The Subtraction Principle

[00:00:00] [SPEAKER_02]: Reviews Wednesday, August 7th, Today, Two Prices, One Answer, Where Do You Put Your Discount?

[00:00:08] [SPEAKER_02]: Media buyers rethink X after the platform's sues an advertiser coalition?

[00:00:13] [SPEAKER_02]: Questions about how effective the latest brand safety tech really is and what Shopify sees in the forecast for the months ahead of consumer spending?

[00:00:24] [SPEAKER_02]: I'm Tod Maffin, that's ahead today in Digital Marketing.

[00:00:29] [SPEAKER_02]: When you're advertising at scale, even the tiniest changes can make a big difference. Just ask Google, which once tested 41 different shades of blue for its search engine links.

[00:00:40] [SPEAKER_02]: The same goes for copywriting.

[00:00:42] [SPEAKER_02]: The placement of words offers calls to action. They've all been studied and tested and debated for decades.

[00:00:50] [SPEAKER_02]: Now, research has been unearthed about one of those elements. The offer, the marketing science newsletter, RE, this week focused on where to place the discounted product.

[00:00:59] [SPEAKER_02]: The price to the left of the original price or to the right.

[00:01:04] [SPEAKER_02]: For example, which is more effective was 45 dollars now $30 or now only $30 was 45 dollars. Answer? It depends.

[00:01:17] [SPEAKER_02]: Research has found that when offering a moderate discount of around 30% writing the discounted price to the right of the original price,

[00:01:26] [SPEAKER_02]: for example was 45 dollars now $30 is most effective. Why? Well, people perceive the discount as bigger compared to when the new price is on the left,

[00:01:39] [SPEAKER_02]: making them more likely to buy the item. But this effect disappears when the discount is only about 10% or if the discount is clearly presented as a percentage.

[00:01:50] [SPEAKER_02]: It also reverses for very low discounts, for example, 4%, which the study said people find opportunistic and very high discounts like 85% which make people question the product's quality.

[00:02:05] [SPEAKER_02]: So why does this happen? The research is speculated that consumers find it easier to calculate the difference when the larger number appears before the smaller one,

[00:02:14] [SPEAKER_02]: matching the typical format for subtraction.

[00:02:19] [SPEAKER_02]: For moderately sized discounts that aren't easy to calculate mentally, we often skip the math and assume the discount is around 10%.

[00:02:27] [SPEAKER_02]: So for your product with a 33% discount displaying was 45 dollars now $30 should yield the best results,

[00:02:36] [SPEAKER_02]: making the deal seem more attractive to potential buyers. The research was published in the journal of marketing,

[00:02:41] [SPEAKER_02]: the paper is called consumer evaluations of sale prices, the role of the subtraction principle.

[00:02:48] [SPEAKER_02]: We have a link to it in today's email newsletter which you can sign up to for free by tapping the link at the top of the show notes.

[00:02:53] [SPEAKER_02]: We're going to todayindigital.com slash newsletter.

[00:03:00] [SPEAKER_02]: Usage of the beleaguered platform X is at an all time high. Also, X is ability to thrive in the future is threatened.

[00:03:08] [SPEAKER_02]: Both of these conflicting statements came in a video by X's CEO Linda Yaccarino this week after the company sued an advertising trade group.

[00:03:17] [SPEAKER_02]: X says the global alliance for responsible media conspired with its industry members to boycott X depriving the platform of ad revenue.

[00:03:26] [SPEAKER_02]: So they're swimming them along with former advertisers like CBS health, Mars and Unilever.

[00:03:32] [SPEAKER_01]: People are hurt when the marketplace of ideas is constructed.

[00:03:36] [SPEAKER_01]: No small group of people should be able to monopolize what gets monetized.

[00:03:43] [SPEAKER_02]: Clever a liberation aside, this case is likely a long shot. Of course there's no requirement for advertisers to buy ads on any platform.

[00:03:52] [SPEAKER_02]: And X's majority owner, Elon Musk himself earlier this summer told an advertising audience it comes that quote,

[00:03:58] [SPEAKER_02]: advertisers have a right to appear next to content that they think fits with their brand.

[00:04:05] [SPEAKER_02]: So will this backfire? It might have already.

[00:04:09] [SPEAKER_02]: Ad week is reporting that quote, two biceyeed sources who have advertised on X this year said X is new lawsuit makes them reconsider future investment in the platform.

[00:04:20] [SPEAKER_02]: A large brand that advertised on X around the 2024 Paris summer Olympic games said the lawsuit would make the brand reconsider whether to even post organically on X.

[00:04:32] [SPEAKER_02]: The source said quote, why would I want to be in any way shape or form involved in a place that wants to sue individual advertisers and the bodies that authentically represent them for choosing to not advertise there.

[00:04:44] [SPEAKER_02]: And quote, Axios reports that X will make $2 billion in ad revenue this year.

[00:04:50] [SPEAKER_02]: The last year in which X reported earnings publicly 2021 that number was 4.5 billion.

[00:05:01] [SPEAKER_02]: A new report from Adelidix claims hundreds of brands appeared next to unsafe content on user generated content websites despite using new AI brand safety technology from providers like double verify and integral ad science.

[00:05:16] [SPEAKER_02]: A piece on digit day today reports that industry players believe the firms may be over promising and under delivering sources quoted in the piece were puzzled by inconsistencies in how the AI tools categorized web pages for risks.

[00:05:30] [SPEAKER_02]: Quoting that piece quote, the Adelidix report showed wiki pages with racist violent or sexual content labeled as low risk.

[00:05:39] [SPEAKER_02]: While pages from the Washington Post and roiders remarked as medium or high risk despite lacking such content.

[00:05:46] [SPEAKER_02]: Most of the sources reached for this story had the same question.

[00:05:50] [SPEAKER_02]: Is the tech not working as it should or hasn't been pitched as something better than the systems are currently capable of offering.

[00:05:57] [SPEAKER_02]: One noted it works well enough to quote, give people just enough.

[00:06:01] [SPEAKER_02]: Ech reduction unquote.

[00:06:03] [SPEAKER_02]: However, the findings now have them wondering if the expenditure which can range in the millions per brand is even worth spending.

[00:06:12] [SPEAKER_02]: For its part double verify accused analytics of selectively searching for problematic terms without proper context.

[00:06:20] [SPEAKER_02]: One of the website studied fandom a large user generated content site said the examples were from old low traffic wikies and that's quote, why it was not flagged via our current moderation systems or Google's ad server both of which monitor our active wikies unquote.

[00:06:40] [SPEAKER_02]: Heads up if you sell through Amazon the company has said an October 19 deadline for third party sellers to send their black Friday inventory to its fulfillment setters.

[00:06:51] [SPEAKER_02]: This is one week earlier than the deadline last year.

[00:06:54] [SPEAKER_02]: The company says it needs the extra time to ensure they meet primed delivery promises during black Fridays ordering rush.

[00:07:00] [SPEAKER_02]: Amazon warns that sellers who miss this deadline may have difficulty finding space at Amazon's fulfillment setters.

[00:07:08] [SPEAKER_02]: That it will have limited slots to accept shipments in November and December.

[00:07:12] [SPEAKER_02]: One bit of good news, sellers that exceed capacity limits this peak season won't have to worry about an inventory storage overage fee.

[00:07:21] [SPEAKER_02]: Amazon eliminated that fee last month.

[00:07:27] [SPEAKER_03]: Do you know who you are, who I understand?

[00:07:31] [SPEAKER_03]: Do you know who your wish was and who you have to take your life as your life?

[00:07:38] [SPEAKER_03]: The commercial platform of Shopify revolutionized millions of people worldwide.

[00:07:43] [SPEAKER_03]: With Shopify, you are in a online shop.

[00:07:46] [SPEAKER_03]: A lot of programmers or designers.

[00:07:50] [SPEAKER_03]: Thanks to the efficient, intuitive social media and online marketplace integration,

[00:07:55] [SPEAKER_03]: you can Instagram, eBay and Co. Verben and Verkhauffen.

[00:07:59] [SPEAKER_03]: New C-coups will still be so easy.

[00:08:02] [SPEAKER_03]: Shopify offers a single-sign platform to build an online business on a single-sign business.

[00:08:08] [SPEAKER_03]: Customs are tested and the business of the world is present.

[00:08:12] [SPEAKER_03]: Shopify.de is a real-time business.

[00:08:15] [SPEAKER_03]: An online shopping-fighting.de is a real-time online game and a close-ling.

[00:08:20] [SPEAKER_03]: Made for Germany, powered by Shopify.

[00:08:43] [SPEAKER_00]: Listen to let me save you 25 years on Spotify, wherever you get your podcasts.

[00:08:48] [SPEAKER_00]: That's let me save you 25 years with Sean Nelson.

[00:08:50] [SPEAKER_00]: Listen now.

[00:09:11] [SPEAKER_02]: One of those formats is called a journey ad, which runs in its mobile app while a user is on a trip.

[00:09:17] [SPEAKER_02]: Quoting Paul Wright, the head of international markets for Uber advertising, quote,

[00:09:21] [SPEAKER_02]: Journey ads appealed to brands that really want to get some long-term engagement

[00:09:24] [SPEAKER_02]: and aren't chasing a performance-based programmatic lower funnel type approach.

[00:09:29] [SPEAKER_02]: The ad unit is only one ad per journey.

[00:09:33] [SPEAKER_02]: So you're not competing with anyone else.

[00:09:36] [SPEAKER_02]: Unquote.

[00:09:36] [SPEAKER_02]: The company also has digital screens inside some cars, often just an iPad with T-Mobile selling ads there.

[00:09:43] [SPEAKER_02]: Uber's global scale is attracting advertisers, particularly large consumer package goods brands interested in multi-market campaigns.

[00:09:52] [SPEAKER_02]: Uber eats has seen strong women to be in that area.

[00:09:55] [SPEAKER_02]: In addition to restaurants, Uber is attracting advertisers from categories like financial services, social networks, tech, entertainment and luxury.

[00:10:03] [SPEAKER_02]: L'Oreal, for example, ran a successful campaign on Uber's platform targeting travelers at London Airport with a perfume ad.

[00:10:11] [SPEAKER_02]: The campaign outperformed benchmarks for view time, swipe rate and click through rate.

[00:10:21] [SPEAKER_02]: And finally, Shopify is revenue grew 21% year over year in the second quarter, beating the company's own outlook of high teams growth.

[00:10:29] [SPEAKER_02]: The strong performance since Shopify shares soaring more than 20% this morning.

[00:10:34] [SPEAKER_02]: Shopify's CFO told analysts the company expects to end the year with minimal head count growth compared to the approximately 8300 employees it had at the end of last year.

[00:10:45] [SPEAKER_02]: When asked if the company had been seeing any signs of a downturn in consumer spending,

[00:10:49] [SPEAKER_02]: he said the company, quote, didn't see any significant deterioration or improvement.

[00:11:01] [SPEAKER_02]: I still haven't really found a game of video game to get back into.

[00:11:05] [SPEAKER_02]: I've been trying for a couple of days, but I don't know. This has happened to other gamers.

[00:11:09] [SPEAKER_02]: You just kind of lose interest for me who knows how long this is going to last.

[00:11:14] [SPEAKER_02]: So I've been spending my time doing two things, one very productive, one not.

[00:11:18] [SPEAKER_02]: The productive thing is I've been doing more chores around the house, making the bed and cleaning things so I have spare time.

[00:11:24] [SPEAKER_02]: I guess that's good.

[00:11:25] [SPEAKER_02]: And then whatever remaining time I have, and I'm not proud to admit this, get sunk into TikTok.

[00:11:32] [SPEAKER_02]: Maybe a couple of hours a day?

[00:11:35] [SPEAKER_02]: It's not all consuming content. I am making content, making really bad content for instance.

[00:11:39] [SPEAKER_02]: I'm telling wheelchair jokes to my wife, who is paraplegic.

[00:11:43] [SPEAKER_02]: It doesn't go over well.

[00:11:45] [SPEAKER_02]: It most cases, and you can watch the cringe for yourself.

[00:11:48] [SPEAKER_02]: My TikTok account, my personal one is at Todd Massen, TOD, MAFF, IN.

[00:11:54] [SPEAKER_02]: And of course we have one for the podcast as well. It's just at today in digital marketing.

[00:11:58] [SPEAKER_02]: All of our social media is at the top of the show notes. That's it for today. Thanks for listening. I'll see you tomorrow.

[00:12:57] [SPEAKER_03]: Copy 5.de is really great. So, Copy 5.de is really great.

[00:13:03] [SPEAKER_03]: Mate for Germany.

[00:13:05] [SPEAKER_03]: Paard by Shopify.