🔎 The New Search Playbook: How AI and Social Shakeups Are Changing Ad Spend

Inside: Meta's play for TikTok creators, AI's growing influence on brand narratives, and the tariff waiting game hits e-commerce

January flew by and the Katalys team has been busy setting the stage for a big year ahead. We are at Affiliate Summit West this week, so if you're attending stop by booth #435 tomorrow to say hello! 👋 As we step into February, we're excited to bring you the newest edition of Katalys Connect - your shortcut to the latest in performance marketing. [Read time: 4 minutes] What's in this issue? Each week we pack the latest trends, actionable insights, and industry breakthroughs into a quick read - ensuring you're not just keeping up, you're staying ahead. Monetization: From Meta's TikTok creator bid to the surge in subscriptions and audio, see how publishers and creators are adapting to a shifting revenue landscape. Growth: AI and social search are reshaping marketing - learn how brands are optimizing content, rethinking search, and preparing for TikTok's uncertain future. The Future of Commerce: Shoppable Super Bowl ads, rising tariffs, and AI's growing influence - discover how tech and policy shifts are redefining e-commerce. 💡 Katalys Insights   Social Whitelisting, a Win-Win • Want to expand your reach? Social whitelisting allows brands to run ads through trusted publisher accounts to amplify credibility and engagement.  This strategy helps brands tap into highly engaged audiences while both the brand and publisher gain valuable performance insights. It's a smarter way to scale paid social campaigns and strengthen partnerships. Read our blog post to learn how social whitelisting can elevate your ad strategy in 2025. Brands: Ready to get started? Sign up or log in to access Social Whitelisting Opportunities on the Katalys Marketplace. Publishers: Have social whitelisting opportunities? Reply to this email to discuss how to list them on our Marketplace.  💸 Monetization Subscriptions Surge, Audio Thrives • With subscription growth slowing and video monetization faltering, publishers must diversify into data monetization and emerging revenue streams to stay competitive. Subscriptions now account for nearly a third of publisher revenue, closing in on display advertising's shrinking 38% share. Digital audio revenue has skyrocketed twentyfold since 2020, while video revenue has dropped 15% due to YouTube's dominance. Meta's Price for Creators • Meta is offering TikTok stars up to $300,000 to post exclusive content on Instagram Reels in a bid to dominate short-form video. Deals range from $2,500 to $50,000 per month, requiring creators to post more Reels than on competing platforms and promote their Instagram presence. Some creators are rejecting the offers, citing restrictive exclusivity terms and frustration with Meta's demands, despite the lucrative payouts. RetailMeNot in Hot Water • Creators are suing RetailMeNot, claiming it hijacks affiliate commissions by manipulating last-click attribution - echoing the recent PayPal Honey and Capital One Shopping cases. The lawsuit, led by YouTubers TechSource and ToastyBros, alleges RetailMeNot replaces creator affiliate links with its own, diverting commissions without adding value. Despite mounting legal pressure, RetailMeNot denies wrongdoing, insisting it follows industry rules - leaving advertisers and affiliates questioning the future of browser extension ethics. 📈 Growth   Search Ads Get Crowded • AI-powered and social platforms like TikTok and Perplexity AI are challenging Google's dominance, reshaping how brands approach search advertising. TikTok is pitching search ad inventory as users increasingly turn to the platform for product discovery, while Perplexity AI charges $30–$60 CPMs for sponsored answers Some brands are increasing experimental search budgets by 25%, but with Google still pulling in $49.4 billion in search revenue last quarter, many remain hesitant to shift their spend.   AI Shaping Brand Stories • Generative AI is rewriting brand narratives, and those who don't optimize their content risk being misrepresented - or worse, erased. AI platforms like Perplexity and Google Gemini pull from online content, meaning brands that neglect search performance risk losing control of their message. Companies optimizing their SEO and owned content see over 50% of AI-generated responses citing their sources, proving that proactive strategies can shape AI-driven brand perception. Brands Hedge Against TikTok Risk • As TikTok's traffic rebounds but remains off app stores, advertisers are diversifying influencer deals across Instagram and YouTube. TikTok's U.S. traffic has rebounded to 90% of pre-shutdown levels, but brands are adjusting deals to include Instagram and YouTube as backup plans. Some creators are thriving on YouTube Shorts, but many struggle to replicate TikTok's engagement, leaving advertisers uncertain about where to invest long-term. 🚀 Future of Commerce   The Shoppable Super Bowl • Tubi is merging streaming and shopping, letting Super Bowl viewers buy game-day gear and themed products straight from their screens. The Tubi Red Carpet Shop, powered by Shopsense AI, offers fan apparel, audio gear, and party essentials, turning the game into a retail moment. With 97 million monthly users and a free Super Bowl LIX simulcast, Tubi is making a play for advertisers, blending entertainment with e-commerce on a massive scale. Tariffs Disrupt E-Commerce Playbook • Trump's crackdown on de minimis, a rule allowing duty-free imports under $800, is forcing Shein, Temu, and even US brands to rethink their strategies. The end of the de minimis rule threatens Shein and Temu's direct-to-consumer model, while 25% of top Shopify stores could face rising import costs. Even US brands manufacturing in China aren't spared - higher tariffs mean possible price hikes on Amazon and beyond, with costs rippling through the entire supply chain. OpenAI Tests AI Persuasion • OpenAI used Reddit's subreddit r/ChangeMyView to measure how well its AI models can craft persuasive arguments - raising questions about AI's ability to influence decisions. OpenAI claims its latest models rank in the 80-90th percentile of human persuasion skills, showing AI can effectively sway opinions in structured debates. This hints at the potential of AI to influence purchasing decisions in product recommendations and ad campaigns - but concerns over manipulation and ethical AI use in commerce are growing 👍 Was this valuable? We strive to deliver engaging, high-value content to you weekly. Did we hit the mark? Let us know your feedback: Excellent | Good | Subpar © Katalys 2025 All Rights Reserved Katalys LLC, 315 S COAST HWY 101 # 528, Encinitas, California 92024, United States Unsubscribe Manage preferences