Flexibility is the industry buzzword for the year, as advertisers continue tightening their belts and budgets remain strained.
At the start of IAB ALM 2023, incoming chair Alysia Borsa took the audience on a journey where she explored the current state of the industry and what we can expect for the rest of the year.
To come up with these insights, the IAB reached out to brands and agencies to understand their core focus areas for the year. For many, they were measurement, first-party data, and leveraging creators. The media and marketing industry organization also contacted all of their members to learn what are the biggest challenges they expect to face over the next year or two.
Unsurprisingly, measurement, the cookie apocalypse, loss of identifiers, inconsistent privacy regulations, brand safety, and consumer trust were the top themes to come out of the research.
IAB’s Tips for a Progressive 2023: Finding Opportunity in Challenge
2023 is all about continuing to address industry challenges and turning them into opportunities. Brands, agencies, and publishers can do this in several ways.
Keep a Consumer-First Focus
By relying on third-party cookies, the industry has gotten away from putting the consumer first and building trusted relationships with them. It’s time to utilize a back-to-the-basics mentality and focus on the consumers’ significance in the advertising value exchange, which is very powerful and meaningful.
The entire ecosystem plays a part in this. If publishers and platforms provide the best content and experiences, and then brands, agencies, and tech platforms ensure that they provide relevant and impactful advertising, consumers are engaged. Since we face economic headwinds, we mustn’t revert to old habits. Borsa encourages the industry to continue to reinform their value to consumers.
To achieve this, we need to continue working on a few areas. First, we must continue to harness first-party data to ensure we understand the consumer. Then we need to build scalable cookieless targetable solutions. And finally, we need to measure the performance. Performance is critical this year, but we need to ensure that measurement is accurate and cross-channel. And then we can continue to think through and evolve the correct measurement KPIs.
“Last year at Dotdash Meredith, we saw the power and the benefit of focusing on the value exchange,” Borsa said. “We are now delivering higher quality intent-driven content paired with a better clear UX. There are fewer, less intrusive ads that are more performant. Consumer engagement and yield are up, so it really does work.”
The ecosystem needs solutions that solve for fragmentation. We need the ability to reach consumers across all channels, so it’s important to have an open ecosystem. In 2023, attention is the new real estate and it’s all about reaching consumers and getting their meaningful attention.
Invest in Growth
Despite tight budgets, we need to continue investing in innovation and growth areas and prioritize what those areas are for your companies. There are a few significant growth areas worth the investment and they are:
- Streaming and Advanced TV – Consumers have flocked to streaming services way faster than expected, and advanced TV has so much growth and opportunity. It marries up the best of digital with the best premium experience of traditional TV to create advertising magic. The IAB pledges to take a role in fostering collaboration and building out standardization to build this marketplace.
- Retail Media Networks – Retail media network ad spend will be over $50 billion in 2023, and over six in ten buyers said they have or will be executing media through these networks this year. Closed-loop attributions and purchase intent signals are impactful, and retail media networks create meaningful partnerships throughout the ecosystem. For example, Roku recently announced a partnership with Kroger that is “making the streamers’ journey the shopper’s journey,” according to Alison Levin, VP of Global Ad Revenue and Marketing Solutions at Kroger. The Kroger partnership is about marrying data so that TV buying can be more precise and accountable.
- Ecommerce – This is another growth area that is a big focus for the IAB, publishers, retailers, and brands. We are now seeing more hybrid commerce models where D2C brands are creating in-store shopping experiences. For example, Borsa highlighted ThirdLove as an example. They quickly opened up stores last year and saw a huge lift from a branding perspective, even more so than compared to revenue.
Collaborate and Take Control
Throughout a time of constant industry upheaval, collaboration is key right now. It’s important to foster partnerships now more than ever. “We will happen to things; things will not happen to us,” Borsa stated. She also encouraged people to adopt that mantra, especially as we consider all of the privacy shifts within the industry.
Coincidentally, the IAB recently released its State of Data 2023 report and found that companies don’t fully realize the impact of privacy legislation, the loss of cookies, and data changes within digital media and ad tech.
The message from Borsa was clear, in 2023 everyone should come together and push for the proper privacy measures that help the industry to flourish. Together, we need to test and learn new privacy, contextual, and addressable solutions. We cannot just wait for the IAB — W3C or Prebid or anyone else — to spoonfeed the industry solutions. We are all in this together and we all need to work together.