What Facebook's Acquisition of Kustomer means for the future of Social Commerce

 

Facebooks $1 billion dollar acquisition of CRM platform Kustomer is a strong single at how Facebook views the future of its own platform.  Customers aren't concerned with the particular channel, as much as they are about getting brands to respond to them.  Incorporating Kustomer's technology with Facebook is a move toward onmi-channel communication for companies with customers regardless of the particular channel the customer reaches out.  If small companies are able to focus their efforts on a single platform but reach customers wherever they are across the internet, it will be a boost to Facebook.  They will become the defacto platform for any business looking to extend their reach.  Beyond the advertising channel, they will become the platform that small to medium companies may begin to run their entire marketing departments.

This purchase, as well, helps to provide context for the Salesforce acquisition of Slack.  Although not directly comparable, enough similarities to see the way companies are viewing the importance of having CRM capabilities built into the social platforms companies are using to understand how to effectively target customers on the web.  Facebook acquired WhatsApp and has made moves to utilize the app to make transactions easier for businesses.  

Salesforce can see these moves by Facebook to transition into the business software business as a threat. Facebook's previous acquisitions have traditionally been with the intent to provide additional features for its users.  These moves single that software companies catering to the business should beware of the tech giants which are responding to the way customers have embraced social media, and its ability to conduct commerce. 

Source: 

https://www.wsj.com/articles/facebook-nears-purchase-of-startup-in-deal-that-values-it-at-1-billion-11606750196

https://techcrunch.com/2020/11/30/facebook-confirms-it-has-acquired-kustomer-sources-say-for-1b/

 Tweets vs. Fleets?

Twitter recently introduced a new content format -- "Fleets" -- that eerily (strategically?) resembles the "stories" format that Snapchat spearheaded and Instagram so skillfully copied.

According to Twitter, the new format aims to create a more active and safer space for users to express themselves and participate -- especially for those who were "intimidated" by the open and public nature of tweeting in the traditional way.

This is also a strategy to engage the silent "lurkers" on Twitter -- there is a trend of users who prefer to consume content from the more active users, but don't usually contribute to the discussions themselves. A lot of users prefer to passively read tweets and are scared to contribute because of the risk of getting "flamed" publicly.

So essentially, what Twitter is doing is taking the pressure off of the users by making their contributions more transient and "fleeting," lowering the barrier of entry even for the most easily intimidated users.

Whether users really need this feature, only time will show. The truth is, if people did have the intention to make something permanent as part of the "cancel culture," they still have the option to take a screenshot of the "fleet" and share it through permanent tweets instead.

But ultimately, it's up to the users to use -- or abandon -- the feature.

Will AR dominate our next decade?

 Smart phone, especially iPhone, defines the decade of 2010-2020. “Mobile first” become the motto of most tech companies. What will the next thing that will define the next decade? Apple again, might have the answer for us – AR. 

 

AR made its debut to mainstream users with a hit game Pokemon Go, as well as other furniture apps. While other big techs all have been actively exploring goggles and glasses for AR, every new iPhone 12 Pro has a depth-sensing lidar sensor that can do advanced 3D-scanning for a depth map as well as more AR capabilities. Apple is keen on making AR work with what everyone already has – their phone than another extra device. However, we predict that one killer app is needed to kick off the AR in mass consumers. Right now, there are more than 10,000 iOS apps that use AR, that helps people to live their lives better. COVID also accelerated the trend for AR adaptation by forcing many of the physical stores to close. Furniture and home improvement has been the first to try out AR, and Home Depot data showed that people are more like to buy if they use the AR. Art exhibition can also use the location information to “install” art wherever they would like.

Amazon launches Online Pharmacy

 

This week, Amazon announced its launch of Amazon Pharmacy, an online and mobile prescription medication ordering service. This move comes a little over two years after its acquisition of Pillpack for $753 million. 

The company said its online pharmacy will offer commonly prescribed medications in the U.S. After setting up a profile, users can have their doctors sent prescriptions directly to Amazon.  

Continuing its ambition to become a one-stop-shop for medicine and wellness, Amazon’s push into the pharmacy business has sent shares of giant drugstore chains such as CVS and Walgreens plummeting. However, industry experts expect the move to mostly affect smaller drugstores that don’t have the purchasing power of retail giants or deals with insurers.

With a track record of disruption in several industries (i.e. booksellers, supermarkets, shipping companies), Amazon’s impact on the pharmacy business will be profound. 

The Future of Black Friday Shopping

This year will be a very different holiday shopping experience. There is no doubt that online shopping will increase this holiday season as we continue to socially distance. Amazon and other e-retailers will be well positioned to benefit from the holiday shopping activity as in store events might even be cancelled or are shifting online as stores do not want to attract large crowd. Target, Kohl's, and Walmart have already decided to keep their doors closed.

This holiday season may just be the first push to a quite different Black Friday shopping of the future.

Here are a few things that will make holiday shopping a different experience this year and may even stay.

• Curbside pickup has become popular not just for restaurants during the pandemic and is likely going to stay. It will take a while until we get comfortable using mass transportation and customers with a car will continue run errands using curbside pickup. Curbside pickup may be a way for brick and mortar retailers to stay relevant and claim a share of sales otherwise moving to online retailer. (https://blackfriday.com/news/stores-with-curbside-pickup)
• Black Friday won’t be just on Friday this year. It’s more like a month as retailers are trying to lure shoppers to make purchases. Deals might be even better and available online this year as customers have been to lure more shoppers. 
• QR Codes have gained popularity to receive special offers or updates by scanning a QR code in a  magazine or store front. The Black Friday of the future will probably turn toward tech to make this a more immersive experience such as AR ad circulars where you can scan QR codes and see special deals and product information on your phone.
• Amazon has some exclusive offers just for Amazon Alexa (https://www.smartenlight.com/alexa-what-are-my-deals/) to get customers to use voice enabled shopping

It will surely be an interesting holiday season for the retail industry.

Are AdBlockers ethical?

"Ad blocking" is a kind of software, usually in the form of a browser plug-in, but now it is more of a mobile application. They prevent advertisements from appearing when you browse the web or App.

Most people using Chrome or Firefox browsers have AdBlocker turned on by default. While many websites have come up with ways to get around that, AdBlocker and similar extensions are effectively reducing the reach of advertisers, especially on 3-party websites. However, is this behavior ethical?

According to the latest report from PageFair, the well-known adblocking plugin Adblock has a huge impact on website traffic and revenue. PageFair's report stated that Adblock has hidden costs. It not only reduces the revenue of small and medium-sized websites, but it also reduces traffic. For every 1% increase in the total website traffic filtered by Adblock, the website traffic of small and medium-sized websites drops by 0.67%. Filtering ads by Adblock usually results in a temporary increase in traffic on the site. This short-term effect is because Adblock users can enjoy the site without advertising. In the past three years, the traffic level of most websites with high Adblock filtering rate has been significantly lower than other websites. Thanks to Adblock, the traffic of the 2,574 websites in the study dropped by an average of 8% in 35 months.

Those who oppose ad blocking usually focus on its potential threat to the Internet economy. Advertising is the mainstream business model on the Internet. Therefore, if everyone uses ad-blocking software, will the Internet lose its appeal and crash? If you can't see the advertisement, then, isn't the service you are using now a truly free product? When using ad blocking software, have you violated your agreement with the network service provider? Is ad blocking an "obvious robbery" as described by AdAge?

In response to these doubts, proponents of ad-blocking often point out that most ads are "annoying" and blocking can make them better. In addition, users who block advertisements would never buy the goods in the advertisements. Many users also object to advertisers tracking their browsing data and online behavior. Some people block ads because they want pages to load faster or reduce overall data usage.

It is reported that AdBlocker now not only intercepts advertisements but also charges these advertisers, it has become a guard for Internet portals. It has made strict criteria for these advertisements, and only allows acceptable advertisements to enter. Let advertisers purchase the permission to display "acceptable" ads so that even users who have installed ad-blocking can see these ads.

Whether ad blocking software is infringing or not, there is no sound answer yet. This debate is still ongoing. At the same time as consumers of advertisements and websites, we can think about the meaning of pop-up advertisements: you can use the browser for free, you can retrieve any information you want to find, and you can see the latest and most popular high-quality videos for free. Some people get used to using news for free but ignore the production of these websites, and maintenance also requires a lot of energy and financial resources. If these sites charge you, how much do you have to pay? If fees are charged, does it violate the original intention of the "Internet" for interconnection? If the advertising business of technology companies such as Google, Facebook, Apple, Tencent, and Alibaba is banned, and investment in cutting-edge technology research and development such as artificial intelligence, will there be enough financial resources and motivation for innovation?

In the long run, ad blocking may have a potential benefit for advertisers and publishers: in the end, it may eliminate the biggest waste of the advertising industry. If ad-blocking becomes more widespread, it will force advertisers to introduce more concise and less intrusive ads, and the way they handle information about us will be much more transparent than in the past, otherwise, they will face the danger of being blocked forever.

Shopify is rushing to prepare big retailers, restaurants, and grocers for the post-Thanksgiving boom

11/20/2020 - CNBC.com 

Shopify is a tech company that provides retailers the tools to build a website, add checkout functionality, manage orders, and integrate with other sites like Facebook, Pinterest, and TikTok. Subscription pricing ranges from $29 to $2,000 per month across small retailers to large national brands. More recently, big brands have leveraged Shopify’s platform to establish a significant digital presence.

Due to the COVID pandemic, there has been a large adoption and shift to e-commerce and online spending. It is projected by eMarketer that Black Friday online sales will surge 39% to $10.2B and Cyber Monday online sales will also jump 38% to $12.9B.

Now large national brands like Heinz, Chipotle, and Schwinn are using Shopify’s e-commerce software for the first time to take advantage of this paradigm shift. Heinz was able to set up a store to go direct-to-consumer for their condiments category. Chipotle introduced a virtual farmers’ market to allow farmers who are part of the restaurant company’s supply chain to sell meat, dairy, and other products direct to consumers.

Shopify’s business has been one of the biggest beneficiaries of the stay-at-home result of the pandemic and stock has increased 143% this year and revenue has doubled in third quarter to $767M. Market cap of $118B makes it the most valuable company in Canada. They are certainly the leader in the industry with BigCommerce being a smaller rival also experiencing growth. Although large brands have added recent momentum, it is the small businesses that remain the engine and critical to Shopify’s long term success.

Mobile marketing channel or desktop channel?

Although making the app available in the mobile undergoes long and complex arrangement with the mobile phone company, the development, evolution, and popularity of apps on the mobile phone is just simply drastic. You would not be surprised at all if someone told you he or she has over 10 apps on his or her mobile phone.

Mobile as a marketing channel just becomes more and more popular and important. There are several key apps in my iPhone which I need to check almost every day: WhatsApp to communicate with classmates for group project and class discussion, LinkedIn App to communicate and keep in touch with my networks, and Zillow App to track the new house on the market for my house hunting effort. Although, the design and content in the apps sometimes are way simple and may not be user friendly comparing with their corresponding website in desktop version, they still provide us a very convenient tool to grasp the information on time. Especially, the capability to be able to gather information at any time when we are away from our desk: during lunch time, during commute time, during vacation time, etc. Such needs and convenience make the mobile app development has more momentum to grow up in the future.

However, the COVID-19 pandemic has completely changed our lifestyles and probably will change our perspectives in business and marketing including the mobile marketing channel.

We have been working from home and spending most of our time in front of computer since early this year. The staying at home and sheltering in place have suddenly changed our behavior in grabbing information. The desktop screen is much more convenient than the tiny mobile phone screen and people start to spend more and more time on desktop than on mobile phones. Since Pandemic start, I seldom use the CanvasGSB app in my iPhone but rather go to canvas website in my laptop to obtain the relevant information and I spend most of my house hunting in Zillow website in my laptop rather than in my iPhone.

Such change in lifestyle in the whole country and in the whole world raises a strategy questions for any business people: should we continue focus on mobile marketing channel or should we modify our strategy and switch our efforts to concentrate on website desktop marketing channel?

Tips for a Social Distance Thanksgiving

With Covid cases hitting an all time high and the second wave in full swing just in time for the Thanksgiving, there are many tools in this digital age that can help us to have a safe and happy holiday.   There are a number of guides to help people host a fully remote Thanksgiving thanks to The New York Times and Mashable.

For me here are the top tips:

- Use a good video chat platform: Microsoft has launched a lower tier free version of their business product for up to 300 people and 24 hour use.  Better than having to keep resending Zoom links every 45 minutes!

- Pre-order the meal online and save the hassle and mess in the kitchen:  Grub Guides offers a range of choices in NYC

- Host a digital movie screening: Disney+ offers a GroupWatch feature or Amazon Prime has Watch Party

- Enjoy some remote games post dinner: My personal favorites: Online Codesnames (free) and you can add your own words or all the rage with the younger generation, Among Us ($5 flat fee app) but very addictive

Happy Thanksgiving!  Hopefully this helps make holiday in the time of Covid a little bit brighter!

Can We Trust the Data: LinkedIn admits to an Oopsie

 LinkedIn has confessed to some glitches in their system that lead to advertisers overpaying for their ad space. Granted, they claim the overcharges were very small, in most cases less than a total of $25, but this has me wondering how common overcharging for digital ads is, and how well it is policed.

Not quite so recently, but still in most seasoned digital marketers' minds is Facebook's snafu on video view time.

It seems the issue may be rooted in what truly counts as a viewable ad, which surely has Oracle squirming. I don't question that this was an innocent mistake, and kudos to Microsoft's LinkedIn for reporting it, but that could be to avoid lawsuits.

What it ultimately goes to show is that when the firm that is charging you supplies all the data, its best to do your own research and learn some best practices. This may be a fact of life life in the constantly evolving world of digital marketing. Staying abreast of current technology and thinking about potential loopholes may help out your costs.

Twitters Disclaimer Has Turned Meme

 Twitter's attempt to combat false claims and fake news, or at least "provide context", has turned into something of a punchline.  And some brands are even getting in on the joke.[1]

Is this clever messaging, or undermining Twitter's efforts to fact-check. What are the responsibilities for companies such as Twitter to perform such a function? It seems like just a harmless joke, but if the effort isn't taken seriously it may be abandoned.  A study has demonstrated that exposure to social media can make consumers of news more biased. [2] This alone would seem to indicate that some responsibility lies with these platforms to do something about falsehoods. Or is the responsibility on our news institutions that seem to have struggled to adapt to a world with social media, and in a post-truth era. How do we as consumers navigate this new world?

Perhaps being able to find humor in a situation is the best way to acknowledge that there is an issue.  I personally feel the posts are riding a very thin line, and time will judge how such posts age.

Sources: 

[1] https://adage.com/article/digital/brands-have-fun-claim-disputed-twitter-meme/2295311

[2] https://onlinelibrary.wiley.com/doi/full/10.1002/hbe2.185

Live streaming and E-commerce: are customers buying it?

In China, e-commerce is undergoing yet another transformation - the combination of live streaming and shopping has penetrated to both mega and lower-tier cities. With smartphone adoption steadily increasing, customers turn to their favorite streaming app to look for hot deals and discover new brands from "influencers" that they trust. 

While live streaming has gained so much popularity in Asia, it hasn't got much traction in the US. Recently Amazon Global stated that the Amazon Live function will be launched on the entire site, making it a major competitor against Facebook Live, in this emerging sector.

Amazon or Facebook wasn't the first. For example, Eight TV launched in August 2017, where users can record a 1-minute short video, including but not limited to the evaluation of various products. All short videos will provide a product shopping link of an online retailer, and viewers can directly purchase products, and Eight TV opens up Amazon's product database.

Another example is Dote, which is also a mobile shopping app that recommends products through videos, helping to plan and sell products from retailers such as Sephora, Victoria's Secret, and Urban Outfitters.

Scattered mobile shopping products or brands that tried to carry out video delivery have not been able to set off the live delivery boom of online shopping in the United States. However, until last year, Internet giants such as Facebook, Amazon, and YouTube entered the game and increased their sales of live broadcasts. 

Will Amazon change the game? With the live streaming function, sellers can directly interact with consumers, and consumers can complete a one-click purchase by clicking on the carousel next to the video. Amazon said that brands are influencing consumers' shopping behaviors and decisions, while live broadcast and the following functions are natural touchpoints that connect sellers and consumers for deeper interaction. With the help of the live streaming, sellers can more easily interact with consumers, thereby further empowering their own brand promotion.

1. Amazon live broadcast and Alibaba/Taobao comparison

Taobao Live has created a new form of product display in the field of e-commerce. High-quality anchors, fan interaction, and high frequency of live broadcasts have become the key to Taobao's leading the development of e-commerce live broadcasts. In contrast, Amazon, which launched the live broadcast function not long ago, has not broken away from the traditional model of product evaluation. When watching Amazon live broadcast, it is like watching a Youtube blogger you don’t know makes product reviews. (This kind of live broadcast) lacks social influence, and at the same time, ignores the user's sense of participation and their willingness to establish interactive relationships. On the way to e-commerce live broadcast, there are still many places to learn from Taobao.

2. TikTok - a disruptor with opportunities

TikTok's overseas version of Douyin was the fourth most downloaded non-gaming app in the world last year. This year it has risen to third place in the world, second only to WhatsApp and Messenger, and ahead of Facebook (fourth) and Instagram (fifth). TikTok has been downloaded more than 1.5 billion times in the App Store and Google Play. Like YouTube, the core of TikTok is videos that people share. The more interesting the video, the more it resonates with the audience. Unlike YouTube, TikTok videos are usually short and shot in a vertical format. The core of influencer marketing is storytelling. You need to give influencers enough flexibility to tell their fans your brand story in a more authentic way.

200 million dollars question: are Uber drivers employees or contractors?

 While people are refreshing websites every 10 minutes for the presidential election vote counts, California has another vote counts for Proposition 22 that might have not catch your attention. Proposition 22 is a proposition made by Uber, Lyft, Doordash and others alike to classify their drivers as contractors to avoid providing health care and other benefits. These companies spent around $205 million on their Yes campaign. And it is paying off: Yes has 58% support comparing to No has 41% support. Interestingly, both sides have strong data from “independent research” to back their arguments.

From the Prop 22 campaign, It was calculated that “‘hundreds of thousands of jobs’ will be lost if Proposition 22 fails”. And survey shows that 4 times more drivers would like to remain as independent contractors. However, these studies are heavily financed by Uber, Lyft and others. Berkeley Research Group took $400k from them and their research result is that “at least 80% of driver jobs would disappear if gig economy companies were forced to classify workers as employees”. And even University of California, Riverside has research funded by these companies and unsurprisingly concluded results in favor of them.

Advertising on Streaming Services

A lot of money is going into advertising on streaming but there are still many challenges to overcome to make it an effective place to advertise.

Connected-TV advertising is growing although it remains relatively small compared to the ~$70 billion that gets spent on traditional TV advertising in the U.S. every year. Ad spending on streaming TV will total almost $8 billion in the U.S. this year, up from nearly $6.4 billion in 2019, according to eMarketer.

Despite Netlix, which is ad-free being one of the most popular streaming providers, ad-supported offerings from providers including Amazon.com Inc., Roku Inc. and TV network programmers have been attracting more viewers.

One of the challenges relates to the fact that the media-buying landscape is fragmented which can result in viewers repeatedly seeing the same ad. Marketers buy ads in streaming TV from a host of providers, including app owners like TV networks, vendors that connect ad buyers with sellers, and device makers with their own operating systems such as Roku, Amazon and Vizio Inc.

However the range of options available also has some limitations. Roku, Amazon and Hulu, for example, each sell ads and have their own audience data. The issue is that it is hard for advertisers to track or target viewers from app to app, or from one operating system to the next. Ad inventory bought from multiple sellers can often show up in the same app.

The lack of transparency has been one of the reasons why not more money has been spent on streaming advertising. Advertisers entering the medium of streaming TV want better measurement and targeting capabilities than currently available. Additional transparency would come at the cost of user privacy, which could create a backlash and would need to be carefully considered for streaming to avoid the same privacy problems other digital media are facing.

EBay looks beyond cookies with new programmatic targeting system

 Ebay Advertising created a program to target ads without third party cookies.  The program offers a better way to match to users, and in turn gives advertisers more certainty that they are reaching the target audience.  The new approach will help solve the issue of "bombardment" and address some of the declining public trust in advertising.

https://www.campaignlive.co.uk/article/ebay-looks-beyond-cookies-new-programmatic-targeting-system/1690502

The election’s impact on the app market

With the close race of this week’s U.S. presidential election, it’s been interesting to watch how trends on the app market were reflective of the nation’s division. There were a number of notable impacts:

1. CNN and Fox News were among the top free iPhone apps in the U.S. App Store
2. Facebook and Instagram ran notifications to inform users that votes continue to be counted after Trump falsely claimed he had won the election
3. Right-wing social media app Parler rose to number 29 from number 1,023 in the iOS app store ranking within a week
4. In light of the stressful week, Calm’s meditation app made headlines for its ad campaign during the election, even popping up on the screen during CNN’s “Key Race Alert.” This move seemed to benefit the app in terms of downloads and app store rankings. 

Influencer Marketing

marketingdive.com

Although there has been a general pullback in advertising since the COVID pandemic, influencer marketing remains quite strong. As consumers are spending most of their time at home due to lockdown or work-from-home measures, marketers are turning to influencers for fresh creative while studio production remains mostly off-limits.

With the emergence of creator-driven platforms like TikTok along with established platforms like Instagram, there has been a boom in leveraging influencers to target their young fans. Before the pandemic, advertising spend on influencer marketing was estimated to reach $9.7B in 2020 and 66% of marketers planned to increase their budgets in this segment.

Authenticity is one of the most critical factors to the success of the influencer. Their expertise in the product makes followers 56% more likely to purchase while 49% of followers stated the influencer’s relatability drives them to buy, according to Morning Consult.  

Channel choice and demographics should also be considered for influencer marketing. 13 to 16 year olds use TikTok more than Facebook, and Twitch is another popular destination for this group. For young men, it’s YouTube with gaming and fitness as categories of interest. For women, it’s Instagram to follow beauty and fashion accounts.

In addition, the microinfluencer economy has been steadily growing as 86% of Gen Zers and millennials report they’re open to sharing sponsored content for money and 61% say they’re likely to boost brands even without getting paid to do so. This presents an opportunity for businesses to tap into the microinfluencer community at a relatively low cost vs. the high-profile and pricey celebrity endorsements. Microinfluencers comprise 40% of brands annual influencer spending compared to 28% for celebrity influencers, according to Rakuten Marketing.  

Sorry... I have no idea who Taylor Robinson is.

If I can attest to anything about the 2020 election campaign, it is the sentiment that it will be remembered as the texting election. More and more, campaigns are finding social media, and more specifically text messaging an effective way to cut through the clutter and connect with potential voters.  

It's noted that 99% of text messages are read, and 90% are being read within the first three minutes. So it's a channel that has unparalleled visibility.[1] But will this method prove effective in driving results? 

The results aren't fully known, but from a personal perspective, the process is anything from perfect, as I have been on the receiving end of messaging that is targeted at my 831 California area code.  I am either the victim of a Taylor Robinson that has a fake number that matches mine, or she mistyped her own number.  Either way, this is wasted effort and only creates annoyance to me, being I'm registered and reside in New York.  So regardless of my position on Prop 15 I won't be voting on it.

New research out of the Center for Media Engagement at the University of Texas at Austin paints a much darker and meaningful picture of the trend. The nature of peer-to-peer (P2P) messages make them “poised to bring political messaging to even higher levels of intimacy and efficacy, and, disturbingly, render them factually impossible to audit by outsiders,” [2] Given the nefarious intentions of bad actors, it's easy to see how a campaign of misinformation may be difficult to combat. It raises serious ethical issues about making sure everyone is informed of the truth.  As text messaging appears to be the new platform of choice for campaigns the question remains if society will adapt fast enough to sift through the clutter or fall prey to the bad actors.

[1] https://www.npr.org/transcripts/920776670

[2] https://www.technologyreview.com/2020/10/28/1011301/why-political-campaigns-are-sending-3-billion-texts-in-this-election/

Media Effect in Mortgage Prepayment Model

 

In managing the cash flow risk of a residential mortgage portfolio, we need to measure and model the prepayment risk. Prepayment risk is the risk that borrower can prepay the loan early before the loan contractual maturity. For example, borrower may have a 30-year fixed rate loan by making the monthly payment for 360 months but may pay off the loan simply after two years due to job relocation. Such sudden payoff of the loan totally alters the cash follow structure of the mortgage and would have a significant impact on the pricing of the mortgage portfolio, the risk to which any mortgage modelers must pay close attention.

In addition to job relocation, one of the key reasons for prepayment is due to that fact that the market interest rate becomes lower than the contractual rate so that borrowers voluntarily prepay the loan and refinance to another loan with a lower interest rate. In general, not all the borrowers are rational, and they may not even pay attention to the low interest rate environment or even they pay attention to the news, they may be simply reluctant to refinance given the uncertain cost associated with the refinance.

There is an important driver in prepayment models which is called the “Media Effect”. The “Media Effect” tries to describe and capture how much borrowers have been influenced to make their prepayment decision when the “media” keeps talking about the low interest environment and the cost-savings if one refinances.

The “media effect” in prepayment modeling was introduced at least 20 years ago where the social medias were simply limited to the newspapers, radios, TV, etc.

Nowadays, the channels for social media becomes way beyond the newspapers, ratio, TV and information can be quickly disseminated through the ads in social media such as Facebook, LinkedIn, Instagram, etc., due to the rapid and extensive development in technology and internet.

Given such rapid change in social media communication, the mortgage modelers should really rethink how to incorporate and adjust the “Media Effect” component in the prepayment model.

Evolution of Election News - from 'Bat-Signal' to Twitter

 The spread of information on election related information has warped exponentially with the rise of digital.  In some ways digital has made things easier with the ability to access realtime data and up to the minute accounts of what's happening across the country, regardless of where you're located.  You can even watch the counting process livestream in certain places like Philadelphia according to Wired.  However, in many ways it has become significantly more complicated to follow election ongoings.

There is no end to the different sources for election coverage, and figuring out a way to choose the right source and approach has become a topic in itself.  The number of media sites covering tips on how to best watch the election is vast.  One approach recommended by C-Net recommends a war-room-like multi screen setup.  Scientific American on the other hand shares expert insider advice from a political scientist on the which polls to look at and even what legal sites to follow election related litigation.  On the other end of the spectrum, for those looking to avoid the election news, or find distractions from the stress of it all there's many suggestions like those from Mashable.

On top of all of this choice, you also have the  uncertainty of whether any given source is accurate or turstworthy.  According to NPR, voters in this election were flooded with disinformation through many different sources, including email, social media, and robocalls.   I always wonder who actually takes the time to listen to a robocall but regardless it's scary to see the proliferation of bad actors in the campaign and election process, despite learnings from previous years.  And craziest of all, or maybe not for anyone who been awake for the last 4 years, the 'fake news' is coming from the incumbent president, using scare-tactics on social media to build distrust in the democratic process.  At least companies like Facebook and Twitter have started to taking action to clarify POTUS' comments on their platforms, but it will be interesting to see how their action in this case sets the precedent for future management of content on their networks.

With all this craziness, we have come along way since early days of election news.  Back in 1904, the New York times was delivering election news via a 'Bat-signal' type approach using search lights in different directions depending on the results from its building in Times Square.  Of course that was only good for a relatively local population, but for those in the MYC metro, much better than waiting by the telegraph all night!  I might actually prefer patiently waiting in blissful ignorance until a nationwide announcement in papers versus the current state of constant bombardment and endless scrolling updates.  

 Speaking of Snapchat... 

I made my last post about Snapchat and how it may not be as forgotten as one might think.

And this week, something came to my attention that emphasized the importance of Snapchat in reaching younger generations today: SoundCloud just announced a partnership with Snapchat, acknowledging its effort to reach young audiences -- namely, students -- to drive student subscription sales.

The partnership will allow users -- especially creators -- to share albums, artist profiles, tracks and playlists on social media with an easy plug-in within the app itself. The feature also allows users to add GIPHY stickers and captions to the tracks before posting.

This partnership -- and future collaboration with Facebook stories -- comes at a time when SoundCloud is honing in the effort to create a sense of community and easy sharing amongst its user base; it mirrors the popular collaboration between Spotify and Instagram stories that allows users to share their favorite tracks to their stories. The collaboration has been especially popular for those who are excited to share statistics from their Wrapped data; Spotify was also the only platform that allows such means to cross-share audio content platform to platform.

With SoundCloud not having a specific recommendation algorithm that users can rely on to discover music -- or vice versa, artists can rely on to get noticed -- this integration allows for a wider reach when it comes to putting audio content out there and offers a new way to promote music for creators who are eager to spread the word about their music.

Politics and the Digital Frontier

 Given today is the Presidential Election, and we are learning about social media, I thought it would be an interesting time to discuss who is and is not allowed to advertise on different Social Platforms, especially considering that jaw-dropping sums are being spent on political adverts on social platforms. 

Facebook blocked most ads about political issues for the week leading up to the election. However, those protections may not exactly be foolproof and has not been executed without issue. Twitter outright bans political advertising on the position that messaging should "be earned, not bought." Reddit allows political advertising but has adjusted how they handle reporting and socialization of that content.

Given how down-ballot races are often decided by name recognition, social provides an advertising option where impressions may be enough to earn the required ROI.

In an era where truth is difficult to tell from fiction and advertisements are tough to recognize in a sea of 'user generated content,' what are other peoples' thoughts on where the line should be drawn? Is there a difference in trying to convince someone to buy your cereal brand versus vote for your candidate? Does it matter if the pixels were paid for or organic?