I don’t think any of us expected 2020 to be the wild ride that it was.
Most publishers we talked to had high revenue expectations for 2020. And marketers were planning on spending big money across digital. But the pandemic changed all of that.
Now that things are starting to pick back up, sellers and buyers have an eye toward the future. What will happen when the cookie crumbles? What will take its place? What will become of mobile attribution? Will OTT and CTV continue to rise? Oh, so many questions.
Well, we put together a collection of predictions from some ad tech executives who wanted to share their vision for how things might shake out in 2021.
Adoption of UDID 2.0 will be embraced by publishers, with asterisks
“Publishers understand that they’ll need to rethink their strategy for a post-third-party cookie world, They’ll need to be able to deliver targeting for their advertisers, which means adopting solutions and frameworks that incorporate modern interpretations of Identity. The Universal ID, backed by a consortium led by the Trade Desk, has gotten a lot of momentum and will surely be adopted by Publishers. However, in a survey conducted by LiveIntent, respondents said email addresses (29%), first-party data collected directly by publishers (25%) and embracing The Trade Desk’s Universal ID 2.0 (22%) are the most important digital assets when trying to replace third-party cookies. This suggests that Universal ID’s adoption will not be a “set it and forget it” scenario for the industry, but rather part of a “balanced meal”. Publishers will still prioritize the collection of first-party assets, including email, in concert with any Universal ID adoption.” — Kerel Cooper, SVP, Global Marketing, LiveIntent
You’ve got identity
“What will replace the cookie in 2021? Email. Yes, email, its enduring value marches on. Email is the de-facto successor to the cookie as the battle rages on between open source identity and proprietary identity, i.e., the walled gardens. Open source would commoditize identity away from the walled gardens, which sounds great in theory. But there are concerns around the quality of this data, who ‘polices’ usage and the potential regulation by legislators.,But we’re looking at a world where open source and proprietary data could live side by side with identity differentiated by direct consumer consent and association to many deterministic signals that can be shared in a secure, privacy-centric way. We’re building something similar with our own identity graph, Verizon Media ConnectID.” — Iván Markman, Chief Business Officer, Verizon Media
Marketers will implement strategic action-based experiences and focus on customer data to drive identity resolution and personalization
“Marketers have been — and will continue — focusing their ad spend on showing action-based outcomes like website traffic, add to cart, absolute shopping and app downloads. This means they are moving away from KPIs like reach and completion rate. However, the main problem with that focus is that marketers must know identity across media, sites and devices for that to work. To address this, we will see big progress on creating a uniform standard for CTV identification in 2021.” — Tal Chalozin, CTO and co-founder, Innovid
More walls will go up for the fortunate few
“We predicted in 2020 that publishers would see the forest through the trees in putting up walls. Some did, but the bigger players are banking on first-party data alone as their lifeboats. As pubs invest more in context and erect walls around first-party data assets, they will face increasing scrutiny to prove ROI and scale. Walled gardens may work in the short term for the likes of the New York Times but mid to small publishers won’t survive on context alone. This may lead those players to lean in more aggressively to data enrichment and testing multiple identity solutions, proving their flexibility and agility to meet marketer’s needs.” — Andy Monfried, CEO, Lotame
Subscriptions become the ultimate monetization model for apps across verticals
“The growth of subscription-based apps has intensified this year as users look to their mobile devices for a broader array of activities, from entertainment and e-commerce to fitness and finance. This is also being driven by changing user habits that point to the ‘stickiness’ of subscriptions. As subscriptions become a regular expenditure, we’ve seen that Gen Z and millennial consumers, especially, are more willing to pay for a premium app product or supporting brands they love. Recent research conducted by Adjust found that 25 – 34-year-olds spent the most on subscription apps — $25.85 a month — compared to $13.97 for respondents aged 55+. More than a quarter of Millennials and Gen Z consumers also said they have stopped paying for other services in order to buy subscriptions on mobile app services (for example, subscribing to fitness apps over going to the gym).With ad targeting set to get harder on iOS 14, we expect an increasing number of apps will be looking to diversify their monetization models beyond ad revenue in 2021 — and subscriptions will become the ultimate income stream for many publishers and advertisers.” — Katie Madding, CPO, Adjust
Transparency will make or break the advertising industry
“Programmatic advertising has, in the past, been blamed for contributing to the lack of transparency within the advertising industry due to complex supply chains which make it difficult for brands to see where their budgets are being spent. As purse strings continue to tighten in almost all industries, 2021 will be the tipping point for many brands who cannot afford to throw money into supply chains where up to 15% of advertiser spend is left unaccounted for. There are several pitfalls that need addressing and it is becoming ever more apparent that programmatic advertising is not a one-size-fits-all strategy. I expect that self-service advertising, an inherently more transparent system that allows businesses to place their own ads without the assistance of an advertising sales representative, will be the savior as well as the driving force that will enable brands to better understand the supply chain, work with partners they can trust and, most importantly, reduce unnecessary ad spending” — Peo Persson, co-founder and CPO, DanAds
Advertising automation is going to catch on
“Advertising automation is a new category that we started this year. I believe that we, as an industry, have done a fantastic job solving the transactional issues. About 15-20 years ago, everything was done manually. And then, ten years ago, we came up with real-time bidding, which solved the transactional issue, everything’s being done automatically. You don’t need any human involvement, and, you don’t need to have numerous paperwork, teams, and things like that. So for that, we’ve done a great job. But I believe that we have not innovated for the last ten years as an industry. And this is where I think we got stuck. We’ve done that to solve the transactional issue, and then we built a system to become better about handling it while everybody’s adopting it, and now everything is adopted. What we haven’t solved is the problem that the black box doesn’t look at the overall picture. And now, with advertising automation, we can tell the black box how to look at it. The big problem that we believe needs to be solved is how the marketers plan and the way that programmatic gets executed today. With advertising automation, we give the control back to the advertisers regarding the consumer journey and how to tell your story to bring somebody to conversion.” — Tal Hayek, CEO & Co-Founder, AcuityAds
Enhanced online shopping experience will be the step-up that is needed for businesses to increase sales revenue
“With e-commerce already having grown by 40% this year as a result of ongoing coronavirus restrictions placed on brick-and-mortar stores, there is no time like the present for brands to focus on their online offering. There are already a number of tools that help with this, for example useful bots used by merchants for upselling or following up with customers if an item is left in the basket and offering free delivery on the order when completed. This level of automation is only going to grow, as technology gets smarter and is incorporated into the many aspects of the consumer journey.” — Thomas Høgebøl, CEO and co-founder, NoA
Traditional Makes a Comeback
“A successful vaccine, coupled with extreme device fatigue from the last year will lead to revitalized interest in more “traditional” formats such as OOH, DOOH, and audio. In fact, VIOOH’s annual State of the Nation report found U.S. marketers were planning to include programmatic DOOH in 51% of all digital campaigns in 2021, a figure unheard of a couple years ago. As data targeting and measurement within these formats advances, advertisers will truly start to realize their power when executed properly. Just look at the history behind the mobile ad growth. Consumption outpaced spend for a decade as we declared it the “year of mobile” – until we solved measurement and mobile spending exploded. Now consider the fact that consumers post-Covid will add to the existing 60%+ of their waking hours spent out of the home (70%+ pre-Covid). And compare that to the 4-5% of budgets historically spent on OOH. Big gap to close.” — Craig Benner, CEO, Accretive Media
Buyers will increasingly move from purely programmatic spending to working directly with publishers – often through an agency
“Indeed, we hear publishers are bulking up their direct sales teams to handle the anticipated inquiries and demand. While digital advertising continues its significant shift from direct to programmatic, fewer players and providers in OTT/CTV make an eminently achievable and likely preferable direct strategy. By buying directly, advertisers open up significantly more customized targeting and pricing tiers to choose the optimal spend for their situation. Buying direct also often provides more robust data, such as enhanced content and demographic data. While some publishers publicly state they offer the same inventory for programmatic deals as they do for direct relationships (and we take them on their word for that), we’ve also heard from other publishers that premium inventory is more likely to be reserved for large, direct buyers.” — John Hamilton, CEO and Founder, TVDataNow
Advertisers will require increased agility across all media types
“The agility that digital platforms offer has been especially valuable amid the COVID-19 pandemic as digital advertisers have needed to adjust spend, messaging and creative on a moment’s notice. In 2021, advertisers will continue to move away from rigid/limiting platforms and invest in digital platforms including CTV advertising, not only to reach homebound consumers, but to combine the flexibility and precise targeting capabilities of digital with the impactful storytelling of linear. Agility will be one of the most important pages in a marketer’s playbook in 2021.” — Frost Prioleau, CEO and co-founder, Simpli.fi
More ad spend going towards OTT and CTV
“Looking ahead to 2021, I expect advertisers will continue to navigate the evolving OTT and CTV landscape and experiment with the media mix best suited to their brand. We’ve seen some DTC brands in recent months adding linear TV to their marketing spend and I expect this is a trend that will continue among digitally native brands. I’m curious about the continuing growth of media aggregators that we’re seeing in our video ad serving data and anticipate that we’ll see an increase in ads served directly to premium publishers in the new year. I’ll also be keeping an eye on ad spend levels on live sports broadcasts, where brands have traditionally allocated large portions of ad budgets with great success. 2020 has shaken up that model somewhat. I predict live televised events, in both sports and entertainment, will have strong advertising support in 2021.” — Melinda McLaughlin, CMO, Extreme Reach