A New Decade Dawns – The Shaping of the Advertising Ecosystem

By Michael Korsunsky On Jan 20, 2020

If you must look back at the past to see the future, 2019 will certainly help advertisers shape their future strategies. Privacy regulations, 5G, and new channels are all changes that will have a bearing on the shape of the advertising ecosystem as we move into a new decade. But looking back over the last 10 years, the digital industry has already made some immense changes – let’s see what we can look forward to in 2020 and beyond.

Privacy – It’s Time to Lighten the Load

The new year kicked off with the California Consumer Privacy Act (CCPA), and with further regulation planned, no business can afford to ignore or side-step the privacy issue. In fact, lessons have already been learned in 2019 – from disseminating search terms to other sites, to illicitly collecting personal details from wifi networks, Google has faced a number of lawsuits due to privacy violations.

As we move further into the era of compliance, we’re seeing an industry-wide focus on increasing transparency and data security – especially as breaches of the CCPA can illicit fines of $7,500 per violation. To put the impact of this new law in perspective, Facebook’s Cambridge Analytica scandal could have resulted in a $184.7 billion fine. Violations include the selling of a user’s data without informed consent, which will have ramifications across the advertising ecosystem.

As a result, first-party data is becoming a priority for many companies and ad-targeting methods are changing. But as we get to grips with compliant processes, we must keep the consumer at front of mind. Regulation requires us to give complete visibility to the user – information about why they are seeing the ad, the brand, the advertising platform that operates the delivery – and of course the opportunity to opt-out; in part, in full, and at any time.

The main question here is how this will affect user experience? With on-going regulations being implemented to protect users, it places too much decision-making burden on the user’s shoulders. Consumers want to have control and to be able to choose who sees their data, but businesses will need to find new, creative ways to achieve this to avoid frustration or blocking access. Those that do will be rewarded with consumer trust and increased lifetime value.

5G – Getting up Close and Personal

Despite health scares over wireless radiation, the latest mobile technology began rolling out in cities globally in 2019, and we can expect it to be widely available in the next two years. Much has been made of the speed of 5G, but actually what will be the game-changer for the consumer is how this will translate into a ‘real-time’ internet.

Highly interactive ad formats will enter the market and with near-instant responses and decision-making possible, triggers will be used to achieve truly individual experiences. This will offer both publishers and advertisers the chance to develop dynamic content based on specific requirements. The opportunities here are vast.

Multi-Channel Campaigns – Create Cohesive Consumer Experiences

We’ve seen an array of new channels enter the ecosystem in recent years – from Over-the-Top (OTT) to Digital out-of-home (DOOH) to Virtual Reality and Augmented Reality (VR/AR) – all rivaling for consumer attention. We can expect to see more develop and evolve in the new decade.

For advertisers, this means they should focus on building a reliable, comprehensive view of the consumer journey, but the demise of traditional tracking methods, such as the cookie, will present a challenge to this. Advertisers must seek innovative solutions that don’t compromise user privacy but do enable them to understand a consumer’s path to purchase.

The data from these tools will allow advertisers to reach users with consistent messaging and guide them down the purchase funnel as they move from channel to channel. The next unique ad experience will be delivered through specific content to achieve required perceptions and actions for each platform, at each stage of the user’s cross-channel journey.

Programmatic buying will continue to grow and support each channel as it is developed. Not only that, a cross-channel approach will become a logical part of all programmatically driven campaigns in 2020, making tracking and optimization easier and more effective.

Performance Marketing – Quality over Quantity

We’ve seen how Marketing strategies that deliver measurable results provide advertisers with new levels of insight, allowing them to quantify everything – from brand reach to conversion rate – for each and every ad. By focusing exclusively on ROI, with results 100% attributable, the performance-based approach has obvious appeal, and brands are expected to continue to favor this over pure campaign reach.

Direct to Consumer – Because They’re Loving It

In the past few years, an explosion of direct to consumer (DTC) brands emerged – revolutionizing the retail sector and changing the way people shop. They grow fast, connect directly with their audiences, are responsive – and consumers love them. Traditional brands will try their hand at this model, enhancing the user experience of their e-commerce sites and focusing on performance in ad campaigns to boost website traffic. This approach takes control of the complete customer journey – and it works on a surprising range of verticals. But seamless customer experience is essential, and not all brands will be able to achieve the necessary cultural change. We can expect to see some failed attempts – alongside the successes – in the New Year.

These are exciting times for the industry. We can expect to see a new era of customer interaction with technology driving advances across all touch-points. There are opportunities for all who are responsive to consumer trends and willing to adapt to need. For the decade ahead, advertisers should keep the focus on their customers and make sure new regulations are front of mind as they come into play.