It’s become a tradition in the media industry that at the end of each year, thought leaders look ahead and share their predictions on trends they believe will shape the industry landscape over the next 12 months. Last year, we published our own list of 2020 digital advertising trend predictions.
For many media organizations, 2020 has been an exceptionally rocky year due to the Covid-19 pandemic—and the year certainly hasn’t unfolded like anyone imagined. As we enter the fourth quarter, it’s a great time to reflect on the past several months to see which of our predictions are still on track despite the public health crisis.
2020 Industry predictions unaffected by Covid-19
Artificial intelligence continues to make waves
Last year, we highlighted that growing numbers of media companies were turning to artificial intelligence (AI) to create better user experiences for their audiences. Today, AI continues to gain ground in the media landscape and could play an even greater role in the industry now that a struggling post-Covid economy poses a new threat to publishers’ bottom lines.
Moving forward, AI can help media organizations drive revenue by putting data to work to find stories and craft subscription offerings that will resonate with audiences. The technology also has the potential to facilitate more collaborative relationships between editorial staff and their colleagues in computer science, engineering, marketing, and sales.
Voice technology is still a consumer favorite
In 2019, we cited research that predicted 55% of households would own a smart speaker by 2022—a 42% increase from 2018. At the same time, voice search was on track to become a $40-billion platform by 2022 and account for half of all online searches.
Today, one third of Americans use voice search, and the platform is expected to increase in popularity by nearly 10% before 2021, amassing a total of over 122 million users. Publishers and advertisers would be wise to keep their eyes open for opportunities to reach consumers using voice technology, if they haven’t already started.
Data privacy pain is holding steady
Last year, we predicted that short-term data privacy pain would lead to long term gain. While that’s still true, media companies and advertisers alike aren’t out of the woods quite yet when it comes to this trend. We don’t have a clear picture of how the industry will look in the future, as privacy regulations continue to evolve and as the phase-out of third-party cookies raises questions for brands around the globe.
Data governance legislation such as the California Consumer Privacy Act (CCPA) and the General Data Protection Regulation (GDPR) has put pressure on publishers to adapt their business models and focus on first-party data to appeal to both audiences and advertisers. Looking ahead, technology such as identity solutions, as well as contextual advertising strategies, will be instrumental in the first-party data-driven world.
Political ad spend is trending up
By fall 2019, presidential candidates had already spent nearly $70 million on digital advertising for the 2020 election. Estimates forecasted that 2020 would be a year for the record books in terms of campaign ad spend, especially within Big Tech’s walled gardens. It turns out that the Covid-19 pandemic has resulted in even higher advertising spend than originally predicted—to the tune of $1 billion greater.
“Physical distancing isn’t allowing for typical in-person campaigning. The money that typically used to support ‘boots on the ground’ campaigning is being shifted to media spending,” said Martha Matthews, SVP and Group Director of Local Activation for Dentsu Aegis Network.
The streaming video craze isn’t over yet
Last year, we said that video would continue to dominate the digital advertising landscape in 2020. Little did we know then that mass furloughs and layoffs coupled with shelter in place orders would cause streaming video consumption to skyrocket among housebound viewers around the world.
The digital video market is expected to grow from a benchmark of $342.4 billion in 2019 to $824.9 billion by 2027, according to Fortune Business Insights. The Covid-19 pandemic has had a significant impact on this trend, especially in the areas of video gaming and over-the-top television.
Personalization is still relevant
In 2019, we cited research that predicted a minimum of 90% of digital advertisers would use personalization the following year. This tactic is one of the most effective ways for publishers to deliver a superior customer experience to audiences.
Despite the challenges brands have faced as a result of the public health crisis, including declining revenues, personalization remains a priority for digital marketers, according to a July 2020 Gartner report. Publishers must continue to emphasize their expertise in this area to advertisers to win a line in their budgets.
Subscriptions are experiencing massive growth
Last year, we suggested that publishers would increase their subscription offerings in 2020. This has played out at an even greater level than expected due to Covid-19 and its negative effects on advertising revenue. Publishers have acted quickly to fill the gap with subscriptions.
For example, “The New York Times subscription revenue rose 5.4% during three months in 2020. Major UK publisher Dennis Publishing recently reported that subscription rates across all its titles have grown by 9%. Similarly, Condé Nast has seen new subscribers in the US double, and subscription orders for UK titles are up 420% compared with the same period in 2019,” according to What’s New In Publishing.
There’s still tension between publishers and the walled gardens
Data from 2019 estimated that Big Tech would rake in 63 cents of every US advertising dollar by 2020. “While these walled gardens will continue to be scrutinized, they’re not going anywhere, so publishers have to learn how to be competitive,” said Sarah Hartland, Global Inbound Marketing Manager at Lineup Systems.
Today, the media industry continues to hold tech giants’ feet to the fire. The Facebook advertiser boycott made headlines this summer, with huge brands like Coca-Cola and The North Face—among hundreds of others—pulling their ads from the platform. In addition, more than 35% of senior marketing leaders in Britain want to see increased transparency from companies such as Amazon, Facebook, and Google.
Stay tuned for 2021 digital advertising predictions
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