How The Big Issues Will Play Out In 2016

The advertising industry ended 2015 on a high — ad spend jumped 5.8% in the first half of the year and the predictions suggest that momentum will have been maintained throughout the full 12 months<sup>1</sup>. It's a tremendous testament to the ad industry's contribution to the UK's economy and forecasts suggest that spend will break the £20bn barrier in 2016.

Online spend continues its incredible growth and takes an ever bigger slice of total spend; Onlinemedia was forecast to take more than half of total Media ad spend in 2015 and when the figures are all in I have no doubt this will prove to be true2.

This puts the media and advertising industry in a great place for growth in 2016. There will be challenges but I am confident that the innovation, ingenuity and inspiration that is the hallmark of the industry will make sure we maintain momentum.

Here is my own take on some of the complex issues we might face in 2016.

Mobile

Mobile needs to be at the heart of any growth strategy for 2016. Businesses planning for success will need to optimise their mobile sites, collate data from signals of intent given by consumers and create great user experiences that can lead to a purchase. Not to do so will see them left behind. The numbers from usage to ecommerce figures could not be more persuasive — mobile accounts for more than a third of ecommerce sales3 while Amazon says it enjoyed its biggest sales day ever on Black Friday when it sold 86 items per second4. Look at how social shopping is taking off and the how consumers are embracing 'buy buttons' to make purchases direct from platforms. From a Google perspective to help retailers capitalise on immediate consumer interest, YouTube has introduced shoppable ad formats in its videos with Truview for Shopping and Shoppings Ads for YouTube, which offers click-to-buy ads within partner videos .

To help retailers capitalise on immediate consumer interest, YouTube has introduced shoppable ad formats.

Video

To points to make on video:

  1. Marketers and their agencies need to focus on the video ad formats most welcomed by viewers. Video consumption is soaring — the number of hours people spend watching videos on YouTube is up 60% year-on-year. But consumers will not put up with a poor ad experience. We believe that skippable ads within a single ad format on Youtube are incredibly powerful for engagement and will produce proof points on effectiveness and engagement. Abusing the viewers trust with excessive ad volume will be counter productive. Consumer hunger for video will be further driven by Innovations such as Youtube 360, which allows the creation and viewing of 360 degree videos.
  2. The rise of the vlogger will continue as these content creators become mainstream celebrities, expanding their empires across all forms of media. Zoella needs no introduction but many others are set for superstardom, from Dan and Phil to Tanya Burr. The Multi-Channel Networks that manage and hothouse YouTube talent will become attractive acquisition targets for 'traditional' media owners — we have already seen German broadcaster ProSiebenSat1 buy a majority stake in Collective Digital Studio5. The reach offered by video can be leveraged with Google Preferred, which offers advertisers the opportunity to reserve inventory from the top 5% of YouTube's most popular channels.
Consumer hunger for video will be further driven by Innovations such as Youtube 360

Digital Display & Programmatic

Advertisers and agencies will need to boost their expertise to better understand the programmatic buying opportunity and invest in the best systems available to gather and interpret signals of intent and data. Then they will be able to deliver effective messages efficiently. Data-driven storytelling will drive the ROI for programmatic and those advertisers and agencies that craft more relevant and personalised messages will reap the benefits.

Data-driven storytelling will drive the ROI for programmatic.

The anxiety over ad blocking should subside. Publishers such as The Guardian and City AM are taking steps to better explain the value exchange of viewer data for content, while the advertising community is beginning to understand what constitutes bad practice, with the help of initiatives such as L.E.A.N. from the IAB6.

Agency Models

I think it is fair to say that the current agency model — be it creative or media — needs to be overhauled but I do not see a return to the full service mode in its traditional sense. The bigger changes will be taking place at group level where suites of specialists are being assembled that will help advertisers get under the skin of consumers and produce relevant content. Examples in 2015 included Dentsu Aegis buying content specialist John Brown Publishing and GroupM buying Essence and The Exchange Lab. The challenge is to ensure each of the component parts are 'best in class' — this will be the best defence against the global consultancies that are beginning to annex some of work traditionally the remit of media agencies.

I think it is fair to say that the current agency model — be it creative or media — needs to be overhauled but I do not see a return to the full service mode in its traditional sense.

Search

Search will remain the most powerful method of understanding consumers' needs and desires and brands must not fall into the trap of treating it as a utility function. It is an expertise medium and marketers and agencies need to have experts.. Those intent signals can now be read on video — YouTube is the second biggest search engine — and on display via buy buttons. In my 10 years at Google Search has evolved into an amazingly sophisticated product and now offers even better targeting and remarketing options. These include features such as Remarketing Lists For Search Ads (RLSA) and Customer Match - the latter lets advertisers serve ads to customers who have signed into Google Search, YouTube or Gmail. Attribution is also constantly improving to track the complex customer journey across devices as consumers make purchase decisions in micro-moments. Greater insight into the consumer path to conversion means marketers can better determine where to allocate spend and Doubleclick now offers cross-device measurement using algorithms based on a number of shopper signals.

My biggest hope for 2016 is that media and creative agencies use technology and digital tools to raise their game further and that advertisers start respecting the quality of work their agencies produce and pay them for it accordingly. This will inspire them to new heights and produce a win-win for all parties.

 

#Reflections: Custom Selfie Sharing with Ray-Ban