My Predictions for Digital Advertising in 2014

I have done these predictions for a number of years now and they are a lot of fun. Please don't hesitate to comment or let me know what you think.

1. Better ad formats. One aspect of the online ad industry that has always frustrated and enraged me is the massive disservice we have done to ourselves with our reliance on banners. At their best, banners are weak and ineffective. As a unit developed over fifteen years ago, they are simply no longer impactful in a world where they take up an infinitesimally small portion of screens and where people have been trained to ignore them. Compared to TV, where we easily remember commercials from decades ago, I barely remember the banners I saw today. They lack the canvas to express emotion, humor, narrative or any of the sticking power of good advertising.

Thankfully, publishers finally said enough with this stupidly and they have started to innovate with what we call Native Ad formats — Facebook with their News Feed ads, Twitter with Promoted Tweets, Buzzfeed with sponsored content — and a wonderful plethora of innovative, new ideas and finally advances. An innovation cycle has begun in an area where we desperately needed it. My prediction is in 2014, we will see an acceleration of this trend as more publishers realize they don’t need to stay in the little boxes any more, and creative folk will experiment with how to make online ads more powerful.

2. RTB growth will continue. A seemingly countervailing trend to the fragmentation of innovation in ad formats is the powerful industry standardization around RTB. As a standard, RTB grows more unstoppable the bigger it gets. As we saw with banners, once a standard is agreed upon and adopted, it becomes virtually impossible to unseat for a long, long time. Over the last year, RTB has crossed this threshold and it is now quite firmly established. The ecosystem of advertisers, publishers, technology companies and service providers who have invested in RTB, and the billions that now flow through, indicates that the critical mass has now developed in an unstoppable way.

2014 will be the year where this momentum manifests and RTB continues its inexorable march to eventually becoming the standard for all media buying across all platforms. While we have a long way to go to achieve total ubiquity, 2014 will be a year where we shift from talking about ‘if RTB is good or bad’ and, instead, begin discussing what a world would look like where RTB totally dominates. And while this certainly sounds hyperbolic, what fun would predictions be if they weren’t a little out there? Moreover, if you look back at the past predictions, my bullishness about RTB has proven to pretty accurate.

3. Identity. One of the core challenges to achieving this dominance of RTB is the tricky problem of identity. In the online world we have the cookie, which is imperfect but ubiquitous, open and relatively effective. Sadly, the cookie doesn’t exist on mobile applications or TV, and until we can find some source of identity, it will be a struggle to address these channels fully. It feels like 2014 will be the year we see some viable solutions to this. On one front exist the platforms like Google, Apple, Microsoft, and the browser developers who are working on building replacements to the cookie, which can also function cross-device.

While these efforts are still nascent, the reward that will accrue to whoever solves this huge problem ensures that people are working hard to win. Another very compelling avenue to solving this problem, in my opinion, resides with those companies who can get users to log in to whatever device they are using. Clearly Facebook and Twitter have a powerful position here, with Google racing to catch up with Google+. A third dark horse in this race is if we can somehow create a standard or solution where smaller, independent companies combine to achieve some collaborative identity solution. I am not quite sure what this would look like, but it could be incredibly powerful. Identity will be big in 2014; you can quote me on it.

4. The rise of Twitter. At the confluence of these three trends sits Twitter. As we have seen over the last two years with the launch of FBX, Facebook has done astonishingly well for itself with native programmatic. Twitter, on the other hand, is just getting ready to spread its wings and show us all what it is made of. With its acquisition of Mopub, they laid the groundwork to do some really cool things. 2014 will be a big year for Twitter and I predict they won’t disappoint.

5. The continued rise of Facebook. Last year I predicted that Facebook would spread its wings and show the world what it was really capable of as a business. They didn’t disappoint. This year they will take it to another level. The flywheel that is the Facebook business is just getting started, and I expect we will see significant progress from them over the next twelve months. The three areas where I anticipate Facebook will make the biggest splashes are in video, identity and attribution, and I will break each of those out in separate predictions, below.

6. Facebook & Video. Facebook clearly has an absolutely massive opportunity in video if they can crack the problem of how to run autoplay ads in the feed. Imagine the reach of the Super Bowl but only targeted to exactly the right users and with the power of social sharing. In order to do this, they need first to get organic “autoplay” video into the feed to accustom users to its presence. Look for them to insert autoplay Instagram video first and, after that, I wouldn’t be surprised if they launch a Youtube competitor where users could upload video that would then become autoplay.

7. Facebook & Identity. The second huge opportunity for Facebook is around identity. Whoever controls identity across web and mobile is in an incredibly powerful position to reach users in multi-platform world. Because users log into Facebook across all devices and use their real names, Facebook is uniquely positioned in this regard. And since whomever controls identity will win in the coming years, we can be confident that Facebook will be very aggressive in this regard.

8. Facebook & Attribution. The last area in which I am quite excited to see Facebook’s efforts is attribution. As I have said many times over the years, attribution is one thing we do quite badly on the Internet. Why is it that we only ascribe value to ads when people click on them? What of the other 99% of users who see the ad but don’t engage in that moment? Does that mean that all TV commercials, Billboards and print ads have no value because no one clicks on them? Obviously there is value when a user sees a brand’s ads, but sadly in online we rarely take it into account. Because Facebook knows the real names of its users, it has the ability to measure the true effect of its ads. Look for 2014 to be a year where Facebook shows us all what we have been missing.

9. Google. Over the last few years, Google, the progenitor of this whole programmatic space, has become undeniably dominant. They sit astride this industry with a massive share and the pole position on many levels. While Facebook and Twitter are certainly viable up-and-coming contenders, Google is still the big dog. I expect them to retain this position throughout 2014. Look for them to launch a video ad exchange, a mobile identity solution and continue their consolidation of the technology layer in this new game.

10. Unpredictable agencies. Every year I make predictions about the agencies and every year I get it wrong. While the industry undeniably moves towards technology, automation and data are not the friend of the agency’s services business, and their response to the disruption has not proven to be particularly predictable (by me anyway). So this year I am simply going to say that in 2014, we will see the continuation of the trend and agencies will react to this threat in unpredictable ways.

11. Last but not least, we are all going to, once again, have a lot of fun in 2014.

Graphic: vs148 / shutterstock