Trends to look out for in 2017: Rise of programmatic video & metrics
After more than fifteen years working in digital media and advertising in Asia, I have learned that change is the only thing we can be certain of.
2016 was a turbulent year of growth, acquisition, and shifting sands in the ad-tech market. There is no doubt there’s an extremely competitive race underway to become the best provider of holistic marketing solutions to advertisers.
There were of course some predictions in 2016 that simply did not bear fruit. Last year the hot topic was the rise of data management platforms (DMPs), and there were confident forecasts that it would be the biggest growth area in Southeast Asia. However, DMP adoption remains tepid among advertisers due to a lack of know-how and the high investment entry cost.
The growth of programmatic advertising, however, is evident and we expect to see premium media being allocated to private marketplaces, and the DMP providers are essential to creating connected ad tech stacks. We are not at that level of adoption yet, which means there is plenty of opportunity for savvy tech platforms to make an impact.
The credibility of consumer data supplied to advertisers did take a hit this year, with the two dominant players, Google and Facebook, squarely in the firing line. The walled garden model took a reputation dent after Google’s served and viewable ad metrics were suspended by the U.S.-based Media Ratings Council, while Facebook was forced to reveal that it had over-estimated key video metrics for two years. This further reinstates the need to work with open, independent and transparent partners.
There were also acquisitions aplenty, including Sizmek, selling to a private equity company, Vector Capital. We also saw the acquisition of TubeMogul by Adobe, signaling the importance of programmatic video buying in the world of martech.
At the end of November, Accenture bought one of London’s largest independent agencies, Karmarama- further evidence that the big consultancies see significant revenue opportunity in the advertising industry. There is no opportunity to be complacent.
The programmatic advertising industry in Asia will also be impacted by developments in the wider global digital industry. I had expected more Asian telecommunications carriers to invest in new digital businesses to protect their incumbency, while the new breed of fintech players are yet to step up to plate and challenge the leading banking players.
So what to look out for in 2017?
There will be a lot more acquisitions as the cashed-up players seek scale, breadth of offering, and differentiation. Media budgets are up for grabs and digital will be the main battleground. I expect to see an increasing marriage of smart data and creative technology, which could threaten the role of the pure creative agencies. At the same time, media and creative agencies need to work closer together as the demand for programmatic creative takes center stage.
Metrics and performance will become even more important, as brand advertisers demand increased transparency and insight into where their budgets are being spent. If 2016 was the year of the viewable impression, 2017 will inaugurate the era where we move to an effective impression that is defined by each individual buyer, across the parameters that matter most to them.
The “impression” will continue to become less relevant as the baseline for digital transactions, as we move along the continuum from delivery to engagement, and experiment with different metrics to represent campaign success. We will see the rise of metrics such as engaged impressions, effective impressions, and consumer attention engagement rates.
It’s also true that ad-tech firms, and the global agency holding groups in Europe and North America, are all eyeing Asia, and China in particular, for growth. New entrants will shake up the scene. However, I believe one of the most intriguing competitive scenarios will be the East vs West battle in Asia. Baidu, Alibaba, Tencent versus Google, Facebook, and Amazon. Local vs Global. It will be fascinating to watch.
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