8 Trends in Advertising to Prepare for in 2018
2017 presented an undeniable shift in marketing and it’s only gaining momentum. Each part of the ecosystem is being impacted in different ways, with media publishers and content providers feeling the effect of the majority of digital ad dollars going to Facebook and Google and adjusting to changes in distribution methods. The agency business — while still ripe with the most talented storytellers and remarkable creative ideas — is under pressure for not transforming quick enough to meet clients rapidly expanding needs to add value to consumers lives, rather than the interruption model so common to our industry.
Now marketers are faced with new challenges in engaging people during constant shifts in attention from big screens and printed pages, to a small screen and then even smaller screen, and for some, none of the above. Many of those same consumers are now screenless and speak aloud in any room to play music, book a flight, order transportation, shop for groceries and a whole lot more. These changes come at a time when clients and their agencies are trying to make valuable use of enormous volumes of available data and trends, not simply for better ad targeting, but to add value, be more personal, thoughtful and show that using data means caring about the consumer.
These are a collection of topics I investigate over my morning cafecito, rant about with my ad industry friends at happy hours and am preparing myself, our team at M8 and our clients for in the year ahead. Your thoughts and ideas are welcomed and expected in the comments section.
#1 Screenless Interactions
Gartner estimates that by 2020, 30% of our interactions with computers will be screenless. The digital ecosystem previously dominated by screens is being invaded by voice-enabled devices (Alexa, Google, Siri) and virtual assistants.
In 2017 e-marketer estimated that 60.5 million Americans would use a virtual assistant monthly. Voice search alone has grown exponentially, with 55% of teens and 40% of adults using voice search daily. Wearables, audio and other screenless interactions have expanded the digital ecosystem even further.
In 2018, brands have to consider these screenless interactions in their marketing plans. This means re-thinking how people interact with brands throughout the entire consumer journey while they engage with content or try to make a purchase. The popularity of digital assistants also means all marketers and their agencies have to get better/smarter at using data and trends, becoming Relationship Scientists, to anticipate user needs while adding value in new ways to fulfill consumer expectations without a screen.
Social video is currently one of the most engaging advertising formats, representing 74% of all internet traffic. Cisco projected that about 80% of all global internet traffic in 2019 will come from video formats. So it’s no surprise that marketers who lean heavily toward socially distributed video content grow their revenues much faster than those who don’t.
2018 is the year when brands who hadn’t fully committed to social video do so in spades, while those who already did, double-down. Brands will have to rethink their production scheduling; taking into account how content is produced for each platform, volume of assets produced, frequency of distribution and what content needs to be produced for desktop, mobile and other touch-points. Cutting different lengths and formats of the same video for all platforms, including TV, isn’t an effective user experience and while still common, wasn’t ever acceptable.
#3 Active Entertainment
The passive consumption of entertainment is becoming a thing of the past; more and more entertainment companies are developing interactive experiences. Netflix, for example, is developing content in ‘choose your own adventure’ formats. Eko is developing shows where the user chooses from multiple options, making each show unique to the viewer.
Active entertainment is opening up new opportunities for brands to participate in immersive user experiences. The cost of VR headsets is within mass affordability range and Apple’s latest iPhone X and other new VR compatible hardware affirm that 2018 will be the year for mass adoption of VR. In 2018, brands will have to figure out in which spaces to participate and how to interact in these new formats. The difficulty will be in becoming part of -or enhancing - the experience, instead of brands interrupting it or being an easily recognized, disingenuous sponsor.
#4 Hybrid Shopping
For years, as e-commerce grew, it was believed online retail would be the death of brick and mortar stores. But increasingly consumers are looking for real experiences they can touch and feel before making decisions — and retailers are paying attention. Examples of hybrid online-offline experiences are Amazon’s purchase of Whole Foods and Walmart’s acquisition of Bonobos. Brands like Casper, which only sell online, have developed brick-and-mortar showrooms to allow customers to try their mattresses before making a purchase. Brands like Home Depot are also seeing that up to 40% of their online orders are picked up in-store.
That’s a step back from previous years when it was all about e-commerce. Brands will need to keep this in mind throughout 2018 and develop experiences that integrate the convenience of online shopping with the real-world experience of brick and mortar stores.
Finally, mass use of Virtual Reality will assist in developing a new age of retail stores, car dealerships and more, where browsing an entire catalogue of products can be done in smaller retail spaces. There will be no need to store inventory locally as consumers continue to expect doorstep delivery a’la Amazon.
#5 Augmented Context
With tools like the AR kit from Apple, Facebook’s Camera Effects Platform and the opening of Snapchat’s Lens Studio capabilities to everyone, marketers are now capable of superimposing layers of information on the real world, providing new utility for users that brands and developers alike can harness.
Your phone’s camera has evolved into a functional window to the world. Through Mixed Reality (MR), users will experience things beyond the physical world, such as interacting with products or spaces through their smartphone (e.g. placing furniture in your living room, or trying glasses on your face — all from the comfort of your phone). The big question for brands this year is: how can they take these experiences beyond novelty and make them valuable for consumers?
Artificial Intelligence (AI) had a big year in 2017 with many advancements that brought it to the forefront — including popular and useful chatbots. Together with Machine Learning (ML), AI will allow marketers to process more data, faster than ever before, giving marketers the opportunity to automate actions without the need for human intervention.
While 2017 was the appetizer, 2018 should be the year where marketers truly sink their teeth into individualized marketing with more focus, tools and techniques available that provide efficiency and scale. Brands can approach AI as a ‘personal trainer’ of sorts, using it as a middleman between what is technology-driven and what human involvement is most valuable for the most effective consumer interaction. For example, AI within a chatbot can be used to provide robust background information so when a human interaction takes place, the interaction can be informed and personalized to help a user take steps toward a desired solution. Machine Learning will also allow brands to develop their own optimization frameworks for marketing campaigns. Increasingly, users continue to expect to receive personalized marketing tailored to their own customer journey, and all brands will need to leverage Machine Learning for optimization and AI to learn how they can deliver upon these expectations.
#7 Platform Marketing
Four platforms dominated time spent online in 2017: Google, Apple, Facebook and Amazon. Fueled by a declining efficiency in traditional digital advertising (display, etc.) to deliver results, these four big platforms also dominated digital investment dollars. Each platform is an ecosystem and world of their own, in many ways self-contained with their own rules, strengths and capabilities while providing the power of addressability at scale. The remaining company in the Frightful 5, Microsoft, is one to watch in 2018 for their huge resurgence into the top 3 of advertising revenue beneficiaries due, in part, to their competitive cloud services which are a welcome shift for many who don’t want to continue to feed the beast that is AWS (Amazon Web Services).
In 2018, we expect the four main platforms will continue to be utilized in gaining deeper insight and more accurate distribution to audiences, truly leveraging personalization. Marketers will continue to create customized operating models (with individualized content) to engage the right customer at the right time on the right platform. As each platform has unique strengths (e.g. Amazon dominates sales, Facebook dominates social interactions), marketers focus on optimizing where budgets are spent and why, using each platform’s creative distribution palette in unique ways to offer consumers real value. I’d personally like to see more alternatives that challenge the consolidation of user attention, but fear that Amazon specifically, has only just begun their impact and shift on all aspects and categories of consumerism.
The age of ads interrupting users’ online and mobile activities should come to an end — and that should go for offline too (stop by our U.S. HQ for a healthy debate on that subject). In early 2017 eMarketer estimated that 75 million users in the U.S. alone would use ad-blocking technology. If ad-blocking didn’t throw a big enough wrench into the traditional ad model, concerns over privacy, fraud and the use of bots to fake impressions have only increased in 2017. Concerns over targeting have made brands look closer at where they’re running their ads as users want more control over their data and how companies use it.
In 2018, brands should continue to move away from interruption marketing in favor of a new model that will draw the user’s attention naturally and willingly towards something of value, be it content or utility. With more instances of Personally Identifiable Information (PII) breaches in the news and the use of data, and data empowered distribution platforms like Facebook and Google, the generation that once freely gave their data in exchange for access and services is more aware of what they are sharing and the value exchange between them, platforms and brands. It’s more important than ever to use any data gathered to reach consumers more specifically, providing value while enhancing their digital exploration through discovery and experiences. Brands will need to make sure data equals caring, not exploiting, their relationships with consumers.
John Santiago, CEO — M8
As CEO of M8, John is challenged with leading and growing M8’s talented team across the Americas, ensuring each is empowered and inspired to innovate and deliver to help build their clients businesses every day.
M8 crafts meaningful relationships between brands and consumers in a Connected Life™.