As 2022 winds down, PR teams are looking and trends and opportunities in their most relevant categories. One of ours is ad tech. Despite economic headwinds, the global advertising industry has been robust and seems poised for more growth. Post-Covid, brands are spending on connected TV (CTV) ad platforms and the industry is abuzz about retail media. Yet, uncertainty is the new normal.
Ad tech is always on the move and changes in the space invite new opportunities and challenges. Heading into 2023, here are some developments we should expect:
CTV has been a huge trend, and 2022 has been a banner year for it. With advertisers ramping up their spending, it’s not unreasonable to think that the “year of CTV” will continue for over a decade just as the “year of mobile” dominated the ad industry for a decade or more. In fact, per this report, 98% of brand advertisers believe CTV will exceed mobile ad budgets. As CTV gains steam among both viewers and advertisers – with nearly 95% of US households reachable via CTV programmatic media and ad dollars flowing from linear to streaming – the opportunities are abundant.
Still, according to industry experts, the era of CTV expansion and fragmentation is coming to a close. Evolution – and maybe even consolidation – are expected in 2023. With Disney+, Netflix and other streaming platforms embracing ads, the CTV landscape is becoming more advertiser-friendly. As more services offer ad-supported options, advertisers will have more opportunities to engage with audiences through ads relevant to their tastes and lives. CTV and the streaming landscape are poised to evolve constantly and advertisers should be ready for the next chapter. To thrive in 2023 and beyond, advertisers will need to win over audiences who have lots of content choices. They’ll succeed by choosing performance-driven partners who deliver brand-safe, premium content, precision audience targeting at scale, personalization and proven measurability.
Demand for first-party shopper data, coupled with the looming disappearance of third-party cookies, has created a moment of opportunity for innovative multi-location brands and retailers. Retail media (explainer here) is more than one of this year’s hottest buzzwords: it’s the next big advertising channel. Retail networks are growing exponentially and per GroupM, retail media already represents 11% of global ad spending and will grow 60% by 2027.
For multi-location retailers, it’s an opportunity to diversify revenue streams and target consumers with highly personalized ads. Many retailers are following the footsteps of giants like Amazon, Walmart, Target and Kroger by launching their own retail media networks (RMNs). Dollar General, Ulta Beauty, HomeDepot, and CVS, among others, have launched ad-sales businesses to diversify their revenue streams, taking advantage of foot traffic in stores and visits to their e-commerce sites.
What does the next phase of retail media look like? Experts say it’s very promising. The ability for brands to reach a retailer’s audience at various points in the buying journey remains attractive for advertisers. As more businesses hop onto the lucrative RMN bandwagon, we can expect to see a growing number of retailers competing for a finite number of advertising dollars.
For digital media, this year has been another time of significant change. Google again announced a delay in third-party cookie deprecation on Chrome and privacy regulations have tightened. These moves have only raised the stakes for advertisers and media companies of all kinds.
Google’s delay gives the industry more time to test, plan and integrate the cookieless solutions available today and prepare for an identity-constrained future. Publishers should therefore continue adopting and testing identity solutions to maintain today’s robust advertising ecosystem and future-proof their business. The good news is that the urgency to test and select identity solutions has doubled YoY among marketers and publishers (this commissioned study from our client, Lotame confirms the urgency as the industry is finally feeling the heat of a cookieless world’s approach).
Will Google sunset third-party cookies eventually, whether it’s in 2024 or beyond? Who knows? But, at this point, the industry should have a clear understanding of where they stand on identity in light of cookie complexities today and in the future.
Overall, 2023 is shaping up to be yet another exciting year for ad tech and ad tech PR. The rise of privacy-focused solutions, growth of programmatic advertising, increasing use of AI and machine learning and brands leaping into the metaverse are just some of the trends we’ll ride to meet the demands of the future.