2022 Will Reshape the Future of Ad Tech
2021 was a year of disruption and realignment in digital advertising. New channels came to the fore, and advertisers and adtech firms alike reconsidered how to do business with tracking changes taking hold. As the big tech players inch closer to their deadlines to address privacy concerns, here are some trends that advertisers and publishers should keep an eye out for in 2022.
Social shakes things up
Privacy changes at tech giants will usher in a new reality for social media marketing as constrained app monetization begins to cut into growth. We’ve already seen the beginning of this new era in earnings reports from the last two quarters. While investors traditionally expect these companies to grow 10-30% annually, I predict a 5-15% shrinkage in 2022 instead.
That’s not devastating news for the industry as a whole, but nevertheless, we should keep an eye on how the behemoths of the tech world react, especially Google. No surprise that Google can benefit from emphasizing search advertising or putting restrictions on Android’s GAIDs. Maybe the impending hard times for social giants help to explain Meta’s pivot towards VR, which presents a whole new opportunity for brands to get involved in the metaverse.
2022: The year of CTV. And 2023, 2024, 2025, etc.
We all remember the “year of mobile” in the ad tech world — since it lasted over a decade. We should all expect CTV to dominate the headlines for the foreseeable future. And why not? After getting a considerable boost in adoption thanks to consumers’ pandemic behavior, it is predicted to grow quite a bit more over the next five years.
More companies are seeing the value of one of the fastest-growing channels in digital advertising; therefore, we are likely to see even more innovation in the space. More CTV inventory will become available to marketers as identity resolution and connectivity solutions come to the fore to address fragmentation in the channel.
And praise be, there are no third-party cookies to battle over in CTV. Ever. Which, speaking of…
Small and independent publishers will finally be heard
Even though third-party cookies will disappear (I won’t be predicting whether Google will ever land on a final date), that doesn’t mean third-party data will. The reality is that third-party data will continue to stick around because the alternatives that will crop up in its absence aren’t feasible options for smaller publishers.
There is a misunderstanding about third-party data in the industry where people believe that it can’t be privacy-compliant. It absolutely can: it just requires checking the source of the data. As my colleague said: “Advertisers should hold [third-party data] providers accountable by asking whether they use and how they use privacy by design.”
First-party data or contextual targeting can’t be the solution for publishers who don’t have enough data to scale. Contextual data works only inside one’s own domain, which for small publishers is, well, too small. Plus, marketers are less willing to engage with sites that don’t have as many monthly visitors as the larger ones.
The industry as a whole seems to have forgotten about smaller publishers since they’re pushing ideas that won’t work for them, instead of ideas that will work for everyone. In 2022, the screams of these smaller publishers will be better heard and addressed.
Dear identity partners: stop the infighting!
ID solutions for the open web are going to be invaluable for publisher monetization, so in 2022 collaboration will dramatically increase. ID partners in 2021 operated in the identity arena like a circular firing squad. Everyone claims their privacy is better than others, and everyone who has a solution wants to say theirs is the only one that works. In reality, all have to work together.
Put down your arms, identity vendors, publishers, and marketers. Instead, let’s focus on our common goal of giving the consumer transparency and control while making everything more efficient. The end result will be better for everyone involved.
The major industry changes afoot present us with two options: we can either work together to ensure the ecosystem thrives or we can just look out for ourselves in silo. I believe that working collectively this coming year will bear the most fruit for all involved. And I hope you agree.
Mike Woosley is Chief Operating Officer at Lotame.