The end of the beginning of digital marketing

This is the 10th year of our "This Year Next Year Interaction" series. As ever it is written from the perspective of a global media investment management company and for the interest of large advertisers and those of us who work with them.

This year we explore in some depth six key aspects of the digital marketing and media landscape. These are listed below and the full report can be found here: 

https://bit.ly/1SHHnMn

1. The integrity of the digital supply chain encompassing fraud, viewability and meaningful measurement are of existential importance to the digital advertising economy
2. Advertising stops working when it is avoided. Better design, greater value to the consumer, and the responsible use of data both in terms of cost to the consumer’s data plan and privacy are essential
3. The app ecosystem represents both challenge and opportunity. The opportunity is for brand participation in the fastest growing mode of media consumption; the challenge is for brands to create impact and value and earn the attention of the consumer.
4. Selling everywhere rather than somewhere will be the new normal for retailers and brand owners. Where intent exists so does the  need to satisfy it.
5. Consumers love video. They love it in short and long formats and increasingly they love it on demand and often free of advertising. Technology enables this, it also enables precision and relevance in targeting that will drive efficiency for advertisers and maintain “free video” as a key platform of marketing communication. This is just one part of the evolving economics of what we have traditionally referred to as television.
6. Data has changed advertising. It has not unequivocally changed it for the better. Our collection and application of data needs to be responsible in targeting and holistic in respect of  attribution. Only then we will combine respect for the individual with true understanding of behavior.

We live in an era in which the discovery of content is as important as its delivery. The distribution systems of media are highly evolved and it’s time for a creative renaissance that produces assets that are discoverable, valuable, relevant and specific to the environment of their intended consumption.

Nowhere will this be more important than in feed based environment as video assets battle for attention and advertisers attune themselves to the potential of live video in the streams that are becoming central to the media consumption experience.

2016 is not a good year for the faint of heart. Despite the cyclical effect of the Olympics, Euro 2016 and the US presidential election there are significant headwinds and perhaps more grey swans (predictable, significant but unlikely events) than ever. Persistent low economic growth, a dent in the Chinese dream and slow realization of the potential of Latin America and Africa all conspire to create a tense business environment. Today businesses are extra cautious and many fear the disruption of activist investors who believe that management is failing to unlock sufficient shareholder value. In response many commentators observe that budgets are increasingly zero based, new product development has slowed and with it the cycle of slow growth is repeated. There appears to be more rationalization of brand portfolios than product innovation. 

Innovation in communications remains of extreme importance but perhaps some emphasis will shift from ‘do it because we can’ to ‘do it because we should’ and, as a consequence, produce results that drive profitable outcomes and contribute to a new wave of product development and economic growth.

The key issues we have identified for 2016 (and 2017) are, we believe, united by this; a day, a month or a year of reckoning is upon us. We are at the end of the beginning of digital marketing.  We are not now, nor have ever been, at anything like a ‘steady state’ but we believe that a more profound sense of responsibility and transparency between business partners together with collective vigilance is an essential ingredient of re-engaging consumers with brand communications. 

@robnorman