The AI advertising and programmatic market is developing at rapid pace and new trends are being identified. As stated in a recent report by Martech, 12 important trends have been identified that will be developing up to the year 2020.
1. AI in programmatic advertising
The Ubex project is in the lead with the first important trend of the market as Artificial Intelligence (AI) and Machine Learning (ML) are taking up an important segment of all advertising. The advantages offered by the technologies cannot be underestimated as the speed and accuracy of analysis they offer cannot be matched by traditional human resources. A 2018 Deloitte survey of over 1,100 US executives from early adopters of AI, reported that 82% of them saw a positive return on investment for their AI initiatives. This indicates the increasing faith in AI in programmatic advertising which will strengthen further over the next year.
2.GDPR on the rise
The General Data Protection Regulation (GDPR), announced in Europe last year, has proven to be a significant boost for advertisers. The rules have placed strict and clear restrictions on data usage and have thus increased transparency of all operations with user data and advertising based on it.
As the GDPR website says, “CIOs must ensure that they have watertight consent management processes in place, whilst CMOs require effective data rights management systems to ensure they don’t lose their most valuable asset — data.”
Programmatic advertising benefits from the new regulations as the technology offers clean data and allows advertisers to legally use the data of users with their consent.
3. Digital Out Of Home (DOOH) merging with mobile data
DOOH combined with mobile location data has the potential to redefine how marketers can address the crucial last mile between home and store, or online and offline. Programmatic in DOOH will allow targeted audience planning and buying with increased efficiency, brand safety and measurement at lower budget expenses. The programmatic market is moving towards the mobile market with every passing year and effective use of DOOH on specialized platforms for programmatic with AI and ML will ensure accuracy in user targeting and increase the efficiency of advertising as a whole, resulting in higher conversions of ad to sale.
4. Voice-activated ads going big
The introduction of voice-based, in-home smart devices has been on the rise as Amazon reported last year, that it had sold over a 100 million Alexa-enabled devices and that customers spoke to Alexa tens of billions more times in 2018 compared to 2017. A few years ago, Gartner predicted that by 2020, 30% of web browsing sessions will be done without a screen, through voice-first browsing. A recent survey by VoiceBot.AI revealed that 25% of respondents say everyday household items are the most ordered through voice-assistants, followed by apparel and then entertainment and games.
Programmatic advertising is crucial in optimizing such voice-activated device ad spaces and converting them into sales. The accuracy of AI and ML combined with the transparency and speeds of blockchain platform will allow marketers to make greater use of voice-activated devices as sales instruments.
5. Wearable devices combining with programmatic
Wearable devices are already collecting data on the location, lifestyle, health metrics and parameters of their users. With GDPR regulating data collection and usage norms, availability of such data with user consent will make immense opportunities available for advertisers to target potential audiences.
A 2019 report by Strategy Analytics claims that global smartwatch shipments grew to 44% year-on-year to reach 12 million units in the second quarter of 2019.
Wearable devices are an immense, untapped market of opportunities for both data collection and ad displaying that programmatic will be taking advantage of as platforms for ad placement make it easier and cheaper for advertisers to target users and penetrate onto wearables.
6. 5G advancing programmatic
The bandwidth of 5G is expected to exceed 100 gigabits per second, which is 100 times more than its predecessor — 4G. Such bandwidth will allow adtech ecosystems to perform faster and allow advertisers to reach more channels and more media at greater speeds through the use of more processing power intensive systems, such as programmatic. By 2024, the adoption of 5G based adtech is predicted to grow to 1.4 billion.
The high speeds of 5G will allow videos to buffer faster and lags will likely disappear, making streaming a common media channel out of reach of Wi-Fi. Such opportunities will make ad displaying faster and more efficient without causing additional inconveniences to users. The addition of augmented reality features will open entirely new opportunities of interactive advertising in 5G media.
7. Personalization is key
As audiences become smarter and are increasingly merging into the digital medium, the need for smarter audience management strategies and increased segmenting, targeting and personalization becomes apparent. Programmatic will come to the rescue in this case with customization, which allows advertisers to offer highly relevant, personalized messaging to their target groups.
Together with predictive modeling based on AI technologies and ML, the programmatic advertising market will be able to cater to the Gen X and Z users of digital media and serve them better on the basis of their personal data analysis.
8. Blockchain coming
A 2019 report by Cheq, a cybersecurity firm, claims that ad fraud damages will touch $26 billion in 2020, $29 billion by 2021 and $32 billion in 2022.
Blockchain is the solution to fraud in the advertising space and programmatic advertising will benefit from the greater evolution and incorporation of such transparent systems. The reduction of middlemen in advertising through the use of decentralized platforms will reduce advertising budgets and will ultimately increase the transparency of ad placement and result in higher conversions of ads to sales with greater customer satisfaction and product quality.
9. Programmatic TV, podcasts and audio programmatic growing
A PwC report titled Global Entertainment & Media Outlook has revealed that programmatic TV will represent approximately one third of global TV ad revenue by 2021. The 2019 annual Podcast Revenue Report by IAB and PwC shows increasing growth in the US podcast advertising marketplace. The 2019 report reveals marketers spent $479 million to advertise on podcasts in the U.S., an uptick of 53% from $314 million in 2017.
Programmatic on TV is not a fantasy, but a real trend and a powerful conversion tool that advertisers will be using. The advent of more powerful platforms based on blockchain and data analysis instruments will allow advertisers to reach even more audiences on TV and make the given channel more productive than it was earlier.
10. Omnichannel programmatic
By adopting an omnichannel approach, advertisers are accessing only smartphones, computers, digital assistants, TVs, and tablets. The adoption of a unified approach through the use of programmatic adtech will allow them to customize their ads to suit various devices or platforms. Adapting to customer behavior of the key to achieving maximum conversions and sales, and programmatic is the instrument that allows it to become possible.
11. Agencies working on pay-per-result model
Deloitte reports that outcome-based remuneration is gaining prominence on the agenda of many multinational brands preparing for zero-based budgeting with companies such as Unilever and Duracell.
Transparency in advertising is becoming critical and blockchain and programmatic instruments are paving the way to making bulk-budget based contracts a thing of the past. With so many user data sources available, it is only natural for advertisers to pay only for results, and it is easier for agencies to make use of the instruments available and generate higher incomes by smart use of programmatic.
12. In-house programmatic Vs. agency transparency
A report by IAB revealed last year that in-house is now the favored advertiser model with nearly 40% executing their programmatic trading via in-house operations. As per the report, 50% publishers also have an in-house model now.
When there are convenient and versatile, and, most importantly, transparent programmatic platforms available for conducting in-house advertising, the need for huge advertising departments fades into the past. It is clear that agencies will be giving way to more focused and low-budget solutions, such as programmatic platforms with integrated DSP and SSP solutions.
