Ad-Tech in 2020 (part 3, final)

This article concludes the predictions for Ad-Tech in 2020. There are many other topics to discuss and many other technologies that need to be put through their paces, however, this article will wrap up this series.

As mentioned in part 1 and part 2 the three key driving pressures which are forcing the Advertising Industry to evolve can be defined as the "TEP rule". These are; Increased Transparency; Increased Efficiency and Increased Performance; These underlining pressured are forcing each of the AdTech companies to evolve and here are some more predictions for 2020.

Search and Social Platforms

Search and Social platforms are the Ad-Tech companies that automate the management of large volumes of search keywords.

When campaigns only had a handful of keywords then humans would manually optimise campaigns. Bid Management platforms came into existence when the number of keywords in a campaign became too large to comfortable handle manually. It's rather frightening to think that Search Optimisation tools like Bid Managers are a series of computers that optimise campaigns which are run via other computers in the hope that a human will see and click on an advert. This is a great example of Artificial Intelligence in our industry. 

Here are three key things to focus on for Search and Social between now and 2020.

• Integration of Search and Display - It's so important now to integrate all types of biddable data. For instance if somebody searches for "Travel to New York" in a search engine. This is a strong signal that that person is in the market to travel to New York. This data signal needs to available in all other programmatic media, especially in display creative. For instance if we know that this user is in market to travel to New York then it's probably a waste to show them an ad for London.
• Rise of Social Listening - Sentiment tracking platforms are one of the most exciting areas that I've seen recently. Companies like Crimson Hexagon, Sysomos & Synthesio are pieces of AdTech that will continue to be more important in the future. They all have different types of algorithms in the back end. However, the concept is so simple and I feel that it's totally underutilized in marketing. I see a coming together of Viewability and Performance measurement technology with Sentiment Tracking technology. This will answer simple questions like "Are people more inclined to interact with an advert on a positive story about "cats fails" or news story about war?". This is such as simple question and something that Sentiment tracking & Social Listening can answer.
• Automated Site Optimization - The exact methodology of how Google (and Bing) index web sites is a closely guarded secret. However, there are some fairly obvious observations about (a) title clarity and length, (b) key-word density (c) number of hyperlinks per article; (d) key-words appearing in the first 100 words of the article etc... I've already seen some technology that gives an SEO scoring for articles. I can foresee that over the next three years that publisher content (like this one) will be 'automatically optimised' to maximize search engine rankings. 

In Summary: Search and Social - Programmatic bidding strategies need to automatically connect to Search data signals.

Tag Management Solutions

Tag Management is whereby advertisers deploy tracking pixels on their own web site in order to measure simple things like (a) how many people visit the site (b) where they come from and (c) what demographic of people are interested in which of the advertisers products.

Tag Management is a tough business to be in because the big players like Google and Adobe has launched their technology at no cost. "It's hard to compete with Free". This has seen an almost 60% contraction of the 'pure play' market with vendors like Telium, Esighten, Signal etc... This pressure is extreme and forcing technology to evolve very quickly. This is what you can expect to see in this sector.

• Integration with Ad-Serving - Stand alone products will most likely wind up. It's almost impossible to offer a stand alone product when the features of the integrated products are better and often free. These companies will most likely integrate with Third Party Ad-Servers (Sizmek, DCM etc...) or Conversion Attribution (CA) vendors. This will be a deep integration whereby the information gleaned from the tracking tags is connected to biddable technology like a DSP.
• Pivot to Site Optimisation - One of the exciting things in this sector is Site Optimisation. The ability to customise the user experience to the advertisers site based on the information gleaned about that user. For instance if the advertiser sells credit cards then show the pink one to user which are suspected to be female and the black one to users that are suspected to be male (please forgive the stereotypical example, just trying to illustrate the point). By pivoting to Optimisation instead of just Tag Management it will offer new revenue streams to the Tag Management providers and align their technology to the advertisers business objectives.
• Site Health Dashboard - The amount of data that Tag Managers generate is phenomenal. They collect vital information about each product that is sold, each user that visits a site and even the load times of each page. This is hugely valuable information and it's very possible that Tag Management providers will start to see themselves as the central dashboard for Site Health. It's possible that big advertisers will start leaning on the Tag Management sector to help maintain and optimise their web site experiences.

In Summary: Tag Management - It's hard to compete with FREE

Out of Home (OOH)

OOH is classified as any (a) stand-by (b) walk-by or (c) drive-by billboard. This sector is one of the oldest parts of our industry (apart from Print) and it's not had the challenges that the other parts of the digital ecosystem has had. They aren't affected by Viewability, Ad-Blocking, Fraud etc... They are often seen as "real-estate agents" which own various advertising assets. Over the next few years the challenges in this part of the industry are;

• Adopting Digital DNA - One of the main challenges will be for Digital to be part of the DNA for outdoor. They know that all their billboards need to eventually become digital. But, their challenge is more than just upgrading to a sexier screen. They need to think about Automation of bookings, Programmatic selling of Media, Real-Time reporting of metrics. This all starts with upgrading their technology backbone. Currently the operations underpinning OOH is still far too manual. It's time for OOH to beef up their digital backbone.
• Standardization of Supply - I heard a rumour that several OOH providers may agree to put their inventory into a digital supply side platform (SSP). This has already happened in some parts of the world, however, they don't seem to be connected to the current media buying platforms. The ability to book Outdoor along with Digital in a technology like Symphony, iDesk, MediaOcean etc... would be nothing short of amazing.
• The New New Thing - Michael Lewis wrote a great book called The New New Thing and it talked about the future of Silicon Valley. If you haven't read it then do yourself a favor and listen to it. The New New thing for OOH would be (a) embedding beacons in each device (b) making each device a WiFi hot-spot (c) embedding a camera in each device for age / gender identification. These are all good initiatives, however, if all OOH providers make these upgrades to their digital assets then they will only be as good as each other. There will still not be any standout's in the group. They need to find the next New New thing.

 In Summary: OOH - Need to embrace Digital as part of their DNA and produce efficiency behind the scenes.

Programmatic TV 

This is one of the topics and probably the hardest to predict. It's a hot topic because nobody really knows what's going on. Everybody seems to be looking at everybody else trying to figure it out. Here are three key topics for this area;

• Common Accounting Metrics - One of the challenge in video advertising today is the ability to measure audience across all video platforms. In our market, OzTam is a robust panel and a rival of any other TV market globally and they have exciting plans to include all connected devices. Ideally, this existing dataset would be able to move beyond Age / Gender and include behavioral data on TV consumed on connected devices. We need a single panel that measures and de-duplicates TV and Video data. The industry will benefit with more standardisation of methodologies.
• Audience Fragmentation - Users are buying more connected devices. Audience Fragmentation is not a new issue. The issue of fragmentation has happened previously in 1950's in the US. After WW2 there was an ever increasing number of Terrestrial TV stations applying for broadcast licences. The FCC put a hold on all licences between 1948 and 1952 because the stations were broadcasting frequencies which were too close to each other and causing interference. The industry was eventually deregulated in 1972 and at that stage cable TV surged. A very similar pattern can be seen with Video at the moment. People want to consume (a) any content that they want (b) anywhere they want; and (c) on any device they want. This is putting an enormous amount of pressure on the technology to evolve and keep-up.
• Programmatic Spot buying - One of the key features that I feel we will need in programmatic is the ability to buy a specific spot. Currently the programmatic TV offerings allow for buying media at an aggregated demographic level. Users book "P25-54" without knowing which TV shows they will appear against.  My personal prediction is that this needs to change. Users will need to have the ability to book individual TV shows.

 In Summary: Programmatic TV - Audiences will continue to fragment. Users will want to consume any content, at any time, on any device.

Cross Device Technology (X-Device)

As mentioned above, users are consuming media on multiple devices. By the year 2020, tech savvy users will consume media on up to nine connected devices each day. This includes smart phones, watches, laptops, tablets, TVs etc... Cross Device technology is the concept of de-duplicating the data of these devices back to a single consumer. Here are some pressures on this part of the industry.

• Deterministic vs Probabilistic - This has been covered previously in more detail here. However, it deserves mentioning again. X-Device data can be categorised as either (a) deterministic or (b) probabilistic. Google and Facebook both have great deterministic datasets. There are over 1 Billion people that have a GMail account and over 1 Billion people with an Android phone. Google can very accurately link these data sources together to form a singular view of the user. However, there are a number of other companies that specialise in X-Device and don't have deterministic datasets. Instead, they have probabilistic datasets that use algorithms to try to match these datasets together. The accuracy of probabilistic isn't nearly as good as deterministic. There will be a huge push for X-Device technology companies to prove the accuracy of their data.
• Testing of Methodologies - Once again we can expect the pressures from Transparency will also affect this part of the industry. Specifically, it is feasible that X-Device data vendors will need to demonstrate a 90% degree of accuracy when comparing results between their methodology and a competitors methodology. Growth of business for X-Device technology companies won't come from developing more sophisticated software, it will come from building the largest and most accurate dataset.
• Connectivity of Data - This point has also been made before with the Verification vendors, however, it's clear that X-Device vendors will need to integrate with a very large number of technology companies. Their development teams will be busy developing integrations with all the major DSPs but also all the major DMPs as well. This will eat up all the engineering resources for the X-Device vendors for the next few years.

In Summary: X-Device - Growth in this part of the industry won't come from sophisticated technology, it will come from larger, more accurate datasets.

Brand Safety & Ad-Fraud

I've mentioned this before but I personally feel that the war on Brand Safety has been fought and won. There are some fantastic pieces of technology out there that can automatically detect if an advert is running on an unsafe site. This includes companies like Moat and Grapeshot, ComScore, IAS, Double Verify, just to name a few. AppNexus has also launched Certified Supply which is designed to help stamp out Fraud and reduce Brand Safety concerns. Google is also tackling this head-on by blocking IP requests which come data centers which are known to be fraudulent. These are some massive wins for this part of the industry but there are still challenges ahead.

• Be Prepared to Pay More - The overall number of display ads has decreased significantly. It hard to tell what the exact size of the decrease is however the factors behind the decrease include the removal of Fraudulent sites, non-Brand Safe sites; ads with low viewabilty and also Ad-Blocking. Each of these factors have removed ads from the inventory pool. However, there are the same number of buyers for these ads, therefore, expect the overall cost price for display advertising to increase as more poor quality ads are removed.
• Integration of Tech - Similar to what has been mentioned for other Validation software, these Brand Safety and Ad-Fraud tech companies will be very busy integrating with each DSP in the market. However, they have one added task, they will need to integrate their reporting with the clients DMP. The "increased transparency" requirement from the advertisers will force the Brand Safety vendors to integrate their reporting into the advertisers dashboards. An ad that was blocked for brand safety reasons is very expensive to an advertiser. They need to pay for the media, tech fees and ad-serving costs. They pay all this money and no ad was shown because it was blocked for Brand Safety reasons. The advertiser will want to know exactly where and why their ads were paid for but blocked. 
• The war on Ad-Fraud is heating up - Ad-Fraud can be divided into two categories (a) non-human traffic and (b) deliberate impression and click farming. The initial efforts on Ad-Fraud have always been concerned with finding the Spiders, Robots and Crawlers that visit a web site. However, since cleaning up the inventory supply the amount of robotic ad-fraud has dropped significantly. In a report from one leading provider the overall non-human traffic number was < 2% of the total number of impressions. This may vary from month-to-month and market-to-market, however, it's still not a huge number. The real problem is human ad-fraud. This is not a new issue and it's been discussed previously here. This is a big problem and it will be hard to tackle. These anti Ad-Fraud technology companies will be very busy building this piece of complicated technology over the next few years. 

In Summary: Brand Safety, Ad-Fraud - Expect to pay more for better quality impressions.

The overall summary is that there is an enormous amount of pressure on our industry and this is causing the Ad-Tech companies to evolve rapidly. In a recent TED talk it was said that 'on average 32% of US based companies won't be around in it's current form in just 5 years time'. That statistic certainly "feels" right for the Ad-Tech industry. We can expect a large number of companies to integrate, team up, acquire or be acquired.

This concludes this series of articles on AdTech in 2020. There are more LinkedIn articles on other Ad-Tech topics coming up, there is another programmatic test coming soon and there is another 'digital debate' on the horizon.