While marketers are awash in toolsets and platforms, finding and knowing your true customer is more challenging than it’s ever been. Technology continues to advance, but marketers are increasingly trying to refocus on what counts: people. Here is how Signal predicts this will change the digital marketing industry in 2016.
Prediction #1: Improved people-based marketing options will give advertisers flexibility and control
Media buyers are being directed to shift as much as 50% of their budgets to fully addressable media options.
In 2016, marketers will feel increased pressure to solve challenges like getting a clear view of the customer across disparate data sources, connecting the past to a customer’s intent, and demonstrating attribution and ROI. Brands will demand better people-based marketing options to tie their campaigns to real people rather than cookies or devices.
Prediction #2: Advertisers shift focus from workflow efficiency to targeting precision
Programmatic media buying has exploded due to the efficiencies it provides in ad buying. But those gains may soon be hitting a ceiling. In 2016, advertisers who want longer-term gains from digital ad spend will increase investment in “targeting efficiency” – in other words, reaching known vs. unknown audiences. This is evident in the increased investment in known targeting solutions like Facebook.
Prediction #3: Marketers will raise technology standards to close the mobile gap
There are more mobile-only consumers than desktop-only consumers. 60% of all time spent on digital media is spent on mobile devices. Mobile ad spending will reach $42 billion, or two-thirds of all digital ad spend.
Marketers still struggle to connect with their customers in mobile environments due to cookie-based technologies that don’t work well in mobile environments. In the next year, expect to see marketers explore new and different technology solutions designed to work across all devices so they can keep up with increasingly connected customers.
Prediction #4: Limitations of waled gardens will force advertisers and publishers to make tough choices
80% of digital publishers say they need better data-driven capabilities to help advertisers target their customers at scale.
Advertisers and publishers have realized the limitations of walled gardens in the form of a limited view of the customer journey and decreasing CPMs. 2016 is the year they will both start thinking about ways to achieve their marketing an business goals outside of those walls, which may take some cooperative data efforts. This means brands and publishers will work with other trusted partners through data matching networks, with a goal of scaling their known audiences.
Spending on digital display ads in the US totals over 27% billion this year; Facebook, Twitter and Google make up 43%.
Prediction #5: With ad blocking as the new normal, better targeting, formats and relevancy become essential
In 2016, the entire ecosystem will get serious about addressing this issue, leading publishers to seek to know more about their customers and get smart about their data-driven offerings, and leading advertisers to push for better creative and higher standards among themselves and their vendor partners. Ad blocking could cost publisher as much as $41 billion.
Prediction #6: The race for data drives bigger and bigger ad tech acquisitions
Nearly 25% of the $53.7 billion M&A deals in 2015 were related to marketing and technology.
– Twitter acquired Tellapart for $533 million
– WWP acquired Comscore for $244 million
– Rubicon Project acquired Chango for $116 million
In 2016, Internet giants – Google, Facebook, Apple, Yahoo, Verizon, Twitter – fueled by the race for data, will continue to expand through acquisition. In response, advertisers will continue to look for walled garden alternatives as this consolidation reduces their choices, buying power, and visibility into their own customer’s journey.
Digital media and technology M&A activity increased from 2015 to 2016 by 24%.
Prediction #7: The era of first-party data creates demand for data-driven C-suite roles
82% of marketers plan to increase the use of the data generated from their customers and brand properties.
A new breed of data-driven leaders will emerge to help businesses leverage data to drive more value across the enterprise and mitigate hurdles such as silos and fragmented governance strategies. To Tackle these challenges, businesses will create a new leadership role in the organization focused solely on deriving value from data. This leader will:
– Be a master of data science skills
– Hold a strategic function within the C-suite
– Work across the organization
Prediction #8: Coalition loyalty programs will open doors to more valuable second-party data
Cooperative identification can increase accuracy of anonymised loyalty member profiles and enable coalition partners to effectively target and execute addressable advertising.
US brand spend $2 billion on loyalty programs each year.
In the upcoming year, more brands will come together to build pools of customer data and rewards through coalition loyalty programs. A new model will emerge of several different brands organised under one loyalty program, giving consumers the opportunity to earn points and redeem rewards in more places, and marketers more visibility into high-value first-party data.