The big picture of the AdTech market
The age-old wisdom goes that choosing the right trend to follow is the key difference between a business thriving and becoming invisible to customers.
And while you’ve heard this a million times, there’s a high likelihood you haven’t yet given some of the most promising trends for 2024 the attention and thinking they deserve. If that’s the case, it might be the ideal moment to start.
Especially since ad placements and, as a result, the opportunities for advertising and monetization are expanding and the competition on the appealing AdTech market is heating up, according to the Technavio report:
- The AdTech market is set to grow by $767.83 billion from 2022 to 2027, progressing at a CAGR of 13.36% during the forecast period.
- The digital advertisement spending market share is expected to increase by $523.45 billion from 2021 to 2026, and the market’s growth momentum will accelerate at a CAGR of 17.47%.
- The digital video advertising market size is estimated to grow at a CAGR of 37.19% between 2022 and 2027. The market size is forecast to increase by $249.42 billion.
7 Key AdTech trends shaking up the industry
To help you reap all the benefits the AdTech market’s increasing value has to offer instead of merely observing it from the sidelines, Oxagile has rounded up a list of the most noteworthy AdTech trends based on the insights from the recent projects and the major industry conferences of the year. And while you’ll probably spot some familiar innovations in this list, like alternatives to third-party cookies, there are also exciting new trends that are bound to give you fresh ideas on reaching target audiences and enhancing your KPIs.
Since “AI” was crowned as the most notable word of 2023 according to the Collins dictionary, it’s no surprise that the first entry in our AdTech trends list naturally grabbing attention is the rapid progress, not just in the general hysteria about AI and ML, but also in the technologies themselves.
And although they are not quite ready to act alone, there are several reasons why they will become essential tools in 2024.
Addressing the void after third-party data vanishing
AI is increasingly becoming the go-to choice for analyzing user interactions with ads, like dwell time, scroll depth, or facial expressions, to assess user engagement and their feelings about the content. This trend shows no signs of slowing down, and AI remains actively employed in understanding people’s reactions to ads.
In a scenario where cookies are no longer in play, all these, including AI techniques like agent-based modeling, will empower both publishers and marketers to be more adaptable. AI will help create precise ads that effectively drive conversions by forecasting demand, running dynamic “what-if” scenarios, predicting customer behavior, and optimizing budget allocation across various channels.
Enhancing much-desired trust and transparency
No doubt you’ve felt the vibes of the growing emphasis on privacy and its significance, driven by such evolving regulations as GDPR, DAA, and many others. Consequently, those who actively demonstrate their commitment to Responsible AI (a set of principles ensuring ethical and legal AI use) will gain increased appeal to stakeholders and potential clients in the coming year.
Moreover, AI-powered contextual analysis will do a great job at keeping brands safe by making sure ads show up in the right places, relevant to the brand. Plus, AI algorithms will provide real-time traffic statistics and catch any malicious actions, like scammers using bot farms, SSAI attacks, SDK spoofing, or click spamming.
2. The evolving landscape of CTV measurement
Expect an uptick in CTV ad spending, which is projected to climb from $14.11 billion in 2022 to $18.29 billion in 2024. As streaming giants like Netflix and Disney+ introduce ad-supported tiers, the volume of available ad inventory will also expand.
Nevertheless, CTV advertising is often seen as a bit tricky to measure accurately. But with the right tech tools and integrations, you can track CTV ads with a level of precision nearly on par with other digital channels. This involves combining IP addresses and device graphs with your own data, market research, and audience segmentation to supercharge your targeting efforts.
Furthermore, 2024 will definitely unleash the potential of machine learning-based creative optimization, which will clearly enhance the profitability of CTV advertising. These intelligent engines will monitor metadata sources and propose ideal music, visuals, and messaging strategies to captivate your audience, granting video ads an extended lifespan and enabling automatic, on-the-fly customization for specific target groups.
3. Sustaining ad revenue and customer insights in the cookieless era
While Google’s decision to phase out third-party cookies was initially perceived as a tragic event in the history of digital marketing when it was first announced, advertisers and publishers are now more and more focused on finding solutions around it.
Collecting first-party data
Based on Epsilon’s research, 62% of marketers are proactively developing strategies focused on first-party data in anticipation of a future without third-party cookies. To address this, they are increasingly utilizing tools like customer data platforms (CDPs) and consent management platforms (CMPs) to collect and manage users’ personal information for various purposes, including marketing, analytics, behavioral advertising, and tailoring content to individual preferences.
In this evolving landscape, the establishment of partnerships, often facilitated by robust data clean rooms, has emerged as a potent method for data exchange and maximizing the value derived from the information willingly shared by users.
Turning to contextual targeting
The fact that it boosts ad performance and media revenue by relying on the subject and context of the content being consumed rather than targeting based on the person viewing it will make contextual advertising an absolute hit among AdTech trends in 2024, especially as not everyone will have quickly figured out secure ways to obtain data directly from users.
And, as we’ve mentioned earlier, when blended with the power of AI technologies like natural language processing and image recognition, contextual targeting could swiftly evolve into a great, scalable, and cost-effective solution for advertisers in the upcoming year.
4. Supply chain optimization
Today, the advertising delivery ecosystem to end consumers has many layers, but there’s a clear trend towards streamlining it, particularly with the convergence of demand-side platforms (DSPs) and supply-side platforms (SSPs). While traditionally serving advertisers and publishers separately, these platforms are becoming increasingly interconnected and taking on each other’s roles. DSPs are now directly integrating with publishers, and SSPs are partnering with agencies, adopting DSP strategies.
This shift is giving rise to a new market model that’s not only more efficient, but also offers greater transparency and ease of understanding. This trend is expected to strengthen in 2024.
5. Supply chain transparency
Unfortunately, the advertising ecosystem today, involving advertisers, publishers, agencies, ad networks, and data providers, can be a bit of a puzzle. It’s not always easy to figure out who’s doing what and how data is being used. However, the good news is that we’re seeing a clear trend towards supply chain optimization, which is all about increasing transparency and efficiency in the programmatic supply chain by cutting out intermediaries who don’t add much value. We’ve started to delve into this when talking about bringing DSPs and SSPs together, but this process goes even deeper.
For instance, the IAB Tech Lab has rolled out Ads.txt 1.1, a tool that assists buyers in recognizing who owns and manages inventory, with the goal of cutting down on fraudulent activities. They’ve also unveiled the Transparency Center, a public hub where digital advertising companies can openly exchange information about their audience segments. This initiative represents a big stride towards eradicating fraud in the supply chain and enhancing responsible programmatic trading.
Benefit from every change on the market
If you’ve been waiting for the right time to breathe new life into your advertising workflow with fresh solutions, there’s no time like now, and no AdTech partner better than Oxagile.
6. Programmatic adoption in retail media networks
It’s probably needless to explain that when we mention retail media today, we’re generally referring to those familiar banner and display ads you encounter while browsing a retailer’s website or mobile app. However, what’s truly worth highlighting in our AdTech industry predictions is the anticipation that retail media will make up 25% of total digital media spending by the year 2026. Additionally, eMarketer foresees that US Retail Media Networks will surpass an impressive $52 billion in ad sales by 2023.
What’s the reason behind these impressive numbers appearing now, given that most retail media networks have been operating as closed-loop ecosystems?
Here’s the deal: lately, retail media networks have shifted their strategies and are becoming more open to a programmatic approach. This means that retail media inventory is now connected to off-site properties and third-party media, expanding its reach across various channels in retail campaigns.
The result? A remarkable surge in opportunities. Retail media ad placements, in particular, are becoming a lifeline for newer products and smaller brands. These entities often have no previous traffic, making them less likely to appear organically. Retail media steps in, offering brands a fair chance to ensure their products catch the eyes of shoppers and create an additional revenue stream.
But it’s not just newer players who benefit from this landscape. For all advertisers, leveraging retail media ads means engaging customers right at the point of sale, directly linking ad spending to digital sales. With an abundance of first-party data and in-depth user profiles built around buying preferences, retail media becomes a powerhouse for analytics and attribution.
7. Digital Out of Home remains undiminished
Overall, the worldwide Digital Out-of-Home (DOOH) market is evidently thriving, as indicated by a report from Upbeat, with a projection to reach $8.3 billion by 2023. Looking ahead, the outlook becomes even more optimistic, as 95% of advertising executives anticipate the DOOH market to exceed $50 to $55 billion by 2026.
Of course, this advertising is nothing new in the marketing world and you’re likely to have used this channel. Still, there are some exciting changes on the horizon for us to anticipate.
The growing popularity of programmatic DOOH advertising
A significant portion of the industry’s growth will stem from the rapid expansion of programmatic DOOH, with real-time bidding (RTB) opportunities now accessible through widely used DSPs. Besides, Google has taken a step to make DOOH ads accessible to all users of its advertising platform, Display & Video 360 (DV360), which currently collaborates with various DOOH SSPs and ad exchanges to provide access to the inventory of major out-of-home media owners.
Expanding across multiple advertising channels
The future of DOOH advertising is likely to be all about combining and coordinating it with other advertising methods. This teamwork and blending of strategies will create more unified and consistent messages for consumers across different platforms, making advertising campaigns more powerful and memorable.
For instance, a brand could air a TV commercial, display the same ad on billboards and bus stops, and then retarget that message through digital channels like social media and email, enabling real-time data analysis and improvements, enhancing the targeting and overall effectiveness of advertising efforts.
The bright future of AdTech
Fast forward to the year 2024, and we find ourselves in an AdTech industry that has wholeheartedly embraced the concept of privacy-first advertising. Buyers and sellers have come together in closer collaboration, putting a strong emphasis on transparent data exchange. In this evolving landscape, the growing importance of first-party data infrastructure is supercharging brand advertising efforts. And let’s not overlook the significance of CTV and DOOH advertising, as they are continually attracting a growing clientele.
Now, let’s rewind back to the end of 2023 to discern which of the myriad trends and directions currently in play are worth implementing now for your business to feel confident in 2024. And no, you don’t have to make a decision right now. But if you wish to explore the upcoming trends in more detail, including the many others we haven’t had a chance to discuss here, like native advertising, virtual reality, or sustainability, you can fully rely on Oxagile, an experienced AdTech developer, to provide you with guidance on the essential actions needed to seize the opportunities presented by the developments on the horizon.
