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Marcus Johnson (00:00):

Your audience is seeing ads everywhere, even on the screens you'd least expect. Nielsen Ad Intel helps you see the whole picture, all of it. From creative trends to ad spends and media across all screens. Maximize every media dollar today with Nielsen Ad Intel.

(00:22):

Hey gang, it's Monday, September 22. Rahul, Yory, Max and listeners, welcome to Behind the Numbers: an EMARKETER video podcast made possible by Nielsen. I'm Marcus, and joining me today we have three gents, director of reports editing, living in Maryland, Rahul Chadha.

Rahul Chadha (00:40):

Hey Marcus, thanks for having me.

Marcus Johnson (00:41):

We're also joined by principal analyst heading up our advertising media and technology teams, living in New Jersey. It's Yory Wormser.

Yory Wurmser (00:49):

Hey Marcus, how are you?

Marcus Johnson (00:50):

Very good, sir. Very good. And finally, our senior analyst covering digital advertising and media, Max Willens.

Max Willens (00:57):

Yo.

Marcus Johnson (00:58):

Hey fella. Today's fact. Rivers can flow backwards or in reverse. Do we know this guys?

Rahul Chadha (01:12):

I think I did.

Max Willens (01:12):

You talking about tidal rivers?

Marcus Johnson (01:16):

I don't know what that means.

Rahul Chadha (01:17):

Oh, I think rivers that flow into an ocean I guess so they're subject to the tides as well. Sorry, go ahead.

Marcus Johnson (01:26):

I'm not sure. I guess so. Some of these, I don't know if it's just in that area of the river or throughout the whole river, but there's a few examples here. The Mississippi River here in the States temporarily reversed course during a powerful earthquake in 1812. So there are some that will temporarily reverse course. The Tonle Sap River in Cambodia actually reverses its flow seasonally due to changes in water levels with rainy and dry seasons. So that one, I think it's the only one in the world, every year that will go one way for part of the year, the other way for another part of the year. And then they can permanently in the grand scheme of the life, they can permanently reverse. So millions of years ago, for example, the Amazon River flowed in the other direction. It's now west to east. It used to run east to west heading into the Pacific.

Max Willens (02:26):

It's bananas. I thought you were going to talk about the Chicago River, which I still don't really understand how they did that, but they reversed the flow of it at the end of the 19th century.

Marcus Johnson (02:35):

Oh, okay. I didn't know this. Why?

Max Willens (02:39):

I don't remember. I heard about it when I was doing their architecture tour on a boat and I thought, that's crazy. How did they do that? And then of course I didn't look into it, but-

Yory Wurmser (02:48):

I think they wanted to connect to Great Lakes with the Mississippi.

Max Willens (02:52):

That's exactly right.

Marcus Johnson (02:53):

Okay, very good. It could have just waited like 7 million years. It would've taken care of itself. Anyway, today's real topic, we make some very specific but highly unlikely predictions for the next six months. Shark Tank style part one.

(03:10):

Okay, here's how this episode works. Max will go first. He gets 60 seconds to pitch a very specific but highly unlikely prediction he thinks will come true in the next six months. Then me, Rahul, Yory and everyone listening will decide if we are going to invest in the prediction, if we believe in it. Rahul goes next and so on. Let's do it. Max, what do you have for us?

Max Willens (03:29):

All right, so I'm going to talk about everybody's favorite topic, which is the next sort of tech form factor after mobile phones. And my prediction is that starting next year the rebooted version of Snapchat Spectacles will get traction culturally faster than Meta's Ray-Bans have. So what do I mean by this? Basically, when I say traction, I mean that they will kind of gain cultural currency and visibility in a way that Meta Ray-Bans mostly have not. So in the two years that Meta, that have elapsed since Meta sort of announced and put these on the market, they've really only sold about 2 million of them, which is about a fifth of the number of people that go bow hunting regularly in the United States. It's even about a tenth of the number of people that have purchased Meta Quest worldwide.

Marcus Johnson (04:30):

Oh wow.

Max Willens (04:31):

And that product, as far as most people understand it has really not gained much mainstream opinion at all. The reason that I say this is effectively down to the ways that I expect people to use them. So one of the things that is sort of a significant shortcoming of Meta's Ray-Bans is that they have very limited device integration. So if you want to sort of exchange text messages for example, or emails that you've gotten from somebody, Apple and Google have in the way that they've designed their operating systems made it quite difficult for people to do that. Whereas Snap, which has really begun leaning into its identity as a messaging platform more than a social network, is really going to, I think put communication and sharing of communication between users at the heart of Spectacles and that is going to, I think, give it a purchase in a way that the Meta's Ray-Bans have not. So that's my pitch.

Marcus Johnson (05:34):

Interesting. Okay. The communications piece being the, I don't want to say killer app, but you think the driving force in terms of application.

Max Willens (05:41):

That's right. And they also too, I mean one thing that's I think very savvy about this, this is essentially Snap's second pass at this. It's funny to think about, but really nearly a decade has elapsed since the first time that they brought Spectacles to market.

Marcus Johnson (05:56):

Wow.

Max Willens (05:56):

I know, it's a crazy thing to contemplate. But one thing that they've done this time, which I think is very smart, is they announced the launch of their operating system for Spectacles about six months before the reboot of the hardware itself, which will allow developers many months to sort of build a little ecosystem of experiences and products that can be incorporated into the Spectacles as well, which I think is also going to help the product get out of the blocks faster than it might have under normal circumstances. So that's my highly specific and maybe highly unlikely prediction for you guys.

Yory Wurmser (06:34):

I love this prediction because you got the brief because it is highly specific and I think it's kind of unlikely. The reason I love it because everything you said is accurate, they just released their new operating system for Spectacles, their 2.0 version. It takes care of a lot of these more functional elements that gives developers time to develop apps for when they release their new lite version of Spectacles, which they're going to call Specs I think. So I agree that they're innovating and they're doing what they need to do to create a cool consumer product. I just think that Meta has too much of a head start, first of all with Ray-Ban stories, but also they're rumored to be going to release their Hypernova smart glasses with a mini smart screen in October, which gives them a bit of a head start.

Marcus Johnson (07:37):

To Yory's point, that part concerns me as well because Grace Harmon who writes for us was saying Snap just doesn't have the deep pockets that Meta has to keep investing in this forever. Snap's invested about $300 million a year for the past decade. Meta on the other hand, has been losing about $12 billion each of the past five years on its reality labs division. So I think that makes me a bit nervous for Snap.

Rahul Chadha (08:04):

I should preface this by saying I know next to nothing about these specific AR glasses, but I did look up a picture of the Snapchat Spectacles and to be perfectly frank, it was incredibly dorky looking. I think the biggest challenge honestly that you're going to face with adoption if you're one of these companies is younger users who I think are overwhelmingly going to be the people who adopt the technology first. I think it looks cool. Snapchat Spectacles, okay, I'm merely saying this as a middle-aged man who unashamedly wears dad sandals, but they do not look cool. I think Meta's, one of the main advantages they have actually is that they've paired with a pre-existing brand for the actual device in terms of Ray-Bans, I think that alone just might give them a leg up in terms of convincing people to adopt a smart glasses. It's probably still going to be pretty clunky and maybe a little awkwardly designed at first.

Marcus Johnson (08:54):

Yeah. I also wonder if you said they need the younger crowd, they're going to be the drivers of adoption here. This and some of the information was reporting that ByteDance is working on a lightweight mixed reality goggles that could directly challenge Meta's products, I guess Snaps products as well and win over TikTok users who they own. But you're not talking about them. You're saying that Snap is going to beat Meta, not necessarily another challenger like a ByteDance or a TikTok.

Max Willens (09:24):

That is correct.

Marcus Johnson (09:24):

Yeah. In your defense though, Max, a few weeks ago, the information reported Snap is considering seeking outside funding for its AR spectacles as it struggles to compete with Meta and TikTok, so maybe there's growth there.

Max Willens (09:38):

Yeah, absolutely. I mean, I would just say in response to my detractors and my doubters here, we're too old. We don't know what's cool anymore. Every time I look at what young people, fashionable young people are wearing, I just go like, this looks awful and-

Rahul Chadha (09:57):

That is 1000% true.

Max Willens (09:59):

And then I think, oh my God, it's happening. It's surely only going to get worse. But I think that the main thing that I'm resting my argument on here is really just the fact that to me, the fact that Meta has sold 2 million of these things and has an ad campaign with Chris Pratt and Kris Jenner in the wild, to me that means nothing. To me, 2 million units sold in two years in a consumer category that I think all of its boosters are hoping will climb into the tens or maybe even hundreds of millions is basically nothing. And it's very easy for that head start, to the extent that it's a head start to get just kind of blown apart by the right kind of splashy launch if Snapchat gets it right. I do concede that they have a funding disadvantage. But I would also say too, that I think comparing the reality lab spending to what Snap has spent is a little bit unfair because that spending also includes spending on-

Marcus Johnson (11:05):

That's very true.

Max Willens (11:05):

... Meta Quest and Horizon Worlds and a whole bunch of other whiz bang tech, which may factor into the glasses, but likely will not. So I will push back against that.

Yory Wurmser (11:18):

To address the form factor. They are rumored to be having a lighter version that is more fashionable. So we'll see what they actually come up with.

Marcus Johnson (11:28):

Yeah, I like this prediction. I think it is very interesting, but I think it's too unlikely to invest in it, and Grace again, as she points something else out, which has convinced me that I shouldn't be investing my very small amount of money into this because she says that they've been copycatted out of almost everything, so why not these? She says, "Snap once led the pack on AR features and short form video content, but the rise of products like Meta's Reels, YouTube Shorts, Ray-Ban's Meta Smart Glasses is no longer strongly differentiated." So I don't think this will come true in the next six months. I'm out. Rahul?

Rahul Chadha (12:08):

Yeah, I think I'm also out. It's a combination of the form factor and lack of coolness as it exists right now. I think Snapchat also trails, just even Instagram users by 50 or 60 million users, I think according to our forecast. I think that's probably another hard hill for them to have to climb and like other people have mentioned, Meta's just got deep pockets. That's a hard challenge to overcome.

Marcus Johnson (12:31):

Yory?

Yory Wurmser (12:32):

I'm out as well, but I actually think there's a chance it could take off. I'm not totally out on it, but I just think it's pretty unlikely.

Marcus Johnson (12:43):

Okay, if this comes true Max, don't give many of your earnings, winnings from this prediction. Okay? A little hedge from Yory. Rahul, you're up.

Rahul Chadha (12:52):

Okay, so my prediction is that Netflix will launch shoppable product placement ads directly into their shows and movies. It's something like a blend between a traditional product placement and shoppable media that could facilitate e-commerce. This comes on the heels of recent news about pairing of a partnership between Netflix and Amazon whereby Amazon's DSP now makes Netflix premium ad inventory easily accessible. I just think it's part of the overall trend of retail media doubling down on CTV and off-site media. And I think it's just another way for Netflix to create a new ad format or I guess a twist on two pre-existing ad formats. I think they can double dip on the revenue in two ways. One is by selling premium product placement fees to brands who want to advertise in their original library content. And the other one is earning some kind of commission when a transaction actually happens at the other end when a user clicks on an ad and makes a purchase or adds it to a cart or something like that.

Marcus Johnson (14:00):

And you gave the Stranger Things example?

Rahul Chadha (14:02):

Yeah, so I was just thinking somebody's watching Stranger Things. Again, this is a reflection of how old I am because I've been shopping nostalgically for 90s basketball sneakers, so I think people like me steeped in nostalgia, see a kid from the 80s wearing an old school pair of Nikes. There's an ad that pops up says you can click on this and buy it straight from Nike.com. Likely I'm clicking on that.

Marcus Johnson (14:30):

I like this one. When looking, I was like, how much of a priority are these shoppable ads for marketers? As you can see from this chart here, 38% planned to increase their focus this year according to the IAB. I imagine that share goes up in 2026. So I think there is an appetite for this. My question I guess is what's the best way to execute shoppable TV functionality? And I wonder because QR code's popping up and that seems to be the accepted way of doing business when it comes to shoppable ads. But this chart here was asking Americans which shoppable TV functions they would be open to using with data from LG Ad Solutions, most 70% said saving products to a wish list on the TV. So not necessarily buying them then and there. Second place, sending a text for more information or a discount code. And then in third place was scanning the QR code to check out on mobile or using voice to add to cart. They were in third place.

(15:37):

Now are they saying the current technology, the current experience of using your voice or scanning the TV isn't great and if that was improved, maybe I'd like to do that? Perhaps. But for now it seems like people would like to interact with these ads differently. So I think if maybe the execution of these ads and what people are hoping to get out of them lines up a bit better, this could absolutely take off.

Rahul Chadha (16:01):

And I think even a step before that, honestly, I would add the caveat that it would be smart for them to make this an opt-in preference for their users. I think it's really easy for subscribers who are paying a fee and already seeing traditional pre mid-roll post ads, whatever. It's just maybe a step too far, but people who are interested in it, let them opt in and let them dip their toes in the water, let Netflix gather some data on how people are using them, interacting with them, do they like them and just low roll it out.

Yory Wurmser (16:29):

I like this prediction. I mean Netflix has already gone down the line a little bit with the shoppable ads with the Emily in Paris integration with Google, where they had the Google Lens. You could scan the screen and see what's there and buy it. I think the challenges they have is their measurements still isn't up there to really make it a full closed loop type of ad. And the technology for these immersive product placement shoppable ads is still kind of early days. You're seeing it with some companies like Rembrandt, which last week merged with another company to kind of build up on that technology, but it's still kind of early days to get full shoppable, but they're definitely moving in that direction. Within six months it's going to be tight to get true shoppable ads, but I like it.

Max Willens (17:25):

Yeah, I think partly because all of you rejected me, God will punish all of you, I'm sure. No, I'm just kidding. No, I think that Yory's last point is the one that I would pick up on, which is just the issue of timing. I feel like in order to really ramp this up to a real kind of next level degree, it will take a bit of time, especially because Amazon's not the only partner now who can kind of pipe demand into Netflix. That was the most high profile one, but you can now... I think Yahoo and Trade Desk can also offer inventory for Netflix. And so I do think that it won't take too long for sort of simple ads that are QR code enabled to show up, but the real kind of next level version of this will likely take quite a bit longer because integrating all that stuff into the content does take time. So based on timing, purely I'm out, even though the overall arching thesis I think is on point.

Marcus Johnson (18:38):

Yeah, I completely agree. Timing is the thing that's putting me off. But otherwise I think it's a fantastic prediction. So I'm out. Yory?

Yory Wurmser (18:46):

I am-

Marcus Johnson (18:47):

No more hedging.

Yory Wurmser (18:48):

I'm going to go in on it.

Marcus Johnson (18:50):

He's in.

Yory Wurmser (18:51):

I'm in.

Marcus Johnson (18:53):

Reckless or perfectly astute? We shall see in the next six months. Very good. Yory, you're up next.

Yory Wurmser (18:59):

So my prediction is that TikTok will not only introduce a Gen AI assistant into the app, but they'll also add advertising against it. And the reason I say that is they have the best search infrastructure of all social networks, but they also have not introduced a Gen AI assistant yet. They're rumored to be releasing at any day. So that's not a very strong prediction. I think, which a stronger prediction, what I think is a more likely prediction is they're going to have targeting that's specifically targeting the Gen AI aspects. So instead of having let's say keywords, they might have key questions or something like that that you might buy for. So I really see TikTok building up both its Gen AI assistant part, but also its ad infrastructure for search, sort of merging the two together.

Marcus Johnson (20:01):

Does this take away people from ChatGPT or Gemini and things like that?

Yory Wurmser (20:07):

Well, the search already does take it away to some extent. Search all within social media does. I think it potentially does though. I think it potentially puts TikTok into more direct competition with Gemini and ChatGPT and Meta AI as well.

Marcus Johnson (20:25):

So is there room for something... My question is there room for something new and not new per se, but is something that folks are going to gravitate to more than the current options? Now 116 million Americans use TikTok, so in theory they could all use this AI assistant. So I think that you've definitely got a pre-existing user base right there, but then there's just so much competition and competition without ads that, I don't know if launching this and then also having ads as well makes it that appealing.

Max Willens (21:08):

I think that there's a version of it though where the ads are quite useful. If I want to find some kind of... If I'm real sort of hungry to figure out what's cool and hip because I'm old and no longer plugged into that stuff. I feel like being able to ask a TikTok assistant to show me some of the stuff that is really popping right now and maybe also some links to buy the stuff on TikTok shop for example. I'm sure that their assistant would be happy to oblige me in that sense. It's not going to sort of gun for the same kinds of budgets that might've traditionally be concentrated on Google search for your local dentist or whatever. Although I think that that sort of stuff could come around in the coming years. But I think the 1.0 version of it being kind of oriented around retail category is quite plausible.

(22:12):

And the presence of shop I think kind of takes some of the risk and guard rails away from it in the way that's distinct I guess from Snapchat for example, which has been very, very cautious about... At the moment that what they do is they will take the conversations you're having with AI and sort of feed it into their overall ad apparatus, but they're not incorporating sponsored responses into the conversations you're having with it. So at the risk of being sort of boring, I think I'm mostly out on this only because six months, again feels really, really aggressive and I think that they... Even though they've shown a willingness to kind of play fast and loose in a way that some social networks haven't, I think they'd probably like to get people semi-addicted to it first before they start monetizing it. So I think that because six months is part of the homework assignment here, I'm out.

Yory Wurmser (23:10):

Yeah, I mean I think some of the complexity... I think it is ambitious. I think the complexity comes with understanding the nature of the question.

Max Willens (23:16):

Yes.

Yory Wurmser (23:16):

Whether it's just they want information, whether they want kind of an open-ended recommendation for videos or if they have commerce intent, and then if they have commerce intent, then sending ads. But understanding that is actually pretty complex, which is why you've seen the other bots sort of go slow on this as well.

Rahul Chadha (23:35):

Yeah, I think I'm in on this actually because I think it makes a lot of sense to me that we're going to see adoption of these AI tools. It's just much more frictionless when you're layering it on top of a product somebody always uses, you just sidestep the issue of user acquisition and there's so much... Honestly right now I think we're just this crazy inflection point where we just see so much kind of conflicting data about adoption rates of what I call standalone pure play AI tools like ChatGPT. I think nobody kind of really knows right now. It's like it's growing really fast, but it's from a small base. But who are these people who are using it?

(24:11):

And I think the other advantage that TikTok would have is that they kind of understand digital advertising in a way that these other peer plays, they kind of have to build the infrastructure from scratch. They have to figure out how to sell stuff. There's just a lot of nuts and bolts things that go into launching an ad product or an ad offering on a new platform that I think TikTok has actually a leg up on them in that way.

Marcus Johnson (24:36):

I was on the fence, Rahul's convinced me. I'm in on this, I think. Max?

Max Willens (24:42):

I remain out and purely because of the timeframe. If you were asking does this happen in 12 or 18 months, I'm almost certainly in, but I just think six months is not enough time.

Marcus Johnson (24:55):

Part of me thinks it's because of the rejection at the beginning of the episode Max, that you've taken this very personally and that's why you're withholding all of your money.

Max Willens (25:02):

Oh, I'm going to hold this against all three of you for the next six months. You can rest assured.

Marcus Johnson (25:08):

All right, this is Max's last episode because he's going to be ignoring [inaudible 00:25:12].

Rahul Chadha (25:12):

I just, for the record, want to say the last time I was on one of these podcasts with Max, he rejected me before Marcus had even asked him if he was in on it. It was a default rejection. I have a long memory too clearly.

Marcus Johnson (25:26):

Didn't expect these episodes to get this personal. That's all for the predictions. We've got Snap Spectacles will gain traction faster than Meta's Ray-Bans have. Netflix will start showing user shoppable product placement ads. And then Yory's TikTok will introduce Gen AI assistant to the app with ads. The winner is Yory, has to be, got the most investment.

Yory Wurmser (25:54):

We'll find out the winner in six months.

Marcus Johnson (25:56):

Exactly. Tune back in, just me, Yory and Rahul. Max won't probably be here. That's what we've got time for. But thank you so much to my guests for hanging out with me today. Thank you to Max.

Max Willens (26:10):

Always a pleasure, Marcus. Thank you.

Marcus Johnson (26:11):

And to Rahul.

Rahul Chadha (26:12):

Thanks for having me.

Marcus Johnson (26:13):

Finally, to Yory.

Yory Wurmser (26:14):

Great to be here.

Marcus Johnson (26:15):

And of course to the whole editing crew and to everyone for listening into Behind the Numbers: an EMARKETER video podcast made possible by Nielsen. Please do subscribe and follow and also leave a rate and review if you find spare moments. Tune in Wednesday to hear our top eight most interesting retailers of the month list for September.