2023 Digital Advertising Outlook
If there’s one thing you can always count on in an industry like ours, it’s that change is inevitable. Every year, marketers are faced with new challenges and exciting opportunities thanks to advancing tech, novel platforms, evolving trends, and more demanding customer expectations. And if you don’t keep adapting and moving forward, you’re going to get run over.
So as you prepare for a successful 2023, we invite you to check out 12 of the top trends that will be having a big impact this year, both in Philly and around the world. And why you should start taking advantage of them now.
- More Eyes on Amazon Media
If you think you know Amazon, you may be surprised at just how much you actually don’t — especially if you’re not selling on their platform. The truth is, you don’t have to even be a retailer to take advantage of their powerful media environment. Over the years, Amazon has collected a ton of data about their customers’ behaviors and interests, and from it, they created a full library of audience segments, which they’ve made available to marketers for their targeting efforts — with over 13,000 segments in the US alone.
This year, more and more marketers will be realizing the power of this preciseness, which not only looks at shopping behaviors, but also viewing behaviors, music preferences, and more to analyze the areas where they overlap. Through Amazon Music, Amazon Prime, Twitch, Fire TV, and Freevee (yes, all Amazon brands!), this “Overlap Report” deciphers trends between these user behaviors to offer marketers a very high-level of targeting accuracy.
In fact, agencies have found Amazon segments to have a 90%+ match rate when uploading clients’ hashed email lists — compared to the 30-45% average for standard programmatic environments. And while they’re not limited to advertising on Amazon’s platforms, there’s certainly increasing value in doing so. A platform like Twitch offers an interactive, creative environment where users actually welcome advertising content, where FireTV presents a much more cost-effective alternative to cable TV with the option to sponsor movies of the week or target specific actors and directors based on audience behaviors. Let’s just say, if you haven’t checked out Amazon Media yet, this is the year you should.
- Content Creation Getting a Boost From AI
The days of long hours spent searching for the perfect stock photo or creating a custom one from scratch are pretty much over. Thanks to artificial intelligence (AI), acquiring the right image for a campaign or website is as easy as drawing some stick figures — basically.
With AI-Generated Content tools like Nvidia Canvas, you can simply sketch something resembling the visuals you’re looking for, and they’ll convert your doodle into a realistic image. A simple brush stroke in the shape of a mountain will auto populate with a highly-naturalistic range, while a couple of keywords can help you find the exact image you’re looking for by automatically narrowing down your options by audience and style. Other tools like ChatGPT by OpenAI generate human-like responses to text prompts, utilizing a plethora of data from books and articles to online conversations, which can actually help copywriters (and non-writers) draft blogs, articles, and other types of sales content. Crazy, right?
AI content will be a game changer for creative freelancers and non-experts looking to create high-quality assets. They’ll also streamline the approval process, allowing actual experts to present more advanced drafts and outlines to clients at every step of the process without the extra work.
- Ad Spending will Continue to Rise
Despite the whirlwind of economic downturn, rising inflation, and historically high interest rates, marketers haven’t cut back on their ad dollars. In fact, advertising spending continues to grow, but that growth is slowing down. In 2022, ad spending grew 8%, or by $53.0 billion, which is down slightly from the 8.7% growth forecast last July, according to the Global Ad Spend Forecast.
In 2023, the US is anticipated to do better than the Americas’ collective growth of 13.2% with a moderate growth rate of +3.8% — up 13.8% in 2022 with a 3.8% boost in 2023 and 4.9% growth forecasted in 2024.
The trend toward digital spending continues, claiming all the growth for 2022 and 2023. And there’s a good reason for it; advertisers are prioritizing performance-based campaigns in hopes for more immediate gains to combat the temporary economic slowdown (Inside Radio). Online channels are predicted to increase their slice of the advertising pie from 55.3% in 2022 to 58.2% in 2024, thanks to the introduction of new categories like retail media.
Speaking of retail media in the digital space…
- The Evolution of Retail Media
Right now, North American online retailers are leading the rest of the world when it comes to launching retail media networks. Think of brands like Instacart, Walmart, Walgreens, etc. But this won’t last long. Dozens of ecommerce retailers in EMEA, APAC and LATAM will either launch or double down on retail media networks in 2023. As a result, global expansion into untapped markets is becoming one of the most popular growth strategies for leading retailers.
Having a strategy that is connected and cohesive will be more important than ever. More brands will start viewing retail media as an interconnected advertising channel versus a handful of unrelated platforms, and they’ll use unified real-time optimization to capitalize on arbitrage opportunities between the various networks. In order to make that happen, we’ll see more centralized retail media teams — both at agencies and large CPGs (consumer packaged goods)
Notably, creative will start to play a bigger role in the success of all retail media campaigns. As global competition increases, savvy brands will be more thoughtful in the use of creative assets that are specifically produced to maximize their retail media KPIs. They will also do a better job of connecting their retail media creative with their overall creative strategy, tailoring to the specific demographics and regions they’re targeting.
- New Universes & the World of Gaming
Word of the Metaverse has certainly made its way extensively around the marketing world, but we haven’t seen much progress yet. Facebook has plans to create a fully-integrated ecosystem, consisting of all the AR / VR applications out there to bring a whole “universe of experiences and capabilities to one technology, as part of a cookie-less future with Web3. But with Facebook’s not-so-stellar year in 2022, filled with layoffs and internal changes, the big stuff is likely still a ways out. Instead, we’re seeing a lot of individual companies taking gamification matters into their own hands, creating digital experiences and virtual worlds for their audiences
For example, Fortnite, the battle royale video game, hosts in-game, virtual concerts featuring real artists — in digital form. Participants can choose whatever avatar they’d like and attend the concert like they would in person, allowing them to interact with other attendees in realistic ways and enabling the artist to tailor their performance using sensors and instruments that are modified to the platform.
You have platforms like Twitch with interactive video programming that puts streamers in more control of the digital content they consume. Redefining the traditional “celebrity,” this type of advertising gives brands the opportunity to weave messaging into the entertainment, creating a direct connection to a highly engaged audience that trusts its creators. We’re sure to see a lot more brands customizing these virtual realities and entertainment platforms to their audiences to connect with them in more meaningful and convenient ways.
- App Development Gets Support from Modern Browsers
Let’s paint the picture here a bit. So as a user, whenever you want to download a new mobile app, you go right to the app store and in a few seconds, the icon appears. But what if you’re a developer trying to publish an app on the App Store and Google Play? Now, that’s a little more complicated — since every operating system (iOS, Android, Windows, etc.) all require a full build of the app, each with a different source code.
But thanks to a Hybrid App approach, this process has gotten a little easier, allowing dev teams to use a single source of code to deploy to different platforms quickly. BUT they still need to go through all the regulations regarding performance, user privacy, performance, etc. required by the app market, and in many cases, pay annual licensing fees.
Which brings us to another great emerging trend: Progressive Web Apps (PWA). A PWA is basically a web application that users can access via browser. In addition to functioning just like a regular website, these sites also allow users to install the app just like a regular app, so accessing it is as easy as finding an icon on your desktop. For developers, that means easier implementation, no fees, and faster turnarounds. They get to take advantage of their expert web dev skills to create hybrid apps (that function like native apps) — all while the users get the ease of familiar browser navigation.
And the best part is that PWAs can work offline too. In these cases, it will display the data it was able to store locally, and then when it gets back online, it will automatically update to the latest version of the app that exists on the web. Pretty cool, huh?
- The (Ever) Increasing Importance of Globalization / Transcreation
Remember all that talk about global expansion? Well, transcreation is a very big part of that. So as we see more brands going global thanks to advancing digital capabilities, they’ll have to be a lot more aware of the needs of their highly-diverse audiences. That means not simply translating language, but also adapting the visuals, layout, and more to every market you’re targeting.
But that’s creating some significant challenges for marketers, especially as animations and video continue to lead in all ad performance metrics. For example, repurposing a master animation banner ad into 100 new versions is no small task when that one banner has 8 different frames. So the new focus for designers will be on increasing the efficiency of the transcreation process without sacrificing personalization and originality.
The good news is that social media has been a big help. Not only has it allowed brands to have a larger presence in global markets, but it’s also offered some useful transcreation tools, which help convert content built on HTML to GIFs and videos that can be easily shared across channels. While it’s certainly a step in the right direction, design teams will remain on the search for new tools that expand on these capabilities for all campaigns.
- Advancing Development with Modular Websites / WebFlow Technology
Sites like SquareSpace and Wix have made it easy for non-developers to build professional looking websites. The only problem is, their customization comes with limitations. Modular websites have offered a compromised solution, and they’re taking the web dev world by storm. In addition to providing a wide range of various UI components for marketers and brands to adjust and scale on their own, they offer a much more robust framework.
With modular sites, the flexibility provided is less in the customization and more in the creation of each page, allowing managers to add as many widgets as necessary to personalize the site when needed. Scaling and redesigning is easy because everything is pre-tested and developed to fit every new element without fail.
Webflow technology is currently one of the most common modular solutions used by developers to create a site that’s code-free, user-friendly for marketing teams, so they can handle all content creation internally. It’s not only easy to use, but also much more cost-effective than HTML sites.
- Emails Getting Interactive with AMP
Thanks to Google, email marketing has ditched its old school reputation. Their new tech allows you to create shopping carts and other website-like experiences for consumers without ever leaving their inbox. In the past, sending out an email meant having two versions; one regular HTML and one text, and the recipient would receive whichever one based on their preferences and email client capabilities. AMP (Automated Mobile Pages) now adds a third tier, which utilizes the same proficiencies as a web page to offer a more interactive experience.
This cuts out a MAJOR step in the sales funnel, allowing consumers to interact with brands like they would on their site’s without ever having to actually visit. Right now, Gmail is the biggest email client in support of this new tech (go figure), but as more and more marketers start demanding these capabilities, it’s sure to spread like wildfire.
- QA No Longer Gets Ignored
Quality Assurance isn’t new. But it does have a newfound importance in website development in 2023. In today’s world of instant gratification, web users have very little patience for flawed technology, so that means if they see an error message or broken link on your website, they may not only bounce; they may never come back again.
QA audits help catch all of those errors, plus other issues like heavy elements causing slow load times, outdated components impacting user experience, and anything not in compliance with the ADA and accessibility or other web regulatory agencies. All of these elements play into your website’s performance across all browsers and devices, ensuring better search rankings and the assurance that you’re delivering what your site visitors want — and expect — from you. Don’t be that site that thinks it doesn’t really need an audit. You do.
- Less is Becoming More in Design
The average human attention span is now officially shorter than that of a goldfish — clocking a mere 8 seconds. And marketers have realized that overcomplicated and busy designs are not a match for these decreasing attention spans. People want ads that are eye-catching, striking, and bold, but they also want all that as quickly as possible. That’s why animation continues to grow in popularity throughout design, offering a great way for brands to grab a consumer’s attention and deliver their message in a quick and visually pleasing way. With an array of screen sizes, ensuring your ads translate just as well through a large monitor and a small cell phone is important and simplicity is key in creating this cohesion across campaigns.
And of course, AI is aiding the process. Reference trend #2 again for more on that.
- The Unwavering Importance of Human Touch
With some of these once-unthinkable advancements with AI-generated content and automated processes, it’s not far-fetched for some creative professionals to question their usefulness in the future. But if there’s one thing we can safely say at this point in its evolution it’s that a human touch matters — to everyone.
Sure, if you have a robot that can crank out 75 banners in an hour, that’s awesome. But the creativity, collaboration, even humor that goes into it — that’s the ultimate art. Behind every great campaign is a human mind building the foundation to inspire and connect.
Not to mention, many of these tech capabilities are still far from perfect, making that human aspect even more crucial to the process. If anything, they will only expedite and simplify the creative process for designers, allowing them to more quickly test their ideas and create iterations for their clients.
So don’t worry, creatives — it’s the special element only you can bring to the process that makes the rest of the tech wheels turn. And we anticipate a great year for all of you as well.