $60 per night. It was designed to raise awareness of The Barbie Dream Gap Project GoFundMe initiative, which aims to help level the playing field for young women so they can follow their dreams.

We recently looked at another excellent example of a brand’s use of local marketing in an article on cultural intelligence. McDonald’s demonstrated the importance of adapting to different cultures in its marketing practices, product offerings and even its pricing. In India, where religious prohibitions prevent adherents from eating beef, McDonald’s introduced vegetarian options and replaced beef patties with mutton, chicken or fish.

mcdonalds

In Thailand, where the minimum wage is much lower than in other parts of the world, McDonald’s lowered the cost of its Big Mac to approximately US $2.20 (contrasted to Switzerland, where Big Macs sold for around US $6.20). In order to adapt to local culture in China, McDonald’s offered rice as a french fry alternative.

Additionally, McDonald’s uses different media personalities and influencers to promote its brand based on the cultural tastes of the locale. Its ability to adapt and change its products, marketing practices, pricing and advertising strategies to suit different geographical and sociological differences is a good indication of why it has become a hugely successful global brand.

Often, local marketing is not about reaching customers in their locale, but rather, bringing them to the brand through community building. The US Sports Network, Bally Sports, was interested in finding a better strategy to understand and engage its local fan base through the use of third-party data, but very quickly this became extremely costly. Instead, Bally turned to its online customer community, FanZone. This inclusive online community became the place where Bally’s diverse fans could get together with other fans, share their thoughts and experience a feeling of belonging.

Sports fans cheering their favorite team, representing the power of local marketing.

Using its FanZone community, Bally Sports enhanced and improved its ability to connect with regional fans in new and unique ways. It obtained on-demand feedback from customers, enabling them to gain a deeper understanding of its audience’s preferences and doubling its fan community through targeted live on-air promotion efforts.

Use Social Media for Local Marketing

Most brands today have a social media presence, but for local marketing, social media is a necessity rather than an option. The benefits of social media for local marketing include:

  • Geo-Targeting: Many social media platforms, like Facebook and Instagram, offer geo-targeting features for advertising. This enables businesses to target users in a particular location or radius specifically.
  • Local Engagement: Social media enables local businesses to engage directly with their community. Businesses can foster a sense of community and build local loyalty by sharing local news, participating in local events or spotlighting community members.
  • Cost-Effectiveness: Social media can be cost-effective compared to traditional advertising channels like TV or print. Businesses can start with a small budget and scale up based on results.
  • Real-Time Feedback: Local businesses can receive immediate feedback from their community. This can be invaluable for understanding the needs and preferences of local customers.
  • Word-of-Mouth Amplification: Satisfied customers can easily share their experiences and recommendations, resulting in word-of-mouth marketing.
  • Versatility: Social media provides a platform for various content types, from videos to images to stories, enabling businesses to be creative and diverse in their messaging.

Aside from advertising on social media and regularly contributing appropriate content, many brands use the community aspects of social media to engage with and attract customers. Ashley Mason, marketing consultant and founder of Dash of Social, a social media management consultancy, told CMSWire that she built the client base for her business through the use of Facebook groups.

“For me, as a Massachusetts resident, I started joining several Boston-based Facebook groups revolving around entrepreneurship, business, etc. in 2016,” said Mason. “Because many members in these groups were often business owners looking to hire social media managers or marketers for their companies, I was able to use these communities to my advantage to establish thought leadership, build trust, gather leads, and grow my business.”

Mason attributes much of her revenue to Facebook groups and wrote about her success on Instagram. “Approximately $630,000 of my total business revenue came from Facebook groups, either by working with people who were in the same Facebook groups as me, or getting referred to other businesses by people I met in those Facebook groups.”

Optimize SEO for “Near Me” Local Searches

Consumers today often search for local businesses by using the phrase “near me.” In fact, a 2022 Statista survey revealed that 82% of US consumers who used their smartphone to shop had used near me searches.

Local businesses trying to increase their online presence and show up more often in near me searches should create a Google Business Profile. It’s free, and once a business has been verified, it will appear in near me search results. The name, address and phone number displayed on a brand’s Google Business Profile should match what is displayed on the brand’s website and any promotional material.

google business profile

 

A 2023 BroadbandSearch report indicated that 54.4% of web traffic was conducted on mobile devices (compared to 0.7% in 2009). Additionally, a recent Hubspot report revealed that local searches are what lead 50% of mobile users to visit stores within 24 hours. Brands today should create their website with a mobile-first strategy, optimizing for mobile devices as a priority, rather than optimizing for desktop displays.

Amy Jennette, senior director of brand marketing at the popular web host GoDaddy, told CMSWire that ensuring your website is mobile-friendly is a key part of the equation. “Consumers want information on the go, so double check that your site has mobile-friendly text, menus, forms, and buttons that make it simple for your audience to browse site information on the go.”

Jennette said that businesses should localize their website to make the content relevant to their target community. “For example, if I was the owner of an electric bicycle shop in my hometown of Seattle, I may rephrase the terms on my website’s homepage to say, ‘bringing our community the greenest bikes for a greener Seattle’ rather than simply putting ‘electric bike shop.’ And this moves beyond just your website —localizing your marketing should be applied across your digital and print ads, social media pages, and other public marketing materials,” said Jennette, who added that these simple tweaks could make a major difference for your audience as they research online local businesses that best fit their needs.

Leverage Traditional and Non-Traditional Advertising

Local marketing often relies on more traditional methods of obtaining the eyes and ears of customers and leads, such as TV and radio advertising, having a visible presence at local events, word-of-mouth, billboards and collaborations with other local businesses. “Whenever possible, join in on local industry-specific events, fairs and festivals, and neighborhood gatherings to boost your brand awareness, show off your locality, and further press the importance of supporting small, local businesses,” said Jennette. “In no time you’ll be the local authority in your industry, and you’ll have the local marketing tools in your toolbelt to thank for it.”

Other brands are using local marketing strategies that include digital displays located in areas where potential customers will see them. Geoff Crain, senior director of sales and marketing at Kingstar Media, a digital marketing and video production agency, told CMSWire that his business uses digital out-of-home (DOOH) advertising for local marketing due to its ability to target local audiences precisely, deliver contextually relevant content and allow real-time updates. “By strategically placing digital displays in specific locations, we have the ability to reach specific and local communities effectively,” said Crain.

“DOOH also allows for dynamic and tailored messaging, incorporating local references and promotions to establish a deeper connection with the local community.” Crain explained that the real-time capabilities of DOOH enable businesses to adapt campaigns quickly, providing timely and accurate information to their desired local audience, enhancing engagement, and driving positive business outcomes in specific local markets.

Traditional marketing and advertising mediums can still be effective strategies for local businesses. Although many may not recognize radio’s reach today, a recent Statista report indicated that radio is one of the most powerful mediums in the United States, with a weekly reach of around 82.5% among adults, and 78% of those under 18. “Radio is another form of media we utilize for local marketing due to its ability to reach a wide and diverse audience within a specific geographical area,” said Crain. “With radio, we can effectively target local audiences, delivering our advertising messages directly to potential customers in their communities.”

Mobility is another benefit of radio advertising. “Radio also offers the advantage of being a mobile medium, reaching consumers in their cars, homes, or workplaces, allowing our clients to stay memorable and top-of-mind throughout the day,” said Crain. “Radio also allows for the creation of engaging and memorable audio content, leveraging the power of storytelling, music, and personalities to connect with the local audience on an emotional level, making it an impactful and cost-effective medium for local marketing.”

Final Thoughts on Local Marketing

Local marketing provides brands with the unique opportunity to intimately connect with their surrounding community, addressing its distinct tastes, cultures and preferences. By using a blend of traditional and digital strategies, from SEO and mobile optimization and social media engagement to radio advertising and participation in community events, businesses can effectively bolster their local presence.

Feature Image Credit: TensorSpark on Adobe Stock Photo

By Scott Clark

Scott Clark is a seasoned journalist based in Columbus, Ohio, who has made a name for himself covering the ever-evolving landscape of customer experience, marketing and technology. He has over 20 years of experience covering Information Technology and 27 years as a web developer. His coverage ranges across customer experience, AI, social media marketing, voice of customer, diversity & inclusion and more. Scott is a strong advocate for customer experience and corporate responsibility, bringing together statistics, facts, and insights from leading thought leaders to provide informative and thought-provoking articles. Connect with Scott Clark:

Sourced from CMSWIRE

local marketing, social media, marketing, social media marketing, digital marketing, advertising
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The Power Of E-Commerce: How Small, Local Businesses Can Expand Online

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By John Hall

If you run a small, local business, chances are you’ve got some sort of a website. You may even be set up to sell a few products online, here and there. But you may not have tapped the massive potential of building out a real e-commerce arm for your business. And you might not realize just how easy — or how lucrative — it’s become for small, local businesses to move online.

If you’re still mostly bound to brick-and-mortar, it’s time to consider a change. Here are some low-risk, high-reward ways to successfully scale into the digital world.

1. Do a Digital Reboot

As noted, you may already have a great website or even a decent online store. But it’s likely you could be doing much more to make it competitive with other e-commerce sites in your niche.

If it isn’t already, your site should be hosted on—or at least integrated with—a platform that’s designed for e-commerce, like Shopify, Squarespace or BigCommerce. Make sure it’s easy to use, intuitive to navigate and has a clean, simple design. It might be worth having a specialist conduct a user experience audit.

Perhaps most importantly, ensure your site is optimized for mobile users. Remember that 91% of Americans ages 18 to 49—likely the bulk of your target customers—shop on their smartphones. Most web design platforms let you convert your desktop designs to mobile layouts almost automatically. But you still need to make sure the mobile version is attractive and usable.

2. Leverage the Power of Online Testimonials

Getting good product reviews on your site and on other platforms can do wonders for your business. Consumers don’t trust brands, but they trust other people’s experience of a brand or product. Positive reviews can be just as effective as hearing directly from people they know in real life.

Smallbiz Technology recommends that businesses feature reviews and testimonials directly on their website and social media channels, natch. But they also note that positive reviews on third-party sites like Google, Yelp, and Trustpilot can generate tons of traffic.

To encourage customers to write reviews, they suggest offering customers free products or discounts as incentives. But note that if you sell products through a marketplace like Amazon, exchanging gifts for reviews could violate their policies. Alternatively, you can reach out and simply ask customers who like your product to take a moment to do a short write-up.

3. Offer Convenient Payment and Shipping Options

Your customer won’t buy from you online if you don’t make it as easy for them as shopping on Amazon. It’s imperative to offer fast, free or cheap shipping and eliminate any trace of friction from the shopping experience. The smallest details can send a customer packing even when they were already pretty serious about making a purchase.

Whatever you do, don’t force your customers to create an account before checkout. That’s one of the fastest ways to turn a ready-to-buy customer into one who’s just closed your site’s browser tab. It’s also vital to offer a number of convenient payment options, including PayPal, Apple Pay and Google Pay in addition to the standard credit cards.

Packing and shipping your own orders in-house may save you money when you’re just starting out. But as a small business, you don’t have the infrastructure to keep doing that at scale. Eventually, you’ll need to contract with a third-party fulfilment service. Shopify offers its own in-house option and maintains a list of other recommended fulfilment services you can try.

4. Be Smart About Email Marketing and Social Media

One advantage you have as a small local business owner is that you already have a devoted following. You’ve got people in your corner who support your business and want to see it flourish. If you create content that speaks to your biggest champions, they’ll be excited to share it with others.

Email marketing remains one of the best ways to drive engagement and sales for your brand. After all, it’s one of the few forms of brand communication that customers actually enjoy receiving. Still, carefully consider your content—you don’t want to irritate your loyal fans with ads for the same old products. Use email to make announcements, share informative blog posts or offer valuable discounts. That’s the kind of content your devotees will be happy to pass along to their friends.

Social media is likewise a powerful tool for bonding with current customers and reaching new ones. This is especially true if you actively engage with users, such as responding to Instagram comments or stitching videos on TikTok. Partnering with influencers through a platform like Grin or Afluencer could also help drive engagement.

Don’t Reinvent the Wheel

As recently as five or 10 years ago, small businesses had to transition to e-commerce on their own. They needed their own systems for everything from packing and shipping to handling customer service to accepting credit card payments.

All that has changed. Now, there’s an easy, affordable third-party solution for just about any e-commerce problem you can think of. You’ve already got a small, likely overworked staff. Don’t make them—or yourself—create systems from scratch when there’s probably a ready-made solution a short Google search away.

Feature Image Credit: getty

By John Hall

John Hall is a top motivational speaker and the co-founder of Calendar, a scheduling and time management app. He’s also an adviser for the growth marketing agency Relevance, a company that helps brands differentiate themselves and lead their industry online. You can book him as a keynote speaker here.

Sourced from Forbes

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YouTube’s Advice for Shorts Creators, Including Hashtags, the Algorithm and More

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Looking to get into YouTube Shorts and build a Shorts presence for yourself or your brand?

You should probably consider it. Shorts is the fastest-growing content type on YouTube, and is now driving over 50 billion daily views in the app. Built in the mold of TikTok, Shorts leans into the growing trend towards more succinct, attention-grabbing clips, and it could be a valuable pathway towards increased brand awareness and perception.

If you can create good Shorts content.

This will help. Today, YouTube has published a new interview with Shorts Product Lead Todd Sherman, in which Sherman answers some of the most common questions about Shorts, including how they’re using hashtags, how often you should post, the Shorts algorithm, and what’s coming next.

There are some interesting notes. Below are some of the key highlights.

On the Shorts algorithm

YouTube advises that creators should “think audience, not algorithm” within their creative process.

Sherman says that the Shorts algorithm is different to the regular YouTube feed, because it’s an entirely different format, with different consumption behaviours.

“For example, on long form, a lot of the times people are choosing which video by tapping on it on their phone, or clicking on it on the web, and that choice is something that drives a lot of engagement. On short form, people are swiping through a feed, and discovering things as they go. That’s one important difference.”

The variance means that YouTube can’t use the same explicit usage indicators as it does in the main feed, so the algorithm is focused more on engagement elements, while the Shorts feed is also broader reaching, meaning that YouTube has to match more content to Shorts viewers.

In essence, this means that YouTube is getting smarter about showing users what they like, based on what they watch, factoring in watch time and re-watches, along with likes, shares, and comments. A big part of that comes down to entity recognition, and YouTube is still building its algorithm to highlight more content based on these measures.

How Shorts views are counted

Sherman says that Shorts views are not measured when a Short appears on screen, but are more aligned with actual viewer interest.

“What we try and do with a view is have it encode for your intent of watching that thing, so that creators feel like that view has some meaningful threshold that the person decided to watch. It doesn’t mean it’s their favourite video ever, it just means that they are deliberately watching it.”

Sherman says that YouTube doesn’t publish its actual calculations on this, in order to stop people trying to game the system.

Extending Shorts length

Sherman says that this is not something that they’re considering, as YouTube already has other long-form options. As such, Shorts will remain 60 seconds max for the time being.

Thumbnail options

Sherman says that the Shorts team has opted not to add specific thumbnail creation tools for Shorts because most Shorts views come from people swiping through the Shorts feed, which means that most people won’t see your thumbnails anyway.

YouTube has added the capacity to select a frame from your clip as the thumbnail, but there are no plans to add custom thumbnail options.

Hashtag usage

Sherman says that hashtags are not required on Shorts, but they can be helpful in certain application.

“Sometimes a hashtag can be associated with a real world thing that’s happened, like an event, and you wanna’ associate it with it. Other times they’re focused on topics, and I think in both those cases, creators should consider using them.”

So not exactly concrete advice on whether hashtags offer any value, but they may be worth experimenting with, in terms of trending discussions and/or niche topics.

Shorts volume

Sherman says that there’s nothing in the algorithm that dictates expanded or reduced reach if you post more Shorts, but he advises that there can be negative impacts for posting lots of lower quality clips.

“If you generated a bunch of relatively lower quality videos and then posted those, and got meager engagement on them, that energy is probably better spent in just making a better video and fewer of them.”

So quality over quantity is, in general, the better approach.

Deleting and re-uploading to maximize reach

Sherman also addresses the suggestion that deleting and re-uploading a Short can help to boost its reach.

Some creators claim that re-uploading can effectively re-trigger the algorithm to expand your distribution, but Sherman says that this is not a great strategy.

“I would not advise that. I’ve heard people talk about this as like a growth hack on Twitter or something [but] I think that there’s also a risk that it gets seen as spam in our systems.”

The future of Shorts

Looking ahead, Sherman says that Shorts will integrate AI elements, though he’s fairly vague on what exactly that means.

You would assume that this would incorporate AI creation tools of some kind, generative elements that can assist in your process, but we’ll have to wait and see what YouTube has in store on this front.

It’s an interesting overview of the current stats of Shorts, and how to best approach Shorts engagement, which could help guide you in your efforts to make the most of the option.

You can view the full interview clip above.

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Sourced from SocialMediaToday

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‘I feel manipulated’: The ‘debt help’ ads targeting struggling mums​​

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By Lora Jones, Deirdre Finnerty & Maryam Ahmed

“Debt help” social media posts are aggressively targeting people in financial trouble. The posts claim to help end money worries but charities warn some companies are misleading people who are struggling.

Some who sign up to the products on offer, known as IVAs, could end up worse off, a BBC investigation has found.

short presentational grey line

Shauna was £17,000 in debt with car and furniture loans when a specific sort of social media post started to appear in her feed. As she scrolled online in the evenings while her three children were in bed, she was drawn to pictures of worried-looking women alongside claims of wiping away financial troubles.

It was autumn 2020, and Shauna, then 23, was on maternity leave from her job as a care worker in a supported living facility. Costs had started to mount when she was pregnant and the bills and reminder notices were clogging up the letterbox of her south Wales home.

“I saw no end to it,” she says. “It was just building and building… I didn’t know how to cope.”

A company called Mums in Debt, she remembers, caught her eye on Facebook. It promised to write off up to 85% of debt. The more Shauna searched, the more it seemed like the perfect solution. One amount she could budget for. The belief she was taking control of her finances.

“I thought… ‘this is something for mothers, struggling'”, she explains. “That’s what sold it to me”.

She says she answered some questions from Mums in Debt on Facebook Messenger and a representative gave her a call. She was passed on to another company, which signed her up to an Individual Voluntary Arrangement – a court-approved debt solution in which debts are combined into a single monthly payment. The arrangement, she was told, would last for five years.

Shauna kept up with her agreed payments of £185 a month. But after a year, she realised her debts had barely budged.

Short presentational grey line

What is an IVA?

  • An individual voluntary arrangement (IVA) is an agreement between a person in debt and their creditors
  • The person in debt agrees to make payments to an insolvency practitioner (IP) who is authorised to act on behalf of people in financial difficulty. The IP divides the repayments between the creditors, if they agree on the amount to be paid back. Interest on debts is frozen for the duration of the IVA and contact from creditors and bailiffs is stopped
  • IVAs appear on an individual’s credit file and will affect their credit score. The repayment period usually lasts five to six years and at the end of the term, any debt not covered by payments already made is written off by the creditors
  • People taking out IVAs can sometimes pay thousands of pounds in frontloaded fees. If an IVA fails, an individual might have spent months or years paying fees and still be liable for the remainder of their debts
Short presentational grey line

Set up in the 1980s as a way to help owners of small companies keep trading and deal with their debt, IVAs are a booming business. Almost 90,000 were registered in England and Wales in 2022, compared to about 50,000 in 2014, according to figures from the Insolvency Service.

Although they can be a welcome solution for people who want to protect their assets, like their homes, IVAs are unlikely to be suitable for people with low levels of debt, people without much disposable income, or people whose income solely comes from benefits.

But the Citizens Advice charity says IVAs are being aggressively marketed at people in vulnerable situations by companies seeking to earn referral fees.

“You can just search online, on Google for debt advice and the [sponsored] ads will typically be from IVA firms”, explains its head of policy Morgan Wild.

“We’re seeing worrying trends of companies making false claims about IVAs, and even posing as charities on social media… these tactics lure people into IVAs which they simply can’t afford”.

Shauna, pictured in her home, looks at her phone

The BBC asked three independent debt advisers to review Shauna’s case. They expressed concerns about the affordability of her IVA payments because it was set up when her outgoings were smaller because she was living with her mother.

Fourteen other people who said they had signed up to IVAs after seeing social media posts also told the BBC they were struggling with repayments.

‘Stop bailiffs’

In a recent report, Citizens Advice deemed a sample of Facebook and Instagram IVA ads to be “misleading”. Some ads failed to mention IVAs, while others used names that could be confused with charities or claimed to offer, free, impartial debt advice.

Meta, which owns Facebook and Instagram, declined to comment when asked about social media adverts promoting IVAs on its platforms.

The BBC decided to investigate what was happening on TikTok. In June 2023, the BBC’s data team searched TikTok for videos promoting IVAs, by typing in keywords like “debt help UK”, “stop bailiffs” or “debt advice”.

Of more than 400 videos the team looked at which directly promoted IVAs or linked to IVA websites, more than 75% appeared to breach Advertising Standards Authority (ASA) rules.

Most of the videos that appeared to break the rules did not mention the risks, terms and conditions or fees associated with taking out an IVA, while about a third overstated the speed or simplicity involved in setting one up.

An illustration of a TikTok video indicating IVA claims to watch out for. This includes "debt write-off claims without evidence", "free advice claims", "claims IVA process is quick or easy" and "no mention of risks, restrictions or fees"
line

The ASA reviewed a sample of the videos. It said it had concerns about “irresponsible ads” and was “continuing to monitor and take action where they appear”.

It said: “Advertisers need to be responsible. They shouldn’t exploit consumers’ fears or lack of experience, or trivialise the decision to use IVAs.”

TikTok said it was “committed to working with the Advertising Standards Authority to ensure advertisers and creators comply with their guidelines”. It added that adverts promoting debt consolidation and debt assistance programs, which IVAs fall under, “are not allowed on our platform and are removed”.

Debt Trap: Who’s Cashing In?

As the cost of living crisis deepens, Panorama investigates the booming debt management industry and the companies signing up people for Individual Voluntary Arrangements.

Watch Debt Trap: Who’s Cashing In? on BBC One at 20:00 on Monday 24 July (20:30 in Wales and Northern Ireland) and on BBC iPlayer afterwards (UK only)

BBC iPlayer

After three years of repayments, Shauna now says she feels “manipulated” by the claims she saw on social media and says she would not have gone ahead with the IVA if she had known about other options.

A statement she shared with the BBC from 2021 showed that she had paid £1,537.99 of the £3,650 in fees that she owes, with just £360 knocked off her debt.

With prices rising, she says she has found it harder and harder to make ends meet and has had to use a foodbank for the first time.

“I couldn’t afford [the food shop] because the IVA went out [of my account],” she says. “I just feel ashamed of myself.”

The BBC wrote to Mums in Debt about Shauna’s case but did not receive a response.

Shauna in her kitchen

Experiences like Shauna’s are familiar to Morgan Wild of Citizens Advice. He says cracking down on social media content is “much needed”, but also calls for greater regulation of the IVA sector itself.

BBC Panorama called several companies in the IVA industry to see what happens when they are approached by potential customers. The team heard high pressure sales tactics being applied in some cases, with a reference to bailiff action if a potential client didn’t go ahead.

It is a complex field to navigate. Two types of companies – lead generators and debt packagers – can pass on potential customers to companies which provide IVAs. But lead generators are not regulated by the UK’s financial watchdog – the Financial Conduct Authority. They typically earn up to about £1,000 in fees for finding a customer who signs up to an IVA.

Separately, insolvency practitioners, who set up the IVAs and earn money in fees, are not overseen by a fully independent regulator, but are members of professional membership associations who oversee their work.

The patchwork of regulation could mean that people like Shauna are falling through the cracks.

The government agency the Insolvency Service acknowledged there are concerns about the use of IVAs, but said when used appropriately they are an “effective way for someone who is in financial difficulty to… pay their creditors”. The FCA said it was doing everything within its remit to ensure firms “really are supporting borrowers in financial difficulty”.

For now, Shauna is in touch with Citizens Advice and is considering her options – she could cancel the IVA and negotiate with her creditors directly, or see if she is eligible for another debt solution. Cancelling the IVA would mean she loses any money she has paid in fees so far.

She has always dreamed of owning her own home, with a bedroom for each of her three children but now feels the prospect is growing ever more distant.

“[I’m] living from pay check to pay check,” she says. “I feel like I’m getting absolutely nowhere.”

To anyone in a complicated financial situation, she urges them to think carefully before signing up to a debt solution.

“If you see an ad [online], do your research and find out exactly what you’re getting yourself into.”

What to do if you find yourself in debt

It is important to seek advice about financial difficulties before debts escalate. The earlier, the better.

If you think you cannot pay your debts or are finding dealing with them overwhelming, seek support straight away. You are not alone and there is help available. A trained debt adviser can talk you through the options available.

Information and support is available and free of charge – click here to find out about organisations who may be able to help.

By Lora Jones, Deirdre Finnerty & Maryam Ahmed

Sourced from BBC News

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4 Expert-Tested Ways to Get More Freelance or Contract Work

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By Amanda Pressner Kreuser

More than a third of the U.S. workforce are freelancers. Here’s how to set yourself apart–and up for six-figure success

The benefits of becoming a full-time freelancer or independent contractor are clear and compelling: being your own boss, setting your own schedule, and potentially working from your dream location anywhere in the world!

And the freelance market is growing steadily. In 2022, 60 million Americans performed some kind of freelance work, which represents an increase of three percentage points from the prior year.

However, with that growth comes increasingly fierce competition for work. I get a glimpse of that every time my content marketing agency has new work to assign; we often have hundreds of talented freelancers who are skilled and ready to take on those projects.

So how do you become the go-to freelancer who’s at the top of everyone’s lists for interesting, well-paying work? I asked some of our top contractors to share their best tips for building and scaling a top-notch freelance business. Here’s what they had to say.

Build your brand.

There are a few key ingredients to setting the right foundation for independent contractor work. A great place to start? Polish your website and LinkedIn profile.

Because you’re representing yourself as a business, it’s important to have a website showcasing your work, including some copy about the type of projects at which you excel. This is also an opportunity to highlight any key results from your projects. Did your ad copy double traffic to your client’s website? Was your article featured on the homepage? Don’t be afraid to brag–a little self-promotion goes a long way.

For LinkedIn, include an email address to make it easy for potential clients to get in touch, a few LinkedIn recommendations from your clients, and a link to your website.

Build your foundation.

As you develop your business, look for work from reputable organizations. You can get a sense of who those companies are by joining freelancer groups on Facebook and LinkedIn. Signing up with agencies (like Masthead Media, the agency I co-own) is a great way to learn about a variety of projects and clients.

Many of the most successful full-time contractors I know started their businesses as side hustles while they continued working at another job. This is a great approach if you need some time to build up your client base and get a better sense of what a full-time freelance income might look like. As you increase your client list (and earnings) from freelance projects, you may naturally shift into the mindset of a small-business owner and transition into independent contractor work full-time.

Finally, lean on technology to help you stay organized as you grow your business. Project management tools can provide structure to help you stay on top of assignments, deadlines, payments, and more.

Build your network.

Relationships are everything in business, and this is especially true for independent contractors. Fostering strong client relationships and building your network are keys to any successful freelance career.

Keep in touch with your clients, get to know their business goals, and check in on a quarterly basis. For example, did a client receive positive press or launch a new product? Did you come across an article that’s relevant to their business? These are all perfect opportunities to touch base so your contact will keep you front of mind when new projects arise.

If a potential new client reaches out with a business inquiry, even if it’s a cold email, be sure to respond! This is still true even if you’re not interested in the opportunity or don’t have the bandwidth for new projects at this time. A professional response goes a long way, and you never know where that connection may lead. Pro tip: Organize these kinds of emails in a separate folder in your inbox to keep track of potential opportunities for the future.

Build your reputation.

How can you become the type of independent contractor clients want to work with again? Submitting high-quality work is crucial, of course. But there are a few other elements that can take a freelancer from good to go-to.

First, meet your deadlines, plain and simple. If, for any reason, you’re concerned about missing a deadline, let your client know as soon as possible and propose a suitable solution. Perhaps that means offering a new timeline or sharing an abbreviated version of the work on the deadline and submitting the full version two days later. Whatever it is, be proactive and keep your client informed.

Another reputation-building tip: Take time to understand your client’s processes. Make sure you know when and where to send your invoice, and track your time, if the client requests it. Confirm how long it takes the client to pay their freelancers. If your agreement says you’ll be paid within 30 days of submitting your invoice, don’t send a reminder about payment before that time is up.

Finally, communicate! Ask questions to make sure you understand expectations, keep your client informed of your progress, and ask for feedback during and after the project. This shows your client that you value your work and the relationship–and that’s a win-win for everyone.

Feature Image Credit: Getty Images

By Amanda Pressner Kreuser

Sourced from Inc.

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Mailchimp Owner Intuit Launches Media Network for Small Businesses

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By Catherine Perloff

Financial services giant Intuit is launching a small business-focused media network, letting advertisers target customers across the web and tapping into a new revenue line, executives exclusively told Adweek.

The venture, called SMB MediaLabs, will let advertisers target the customers of accounting firm QuickBooks on a range of digital media properties, including audio, online publishers, social platforms like Meta, and connected TV. Intuit is working with Vizio as its exclusive CTV partner. QuickBooks had 7.1 million customers at the end of the fiscal year 2022.

Small business owners use QuickBooks to help manage their accounting and pay employees, among other tasks. Intuit also owns email marketing business Mailchimp, whose customers the company plans to eventually make available to advertisers for targeting, said Dave Raggio, vice president of U.S. acquisition marketing for Intuit’s small business and self-employed group.

“There are not that many good small-business data sources,” Raggio said, noting many data sources on small businesses come from government sources or are scraped from the web, making them less up-to-date and inaccurate. “I just looked at what we had and noticed that we could provide a lot of value for other advertisers that were trying to reach this audience.”

Intuit joins a growing number of corporations, often retailers, that have been retooling themselves as media networks in response to the proliferation of digital interfaces and the impending deprecation of third-party cookies, which has made advertisers hungry for new sources of first-party data. The bet has paid off: Retail media will attract $45 billion in U.S. ad spend this year, a 20% year-over-year increase, per Insider Intelligence.

Most entrants into the space start by serving ads on their e-commerce websites, including Marriott, a non-retailer that launched a media network last year. By contrast, SMB MediaLabs will not start by serving ads on its owned and operated (O&O) properties but on other digital channels.

Hailing from the consumer-packaged goods (CPG) world, Raggio joined Intuit to market QuickBooks to small business owners. The challenges Raggio faced there spurred the idea for SMB MediaLabs.

“The creep of the scope is not novel, but the focus is,” said Nikhil Lai, senior analyst of performance marketing at Forrester, of the rise of commerce media.

Intuit also owns tax filing service TurboTax and personal finance company Credit Karma, but these business lines will be separate from the media venture.

Filling a niche

Intuit is betting the small business audience could be a lucrative area to target for all kinds of advertisers, both business-to-business and business-to-consumer.

For example, it can be more efficient for CPG companies to ship products directly to shoppers if they are in bulk, and small business owners would be the ideal customers for bulk orders, Raggio said.

“If you’re trying to sell homeowners insurance, the fact that [someone] owns a small business makes it much more likely that they own a house,” said Eric Perko, founder of media agency Apollo Partners, which worked with Intuit to launch SMB MediaLabs.

Unlike a lot of traditional retail media networks that only run on O&O properties, we are running ads in environments where [buyers] are already investing

Dave Raggio, vice president acquisition marketing, Intuit

SMB MediaLabs will start as a managed service available via insertion orders. Intuit will place the buy with a demand-side platform (DSP) and any audiences are isolated to individual campaigns. In order to be able to deliver this offering, Intuit made several hires in data science. It’s also worked with agency Apollo Partners and has integrated tech from LiveRamp.

QuickBooks customer data is anonymized and aggregated, and advertisers cannot access customers’ personally identifiable information or financial data. The company is also letting customers opt out.

Getting on the media plan

The managed service offering may offer more privacy, but it could deter some buyers who want to test a new media channel easily, preferring the synergies in reporting and frequency management that come with buying directly via a DSP, said Janine Flaccavento, executive vice president of the retail, CPG and QSR vertical at Dentsu-owned data agency Merkle.

“Automation and self-serve are where some of these newer [retail media] brands find scale,” she said. “It’s easier for us buyers to test and learn, and the more the effort that has to go into that, the more it costs the brand that’s buying.”

Raggio said SMB MediaLabs is more open for buyers to test than most retail media networks by not acting as a walled garden.

“Unlike a lot of traditional retail media networks that only run on O&O properties, we are running ads in environments where [buyers] are already investing,” he said.

Because buyers can already execute granular targeting on Meta and other social platforms, QuickBooks will also have to prove to buyers that their audience is non-duplicative, Flaccavento said.

“I can go to Facebook and target small business owners,” she said. “What else makes it richer?”

Raggio said that along with offering basic data points like industry, location and age off-the-shelf, SMB MediaLabs can put together a bespoke targeting plan for buyers, based on when a customer is up for renewal on services, if they’re overpaying for products or their existing brand loyalties, among other attributes, for an additional fee.

“It’s about driving efficiency through finding the highest value subset of audiences within the vast SMB landscape,” Raggio said.

Feature Image Credit: Getty Images

By Catherine Perloff

Catherine is an Adweek staff reporter covering ad tech and platforms.

Sourced from ADWEEK

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‘They love being heard’: How Bubble built an avid fan base via TikTok and brand ambassadors

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By Julia Waldow

Bubble, a Gen Z-focused skincare brand, is taking off on TikTok.

Over the last five months, Bubble more than doubled its number of followers from 500,000 to 1.1 million people. Several of its videos, which Bubble typically posts once a day, have millions or hundreds of thousands of views.

Bubble’s business has ballooned across channels since Bubble launched at the end of 2020. Thanks to a recently-expanded partnership with Ulta Beauty, Bubble’s products — which vary from moisturizers to masks — are available in around 9,000 stores in the U.S., including CVS and Walmart locations. Bubble’s online sales have grown 1,000% year-over-year, while its in-store sales have spiked 800%. This number could be higher, though, because Bubble runs out of inventory quickly due to rising demand, CEO Shai Eisenman told Modern Retail.

On TikTok, all of Bubble’s reach is 100% organic, according to Eisenman. “It’s something we’re super proud of,” she said. Some of Bubble’s TikTok videos are educational (why the brand is fragrance free, for example), while others jump on social media trends (like rolling a product down a set of stairs to see if it breaks). One of its newest videos, which advertises Bubble’s new Cloud Surf moisturizer, racked up some 220,000 views in the first two hours. As of July 21, it had 696,000 views.

Bubble is on other platforms, too, although it has fewer followers there than on TikTok. The aforementioned Cloud Surf video, for instance, had 7,300 views on YouTube Shorts and 11,000 likes on Instagram, as of July 21.

Eisenman attributes the brand’s fast growth on TikTok to its relationship with customers. Bubble replies to nearly every comment posted on its TikTok videos, it’s amassed an ambassador program of 7,000 fans and it features user generated content (UGC) in its posts. One of Bubble’s most recent TikTok videos, which thanks fans for helping the company reach 1 million followers on the platform, includes videos of customers explaining what they like about the brand. Many Bubble fans will post videos of their product hauls or give tips or tricks for how to use items under the hashtag #bubble.

Bubble will sometimes use UGC to come up with its products. One recent example is the brand’s new plushie, a new category for Bubble. Eisenman told Modern Retail that she was watching fans’ videos showing their product hauls and noticed that many of the TikTokers had stuffed animals in the background. That observation, combined with the knowledge that one of Bubble’s most popular products is its moisturizers, led Eisenman and her team to develop a plushie version of Bubble’s Slam Dunk moisturizer. A video teasing the plushie has 547,000 views, with comments such as “BUYING WHEN IT COMES” and “OMG IT’S A SQUISHMELLOW OF BUBBLE?!”

Bubble typically enjoys a spike in sales after posting TikTok videos. In January, Bubble saw its sales through Walmart stores double after a video from a TikTok user went viral. But, Eisenman says she doesn’t think of TikTok primarily as a sales channel, although people can buy products via a link in Bubble’s TikTok bio.

“It’s really hard for us to come and say, ‘Oh, this is a sales channel,’ because honestly, most of our sales happen in-store and in retail and Walmart and CVS and Ulta,” she said. “But obviously, TikTok is fueling that growth significantly.”

Instead, Eisenman said she wants to use TikTok to build brand awareness, engage with customers and explain Bubble’s values. “We constantly adapt and post content and speak to our audience as if it’s a conversation,” Eisenman said. “And that’s, I think, something that’s very unique in terms of just our growth and in terms of our community, because they love being heard.”

Bubble’s ambassador program is key to this effort. Bubble has set up chat channels on the app Geneva to collect feedback from Bubble’s biggest fans. “Everything we want to launch, everything we want to do, they’re a part of,” Eisenman said. “We send them pictures of stuff way before they launch, and they help us choose names, and they help us choose packaging. And they’re truly a part of the ideating and the decision-making process in the company.”

Bubble’s ambassador program is so popular that it has a waitlist of more than 41,000 people. Eisenman said. She said the brand is focused on “accepting as many people as possible,” but that because many applicants are under 18 years old, Bubble needs to get consent from their parents. “That’s why it takes a very long time to actually go through the list,” Eisenman said.

Bubble’s brand ambassadors need to be at least 14 years old; have at least one valid and active social media account on Instagram, TikTok, Pinterest or YouTube; and provide a valid personal email address (plus a parent or guardian email address if under the age of 18).

Kimberley Ring Allen, founder of Ring Communications and adjunct professor at Suffolk University, applauded Bubble’s community-based strategy, calling it “smart.”

When TikTok first launched, Allen said, brands wanted to churn out as much content as possible. “Everybody was spending all their time making videos, right?” she told Modern Retail. “You had just been pumping out videos, and sometimes they would get views, and sometimes they wouldn’t. And that’s because there was no strategy.”

Now, Allen said, companies are thinking about channels like TikTok more as community-building tools. It’s not enough just to post content, she said — brands have to form a relationship with consumers. This is especially important, Allen added, because today’s consumers are “very ad-aware.” “The second they see an ad, they know to ignore it,” she said.

Brands are constantly trying to formulate new and existing TikTok strategies, but some work better than others. The food-saving app Too Good To Go posts its own content, but largely benefits from viral videos of customers showing off how much food they can get for $3.99. Brands like Pepsi and Pizza Hut have found mixed success in creating their own TikTok sounds in the hopes of going viral.

Ultimately, companies that use TikTok to collect feedback from fans and interact with customers will see the benefits from that, Allen said. “They turn their customers into prosumers,” she said. “Like, you know, your feedback is important, we want you to test these new products. They make them feel super appreciated… [and] they stay engaged.”

Feature Image Credit: Bubble

By Julia Waldow

Sourced from ModernRetail

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TikTok’s new monetization feature invites creators to make video ads for a chance to earn money

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By Aisha Malik

TikTok is introducing a new way for creators to earn money on its platform. The company announced that it’s launching the “TikTok Creative Challenge,” a new monetization feature that allows creators to submit video ads to brand challenges and receive money based on video performance. TikTok Creative Challenge is currently in testing as with select brands.

To be eligible for the new feature, creators must be at least 18 years old and have a US-based account with a minimum of 50,000 followers. Once enrolled in the TikTok Creative Challenge, creators will be able to browse through a list of challenges, and view the reward pool, additional details and requirements.

“Submissions should be high-quality, well-edited, original content,” TikTok explained in a blog post. “Once submitted and approved, creators can see the status of their submissions, view performance and check monthly earnings. Rewards are influenced by many factors, including qualified video views, clicks and conversions. Creators will receive notifications for their submissions if revisions are necessary, with the option to revise or appeal.”

Videos that creators submit will not be displayed on their profiles. If their video is approved, it will run as an ad on the app’s For You Feed.

TikTok says creators who are enrolled in the program will get access to resources, including a dedicated Creator Community group and Mentor Program to connect with other creators.

The idea and premise behind the TikTok Creative Challenge is somewhat similar to that of Pearpop, an LA-based startup that facilities brand-to-creator collaboration as well as creator-to-creator collaboration. Pearpop allows creators and brands to buy collaborations with celebrities like Madonna and creators like Sommer Ray. These celebrities and influencers are able to sell the chance to collaborate with them. Or, they can run “challenges” that invite people to post using a specific prompt or sound on TikTok or Instagram for the chance to receive cash rewards determined by engagement milestones.

TikTok’s new offering follows the same sort of model by helping creators cut down on the amount of time and effort it takes to reach out to brands to try to get brand deals.

It’s worth noting that the new feature comes as TikTok opened its revamped creator fund, called the “Creativity Program Beta,” to all eligible creators in the United States last month. TikTok says the new program is designed to generate higher revenue and unlock more real-world opportunities for creators. To be eligible for the program, creators must have a U.S.-based account, be at least 18 years of age and have at least 10,000 followers and at least 100,000 views in the last 30 days.

The TikTok Creative Challenge is the latest addition to TikTok’s suite of monetization tools, which includes LIVE subscriptions, Series and TikTok Pulse. The company also has tips and gifts monetization features.

Feature Image Credit: Yui Mok/PA Images / Getty Images

By Aisha Malik

Sourced from TechCrunch

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Publishers want billions, not millions, from AI

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By Ben Smith

Barry Diller fired publishers’ opening shot at artificial intelligence platforms in a Semafor interview this April, suggesting they sue the companies that have trained models on their data.

Now his company, IAC, and a handful of key publishers are close to formalizing a coalition that could lead a lawsuit as well as press for legislative action, people at those companies said. The group crucially includes the two industry pillars, The New York Times and News Corp., as well as Axel Springer.

“The thing that everyone wants to talk about is whether AI is going take over the world to eliminate humans and all that stuff,” IAC CEO Joey Levin, who is playing a central role in the coalition but declined to discuss it in detail, said in an interview in his office on Manhattan’s West Side. An AI takeover of the media “could be more profound than that sort of sci-fi fear.”

Many publishers have begun to experiment with AI tools aimed at making writing more efficient. But executives also worry about threats to everything from their revenue to the very nature of online authority.

The most immediate threat they see is a possible shift at Google from sending traffic to web pages to simply answering users’ questions with a chatbot. That nightmare scenario, for Levin, would turn a Food & Wine review into a simple text recommendation of a bottle of Malbec, without attribution.

“The machine doesn’t drink any wine or swirl any wine or smell any wine,” Levin said.

“Search was designed to find the best of the internet,” he said. “These large language models, or generative AI, are designed to steal the best of the internet.”

Ben’s view

Neither publishers nor platform executives are eager to restart the bitter coastal wars of the last decade. And they’re bringing none of the utopianism of the early internet. Publishers are determined not to repeat what many see as the mistakes of the social media era, in which they gave away their content for free. And tech executives are eager to avoid new allegations that they’re destroying democracy and journalism — and the attendant congressional hearings.

And in conversations with leading figures on both sides of the argument, the outlines of a settlement in which AI companies pay for training data are becoming clear — with one large glitch.

Tech companies appear to hope that they can placate publishers with, perhaps, eight figures worth of pay-outs, as the Facebook News Initiative did when it doled out payments annually between 2019 and 2022, fees reportedly exceeding $20 million for the Times, $15 million for the Washington Post, and $10 million for the Wall Street Journal.

Publishers believe the numbers ought to be much bigger this time around. If these breakthrough language models rely on their inputs, they argue, the share of the value they collect should be commensurate — and should run into the billions of dollars across the industry.

Levin, other publishers and their counterparts at Google, Microsoft, and other tech giants declined to quote numbers, or to discuss the coalition they’re forming.

But the publishers, led by Diller himself, are also threatening to try their luck in court, where complex questions about how copyright law applies to both the inputs to AI training and the outputs of AI models remain largely untested. Publishers are watching with particular interest to a Delaware lawsuit over an artificial intelligence company’s copying of legal texts from Westlaw.

Payments on the scale the publishers expect would mark a dramatic change for companies like Google, which have built high-margin business in large part because they — unlike media companies from Netflix to Comcast — don’t pay for content.

Unless the publishers lower their expectations, or the tech companies adjust their fundamental sense of what it is to be a platform, this high stakes conflict is likely to escalate.

The View From The Platforms

Tech executives raise one major objection to publishers’ demands: They haven’t even figured out a business model for AI yet, and there are no profits to share in the crushingly expensive business of maintaining language models.

A Google spokeswoman, Jenn Crider, said it is “very early days” for large language models.

“As we develop LLM-powered features, we’ll continue to prioritize experiences that send valuable traffic to the news ecosystem. We’re also working to develop a better understanding of the business models for these products and on ways to give web publishers choice and control of their content,” she said in an email.

Notable

  • Even as some big publishers attempt to assemble a coalition, others are striking their own deals with platforms, as the Associated Press recently did with OpenAI.
  • Google has developed a tool it says will help journalists write articles. Some of the executives who have played with Genesis described it to the New York Times as “unsettling.”
  • ChatGPT wrote a novel. Slate says it’s “pretty good.”

Feature Image Credit: Michael Loccisano/Getty Images for Semafor

By Ben Smith

Sourced from SEMAFOR

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