The Future of Digital Advertising
Martech Outlook | Wednesday, January 11, 2023
Digital advertising will witness new changes in the coming years by integrating technological innovations and focusing on consumer demands and performance marketing.
FREMONT, CA: Digital media giants are going through a challenging time after leading advertising for a few years. Although digital advertising spending may have surpassed that of television advertising, there has been a shift in consumption and device changes. Cable and satellite (C&S) television consumption will decrease; however, family viewing is not stagnating. Television as a device will continue to beam content, but the source is changing. C&S is dropping and 4G streaming is increasing. With the 5G launch, digital advertising will dramatically increase in the coming years.
Positive Consumer Sentiment: Beauty and cosmetics sales are rising as young women are more inclined to prioritise buying skincare and beauty products as treats when on a budget. Similarly, the number of people purchasing vacations or travel tickets has also increased recently. Therefore, even in times of diminishing financial confidence, clothing and ordering delivery top the list of budget treats in many countries. With the decreasing economy expected in some countries, digital spending, giving dual gains in reach and ROI, will gain increased importance in the media mix. However, TV will continue to dominate the AdEx industry, but online spending will almost be on par with TV.
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Greater Focus on Performance Marketing: Brands will continue to focus on performance marketing in the coming years. However, it will not last long, and the focus will be shifted to brand building shortly. Performance marketing is focused on generating leads and sales, while brand marketing focuses on creating awareness about the brands requiring major budgetary allocations.
Growth of Tech Adoption: Integration will be the keyword for digital media, and the industry expects an increase in technology adoption, especially in artificial intelligence and machine learning, by brands to reduce costs. The use of AI and ML will reduce the cost of content creation, scripting, and auto-atomization. Digital media would be integrated into traditional means to build unique engagement pathways to connect with customers. A major example of this is the upward trajectory of digital outdoor screens and billboards. Although they will find more use cases, it will be interesting to see how 3D and 4D billboards are used in brand campaigns.
In addition, the integration of advanced technology into digital will become more prominent. The convergence of marketing, advertising, and technology, or MadTech has radically grown in the previous years. MadTech will be a more commonly used term in the digital sphere in the coming years. On the other hand, the metaverse has yet to be leveraged to its full potential. With more brands and advertisers joining the phase, audiences will get to experience many aspects of the metaverse in more detail. This is possible through experimenting and innovating with the creator economy. As many tech companies face a slowdown, one of the possibilities that can emerge is hiring people from the technology side depending on work demand.
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