Is Ad Tech Primed for Its Own Roaring ’20s?
Welcome back to WOW - What's Outstanding this Week in Marketing Management 2021. Like almost everything else, it seems, it is just like last year. Fortnightly updates on the topics and articles that catch my attention in global marketing and advertising trade media.
Kicking off 2021 is a harking back to the roaring 20s - Speakeasies, flappers, jazz music and everything that made Baz Luhrmann’s film, The Great Gatsby, such a visual feast. The 1920s followed on the end of a world war. But they also followed on from a global pandemic. So, a headline suggesting a new roaring 20s is not out of the question. In fact, many optimists are suggesting, that like 100 years ago, the world will go into a global party of spending and celebrating once the current pandemic is controlled. But that was the headline that caught my attention this week from AdWeek.
Ronan Shields writes “Apple and Google’s vice-like grip on the wider digital media landscape means the future of the sector is intertwined with the fate of Big Tech. Increased scrutiny from lawmakers, with the potential for a Big Tech breakup, provides independent players with hope for survival, but in the interim, they will have to re-architect the fundamentals”.
The idea that Ad Tech specifically is on the dawn of their own roaring period of growth and associated excess, is both frightening as it is confounding. Considering the multitude of challenges the industry faces and the apparent apathy of advertisers to hold it accountable to address these, it is hard to see anything roaring, except the voices of those (such as yours truly) frustrated by the slow progress in improvement. So this is what makes me go WOW this week.
AT HOME, GOOGLE AND THE GOVERNMENT ARE FIGHTING OVER NEWS
Google has threatened to pull its search business from Australia if regulators don’t modify a proposed law that would force tech giants to pay royalties to publishers.
The claim to pull the service, made by Google Australia and New Zealand managing director Mel Silva at a Senate inquiry Friday, has sparked heated responses. “We don’t respond to threats,” returned Australian Prime Minister Scott Morrison.
This ongoing battle is part of a wider global push to hold U.S. tech companies to account. The question is, is this the right fight to be having? And believe me, it has turned into a battle of wills, rather than a negotiation.
HOW AD TECH MIGHT WORK IN A POST-COOKIE WORLD
Despite the chaotic mess that has been 2020, Google announcing plans to withdraw support for cookies in Chrome is still ad tech’s biggest story.
The move reflects how laws such as the General Data Protection Regulation and the California Consumer Protection Act are curbing online user targeting.
Arguably, Apple’s intelligent tracking prevention (ITP) rollout, beginning in 2017, was a harbinger of how this societal shift was to force the hand of major platform providers in implementing cataclysmic changes that would impact the online ad industry. And given Chrome’s market share, the disruption caused by ITP will be magnified greatly come 2022.
P&Gs MARC PRITCHARD SAYS AT CES ‘SOME FORM OF PROGRAMMATIC’ IS THE FUTURE OF ALL ADVERTISING
Three of advertising’s top executives believe there’s no going back to the way business was done before the Covid-19 outbreak.
Nearly a year after the pandemic fully hit the U.S., leaders from Procter & Gamble, NBCUniversal and advertising technology firm The Trade Desk all emphasized the rise of data-driven ad buying and noted how the decline of the television upfront is permanent.
Marc Pritchard, P&G’s chief brand officer, said during a CES 2021 panel today that the “inevitable future” of advertising will be fully digitized and embrace real-time trading.
“All advertising and media will become some form of digital, some form of programmatic—data-driven and automated—which then will enable us all to define the audiences that we want to reach, define what kind of programming we want our brands to be associated with, and then be able to allow that to happen”. Okay, but how do we all get there Marc?
INVESTORS DO NOT WANT DIGITAL ADS FUNDING MISINFORMATION
Early this week, The New York Times reported that shareholders at two major media buyers, Omnicom and Home Depot, filed resolutions in November asking for investigations into whether their digital ad buys contributed to “the spread of hate speech, disinformation, white supremacist activity or voter suppression efforts.” The resolutions, which were coordinated by corporate accountability non-profit Open MIC, were first made public on Jan. 15.
Brands have long been struggling to keep tabs on their ad placements due to the complex nature of the ad-tech ecosystem. With many players along the supply chain, brands can end up advertising on—and, in turn, funding—websites and content that run counter to their companies’ stated values. This is a welcome move. It will be interesting how the ad tech suppliers respond.
INFLUENCERS URGE APPEALS COURT TO ALLOW TIKTOK TO CONTINUE OPERATING
President Trump's planned TikTok ban would harm people who post content to the service for profit, three influencers who use the service told an appeals court.
“The consequences of the regulations are dire,” attorneys for Douglas Marland, Cosette Rinab and Alec Chambers write in papers filed Friday with the 3rd Circuit Court of Appeals.
“Mr. Marland, Ms. Rinab, and Mr. Chambers, like myriad other creators, rely on TikTok as a creative outlet as well as a method of earning income,” they add. “All of them have tried but failed to develop large followings on platforms other than TikTok.” So what happens now?
HOW ADTECH HELPED TO RADICALISE THE US
The digital advertising ecosystem has played a role in promoting hate and division, the author of the Ad Contrarian blog, Bob Hoffman writes.
“There is nothing ambiguous about the role the marketing and advertising industry has played in the radicalisation of US politics and the horrifying events of recent days. There is a clear line connecting adtech and radicalisation. While it has been widely reported and acknowledged that social media has played a significant role in the schism in US society, there is a deeper, more nuanced truth behind the deterioration of our politics.
But how accountable are the ad tech platforms willing to be? The fact is like media owners, they provide content and make most of the revenue from advertising, without any of the responsibilities for the content they amplify. The consequences are increasingly obvious.
BRANDS SPENDING ‘TOO MUCH TIME’ MONITORING PLATFORMS SAYS MARC PRITCHARD
If anyone has been vocal about the need for a safer media ecosystem, it’s Marc Pritchard. The P&G chief brand officer is known for his compelling speeches urging more accountability and oversight of social media platforms where advertisers spend their money.
That urgency has only grown in light of the insurrection at the US Capitol last week. “I won't tell you the specifics, but we're off a lot [of platforms],” he told Campaign US. “We don't want to monitor ad content. That's really something that the platforms need to do.” But as we say with the Facebook advertising ban last year, it does not take long for advertisers to be going back before the changes are made.
MEANWHILE IN THE UK, GOOGLE INVESTIGATED OVER THIRD-PARTY COOKIE REPLACEMENT PLANS
The UK’s competition regulator has launched another probe into Google’s dominance of the online advertising market—this time concentrating on the way its proposals to introduce new privacy measures could shut out competitors on the open web.
The Competition and Markets Authority is investigating changes proposed in Google’s Privacy Sandbox, which include the removal of third-party cookies from its popular Chrome browser because privacy campaigners have complained that certain consent techniques fall foul of the GDPR, the European privacy law.
Google announced in 2019 that third-party cookies would be disabled on the Chrome browser within two years and created Sandbox as a way of enabling people and businesses to submit proposals for how to execute open-web advertising without cookies. However, the CMA has received complaints, including from Marketers for an Open Web (MOW)—a group of newspaper publishers and tech companies—which argue Google is abusing its dominant position in online advertising through the Sandbox initiative.
THE YEAR AHEAD FOR ADTECH: IDENTITY, EFFICIENCY AND OTT
It may seem fruitless to make predictions as the world continues to battle a pandemic and the uncertainty this brings with it. But while Covid-19 has heavily disrupted many industries, adtech has remained resilient.
Indeed, the 2020 predictions that adtech experts made for the industry in January before the virus took hold all came to pass despite disruptions to global ad spend. Covid-19 acted as an accelerant to many of the anticipated trends: social distancing propelled the growth of OTT consumption and ad spend followed; the industry witnessed faster-than-expected growth of in-app; metrics came into sharper focus, and privacy was thrown even further into the spotlight.
Programmatic spend was hit by Covid-19 in the first quarter of 2020 when the majority of ad spend was put on pause as marketers tried to figure out how to navigate the effects of nationwide lockdowns. But it rebounded astonishingly fast, particularly in APAC. Check out their predictions in this Campaign Asia article.
Marc Pritchard is right. Programmatic and adtech are here to stay. But it requires advertisers and their agencies to demand that the adtech market and players improve the ecosystem. Yes, advances are being made. Yes, they are also painfully slow. Part of the reason is the vast number of players. But it is also because of the dominance of a number of players. Some of whom are clearly willing to stand in defiance of democratically elected governments.
Late last year I provided a keynote at the MMS Programmatic & New Media Summit.
I also wrote up my thoughts on the topic here.
The roaring 20s for adtech? We can only hope they get their act together. And fast.
As always, if any of this has piqued your curiosity or you simply want a more confidential discussion on any topic and the marketing implications and advertising opportunities let me know.
As always. Stay safe. Stay healthy. Stay sane.
Cheers
Darren