Think back to the media of 20 years ago. Cable was king, getting online took about an hour and Netflix sent out rental DVDs by mail.
Almost no other aspect of people’s everyday lives has been as thoroughly rewritten, and it’s about to happen all over again. Today’s mass media space will probably look rather quaint by 2030, let alone 2043.
The media and advertising worlds are closely symbiotic. Just as pay-per-click and programmatic advertising drove the emergence of Web 2.0, the major shifts now at play in the advertising market will determine the nature of digital media to come.
Ahead of the publication of our new whitepaper – Futureproof Strategies to Optimise Ad Revenues – we caught up with our Head of Advertising, Neil McIntyre. Here’s what he thinks media buyers, advertisers and publishers ought to expect.
1. The media landscape is going through a major evolution. What changes and trends are weighing heaviest on the minds of media buyers and sellers?
The whole digital media ecosystem rests on the effectiveness of digital advertising, in terms of reach, targeting and measurability. When the basic rules of digital media change, as they are doing rapidly, the advertising business model shifts too.
Right now, we’re seeing that happening across the board. Over-the-top (OTT) TV services are attracting more viewing time and cutting into traditional TV networks’ market share. This provides a new layer of opportunities for advertisers to reach precisely targeted audiences with meaningful, measurable creative. Aside from the big players like Netflix or Disney+, upstart streaming platforms that cater for niche audiences are seeing big rises in revenue.
In a similar fashion, TikTok has created a vibrant touchpoint, capturing ad spends that would once have gone to Instagram or Snapchat.
We’ve even seen an unexpected resurgence in out-of-home advertising. This is largely due to the rise of digital billboards, enabling precise geotargeting and more accurate measurement.
Both the impending deprecation of third-party cookies and the rise of direct-to-consumer (D2C) e-commerce are turning first-party data into gold, for both buyers and sellers.
Lastly, ad buyers are now using omnichannel planning tools to automate many of the inefficient, manual processes associated with traditional media buying in legacy formats.
2. Omnichannel is increasingly moving from a nice-to-have to a strategic necessity. What do you think is behind this transition?
The media landscape is so unpredictable that it’s pushing brands to diversify their advertising presence. Success now lies in creating a consistent, seamless experience across the maximum number of appropriate media channels for your brand.
Omnichannel also suits people’s changing media consumption habits. In the US, 84% of adults now look at a second screen while watching TV. It pays to be there on at least one of these screens at any one time.
Also, D2C e-commerce just keeps growing. This really heaps pressure on retailers to compete for visibility.
Omnichannel isn’t just a case of hedging your bets against a changing market backdrop. There’s quantitative value in a holistic strategy for brand awareness, revenue and customer retention; if a metric exists, omnichannel will boost it.
3. How can media agencies harness emerging technology to create strong and effective omnichannel offerings for their clients?
This is all about finding the right platforms. Modern ad-buying software puts buyers in the cockpit of their omnichannel campaigns, so to speak. The best tools let you manage everything in one place. They also automate a lot of the manual legwork that used to slow down ad deals.
Of course, none of this is even worth attempting if you don’t have accurate data. A lot of the agencies I speak to are focusing on bolstering their clients’ web analytics capabilities. It’s crucial on both sides of the ledger. It doesn’t matter if you’re selling or buying ads; you need to have the most expansive, detailed view of your customer bases and how your campaigns are modifying their behaviour.
Artificial intelligence and machine learning tools make it easier to turn all this data into useful insights that predict consumer behaviour. They’re also handy for automating the more painstaking bits of campaign planning, like audience segmentation and content personalisation.
4. Why is the end of third-party cookies such an adapt-or-die moment for the online advertising industry?
Third-party cookies have been the bedrock of online advertising since day dot, for both execution and measurement. Advertisers and publishers are going to have to completely rethink their strategies. In practice, this will mean a much bigger dependence on first-party data.
Advertisers may well spend more with walled gardens like Google, Facebook and Amazon who can offer a large arsenal of targeting capabilities. But smaller publishers can take heart too – contextual relevance is becoming much more important for advertisers.
5. What kind of tools are media buyers and sellers investing in to see them through the ‘cookiepocalypse’? And which would you recommend as the most important?
The tool has to complement the strategy. Sellers have to be able to define their audiences and serve them up on a platter for buyers. This is a matter of collating and unifying customer-identifiable data, which is where customer data platforms (CDPs) come into play.
These software tools pull together all the data from the many possible sources out there. They then apply machine learning algorithms to analyse customer data. This is the easiest way to identify patterns and insights to inform the development of more effective ad campaigns.
We’re seeing more sites turning to Authenticated Traffic Solutions (ATS) to get information on their user base. In a nutshell, these tools create persistent, pseudonymous identifiers for each user without ever using third-party cookies. You get a more expansive picture of the customer and their browsing history that advertisers can target without betraying real identities.
I’d recommend every website and every brand to start doing their best to collect zero-party data – data that your customers have proactively shared. This is some of the most valuable data of all, and all it takes is incentivising people to take a couple of surveys or polls.
Natural language processing is impacting everything, advertising included. As I already said, contextual advertising is going through a renaissance, and machine learning just makes it so much easier to match ads to the sites they’ll be most at home on.
6. Can you tell us about the potential value that the end of third-party cookies creates for all parties in the digital ad industry?
Third-party cookies were a bit of a sugar high for the advertising industry. The levels of targeting and reach they enabled were pretty intoxicating, but the privacy problem was always going to make this business model unsustainable. So many of the impressions that came about through third-party data were ephemeral and low-quality, or just actively off-putting. Ultimately, people didn’t like feeling like they had no control over their own information, and they especially didn’t like the feeling of being watched and followed around.
In this sense, the ‘cookiepocalypse’, as people are calling it, is a good thing. It’s a chance for advertisers to strengthen bonds of trust with their audience and improve attitudes towards advertising. We need to treat the first- and zero-party data that people share with us with the utmost respect and transparency.
The deprecation of the third-party cookie may also help drive innovation and differentiation in the ad industry. The race is on for buyers to develop the most effective ways of targeting and measuring campaigns, and for sellers to gather and augment as much first-party data as they can.
Whether you’re buying or selling ad space, our whitepaper Futureproof Strategies to Optimise Ad Revenues could help you turn the changes afoot in the media market to your own advantage. Download it here.