- The UK tech startup SuperAwesome is trying to build an ecosystem for brands to target kids on the web while avoiding privacy pitfalls.
- The company sees an opportunity given falling TV ratings and YouTube's stumbles.
- But kids' marketers are generally conservative and GDPR could make them more skittish.
Kids love digital media. Kids' marketers, not so much.
US regulators enforce strict limits on the kind of advertising brands can do online (no targeting, no data capture), and the sweeping European privacy law known as GDPR, which just went into effect, is leading several countries to effectively raise the age limit for marketing to kids online.
Throw in YouTube's recent stumbles with its own kids' product (some not-safe-for-kids videos recently ended up on the app), and digital media is seen as radioactive for many brands.
But UK startup SuperAwesome, which last year raised $21 million in a Series B funding round, says it has a much safer way for Barbie, My Little Pony, and other iconic toys to reach children through digital channels.
The company has built a platform it calls "kids tech," which essentially does the opposite of what most ad tech does. For example, SuperAwesome lets marketers run ads on kids' games and websites without collecting any data or using sophisticated targeting.
SuperAwesome
SuperAwesome's "Safe Ads" for kids.
And now the startup is rolling out an app-development platform dubbed Kids Web Services, through which developers will be able to create kid-friendly apps and games that comply with GDPR and COPPA (the US regulation Children's Online Privacy Act), CEO Dylan Collins says.
Besides providing a means for developers to make kids' apps that follow all the unique children's-privacy rules, Kids Web Services will also enable them to build in children-safe functionality, such as timers aimed at limiting kids' screen time, Collins says.
It won't be easy to persuade big brands to advertise on these apps, given how conservative kids' marketers are. Despite the obvious shifts in media consumption among younger consumers, ad spending aimed at children is still primarily locked up in TV.
Many ad buyers with whom Business Insider spoke say their kids' clients were exceedingly reluctant to try anything digital. And most had not heard of SuperAwesome.
Kids' advertising is strangely stuck in the past
Advertisers spent $800 million on children's TV as recently as 2017, but digital ad spending numbers are hard to come by and thought to be tiny.
Because of the privacy restrictions on the web and the general fear of missteps, "Kids' marketers' position is generally 'We've got to be careful,'" says Dona Fraser, president of the Children's Advertising Review Unit, which oversees kids' ads. "They've sort of felt, like, when it comes to digital, 'We just can't do anything at all.'"
That's in spite of kids'-TV ratings recently falling off a cliff, as Bloomberg reports.
Tom Horner, president of Beacon Media Ratings, which specializes in children's ad buying, says when it comes to live commercial TV viewing, kids'-TV networks have seen "a pretty significant drop in ratings."
And outside of Netflix, kids are watching a lot of on-demand TV, which Nielsen struggles to track, Horner says.
Kids love YouTube, even if they're not supposed to
If anyone is succeeding with kids' advertising outside of entrenched TV leaders Nickelodeon, Cartoon Network, and Disney, it's Google's YouTube, where millions of kids congregate.
But YouTube is officially for people age 13 and over, so to capitalize on the children's market, in 2015, Google rolled out YouTube Kids, which aimed to be a curated hub just for children. About a year ago that app was pulling in its first ad commitments from brands like Mattel.
Then, late last year, The New York Times uncovered that some non-kid-friendly videos - including conspiracy fare - were finding their way on to YouTube Kids.
Soon after, lots of creepy, kids-in-peril videos were found on the main YouTube site, forcing YouTube to kick several creators off the platform.
That's only increased skittishness among kids' brands. Now there's GDPR, which is all about protecting people's privacy online by requiring publishers and advertisers to get their consent to be tracked and targeted.
Kids can't give their consent to be tracked on the web until they reach a certain age, and different countries are setting different standards - 13 in the UK and 16 in Germany, Collins says.
"GDPR makes kids' marketing online extremely challenging," Fraser says. "There is just a lack of overall guidance in how the law will work."
So kids' marketing "is the last industry making the shift to digital," Collins adds. "Really, the internet was never, ever built for kids in the first place. It has inherited a children problem, even if its entire business model is data and adults. So you're sort of damned if you do, damned if you don't."
Mattel
Mattel's Monster High is a way to reach kids online.
"Silicon Valley has never really understood kids," he says.
So SuperAwesome is essentially trying to build a new web-advertising ecosystem for kids' brands. Collins acknowledges that the company is still trying to gain traction among top media buyers in the US.
Yet SuperAwesome is finding success working directly with children's brands. For example, it places what it calls "Safe-Ads" on mobile games built by Mattel, such as "Barbie Fashion Closet" and "Monster High."
The company has also built a kid-safe game/social network called "PopJam." And now with its new developer offering, the hope is brands like Hasbro will use SuperAwesome's tech to build out kid-safe social environments such as Mattel's "My Little Pony Friendship," which requires parental consent if children want to log on.
Collin Douma, a marketing consultant for toy companies who was previously global Hasbro account manager at the ad agency giant Omnicom, says that YouTube's stumbles with kids has provided SuperAwesome with a solid opportunity. "But," he adds, "it needs to move fast."