Digital Transformation of the Advertising Industry
Advertising is one of the most innovative and creative industries in tech. And when you think about how media has changed, it makes sense why advertising would also need to change in order to keep up. Digital transformation in the advertising industry has been a long time coming and it’s not slowing down anytime soon. According to WAN-IFRA’s World Press Trends 2020–2021, 44% of publishers believe accelerating digital transformation should be a top priority.
Media is continuing to evolve and become more personalized, and this means that advertisers need to do the same. Advertising isn’t just about getting your message out there anymore; it’s about truly understanding consumers and building relationships with them. In this article, we’ll discuss some ways digital transformation will impact the future of advertising.
What is digital transformation?
Digital transformation is a cultural shift in an organization or industry resulting from the integration of digital technology, in which new business processes are developed or existing processes are altered to provide value to various stakeholders, including customers. Spending on digital transformation technology and services is anticipated to increase from 1.78 billion dollars in 2022 to 2.39 billion dollars in 2024. The use of new digital technology allows businesses to rapidly adapt to changing conditions, allowing them to remain on top of new trends as they emerge.
What role is digital transformation playing in the Advertising industry?
Adapting to Consumer Trends
Consumers interact with media in a variety of ways, including mobile, desktop, and over-the-top (OTT) platforms. Advertising is one thing that is constant across all of these devices, however, advertisement fatigue is a challenge being addressed by publishers. Support is being offered, such as frequency limiting, to restrict a consumer’s exposure to a certain ad or product. Advertisements from different publishers cannot compete or clash. This is a challenging topic to address since making advertising decisions requires real-time data. That is where digital transformation has had a significant impact on publishers who are trying to find a balance between the ads that are distributed to consumers. Digital technologies are being used to calculate frequency and provide publishers with answers to help them make informed decisions to overcome the advertising challenge of ad fatigue.
Increased Access to Data
Digital transformation has led to publishers having greater access to data. It has encouraged organizations to connect their technologies to gather all data in one location. Data is at the heart of digital transformation. All interactions in the new digital world lead to data being generated. Publishers can now offer advertisers much more detailed performance data on campaigns, since the transformation. This data is helping advertisers to understand customer behavior and is helping to make campaigns more effective. Publishers and advertisers that are utilizing this data are the ones who will be successful.
New Revenue Streams
To keep up with shifting consumer habits, traditional print advertising has been moving online. While conventional media will always have a position in the advertising ecosystem. Consumers are fast-moving and engaging in diverse material online, and print publishers are discovering that having a single strategy for advertising is no longer adequate. This isn’t a new trend for print publishers; it’s been happening for a while, but with the growing market for subscription models, publishers are looking at this new revenue stream to take advantage of the changing environment and to generate new forms of revenue from the digital transformation.
End of 3rd Party Cookies
Even if the end of third-party cookies is good for consumers, the rest of the advertising ecosystem is aware of the challenges the new changes will bring.
Cross-site retargeting will no longer use third-party cookies to provide appropriate ads to particular visitors. After some changes, this will only function inside one domain. Unfortunately, data exchange across domains will be discontinued. This will be a challenge for publishers that have a large number of websites. But, publishers are embracing digital transformation and looking for ways to overcome this. As previously stated, they are setting up subscription models to gain access to first-party data, which can help offset the loss that will be felt by publishers when third-party data is no longer available.
With the deadline for third-party cookies being pushed out to 2023, publishers should take advantage of the opportunity to plan ahead of time to guarantee a smooth transition to only using first-party data when the time comes by embracing digital transformation and looking at other digital technologies to help them in the soon to be cookieless world.
Change may be intimidating, and digital transition might be a significant shift for many conventional publishers, but it is not a bad thing. It is assisting publishers in their transition to the digital world and increasing the value they provide to their advertisers. There is no doubt that as more technologies are brought to market, digital transformation will grow and develop further, arming publishers with enhanced technology tools to help them provide even more value to advertisers, but right now publishers that are not on board with digital transformation need to get on board fast, as there’s only one direction this trend is going and publishers don’t want to get left behind, especially with the end of third-party data on the horizon.
Originally published at https://www.advendio.com on October 14, 2021.