2010 was one of my favourite years in digital marketing. The financial crash had come to an end and the economy was starting again in a new era. Programmatic was poised to go mainstream and the big agencies were determined to be at the forefront of that change.
Anyone who worked in the industry at the time will tell you how quickly things changed. I was lucky enough to be one of many people that large agencies hired to lead a change in how they approached digital data and technology that led to the birth of the trading desks. In previous years companies like Specific Media, Exponential and adconion ruled the roost in display, but they were about to be disrupted not only by DSPs but also by the trading desks they spawned.
Facebook was poised to introduce (programmatic) paid social and become the world’s second biggest publisher. Large group agencies were able to out compete and consolidate with large independents which culminated in the end of once unicorn agencies such as I-level and The Search Works. It was a time of huge change which was so much fun to be involved in if you were on the right side of it.
Equally it was a time when many businesses declined slowly at first but soon were never to be seen again. I say this because I believe that 2021 will be very much like 2010 and 2003, as the year an old era died and a new era came through, where existing emerging trends (programmatic in 2010, paid search in 2003) became mainstream. In short, an exciting time for those individuals and companies who are ready but also a very difficult time for those who are not.
The cookie will crumble. Privacy will bite
The industry’s drive towards the privacy era slowed in 2020 as regulators focussed their efforts on the pandemic and actions such as track and trace. However, any respite for the old era will end in 2021 as Google completes its exorcism of third party cookies (joining Safari and Firefox where they are already effectively obsolete).
The new presidency in the USA is likely to accelerate efforts in the US and add real world impacts including emboldening European privacy efforts. An example of what is to come can be seen in California where CCPA prevents advertisers retargeting on Facebook and requires consent. with advertisers which do not have their systems in check frozen out.
Such impacts of technology and legislation will be widespread and global in impact. Marketers will have to learn how to target and measure without the ubiquitous cookie. Publishers will look to a new way of operating and MadTech will need to either adapt or die to the new world order. The change this results in will be unprecedented, dwarfing the changes in previous eras that felt big at the time. Advertisers, publishers, service, data and tech companies need to transform their businesses to survive the bite and thrive in the privacy first era.
GAFA carry on
Google, Amazon and Facebook will hunker down – others will join them.
It’s a sad fact that many of these changes will actually help the largest players intensify control of online marketing, as online marketing becomes ever more important. We have already seen this play out in 2020 where, despite the damage to the economy, the value of these dominant players has grown rapidly. Some believe that the new presidency and litigation will clip the wings of these companies and in years to come this may be the case, however don’t expect this to be quick and it is unlikely any major breakups will occur in 2021. Instead as these businesses already have large groups of authenticated logged in users, their share of media spend will increase. For change here, expect other players to copy and join these mega publishers.
From emerging giants like TikTok and Snap to TV companies all offering logged in ecosystems (walled gardens). The major question large publishers need to answer is which of these gardens they wish to engage with to syndicate their content and monetise their media.
Some will choose their own through collaboration as scale will be vital to success. Recently Facebook and Google have offered to pay publishers for their content however this commentator does not believe they have their long-term interests at heart. Collaborations more along the lines of the ozone project point to a more sustainable future for publishers.
For advertisers and agencies it will be important to plan for an approach to the multiple walled gardens and how best to utilise them.
Rise and Fall. Connected TV will grow. Long Tail display will fall
2020 was a great year for connected TV and we can only expect that to continue in 2021 so predicting this continuing would be something of a cop out. As with the above, large publishers and connected TV will prosper as part of new emerging ecosystems and vertical ad networks.
What is less well discussed is who will lose out and sadly this will be the long tail display. In the programmatic era long tail publishers prospered through a combination of cookie retargeting and cookie bombing. Expect these tactics to be in huge decline for reasons of both technology and emerging marketing practice. It was always a myth that a retargeted user on a low quality site with low dwell time and viewability was as valuable as on premium sites and this myth will be exploded in the privacy first era.
Generic display has long been in decline and its decline will be swift in 2021, ruinously impacting publishers who cannot collaborate on new data ecosystems and adtech companies who cannot modernise. Some hope for these publishers exists in a switch towards local targeting and new ways of monetising the anonymous web (but for many these changes will come too late (I expect local media to be one of the stories of 2022/2023 – imagine a world where small businesses could easily buy advertising on local news sites and location focussed local publishers).
In many ways this is back to the future and how media was bought in the mid 2000s with advertisers focusing on the top 50 publishers and, whilst not for those negatively impacted, a return of this sort and valuing quality environments and contextually relevant quality networks is something to celebrate.
Re building MadTech. Data and Technology skills to the fore
Digital Transformation is an often (perhaps over) used phrase. Now there is a huge need for digital marketing transformation that enables advertisers to adapt to the new world. This is a world where online is ever more important and privacy first technology has made many companies’ marketing efforts increasingly obsolete.
Just as in 2010 and 2003 the marketing sector is crying out for those with the skills to help make the change. In 2003 this meant search and IT skills, in 2010 it was programmatic and tech skills. Now in 2021 it will be IT Skills around Identity, cloud computing, API building and systems integration – what we at Canton call Marketing Engineer.
Programmatic skills will also be in high demand as the number of media ecosystems that can be bought using these methods proliferate. This creates a world of opportunity for those that have the skills. A range of online training options means that the future is bright for any with the appetite to learn new skills. Creative skills will also be in huge demand, though again creatives need to understand how to apply their skills to the new privacy first world. Lastly, these changes also create a world of opportunity for tech companies both emerging and emerged (provided they can modernise) to gain market share and capitalise on the newfound love affair between finance and MadTech.
The Grand Review.
Advertisers will change their buying relationships en masse. In-house is the direction.
Advertisers’ needs from their marketing and media buying teams have never changed so much so quickly as in 2020. Yet an understandable focus on other priorities and the challenges of pitching remotely have meant that very few media reviews occurred. This is creating a pressure cooker that will surely burst in 2021 leading to a record number of companies reviewing their media relationships.
In-housing is now widely understood not to be a binary choice but a direction of travel and a huge continuing trend into 2021, with almost all reviews resulting in advertisers increasing their capabilities internally – a requirement to use their data with speed and legislative precision will be required in the new privacy first era.
In previous eras there has been a shift in power to independents (2003-2010) and back to the big agency groups (2010-2020). In this new era, power will shift again to in-house teams and consultancies that support them. That is not to say that agencies are dying, they are still the best options for global media planning and execution, but that their relationship with advertisers and their way of working will change profoundly.
Agencies large or small that adapt can look forward with confidence, however those who cannot (of which there will be several) may go into terminal decline. For advertisers it will be important to have a range of companies invited to be part of any review including a specialist in housing.
A new dawn
The pandemic has likely got some more pain to dish out in the first months of 2021, both with the pandemic and with the delayed economic impacts of it. Sadly this may put huge pressure on many companies and jobs into 2021.
However as we enter the spring we should be able to proceed with much more confidence, but as history shows in this kind of environment there will be both losers as well as (big) winners. For those in online marketing that are ready to adapt to the new era we can look forward with confidence to a hugely exciting time.
Merry Christmas and hope to see many of you in the spring of 2021!